U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

[ ] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
    of 1934

                    For the fiscal year ended ______________.

[X] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934

        For the transition period from JANUARY 1, 2004 to MARCH 31, 2004.


                        Commission File Number 000-29331

                               MAILKEY CORPORATION
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                 (Name of Small Business Issuer in Its Charter)

               Nevada                                 76-0270295
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   (State or other jurisdiction of        (IRS Employer Identification Number)
   incorporation of organization)

       130 Shaftesbury Avenue
          London, England                              W1D 5EU
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(Address of Principal Executive Offices)              (Zip Code)

                               011-44-2070-310821
         ---------------------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)

           Securities registered pursuant to Section 12(b) of the Act:

        Title of Each Class            Name of Exchange on which Registered
        -------------------            ------------------------------------
               None                                  None

         Securities registered under Section 12(g) of the Exchange Act:

                     Common stock, $.001 par value per share

        Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes  X  No
    ---    ---

<PAGE>

        Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this form 10-KSB. [X]

        State issuer's revenues for its most recent fiscal year:      -0-    .
                                                                -------------

        The aggregate market value of the voting common equity held by
non-affiliates of the registrant based on the closing sale price of the
registrant's common stock as reported on the OTC Bulletin Board on July 9, 2004,
was $2.20.

        As of July 9, 2004, 29,355,251 shares of the registrant's common stock
were outstanding.

        Transitional Small Business Disclosure Format (check one):

        Yes     No  X
            ---    ---


                       DOCUMENTS INCORPORATED BY REFERENCE

        None.

<PAGE>

                 DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

        This prospectus contains "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements other than
statements of historical facts included or incorporated by reference in this
prospectus, including, without limitation, statements regarding our future
financial position, business strategy, budgets, projected revenues, projected
costs and plans and objectives of management for future operations, are
forward-looking statements. In addition, forward-looking statements generally
can be identified by the use of forward-looking terminology, such as "may,"
"will," "expects," "intends," "plans," "projects," "estimates," "anticipates,"
or "believes" or the negative thereof or any variation thereon or similar
terminology or expressions.

        These forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from results proposed in
such statements. Although we believe that the expectations reflected in such
forward-looking statements are reasonable, we can give no assurance that such
expectations will prove to be correct. Important factors that could cause actual
results to differ materially from our expectations include, but are not limited
to: our ability to fund future growth and implement our business strategy; our
ability to integrate the operations of any businesses we may acquire; our
ability to attract and retain customers and qualified personnel; our dependence
on a small number of customers for revenue; customer acceptance and satisfaction
with our electronic messaging security solutions; anticipated product
enhancements and releases; defects in our products and services; legal claims
against us, including, but not limited to, intellectual property infringement
claims; our ability to protect our intellectual property; forecasts of Internet
usage and the growth and acceptance of the anti-spam and antivirus industry;
rapid technological changes in the anti-spam and antivirus industry; competition
in our industry and markets; general economic and business conditions, either
nationally or internationally or in the jurisdictions in which we are doing
business; the condition of the securities and capital markets; legislative or
regulatory changes; and statements of assumption underlying any of the
foregoing, as well as any other factors set forth under the caption "Risk
Factors" and "Plan of Operation" under Item 1 of this report.

        All subsequent written and oral forward-looking statements attributable
to us, or persons acting on our behalf, are expressly qualified in their
entirety by the foregoing. Except as required by law, we assume no duty to
update or revise our forward-looking statements based on changes in internal
estimates or expectations or otherwise.

        Unless otherwise indicated or the context otherwise requires, all
references to "MailKey," the "Company," "we," "us" or "our" and similar terms
refer to MailKey Corporation and its subsidiaries.

<PAGE>

                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

        We were formed on July 19, 1996, as a Nevada corporation.

        On August 8, 2001, we entered the online trading solutions market by
acquiring Sutton Online, Inc., a Delaware corporation and an application service
provider providing online trading solutions to individuals, broker dealers and
financial institutions worldwide. In February 2003, we sold Sutton Online, Inc.
and changed our business plan to that of seeking to enter into a business
combination with one or more privately-held operating companies.

        On March 25, 2004 (the "Effective Time"), pursuant to an Agreement and
Plan of Merger, dated February 20, 2004, by and among us, G.D. Acquisition
Corp., a Delaware corporation and our then wholly-owned subsidiary, MK Secure
Solutions Limited, a British Virgin Islands private limited company, and
Westvale Consultants Limited, a principal shareholder of MailKey, as amended by
a First Amendment to Agreement and Plan of Merger, dated March 23, 2004, by and
among us, G.D. Acquisition Corp., MK Secure Solutions Limited and Westvale
Consultants, Ltd., G.D. Acquisition Corp. was merged with and into MK Secure
Solutions Limited, with MK Secure Solutions Limited remaining as the surviving
entity and becoming our wholly-owned subsidiary.

        At the Effective Time: (i) we issued 26,246,000 shares of its common
stock to the holders of MK Secure Solutions Limited's capital stock,
representing approximately ninety-four percent (94%) of the then issued and
outstanding shares of common stock on a fully diluted basis, (ii) received a
letter of resignation from Andrew J. Kacic as a member of its board of
directors, which resignation became effective at 12:00 noon eastern standard
time on March 26, 2004, (iii) appointed Graham Norton-Standen and Tim Dean-Smith
to serve as two of our directors, which appointments became effective at the
Effective Time, and (iv) received letters of resignation from John W. Shaffer
and Raymond J. Bills, constituting all of the remaining members of our Board of
Directors as it existed immediately prior to the Effective Time, which
resignations became effective on or about June 3, 2004.

        As a result of our acquisition of MK Secure Solutions Limited, we
entered the electronic messaging and business solutions security market, and on
April 14, 2004, we changed our name from "Global Diversified Acquisition Corp."
to "MailKey Corporation" to more accurately reflect our current business
activities.

OVERVIEW

        We intend to become a leading messaging security solutions provider
focused on the provision of business solutions by continuing to develop and
adapt our own products and by entering into strategic acquisitions and
partnerships.

        We are developing a software platform designed to have anti-spam,
anti-virus and related messaging security capabilities to help protect
organizations' email and electronic messaging infrastructure by identifying and
disposing of unwanted or malicious messages while accurately


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allowing delivery of legitimate messages. Our software is being designed so that
it can be installed at the server level and provide administration,
customization and policy management capabilities. As a result, we intend to be
able to provide organizations with a more secure and improved messaging
environment, allowing them to realize workforce productivity gains and more
efficiently utilize their technology infrastructure.

        We intend to market our products and services through a combination of
indirect sales channels, including distributors, resellers, business outsourcing
and hosted service providers, large global systems integrators, original
equipment manufacturers and appliance vendors, as well as through the efforts of
a direct sales force. We are designing our software to ultimately be capable of
supporting numerous hardware configurations, operating systems and messaging
applications and infrastructure, and to be deliverable as stand-alone software,
as an integrated part of the appliance solutions of distribution partners, or as
a hosted service.

INDUSTRY BACKGROUND

        As a highly flexible network capable of carrying almost any type of
digital traffic, the Internet continues to evolve as a critical business tool
and an important communications and commerce platform for organizations
worldwide. As part of their overall business strategies, many organizations are
using the Internet to utilize business applications that are accessed over their
corporate networks. Companies utilize the Internet to optimize their extended
supply chains, automate their sales forces, track shipments and communicate with
employees, customers, partners and suppliers. Due to the efficiencies,
cost-savings and competitive advantages that can be gained by leveraging the
Internet, many businesses are continuing to build out their computer networks
and information technology infrastructure. In order to accommodate a significant
number of simultaneous users and the increasing volume of data transfer
associated with enterprise Internet use, many organizations continue to make
substantial investments in wide-bandwidth connections such as dedicated T-1
lines, enabling high-speed Internet access.

        The Internet has also become a highly popular consumer medium for
communication, entertainment, information and commerce. International Data
Corporation, a market research firm ("IDC"), has projected that the number of
corporate Internet users worldwide will grow to more than 449 million in 2006.
This rapid adoption of the Internet has been accompanied by remarkable growth in
the number of consumer-oriented content and commerce websites and by an
expanding assortment of web-based consumer services and applications. Internet
users today have the ability to communicate through e-mail and instant
messaging, retrieve news and information from numerous Internet sources,
download music, movies and other high-bandwidth content, share files over
peer-to-peer networks, make online purchases of goods and services ranging from
books to airline tickets, and generally access a broad range of non-business
content and commerce websites. As the rapid evolution of Internet technology and
web content continues, the amount and types of data, as well as the way people
access it, has increased, creating growing challenges for employers.


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EMERGENCE OF ELECTRONIC MESSAGING AS A MISSION CRITICAL BUSINESS APPLICATION

        The use of electronic messaging has become a ubiquitous communication
tool and a mission critical application for the conduct of business. According
to estimates by IDC, by 2007, the number of worldwide email boxes will be 1.6
billion and the number of person-to-person email messages sent worldwide will be
more than 9.1 trillion. In addition to email, a wide variety of other forms of
electronic messaging have emerged and are increasingly embraced by businesses,
including instant messaging and Short Messaging Service ("SMS"), and short text
messaging through mobile phones, two-way pagers, personal digital assistants and
other mobile devices. While electronic messaging and collaboration applications
provide significant functionality and efficiencies, they also expose
organizations to spam, viruses, the transmissions of malicious or inappropriate
content, and the unauthorized distribution of confidential information.
Organizations must effectively manage these risks in order to continue to
realize the benefits of electronic messaging and collaboration applications.

        The widespread adoption of electronic messaging has made securing and
managing the messaging infrastructure increasingly important, complex and
costly. The messaging standards originally adopted by the public Internet were
not optimized to address concerns for security, privacy and fraud. As a result,
the existing infrastructure is susceptible to security attacks that compromise
and threaten the utility of electronic messaging. Frequently encountered
messaging security threats include:

        o       spam, or unsolicited or unwanted bulk email, generally sent by
                individuals or organizations that send mass emails to a
                specified list of email addresses;

        o       viruses or malicious code designed to disrupt and damage
                computer systems and performance; and

        o       electronic messaging that mimics legitimate corporate
                communications for the purpose of stealing confidential
                information or that contains offensive content.

THE EFFECTS OF SPAM ON ELECTRONIC MESSAGING

        We believe the proliferation of spam is one of the most severe and
challenging electronic messaging security threats faced by businesses today. The
proliferation of spam is driven largely by its potential to generate attractive
profits for spammers. Email allows a spammer to reach individuals and businesses
for a fraction of the cost of using any other communication vehicle because the
spam market has almost no barriers to entry and the marginal cost of sending
additional emails is almost zero. In addition, hackers and spammers increasingly
use spam to introduce viruses into business networks and steal confidential
information from businesses. According to IDC, in 2003 spammers sent an average
of 13.5 billion emails per day, and spam as a percentage of overall Internet
email traffic will grow from 35% in 2002 to 67% in 2007.

        Techniques frequently used by spammers include deliberately obscuring
the identity of the email sender, implementing false "unsubscribe" mechanisms to
validate an email address and harvesting email addresses published on the
Internet. Spammers target virtually anyone with a valid email address, across
any geography or industry. Moreover, spam campaigns often involve large volumes
of emails sent repeatedly, which tax network and server bandwidth and allow the


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perpetrators to rapidly evolve the form and content of the message traffic to
evade new spam filtering techniques.

        Many jurisdictions in the United States and abroad have enacted
legislation attempting to solve the spam problem. While legislation has been an
important driver toward raising public awareness of spam and may act as a
deterrent, legislation alone will not solve the spam problem. Governments have
difficulty prosecuting across jurisdictions and have typically placed enforcing
spam laws at a lower priority. In addition, the international portability of
spam operations and the ability of spammers to remain anonymous has meant that
an effective technology solution in addition to legislation is necessary to
address the spam problem.

        The proliferation of spam and the need to block it has created a number
of significant challenges for businesses, including:

        o       LOST PRODUCTIVITY. Spam results in lost productivity associated
                with the time employees spend separating legitimate email from
                spam or responding to spam.

        o       FALSE POSITIVES. Many spam filtering systems currently on the
                market block spam as well as a number of messages that are not
                spam. The cost of false positives, or the inappropriate blocking
                of legitimate messages by spam filtering systems, may result in
                loss of sales or critical information.

        o       STRAIN ON INFORMATION TECHNOLOGY RESOURCES. Spam taxes the
                technology infrastructure by utilizing network, server and
                storage resources and bandwidth, potentially requiring
                organizations to purchase additional systems and devote more
                personnel to manage them. In addition, IT staffers are spending
                an increasing percentage of their time combating spam, fielding
                inquiries and complaints about spam, and installing,
                configuring, and administering new hardware and software to
                defeat spam.

        o       DAMAGE TO CORPORATE BRANDS. Techniques have emerged, such as
                "phishing," where spammers create messages designed to resemble
                a message from a legitimate business, which not only places the
                recipient at risk, but also damages the trust in the business'
                corporate brand.

        o       INCREASED RISK OF WORKPLACE LIABILITIES. Spam often contains or
                directs users to offensive content, which may create an
                uncomfortable or hostile work environment. This is resulting in
                greater liability risks for businesses that do not take
                appropriate steps to safeguard their employees from such
                content.

        o       INCREASED CUSTOMER CHURN FOR MESSAGING SERVICE PROVIDERS. If
                email accounts become flooded with spam, customers may become
                dissatisfied with the messaging service provider, thereby
                increasing customer support costs and the risk of service
                termination.

        These challenges result in significant costs for businesses. IDC
estimates that the global market for messaging security applications, which
includes anti-spam and content filtering


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products, but excludes antivirus products, will grow from approximately $236
million in 2002 to approximately $1.1 billion by 2007.

        Effectiveness and accuracy of anti-spam solutions vary depending on the
specific approach, product and customer settings, as well as their ability to
respond to efforts by spammers to evade anti-spam solutions. For example, faster
distribution of spam with different subject lines poses challenges for decoy
email mailbox-based solutions that take time to identify spam and create and
distribute exact signatures of the spam received before they can begin blocking
spam. Another challenge for anti-spam solutions is the time required for
administration and usage. According to IDC, a considerable amount of time is
spent dealing with spam, even after anti-spam solutions are in place. IDC
estimates that email users spend 5 minutes and IT staff spend 19 minutes on
average every day dealing with spam. This includes a variety of tasks such as
maintaining and updating the anti-spam solution, reviewing suspected spam,
tracking down false positives, and asking or answering questions about spam. To
further reduce spam's impact on worker productivity and other resources, we
believe that organizations will be looking for anti-spam solutions that provide
appropriate levels of automated operation, end-user involvement, effectiveness,
accuracy, and up-to-date detection of new forms of spam that have yet to be
created.

THE EFFECTS OF VIRUSES ON ELECTRONIC MESSAGING

        Viruses have become a common network security threat. A virus is a
software program that is designed to replicate itself and spread from file to
file, usually by attaching itself to computer applications, such as email.
Viruses generally require a user action to be activated, although users are
usually not aware that such action will activate the virus, and typically are
spread when files are copied to and from file servers. Viruses pose an array of
serious threats to organizations, including crippling mission critical
applications, degrading system performance and damaging valuable business
information. The financial impact of viruses generally includes labor efforts,
lost revenues from denial of service issues, and costs associated with cleaning
and restoring lost data and applications.

        The virus problem is further complicated by the ongoing cycle of virus
creation and eradication. Virus developers continually react to new antivirus
products by creating more sophisticated viruses designed to avoid them.
Furthermore, as network environments continue to become more complex, virus
developers have begun to exploit new delivery mechanisms, including instant
messaging, and peer-to-peer and real-time collaboration networks. IDC estimates
that the global market for antivirus products that protect Internet gateways and
email servers will grow from approximately $484 million in 2002 to approximately
$1.6 billion by 2007.

OTHER PROBLEMS ASSOCIATED WITH ELECTRONIC MESSAGING

        In addition to spam and viruses, organizations face an increasing risk
of confidential information being leaked, either intentionally or inadvertently,
through electronic messaging. New regulations require organizations to be more
vigilant with respect to such confidential information and electronic
communications. For example, the Health Insurance Portability and Accountability
Act of 1996 requires organizations engaged in the processing of patient records
to


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implement systems to ensure the confidentiality of such information. More
generally, organizations are becoming increasingly sensitive to the electronic
transmission by employees of inappropriate content, such as communications
containing racist, sexist, discriminatory or pornographic materials.

EFFECTIVE AND ACCURATE MESSAGING SECURITY SOLUTIONS

        We believe that the proliferation of spam, compounded by the severity of
email related security threats, presents a formidable challenge for businesses
as they look to maintain a secure environment, contain costs and realize the
benefits of an electronic messaging platform and that, as a result, businesses
require a messaging security solution that can address these challenges.

        The effectiveness and accuracy of anti-spam and antivirus solutions vary
depending on the specific approach, product and customer settings, as well as
their ability to respond to efforts by spammers to evade anti-spam and antivirus
solutions. For example, faster distribution of spam with different subject lines
poses challenges for decoy email mailbox-based solutions that take time to
identify spam and create and distribute exact signatures of the spam received
before they can begin blocking spam. Another challenge for anti-spam solutions
is the time required for administration and usage. According to IDC, a
considerable amount of time is spent dealing with spam, even after anti-spam
solutions are in place. IDC estimates that email users spend 5 minutes and IT
staff spend 19 minutes on average every day dealing with spam. This includes a
variety of tasks such as maintaining and updating the anti-spam solution,
reviewing suspected spam, tracking down false positives, and asking or answering
questions about spam. To further reduce spam's impact on worker productivity and
other resources, we believe that organizations will be looking for anti-spam
solutions that provide appropriate levels of automated operation, end-user
involvement, effectiveness, accuracy, and up-to-date detection of new forms of
spam that have yet to be created.

        We believe that an effective solution must:

        o       identify and prevent spam, viruses and fraudulent email from
                entering the core network;

        o       minimize false positives (the inappropriate blocking of
                legitimate messages by spam filtering systems);

        o       limit the management and administrative cost required to
                maintain control over the rapidly evolving spam tactics and
                messaging threats;

        o       support the wide variety of hardware, software and messaging
                applications and protocols typical of the technology
                infrastructure;

        o       process hundreds of millions of emails each day across multiple
                locations, without delaying message delivery; and

        o       block spam regardless of the language or dialect used.


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        Given the growth of complex messaging threats, we believe that
businesses of all sizes require a dynamic messaging security solution to ensure
a safe, secure and stable messaging system. Combating spam and related messaging
threats has required increasing financial investment in security technology. IDC
estimates that the messaging security software market will grow from $364
million in 2003 to $1.1 billion in 2007, representing a compound annual growth
rate of 31%. Today, the market for enterprise anti-spam solutions remains
largely unpenetrated. According to Ferris Research, only approximately 10% of
corporate mailboxes have some level of anti-spam protection.

OUR MAILKEY SOLUTIONS

        We intend to become a leading messaging security solutions provider
focused on the provision of business solutions to enterprises and messaging
service providers worldwide. Our flagship software platform, MailKey Message
Manager, is being designed for the purpose of providing businesses with a
flexible, scalable and dynamic electronic messaging security solution. We are
developing our software to be server based and to provide administration,
customization and policy management capabilities. In addition to our core
anti-spam functionality, we are designing our software to provide organizations
with an extensible platform and complementary application modules for reducing
risks associated with their electronic messaging infrastructure. We anticipate
selling our products on a license fee or subscription basis and provide our
customers with continuous updates by drawing upon our proprietary technology to
monitor evolving spam and virus attacks in real-time. Our software is being
designed to support numerous hardware configurations, operating systems,
messaging applications and infrastructure, and to be deliverable as stand-alone
software, as a hosted service, or as an integrated part of the appliance
solutions of distribution partners.

MAILKEY MESSAGE MANAGER

        We are designing MailKey Message Manager to be a multi-device,
multi-message platform that helps network administrators and network operators
to protect their individual users - be they customers, members of staff or other
networks. The product is being designed to manage inbound messages as well as
outbound messages. Inbound messages will be checked at the gateway for viruses.
Network administrators will be able to set filtering and blocking options
globally, and end users will be able to set their own message management
options.

        MailKey Message Manager is expected to employ the following tools:

        LOCALIZED WHITE AND BLACK LISTS. Whitelisting and blacklisting relies on
the identity of senders of email to determine whether the messages should be
allowed into an end user's inbox.

        MailKey Message Manager is being designed to enable end users to decide
how they want to handle mail from specific senders by allowing them to create
lists of "Accepted Senders" (often referred to as a "white list") and "Blocked
Senders" (often referred to as a "black list"). For example, if a friend of an
end user sends an email to the user and is on the user's Accepted Senders list,
the email will automatically be delivered to the user's inbox, regardless of the
content of the message. Similarly, the user will be able to command MailKey
Message Manager to automatically reject and store or reject and delete mails
from specific senders or domains.


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MailKey Message Manager will enable MailKey users to import their entire email
address book from existing programs, such as Outlook, Outlook Express and
Eudora, into their Accepted Senders list.

        MailKey Message Manager is also being designed to enable Network
administrators to control a central address book, either white listing or black
listing specific domains or addresses for all users on the network. Individuals
will be able to set their own preferences in their address books. For example,
an individual will be able to add a sender address to their "Accepted Addresses"
list, even when that address is on the network administrator's global Banned
Addresses list. Mails sent from that sender will get through to that individual
user, but will be rejected if sent to anyone else on the network.

        In addition, blacklisting services are available commercially that
maintain dynamic lists containing IP addresses, domain names and email addresses
that are known or strongly suspected of originating or passing on spam. These
lists are often utilized by anti-spam web sites, service providers and IT
departments to reject suspect email. We intend to link MailKey Message Manager
to one or more of these blacklisting services.

        MAILKEYS. While whitelisting and blacklisting are an effective solution
in circumstances in which the identity of the sender is already known, it is not
an effective solution in circumstances in which the identity of the sender is
not already known. People who are not already on the user's Accepted Senders
list will not be able to have their messages delivered to the user. This
substantially impacts one of the main benefits of email, which is the openness
of the email system. The challenge is to provide a solution that robustly
excludes all the messages that a user does not want to get, while not excluding
the messages a user does want to receive.

        A fundamental part of our proposed solution to this problem is the use
of short codes, or "MailKeys", by users. For example, if a user has the email
address "user@mailkey.com", and the user creates a MailKey "abc123", then the
user can give out its email address as "abc123.user@mailkey.com". When the
recipient receives an email from a new sender who is not on the user's Accepted
Sender list, MailKey Message Manager will recognize that the incoming email is
being sent with one of the user's valid MailKeys. The system will deliver the
email to the user and, depending on the user's settings, add that sender to the
user's Accepted Sender list. If the integrity of the email address containing
that MailKey is compromised (for example, a spammer learns of the address), then
the user can cancel that MailKey. However, we are designing MailKey Message
Manager so that, even in such a circumstance, senders who have already used that
MailKey to email the user will still be able to have their messages delivered,
even if they continue to send messages to the user using the old now-deleted
MailKey. Users will be able to use multiple MailKeys and use different MailKeys
for different purposes, such as business cards, booking travel and subscribing
to newsletters.

        CHALLENGE/RESPONSE. We believe that challenge/response is another
effective way to deal with incoming e-mail in situations in which the email is
coming in from a sender who is not already on the user's Accepted Senders list.


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        In a typical situation involving challenge/response, a person will send
an email to an end user's MailKey-protected email address. If an incoming e-mail
is sent from a person on the user's Accepted Senders list, or if it has a valid
MailKey for that user included in the address, then the message will be
delivered immediately to the user's inbox. If the email is sent from a person on
the user's Blocked Senders list, it will be rejected or deleted, depending on
the settings chosen by the user. If the email is sent from someone who is
neither on the Accepted Senders nor on the Blocked Senders list, then it will be
rejected. The rejected messages are sorted by a filter and then stored in one of
two rejected mail folders. A green rejected mail folder will be used to store
general rejected messages that appear to the filter to be more likely to be from
valid senders. A red rejected mail folder will be used to store messages that
appear to be more likely to have originated from spammers.

        Depending on the user's selected settings, unknown senders will be sent
an email challenge asking them to perform a test seeking to confirm that they
are a human sender. Automated robots will be unable to complete such a test, so
senders of automated spam, phishing and infected email will be unable to
respond. If the sender responds to the challenge successfully, the sender's
email will be immediately released from the rejected mail folder and forwarded
into the user's inbox. The user may then choose to add the sender to the user's
Accepted Senders or Blocked Senders list.

        CONTENT FILTERING. We believe that content filtering alone does not
provide a fully effective solution against spam. No matter how good the filter
is, it will not be able to avoid false positives (blocking legitimate email),
and it will not be able to exclude all spam. We believe, however, that filters
can be useful in helping to categorize messages as spam based on their
appearance.

        One or more content analysis techniques can be used to analyze the
content of inbound email. This approach focuses on trying to detect the
suspicious characteristics of legitimate and illegitimate offerings or
information requests that spammers try to hide from spam filters and email users
at least until they open the emails. There are many different types of content
analysis techniques available today, including:

        o       keyword analysis, which involves analyzing the text section of
                an email for specific key words or phrases;

        o       lexical analysis, which involves analyzing the context for all
                of the words and phrases in a particular message;

        o       Bayesian analysis, which uses the knowledge of prior events to
                predict future events;

        o       Heuristics, which is a technique that looks for spam-like
                characteristics in an email message;

        o       header analysis, which involves the examination of headers,
                looking for such items as the validity of the sender's address,
                whether the same information is found in the "sender" and "from"
                fields of an email, and whether a specific message contains
                information not common to normal email; and


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        o       URL analysis, which analyzes the embedded links in email
                messages and compares the link to a list of URL rules or known
                spam URLs to determine if the message is spam.

Multiple techniques can be combined to generate aggregated scoring for each
inbound email representing the probability of it being spam. An advantage common
to any content analysis technique is that it can block the very first spam sent
by a spammer.

        MailKey intends to use a proprietary content filter to filter incoming
messages. In addition to this, we are considering a modular approach to the
filtering process, which would allow the use of filtering solutions developed by
other providers.

        SENDERID. One of the biggest security holes in email messaging is the
ability of senders to hide their identities. Spammers and virus writers commonly
write programs that automatically fake the sender addresses, a practice known as
"spoofing". Spoofing is also a fundamental part of the phishing frauds being
perpetrated today. In the typical case, a spammer sends an email and fakes its
address to be that of a bank, credit card company or similar targeted
institution. This makes the maintenance of blacklists much more difficult.

        MailKey is developing "SenderID" as a new approach to determining the
identity of senders. SenderID is being designed to determine the authenticity of
the address from which the message purports to have originated from. This
process is generally referred to as "authentication." SenderID will use a
combination of techniques to analyze incoming emails and provide an estimate of
the likelihood that the sender is authentic. We plan to incorporate our SenderID
authentication protocol into MailKey Message Manager to validate the identity of
senders and to prevent spoofing and identity theft.

MAILKEY FOR INTERNET SERVICE PROVIDERS

        We are designing MailKey Message Manager as an attractive cost-saving
and revenue-generating opportunity for Internet Service Providers ("ISPs"). We
believe the cost of information pollution to ISPs is very large, with customers
paying flat rate fees for their packages while using up huge amounts of
bandwidth on bad messages. By stopping much of the unwanted messages at the
server level and empowering customers to stop them as well, ISPs will be able to
reduce the cost of bandwidth as well as the risk from viruses and other attacks.
ISPs will be able to configure the user rights and default settings in the
program to customize the service, providing flexibility in what is offered for
the chosen price. ISPs may offer, for example, a restricted set of options at an
entry level price, allowing customers to upgrade at a higher price later on.
Additionally, we are designing MailKey Message Manager so that it may be sold as
a value-added service on a subscription or license basis by ISPs, thus providing
ISPs with an additional potential source of revenue.

MAILKEY FOR THE MOBILE MESSAGING INDUSTRY

        We are also designing MailKey Message Manager for the mobile messaging
industry. Since mobile phone numbers are numeric, marketers have not found it
difficult to compile lists of phone numbers and use auto-dialers to validate
them. In addition, the proliferation of services


                                       11
<PAGE>

that ask people for their mobile phone number has made it virtually impossible
for mobile phone users to remain private, despite any laws to the contrary. In
certain countries, there has been a proliferation of unwanted commercial
messages being sent to mobile phones. Because there are more mobile phone users
than email users, many of them minors, network operators have a social
responsibility to provide as much protection as possible against unwanted
commercial messages sent to users' mobile phones.

        We are considering the development of a commercial module that would
provide mobile network operators with an incentive to partner with us. This
would provide us with an opportunity to establish a relationship with mobile
network operators pursuant to which the mobile network operators could offer our
solutions to their users. We believe that protection of mobile communications
could be a valuable customer retention tool as well as a value-added service
that could be sold to end users as a premium subscription service.

OUR STRATEGY

        Our objective is to become a leading provider of electronic messaging
security solutions to businesses worldwide. We intend to achieve this objective
by becoming a market-driven company focused on offering value propositions and
the delivery of full service business solutions developed internally and
acquired through strategic acquisitions and partnerships. The key elements of
our strategy include:

        ESTABLISH PRODUCT AND TECHNOLOGY LEADERSHIP. We intend to continue to
invest in the development of our MailKey Message Manager products, services and
technology in order to establish a complete messaging security platform that
provides value-added messaging security capabilities to organizations. We intend
to enhance our solution offerings through internal development, third party
solution providers and, potentially, strategic acquisitions. We also will
continue to focus on enhancing the functionality of our core technologies.

        ESTABLISH BROAD GEOGRAPHIC COVERAGE. It is our intention to establish
customer bases in North America, Asia Pacific and Europe, the Middle East and
Africa. The markets outside North America are experiencing similar spam growth
trends to those in North America, but to date have a lower rate of adoption of
messaging security solutions.

        ESTABLISH INDIRECT SALES CHANNEL. We intend to enter into sales
agreements with an indirect channel of distributors, resellers, business
outsourcing and hosted service providers, large global systems integrators,
original equipment manufacturers ("OEMs") and appliance vendors.

        ENGAGE IN STRATEGIC ACQUISITIONS AND JOINT VENTURES. We intend to
acquire additional technologies that we believe are complimentary to either our
existing technologies or technologies that we are developing or may attempt to
develop in the future. In addition, we intend to acquire companies, businesses
and assets that we believe are complementary to our business. We may seek to
form joint ventures and seek joint venture partners in order to reduce our
investment in a particular project and help promote the development and sale of
our products.


                                       12
<PAGE>

SALES, MARKETING AND DISTRIBUTION

        We intend to sell our products and services through direct channels and
through indirect channels comprised of value-added resellers. Our channel sales
efforts will be coordinated worldwide through a sales team. We expect to derive
most of our future revenues from licensing fees and revenue sharing from the
sale of our electronic messaging security solutions.

        Our marketing strategy is to raise awareness of the potential risks
associated with spam and increase the recognition of MailKey Corporation as a
provider of anti-spam and antivirus solutions. Our marketing efforts will be
targeted toward business executives in corporations and ISPs, including
information technology professionals, chief executives, upper-level management
and human resource personnel. We plan to actively manage our public relations
programs, communicating directly with technology professionals and the media in
an effort to promote greater awareness for the growing problems associated with
electronic messaging. We also plan to provide potential customers and channel
partners with free trials of our MailKey solutions. Our additional marketing
initiatives may include:

        o       advertising online and in high-technology magazines, management
                journals and other business-oriented periodicals;

        o       participating in and sponsoring trade shows and industry events;

        o       hosting regional and international seminars, webinars and
                training sessions for our sales organization and reseller
                partners, as well as customers and prospects;

        o       participating in cooperative marketing efforts with our Internet
                infrastructure partners including web link exchanges, joint
                press announcements, joint trade show activities, channel
                marketing campaigns, road shows and seminars;

        o       conducting speaking engagements on topics of interest to our
                customers and prospects;

        o       using our website to communicate with our indirect sales
                channels, and provide product and company information to
                interested parties; and

        o       providing and distributing soft and hard copy materials on our
                company, products, solutions, technologies, partnerships and
                benefits.

COMPETITION

        The market for our products is fragmented, highly and increasingly
competitive, quickly evolving and subject to rapid technological change. Our
competitors vary in size and in scope and breadth of the products and services
they offer. Our current principal competitors include:

        o       providers of content security solutions, such as Clearswift
                Technologies, CipherTrust, Tumbleweed, Trend Micro, Postini,
                Brightmail, SurfControl, NetIQ, Sybari, MessageLabs and
                Websense;


                                       13
<PAGE>

        o       providers of secure e-mail messaging products, such as
                Tumbleweed, Brightmail, Certified Mail, Postini, Authentica,
                Sybari, Zix and Sigaba; and

        o       providers of security management solutions, such as BindView,
                Computer Associates, IBM, Internet Security Systems, Network
                Associates and Symantec.

        In addition, we may face competition from large enterprise network
infrastructure and software vendors such as Cisco Systems and Microsoft as they
diversify their product offerings, and large Internet-based companies such as
Google and Yahoo.

        We believe that the principal competitive factors in the market for our
products include:

        o       product functionality and effectiveness;

        o       product integration;

        o       price;

        o       platform coverage and ability to scale;

        o       worldwide sales infrastructure; and

        o       global technical support.

        Many of our current and potential competitors have longer operating
histories and significantly greater financial, technical, marketing or other
resources than we do. They may have significantly greater name recognition,
established marketing relationships and access to a large installed base of
customers. In addition, current and potential competitors have established or
may establish cooperative relationships among themselves or with third parties
to increase the functionality of their products to address customer needs.
Accordingly, new competitors or alliances among competitors may emerge and
rapidly acquire significant market share.

INTELLECTUAL PROPERTY RIGHTS

        Our MailKey brand and proprietary technology are important to our
business. We generally enter into confidentiality and other written agreements
with our employees, consultants and strategic partners, and through these and
other written agreements, we attempt to control access to and distribution of
our software, documentation and other proprietary technology and other
information. We do not currently have any registered trademarks for any of our
corporate or brand names or symbols, nor do we have any issued patents relating
to our proprietary technologies. We have applied for trademark registrations for
our "MailKey" and "SenderID" brands and have applied for patents for certain of
our proprietary technology in both the United States and the United Kingdom. We
intend to apply for additional legal protection for our brands and technology in
the future. We can provide no assurance, however, that we will receive such
legal protection or that, if received, such legal protection will be adequate to
protect our MailKey brand or our proprietary technology.

        Despite our efforts to protect our proprietary rights, third parties
may, in an unauthorized manner, attempt to use, copy or otherwise obtain and
market or distribute our intellectual property rights or technology or otherwise
develop a product with the same functionality as our


                                       14
<PAGE>

products. Policing unauthorized use of our products and intellectual property
rights is difficult, and nearly impossible on a worldwide basis. Therefore, we
cannot be certain that the steps we have taken or will take in the future will
prevent misappropriation of our technology or intellectual property rights,
particularly in foreign countries where we do business or where our products are
sold or used, where the laws may not protect proprietary rights as fully as do
the laws of the United States or United Kingdom or where enforcement of such
laws is not common or effective.

        Substantial litigation regarding intellectual property rights exists in
the software industry. From time to time, in the ordinary course of our
business, we may be subject to claims relating to our intellectual property
rights or those of others, and third parties may commence legal proceedings or
otherwise assert intellectual property claims against us in the future,
particularly as we expand the complexity and scope of our business, the number
of similar products increases and the functionality of these products further
overlap. These claims and any resulting litigation could subject us to
significant liability for damages. In addition, even if we prevail, litigation
could be time consuming and expensive to defend and could affect our business
materially and adversely. Any claims or litigation from third parties may also
limit our ability to use various business processes, software and hardware,
systems, technologies or intellectual property subject to these claims or
litigation, unless we enter into license agreements with the third parties.
However, these agreements may be unavailable on commercially reasonable terms,
or not available at all.

RESEARCH AND DEVELOPMENT

        We have invested significant time and resources in undertaking product
and service development projects. Members of our research and development
department are involved with production, software development, validation and
testing, documentation and research. They work as a team designed to provide a
framework for defining and addressing the activities required to bring product
concepts and development projects to market successfully. Research and
development expenses were approximately $385,000 for the three months ended
March 31, 2004 and approximately $665,000 for the period commencing upon our
inception on March 11, 2003 and ending December 31, 2003.

EMPLOYEES

        As of July 9, 2004, we had approximately 8 full-time employees and
approximately 15 consultants. None of our employees are represented by a labor
union, and we have never experienced a work stoppage. We believe that our
relations with our employees are good.

REGULATORY AND LEGISLATIVE ISSUES

        As use of the Internet has become more prevalent and various negative
issue associated with the Internet have received increasing amounts of
publicity, there has been a correspondingly greater amount of governmental
attention directed to the Internet in the United States Congress and elsewhere.
While various pieces of legislation regulating different aspects of the Internet
and Internet-related activity have been proposed, to date there has been no
legislation enacted


                                       15
<PAGE>

that places any direct and substantial regulatory burden on us. Nonetheless, we
anticipate further attempts to regulate internet-related activity in the future,
some of which may impose substantial burdens on our ability to do business.

                                  RISK FACTORS

        The following risk factors, among others, may affect our business,
financial condition and results of operations.

                       RISKS ASSOCIATED WITH OUR BUSINESS

WE ARE A DEVELOPMENT-STAGE COMPANY WITH AN UNPROVEN BUSINESS MODEL, WHICH MAKES
IT DIFFICULT FOR US TO EVALUATE OUR CURRENT BUSINESS AND FUTURE PROSPECTS.

        We have only a limited operating history upon which to base an
evaluation of our current business and future prospects, and our products are
currently in the development stage. As a result, the revenue and income
potential of our business and our market are unproven. Because of our limited
operating history and because the market for electronic messaging security
products is relatively new and rapidly evolving, we have limited insight into
trends that may emerge and affect our business. We may make errors in predicting
and reacting to relevant business trends, which could harm our business.

WE HAVE A HISTORY OF LOSSES AND, BECAUSE WE EXPECT OUR OPERATING EXPENSES TO
INCREASE IN THE FUTURE, WE DO NOT EXPECT TO BECOME PROFITABLE IN THE NEAR TERM.

        We have experienced substantial operating losses in each fiscal quarter
since our inception on March 11, 2003 and as of March 31, 2004, we had an
accumulated deficit of approximately $4.7 million. We incurred net losses to
common shareholders of approximately $2.5 million during the three months ended
March 31, 2004, and approximately $2.2 million during the period commencing with
our inception and ending December 31, 2003. We expect to continue to incur
significant net losses for the foreseeable future. We also expect our operating
expenses to increase substantially as we:

        o       expand our domestic and international selling and marketing
                activities;

        o       increase our research and development efforts to upgrade our
                existing MailKey solutions and develop new products and
                technologies;

        o       upgrade our operational and financial systems, procedures and
                controls;

        o       hire additional personnel, including additional engineers and
                other technical staff; and

        o       fulfill our responsibilities associated with being a public
                company.

WE WILL NEED TO RAISE ADDITIONAL FUNDS IN THE FUTURE, WHICH FUNDS MAY NOT BE
AVAILABLE OR, IF AVAILABLE, MAY NOT BE AVAILABLE ON ACCEPTABLE TERMS.

        We expect that our operating expenses will increase substantially over
the next 12 months. In addition, we may experience a material decrease in
liquidity due to unforeseen


                                       16
<PAGE>

capital requirements or other events and uncertainties. As a result, we may need
to raise additional funds, and such funds may not be available on favorable
terms, if at all. If we cannot raise funds on acceptable terms, we may not be
able to develop or enhance our software applications, execute on our business
plan, take advantage of future opportunities or respond to competitive pressures
or unanticipated requirements. This may seriously harm our business, financial
condition and results of operations.

OUR FAILURE TO DEVELOP A COMMERCIALLY VIABLE PRODUCT AND ANY FAILURE OF THIS
PRODUCT TO SATISFY CUSTOMER DEMANDS OR TO ACHIEVE MEANINGFUL MARKET ACCEPTANCE
MAY SERIOUSLY HARM OUR BUSINESS.

        Substantially all of the revenues we expect to generate in the
foreseeable future will come from licensing fees and revenue sharing for the
MailKey solutions we are developing. If we are unable to produce a commercially
viable product and generate revenues from the licensing of our MailKey
solutions, our operating results and our business may be significantly impaired.
If our MailKey solutions fail to meet the needs of our target customers, or if
they do not compare favorably in price and performance to competing products,
our growth may be limited. We cannot assure you that we will complete the
development of our MailKey solutions, or that our MailKey solutions will achieve
any meaningful market acceptance. Our future financial performance also will
depend, in part, on our ability to diversify our offerings by successfully
developing, introducing and gaining customer acceptance of new products that we
offer. We cannot assure you that we will be successful in achieving market
acceptance of any new products that we develop or of enhanced versions of our
MailKey solutions. Any failure or delay in diversifying our existing offering
could harm our business, financial condition and results of operations.

WE INTEND TO ESTABLISH INDIRECT SALES CHANNELS TO HELP GENERATE REVENUE AND
IMPROVE OUR OPERATING RESULTS.

        We currently intend to sell any products we develop both directly and
indirectly. However, if and when we begin selling our products, we intend to
utilize indirect sales channels, including value-added resellers, distributors
and Internet service providers, to offer our MailKey solutions to a larger
customer base than we can reach through our direct sales efforts. We cannot
assure you that we will be able to establish such relationships, or that any
such relationships will be available on commercially reasonable terms. If we are
unable to establish such relationships, we may lose customer introductions and
co-marketing benefits and our operating results may suffer.

TO THE EXTENT WE RELY ON INDIRECT SALES CHANNELS IN THE FUTURE, SUCH RELIANCE
COULD HINDER THE DEVELOPMENT OF OUR BUSINESS BECAUSE WE HAVE LITTLE CONTROL OVER
OUR VALUE-ADDED RESELLERS, DISTRIBUTORS AND OEMS.

        We anticipate that sales from our various indirect sales channels,
including value-added resellers, distributors, providers of managed Internet
services and others, will account for substantial percentage of our total
revenue in future periods. We do not expect that any of these parties will be
obligated to sell our products or make any purchases from us. Our ability to


                                       17
<PAGE>

generate revenue will depend significantly upon the ability and willingness of
our indirect sales channels to market and sell our products to organizations
worldwide. If they are unsuccessful in their efforts or are unwilling or unable
to market and sell our new product offerings, our operating results may suffer.
We cannot control the level of effort these parties will expend or the extent to
which any of them will be successful in marketing and selling our products. Any
indirect sales channels through which we conduct business may also market and
sell products that compete with our MailKey solutions or may decide to do so in
the future. We may not be able to prevent these parties from devoting greater
resources to support our competitors' products and reducing or eliminating their
efforts to sell our MailKey solutions.

THE PRODUCTS WE ARE DEVELOPING MAY BECOME OBSOLETE DUE TO RAPID TECHNOLOGICAL
CHANGE IN THE ELECTRONIC MESSAGING SECURITY MARKET.

        The messaging security market is characterized by:

        o       rapid technological change;

        o       the proliferation of new and changing methods of distributing
                spam and other messaging threats;

        o       frequent product introductions and updates; and

        o       changing customer needs.

        These characteristics of our market create significant risks and
uncertainties for our business success. Our competitors might introduce products
with better performance, higher effectiveness and better accuracy. Numerous
service providers and vendors have also announced that they are developing or
considering developing an email authentication system to enhance the
effectiveness of their spam filtering products by blocking emails that obscure
the identity of the sender of an email. Additionally, new software operating
systems, hardware or messaging security industry standards could emerge. We may
not be successful in either developing appropriate modifications and
enhancements to our products and services or in timely bringing them to market.
Furthermore, uncertainties about the timing and nature of new network platforms
or technologies, or modifications to existing platforms or technologies, could
increase our product development expenses. The MailKey solutions that we are
developing may be incompatible with some or all of such standards or if such new
standards are successful in eliminating messaging threats, the demand for our
products could significantly decrease. Our business and operating results could
materially suffer unless we are able to respond quickly and effectively to these
developments.

WE MAY NOT BE ABLE TO DEVELOP ACCEPTABLE NEW PRODUCTS OR ENHANCEMENTS TO FUTURE
PRODUCTS AT A RATE REQUIRED BY OUR RAPIDLY CHANGING MARKET.

        Our future success depends on our ability to develop new products or
enhancements to future products that keep pace with rapid technological
developments and that address the changing needs of our customers. Although our
MailKey solutions are being designed to operate with a variety of network
hardware and software platforms, we will need to continuously modify


                                       18
<PAGE>

and enhance our MailKey solutions to keep pace with changes in Internet-related
hardware, software, communication, browser and database technologies. We may not
be successful in either developing such products or timely introducing them to
the market. In addition, uncertainties about the timing and nature of new
network platforms or technologies, or modifications to existing platforms or
technology, could increase our research and development expenses. The failure of
our products to operate effectively with the existing and future network
platforms and technologies may limit or reduce the market for our products,
result in customer dissatisfaction and seriously harm our business, financial
condition and results of operations.

DEFECTS IN THE PRODUCTS WE ARE DEVELOPING COULD DIMINISH DEMAND FOR OUR PRODUCTS
AND SERVICES AND CAUSE US TO LOSE CUSTOMERS.

        The products we are developing are complex. As a result, they may have
errors or defects that users identify after they begin using them, that could
harm our reputation and our business. In particular, the anti-spam products we
are developing may identify some legitimate emails as unwanted or unsolicited
spam, or we may not be able to filter out a sufficiently high percentage of
unsolicited or unwanted messages sent to the email accounts of our customers.
Complex software products such as those that we are developing frequently
contain undetected errors when first introduced or when new versions or
enhancements are released. In addition, we may be unable to respond in a prompt
manner, or at all, to new methods of attacking a messaging system, such as new
spamming techniques or virus attacks. Any such errors, defects or other
performance problems could impact the perceived reliability of our products and
services and hurt our reputation. If that occurs, customers could elect to not
renew or terminate their subscriptions and we could lose future sales. In
addition, while we expect that any subscription agreements we may enter into
will contain provisions that limit our liability to our customers, these
limitations may not be enforced in certain circumstances and we may be liable
for lost business or other claims by customers if our products do not perform as
expected.

COMPUTER HACKERS MAY DAMAGE OUR PRODUCTS, SERVICES AND SYSTEMS, WHICH COULD
CAUSE INTERRUPTIONS IN OUR SERVICE AND HARM TO OUR BUSINESS.

        From time to time, we and any customers we may in the future have may be
targets of computer hackers who, among other things, create viruses to sabotage
or otherwise attack companies' products and services. Our or our customers'
websites and systems may be subject to denial of service attacks, where a
website is bombarded with information requests eventually causing the website
and system to overload, resulting in a delay or disruption of services. Our
website, system, products and services, as well as our customers' websites and
systems, may be the subject of attacks by hackers. If successful, any of these
events could damage such computer systems and result in an interruption of the
provisioning of our products and services, force us to incur substantial costs
to fix technical problems or result in hackers gaining access to our technical
and other proprietary information, which could harm our business and operating
results.

FAILURE TO PROTECT OUR INTELLECTUAL PROPERTY RIGHTS COULD ADVERSELY AFFECT OUR
BUSINESS.

        If we fail to protect our intellectual property rights adequately, our
competitors might gain access to our technology and our business might be
harmed. In addition, defending our


                                       19
<PAGE>

intellectual property rights might entail significant expense. Any patents,
trademarks or other intellectual property rights we may in the future obtain may
be challenged by others or invalidated through administrative process or
litigation. Although we have filed several patent applications, we may be unable
to obtain any patent protection. Any future patents we obtain may not provide us
with any competitive advantages, or may be challenged by third parties.
Furthermore, legal standards relating to the validity, enforceability and scope
of protection of intellectual property rights are uncertain. Effective patent,
trademark, copyright and trade secret protection may not be available to us in
every country in which our products and services may in the future be available.
The laws of some foreign countries may not be as protective of intellectual
property rights as those in the United States and United Kingdom, and mechanisms
for enforcement of intellectual property rights may be inadequate. Accordingly,
despite our efforts, we may be unable to prevent third parties from infringing
upon or misappropriating our intellectual property.

        We might be required to spend significant resources to monitor and
protect our intellectual property rights. We may initiate claims or litigation
against third parties for infringement of our proprietary rights or to establish
the validity of our proprietary rights. Any litigation, whether or not it is
resolved in our favor, could result in significant expense to us and divert the
efforts of our technical and management personnel.

IF WE ARE SUED BY THIRD PARTIES FOR ALLEGED INFRINGEMENT OF THEIR PROPRIETARY
RIGHTS, OUR BUSINESS AND OPERATING RESULTS COULD BE HARMED.

        The software and Internet industries are characterized by the existence
of a large number of patents, trademarks and copyrights and by frequent
litigation based on allegations of infringement or other violations of
intellectual property rights. As we expand the scope of our business and the
number of entrants into our market increases, the possibility of an intellectual
property claim against us grows. Our products and technologies may not withstand
any third-party claims or rights against their use. Any intellectual property
claims, with or without merit, could be time-consuming and expensive to litigate
or settle and could divert management attention from the execution of our
business plan. In addition, any subscription agreements we enter into with
customers and other agreements we may enter into with resellers, distributors
and other partners may require us to indemnify our customers and partners for
third-party intellectual property infringement claims, which would increase the
cost to us of an adverse ruling in such a claim. An adverse determination could
also prevent us from offering our products to others, cause the sales of our
products to decrease or require us to pay substantial license fees or royalties
in connection with sales of our products.

IF WE ACQUIRE ANY COMPANIES OR TECHNOLOGIES IN THE FUTURE, SUCH COMPANIES AND
TECHNOLOGIES COULD PROVE DIFFICULT TO INTEGRATE, DISRUPT OUR BUSINESS, DILUTE
STOCKHOLDER VALUE AND ADVERSELY AFFECT OUR OPERATING RESULTS.

        We intend to acquire or make investments in complementary companies,
businesses, assets and/or technologies in the future. We have not made any
acquisitions or investments to date, and therefore, our ability to make
acquisitions or investments is unproven. Acquisitions and investments involve
numerous risks, including:


                                       20
<PAGE>

        o       difficulties in integrating operations, technologies, services
                and personnel;

        o       diversion of financial and management resources from existing
                operations;

        o       risk of entering new markets;

        o       potential write-offs of acquired assets;

        o       potential loss of key employees;

        o       inability to generate sufficient revenue to offset acquisition
                or investment costs; and

        o       delays in customer purchase due to uncertainties.

        Acquisitions could also require us to record substantial amounts of
goodwill and other intangible assets. Any future impairment of such goodwill,
and the amortization of other intangible assets, would adversely affect our
operating results. In addition, if we finance acquisitions by issuing
convertible debt or equity securities, our existing stockholders may be diluted,
which could affect the market price of our stock. If we finance such
acquisitions with bank debt or high yield debt, these arrangements may impose
substantial operating covenants on us and result in interest expense that could
adversely affect our business and operating results. As a result, if we fail to
properly evaluate and execute any future acquisitions or investments, our
business and operating results may be seriously harmed.

OUR GROWTH COULD STRAIN OUR PERSONNEL AND INFRASTRUCTURE RESOURCES, AND IF WE
ARE UNABLE TO IMPLEMENT APPROPRIATE CONTROLS AND PROCEDURES TO MANAGE OUR
GROWTH, WE MAY NOT BE ABLE TO SUCCESSFULLY IMPLEMENT OUR BUSINESS PLAN.

        As we implement our business plan, we may experience a period of rapid
growth in our headcount, operations and product development, which may place a
significant strain on our management, administrative, operational and financial
infrastructure. We anticipate that further growth will be required to establish
a customer base and complete the development of our MailKey solutions, as well
as expand our sales efforts into new geographic areas.

        Our success will depend in part upon the ability of our senior
management to manage this growth effectively. To do so, we must continue to
hire, train and manage new employees as needed. If our new hires perform poorly,
if we are unsuccessful in hiring, training, managing and integrating these new
employees, or if we are not successful in retaining our existing employees, our
business may be harmed. To manage the expected growth of our operations and
personnel, we will need to continue to improve our operational, financial and
management controls and our reporting systems and procedures. The additional
headcount and capital investments we are adding will increase our cost base,
which will make it more difficult for us to offset any future revenue shortfalls
by offsetting expense reductions in the short term. If we fail to successfully
manage our growth, we will be unable to execute our business plan.


                                       21
<PAGE>

THE MARKET IN WHICH WE PARTICIPATE IS INTENSELY COMPETITIVE, AND IF WE DO NOT
COMPETE EFFECTIVELY, OUR OPERATING RESULTS COULD BE HARMED.

        The market for network security solutions, including messaging security
products and services, is intensely competitive and rapidly changing. Barriers
to entry into this market are relatively low and many of our competitors are
larger and have more resources than we do. With the introduction of new
technologies and market entrants, we expect competition to intensify in the
future. Many of our current and potential competitors enjoy substantial
competitive advantages, such as greater name recognition, longer operating
histories, larger research, development and marketing budgets as well as
substantially greater financial, technical and other resources. In addition,
many of our current and potential competitors have access to larger customer
bases and have more extensive marketing and distribution arrangements with
resellers, distributors and OEMs than we do. As a result, our competitors may be
able to respond more quickly and effectively than we can to new or changing
opportunities, technologies, standards or customer requirements. Furthermore,
because of these advantages, even if we develop products that are more effective
than the products that our competitors offer, potential customers might accept
competitive products in lieu of purchasing our products.

        We face competition from businesses that develop their own anti-spam and
other messaging security technology, as well as from enterprise software vendors
and online service providers who develop or bundle anti-spam, anti-virus and
other messaging security technology with their other products. Our current and
potential principal competitors include:

        o       providers of content security solutions, such as Clearswift
                Technologies, CipherTrust, Tumbleweed, Trend Micro, Postini,
                Brightmail, SurfControl, NetIQ, Sybari, MessageLabs and
                Websense;

        o       providers of secure e-mail messaging products, such as
                Tumbleweed, Brightmail, Certified Mail, Postini, Authentica,
                Sybari, Zix and Sigaba; and

        o       providers of security management solutions, such as BindView,
                Computer Associates, IBM, Internet Security Systems, Network
                Associates and Symantec.

        In addition, we may face competition from large enterprise network
infrastructure and software vendors such as Cisco Systems and Microsoft as they
diversify their product offerings.

        Major vendors of enterprise software or hardware may decide to bundle
anti-spam, antivirus or other messaging security products as components or
standard features of their broader product offerings, which could enable these
competitors to provide their anti-spam, anti-virus or other messaging security
products at deep discounts or at no additional cost. Some of our principal
competitors may offer their products at a lower price, which could result in
pricing pressures on our products. This could render any products we develop
obsolete or unmarketable, particularly if the products offered by these vendors
are comparable or superior to our products. If we are unable to establish any
meaningful market share, our business and operating results will be negatively
impacted. In addition, pricing pressures and increased competition generally
could result in reduced sales, reduced margins or the failure of our products
and services to achieve or maintain more widespread market acceptance, any of
which could harm our business.


                                       22
<PAGE>

WE ARE DEPENDENT ON OUR MANAGEMENT TEAM, AND THE LOSS OF ANY KEY MEMBER OF THIS
TEAM MAY PREVENT US FROM IMPLEMENTING OUR BUSINESS PLAN IN A TIMELY MANNER.

        Our success depends largely upon the continued services of our executive
officers and other key personnel. We are also substantially dependent on the
continued service of our existing development personnel because of the
complexity of our products and technologies. We have entered into employment
agreements with many of our employees. These agreements provide that the
employees may discontinue their employment with us after providing us with
little notice of their decision (typically one month). In addition, none of our
executive officers are parties to employment agreements with us. As a result,
our employees could terminate their employment with us at any time without
penalty and go to work for one of our competitors. We do not maintain key person
life insurance policies on any of our employees. The loss of one or more of our
key employees could seriously harm our business.

OUR MANAGEMENT TEAM WAS ONLY RECENTLY FORMED, AND OUR SUCCESS DEPENDS ON ITS
ABILITY TO WORK TOGETHER EFFECTIVELY.

        We hired Graham Norton-Standen, our Chairman and Chief Executive
Officer, in March 2004, and Roger B. Ponting, our Chief Financial Officer, in
June 2004. In addition, the majority of our senior management team has joined us
in the last 12 months. Our future success depends on the integration of this
management team and its ability to work together effectively. If our management
team fails to work together effectively, our business could be harmed.

BECAUSE COMPETITION FOR OUR TARGET EMPLOYEES IS INTENSE, WE MAY NOT BE ABLE TO
ATTRACT AND RETAIN THE HIGHLY SKILLED EMPLOYEES WE NEED TO SUPPORT OUR PLANNED
GROWTH.

        To execute our growth plan, we must attract and retain highly qualified
personnel. We may need to hire additional personnel in virtually all operational
areas, including selling and marketing, research and development, operations and
technical support, customer service and administration. Competition for these
personnel is intense, especially for engineers with high levels of experience in
developing messaging security solutions. We may not be successful in attracting
and retaining qualified personnel. We have from time to time in the past
experienced, and we expect to continue to experience in the future, difficulty
in hiring and retaining highly skilled employees with appropriate
qualifications. Many of the companies with which we compete for experienced
personnel have greater resources than we have. If we fail to attract new
personnel or fail to retain and motivate our current personnel, our business and
future growth prospects could be severely harmed.

EVOLVING REGULATION OF THE INTERNET AND UNREGULATED COMMERCIAL EMAIL MAY AFFECT
US ADVERSELY.

        As Internet commerce continues to evolve, increasing regulation by
federal, state or foreign agencies becomes more likely. For example, the United
States government recently enacted the CAN-SPAM Act of 2003, which is largely
directed at curbing fraudulent and deceptive practices used in connection with
the transmission of email messages. Strict legal prohibitions on the
transmission of unsolicited commercial email, coupled with aggressive
enforcement, could result in the transmission of less unsolicited commercial
email and, thus, a


                                       23
<PAGE>

corresponding decrease in demand for the products and services we are
developing. If legal developments alone prove effective in eliminating or
sharply reducing spam, the market for our products and services will be
adversely affected.

        In addition, taxation of products and services provided over the
Internet or other charges imposed by government agencies or by private
organizations for accessing the Internet may also be imposed. Any regulation
imposing greater fees for Internet use or restricting information exchange over
the Internet could result in a decline in the use of the Internet and the
viability of Internet-based products and services, which could harm our business
and operating results.

WE MAY BECOME INVOLVED IN LITIGATION, WHICH COULD BE COSTLY AND TIME CONSUMING
TO DEFEND.

        We may become involved in litigation such as securities class actions,
intellectual property, employment (unfair hiring or terminations) and product
liability claims, among others. For example, we may be subject to lawsuits by
parties claiming that we intentionally blocked the intended recipient from
receiving their emails. Parties whose emails are blocked by our products may
also seek redress against us for labeling them as spammers or for interfering
with their business. Any of these sources could claim we are interfering with
the lawful conduct of their business. Although we believe we have the authority
under applicable law to block unwanted emails, we cannot guarantee this or that
we will obtain a favorable outcome for any such claims that may be brought
against us in the future. Litigation involves costs in defending the action and
the risk of an adverse judgment. Any resulting litigation, with or without
merit, could result in substantial costs and divert management's attention and
resources, which could seriously harm our business and operating results.

INTERNATIONAL SALES EXPOSE US TO ADDITIONAL RISKS THAT HAVE THE POTENTIAL TO
ADVERSELY AFFECT OUR BUSINESS AND OPERATING RESULTS.

        We plan to expand our international sales efforts. International
operations and sales subject us to risks and challenges that we would otherwise
not face if we conducted our business only in the United States. The risks and
challenges associated with operations and sales to customers outside the United
States include:

        o       localization of our products and services, including translation
                of the interface of our products into foreign languages,
                development of technology to identify, assess and analyze
                messages written in foreign languages, creation of localized
                agreements and associated expenses;

        o       foreign currency fluctuations;

        o       a largely unproven market for our products and services outside
                of the United States;

        o       laws and business practices favoring local competitors;

        o       compliance with multiple, conflicting and changing governmental
                laws and regulations, including employment, tax, privacy and
                data protection laws and regulations;


                                       24
<PAGE>

        o       our ability to adapt sales practices and customer requirements
                in different cultures;

        o       differing abilities to protect our intellectual property rights;

        o       difficulties in staffing and managing foreign operations;

        o       longer accounts receivable payment cycles and other collection
                difficulties; and

        o       regional economic and political conditions.

        If we successfully expand our international sales, we expect that the
percentage of subscription fees payable in foreign currencies will increase.
Consequently, our potential exposure from fluctuations in the value of the U.S.
dollar and foreign currencies could increase. Currently, we do not hedge our
exposure to currency fluctuations. Fluctuations in the value of the U.S. dollar
and foreign currencies may make our products more expensive for international
customers, which could harm our business. If we fail to realize increased sales
from our investment in expanded international operations, our business and
operating results will be adversely affected.

                       RISKS ASSOCIATED WITH OUR INDUSTRY

THE MARKET FOR OUR PRODUCTS CONTINUES TO EMERGE, AND IF WE ARE NOT SUCCESSFUL IN
PROMOTING AWARENESS OF THE NEED FOR OUR MAILKEY SOLUTIONS AND OF OUR MAILKEY
BRAND, OUR GROWTH MAY BE LIMITED.

        Based on our experience with potential customers, we believe that many
corporations do not recognize or acknowledge the existence or scope of problems
inherent in the electronic messaging. In addition, there may be a time-limited
opportunity to achieve and maintain a significant share of the market for
electronic messaging security solutions due in part to the emerging nature of
this market and the substantial resources available to our existing and
potential competitors. If employers do not recognize or acknowledge these
problems, then the market for electronic messaging security solutions may
develop more slowly than we expect, which could adversely affect our operating
results. Developing and maintaining awareness of our MailKey brand is critical
to achieving widespread acceptance of our existing and future products.
Furthermore, we believe that the importance of brand recognition will increase
as competition in our market develops. Successful promotion of our MailKey brand
will depend largely on the effectiveness of our marketing efforts and on our
ability to develop reliable and useful products at competitive prices. If we
fail to successfully promote our MailKey brand, or if our expenses to promote
and maintain our MailKey brand are greater than anticipated, our financial
condition and results of operations could suffer.

THE SUCCESS OF OUR BUSINESS DEPENDS UPON THE CONTINUED GROWTH AND ACCEPTANCE OF
THE INTERNET AS A BUSINESS TOOL.

        Expansion in the sales of our MailKey solutions depends on the continued
acceptance of the Internet as a communications and commerce platform for
enterprises. The Internet could lose its viability as a business tool due to
delays in the development or adoption of new standard


                                       25
<PAGE>

and protocols to handle increase demands of Internet activity, security,
reliability, cost, ease-of-use, accessibility and quality of service. If the
Internet does not continue to be a widespread communications medium and
commercial platform, the demand for our MailKey solutions could be significantly
reduced, which could have a material adverse effect on our business, financial
condition and results of operations.

EVOLVING REGULATION OF THE INTERNET MAY AFFECT US ADVERSELY.

        As Internet commerce continues to evolve, increasing regulation by
federal, state or foreign agencies becomes more likely. Such regulation is
likely in the areas of user privacy, pricing, content and quality of products
and services. Taxation of Internet use or other charges imposed by government
agencies or by private organizations for accessing the Internet may also be
imposed. Laws and regulations applying to the solicitation, collection or
processing of personal or consumer information could affect our activities.
Furthermore, any regulation imposing fees for Internet use could result in a
decline in the use of the Internet and the validity of Internet commerce, which
could have a material adverse effect on our business, financial condition and
results of operations.

                         RISKS ASSOCIATED WITH OUR STOCK

WE INTEND TO ATTEMPT TO RAISE ADDITIONAL FUNDS IN THE FUTURE, AND SUCH
ADDITIONAL FUNDING MAY BE DILUTIVE TO STOCKHOLDERS OR IMPOSE OPERATIONAL
RESTRICTIONS.

        We intend to attempt to raise additional capital in the future to help
fund our operations through sales of shares of our common stock or securities
convertible into shares of our common stock, as well as issuances of debt. Such
additional financing may be dilutive to our stockholders, and debt financing, if
available, may involve restrictive covenants which may limit our operating
flexibility. If additional capital is raised through the issuances of shares of
our common stock or securities convertible into shares of our common stock, the
percentage ownership of our stockholders will be reduced. These stockholders may
experience additional dilution in net book value per share and any additional
equity securities may have rights, preferences and privileges senior to those of
the holders of our common stock.

THE MARKET PRICE OF OUR COMMON STOCK IS LIKELY TO BE HIGHLY VOLATILE AND SUBJECT
TO WIDE FLUCTUATIONS.

        The market price of our common stock is likely to be highly volatile and
could be subject to wide fluctuations in response to a number of factors that
are beyond our control, including:

        o       announcements of technological innovations or new products or
                services by our competitors;

        o       demand for any electronic messaging security solutions we
                develop, including fluctuations in license renewals; and

        o       fluctuations in revenue from our indirect sales channels.


                                       26
<PAGE>

        In addition, the market price of our common stock could be subject to
wide fluctuations in response to:

        o       quarterly variations in our revenues and operating expenses;

        o       announcements of technological innovations or new products or
                services by us; and

        o       our technological capabilities to accommodate the future growth
                in our operations or those of our customers.

        In addition, the stock market has experienced significant price and
volume fluctuations that have particularly affected the market price of the
stock of many Internet-related companies, and that often have been unrelated or
disproportionate to the operating performance of these companies. Market
fluctuations such as these may seriously harm the market price of our common
stock. Further, securities class action suits have been filed against companies
following periods of market volatility in the price of their securities. If such
an action is instituted against us, we may incur substantial costs and a
diversion of management attention and resources, which would seriously harm our
business, financial condition and results of operations.

IF WE EXPERIENCE SIGNIFICANT FLUCTUATIONS IN OUR OPERATING RESULTS OR FAIL TO
MEET REVENUE AND EARNINGS EXPECTATIONS, OUR STOCK PRICE MAY FALL.

        Due to our limited operating history and the unpredictability of the
developing messaging security industry, we may not be able to accurately
forecast our future operating results. We have not generated any revenues to
date. In addition, our expenses are to a large extent fixed in the short term,
and we expect that these expenses will increase in the future. We may not be
able to adjust our spending quickly enough if our expenses exceed our
expectations.

        Factors that could cause our quarterly financial results to fluctuate
include:

        o       the successful development of our products and implementation of
                our products by organizations;

        o       releases of new versions of our products and product upgrades,
                and the effect those new product releases will have on our
                ability to retain existing customers and to win new customers;

        o       the introduction of competitive products and the pricing of
                these products;

        o       reduced demand for our anti-spam, anti-virus and other products
                and services;

        o       significant increases in expenses to drive the growth of our
                business and international expansion, which may not yield
                corresponding increases in revenue;

        o       the effectiveness of future legislation in eliminating or
                reducing spam;

        o       changes in customer demands and needs for messaging security
                solutions; and


                                       27
<PAGE>

        o       fluctuations in currency exchange rates, particularly as we
                expand our international operations.

        As a result, we may not generate any revenues, and our earnings may be
harmed. We believe that period-to-period comparisons of our historical operating
results may not be meaningful, and you should not rely on them as an indication
of future performance.

WE DO NOT INTEND TO PAY DIVIDENDS.

        We have never declared or paid any cash dividends on our common stock.
We currently intend to retain any future profits from operations to fund growth
and do not expect to pay any dividends in the foreseeable future.

APPLICABLE SEC RULES GOVERNING THE TRADING OF "PENNY STOCKS" LIMITS THE TRADING
AND LIQUIDITY OF OUR COMMON STOCK WHICH MAY AFFECT THE TRADING PRICE OF OUR
COMMON STOCK.

        Our common stock currently trades on the OTC Bulletin Board. Since our
common stock trades at a price below $5.00 per share, our common stock is
considered a "penny stock" and is subject to SEC rules and regulations which
impose limitations upon the manner in which our shares can be publicly traded.
These regulations require the delivery, prior to any transaction involving our
stock, of a disclosure schedule explaining the penny stock market and the
associated risks. Under these regulations, certain brokers who recommend our
securities to persons other than established customers or certain accredited
investors must make a special written suitability determination regarding such a
purchaser and receive such purchaser's written agreement to the transaction
prior to sale. These regulations may have the effect of limiting the trading
activity of our common stock and reducing the liquidity of an investment in our
common stock.

ITEM 2.  DESCRIPTION OF PROPERTY

        Our corporate headquarters and principal offices are located at 130
Shaftesbury Avenue, London, England W1D 5EU, where we lease approximately 1,150
square feet of office space for a monthly service charge of approximately
$8,000. This lease expires within 12 months. We also lease approximately 1,060
square feet of office space at Shearway Business Park, Shearway Road,
Folkestrone, Kent CT19 4RH for a monthly service charge of approximately $3,500.
This office space is available on a rolling short term lease subject to
termination on 2 weeks' notice. We believe that our office space is adequate to
support our current operations and that adequate additional space is available
to support our operations over the next 12 months.

ITEM 3.  LEGAL PROCEEDINGS

        We are not currently a party to any material legal proceedings. We may
from time to time become involve in litigation relating to claims arising in the
ordinary course of our business.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

        None.


                                       28
<PAGE>

                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL
BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES

MARKET INFORMATION

        Our common stock currently trades on the OTC Bulletin Board under the
symbol "MAKY". The following table sets forth the range of high and low bid
prices for shares of our common stock on the OTC Bulletin Board for the periods
indicated, as reported by Nasdaq. These quotations represent inter-dealer
prices, without retail mark-up, markdown or commission, and may not represent
actual transactions.

        Fiscal Year Ended March 31, 2004            High            Low
        --------------------------------            ----            ---

        Quarter ended March 31, 2004               $3.25          $0.15
        Quarter ended December 31, 2003             0.15           0.15
        Quarter ended September 30, 2003            0.15           0.15
        Quarter ended June 30, 2003                 2.40           0.15

        Fiscal Year Ended March 31, 2003            High            Low
        --------------------------------            ----            ---

        Quarter ended March 31, 2003               $4.00          $2.40
        Quarter ended December 31, 2002             4.00           2.00
        Quarter ended September 30, 2002          144.00           3.20
        Quarter ended June 30, 2002               232.00          92.00

        The last price of our common stock as reported on the OTC Bulletin Board
on July 9, 2004, was $2.20 per share.

HOLDERS

        As of July 9, 2004, the number of stockholders of record of our common
stock was 293. Based on broker inquiry conducted in connection with the
distribution of an Information Statement on Schedule 14(f) on or about May 24,
2004, we believe that there are approximately 600 beneficial owners of our
common stock.

DIVIDENDS

        We have not paid any cash dividends on our common stock to date, nor do
we currently anticipate paying any cash dividends on our common stock in the
foreseeable future. We currently intend to retain future earnings, if any, to
finance the operation and development of our business.


                                       29
<PAGE>

TRANSFER AGENT

        The transfer agent for our common stock is Madison Stock Transfer, P.O.
Box 145, Brooklyn, NY 11229; (718) 627-4453.

RECENT SALES OF UNREGISTERED SECURITIES

        On February 12, 2004, we issued 200,000 shares of our common stock and
warrants to acquire 200,000 shares of our common stock to Corporate
Communications Network, Inc. for aggregate consideration of $65,000. The
warrants were exerciseable immediately at an exercise price of $.001 per share.
Corporate Communications Network, Inc. subsequently exercised all of the
warrants. These securities were issued to one accredited investor in a private
placement transaction exempt from the registration requirements of the
Securities Act pursuant to Section 4(2) of the Securities Act directly by us
without engaging in any advertising or general solicitation of any kind and
without payment of underwriting discounts or commissions to any person.

        On March 25, 2004, we issued 26,246,000 shares of our common stock to
the holders of MK Secure Solutions Limited's capital stock as consideration for
the acquisition of MK Secure Solutions Limited. These securities were issued to
a limited number of accredited investors in a private placement transaction
exempt from the registration requirements of the Securities Act pursuant to
Section 4(2) of the Securities Act and Rule 506 promulgated thereunder or
Regulation S under the Securities Act directly by us without engaging in any
advertising or general solicitation of any kind and without payment of
underwriting discounts or commissions to any person.

        On March 25, 2004, we issued 475,000 shares of our common stock to
Legend Advisory Services, Inc. as partial payment for certain advisory services
performed by Legend Advisory Services, Inc. in connection with our acquisition
of MK Secure Solutions Limited. These securities were issued to one accredited
investor in a private placement transaction exempt from the registration
requirements of the Securities Act pursuant to Section 4(2) of the Securities
Act directly by us without engaging in any advertising or general solicitation
of any kind and without payment of underwriting discounts or commissions to any
person.

        On March 25, 2004, we issued 300,000 shares of our common stock to
Jonathan D. Siegel as payment for certain consulting services he performed for
us subsequent to his resignation as our Chairman and Chief Executive Officer in
November 2002. These securities were issued to one accredited investor in a
private placement transaction exempt from the registration requirements of the
Securities Act pursuant to Section 4(2) of the Securities Act directly by us
without engaging in any advertising or general solicitation of any kind and
without payment of underwriting discounts or commissions to any person.


                                       30
<PAGE>

ITEM 6.  PLAN OF OPERATION

        This "Plan of Operation" and other parts of this report contain
forward-looking statements that involve risks and uncertainties. All
forward-looking statements included in this report are based on information
available to us on the date hereof, and we assume no obligation to update any
such forward-looking statements. Our actual results may differ materially from
those anticipated in these forward-looking statements as a result of a number of
factors, including those set forth under the caption "Risk Factors" in Item 1
and elsewhere in this report. The following should be read in conjunction with
our audited financial statements and the related notes thereto contained
elsewhere in this report.

OUR PLAN OF OPERATION

        We intend to become a leading messaging security solutions provider
focused on the provision of business services through a number of integrated
technology solutions we are developing internally as well as solutions we may
acquire through strategic acquisitions and partnerships.

        We intend to achieve this objective by becoming a market driven business
solutions company focused on offering value propositions and the delivery of
full service business solutions developed internally and acquired through
strategic acquisitions and partnerships. The key elements of our strategy
include: (i) establishing product and technology leadership for our solutions,
(ii) establishing a broad customer base in North America, Asia Pacific and
Europe, the Middle East and Africa, (iii) establishing an indirect sales channel
comprised of distributors, resellers, business outsourcing and hosted service
providers, large global systems integrators, OEMs and appliance vendors; and
(iv) engaging in strategic acquisitions and joint ventures.

        We intend to market our products and services through a combination of
indirect sales channels, including distributors, resellers, business outsourcing
and hosted service providers, large global systems integrators, original
equipment manufacturers and appliance vendors, as well as through the efforts of
a direct sales force. We are designing our software with the intention that it
be capable of supporting numerous hardware configurations, operating systems and
messaging applications and infrastructure, and to be deliverable as stand-alone
software, as an integrated part of the appliance solutions of distribution
partners, or as a hosted service.

        Our research and development activities are focused on the enhancement
of our current electronic messaging security solutions and on the development of
next-generation technologies in the anti-spam and antivirus market. We
anticipate that the majority of our research and development efforts will be
devoted to the internal development of complimentary technologies that we intend
to acquire from external sources, and that the remainder of such efforts will be
devoted to the internal development of our own proprietary technologies.

        We intend to acquire additional technologies that we believe are
complimentary to either our existing technologies or technologies that we are
developing or may attempt to develop in the future. In addition to acquisitions
of complimentary technologies described above, we intend to acquire companies,
businesses and assets that we believe are complementary to our business.


                                       31
<PAGE>

        We anticipate that the number of people who we employ will increase
substantially over the next 12 months as we continue to execute on our business
plan.

LIQUIDITY AND CAPITAL RESOURCES

        Since our inception, we have funded our operations primarily through
private sales of equity securities and the utilization of short-term convertible
debt. As of March 31, 2004, we had a cash balance of $437,523.

        On June 11, 2004, our wholly-owned subsidiary, MK Secure Solutions
Limited, completed a round of financing for aggregate cash proceeds of $650,000.
The proceeds were raised through the issuance of loans convertible into shares
of our common stock and warrants to acquire 650,000 shares of our common stock.
These securities were sold in loan units comprised of one (1) loan in the amount
of $50,000 and one (1) warrant. The loans have a maturity date of July 31, 2004
and bear interest at an annualized rate of 10%. The loans and any accrued
interest thereon are convertible into shares of our common stock at a conversion
price of $0.85 per share, and the warrants are exercisable into 50,000 shares of
our common stock at an exercise price of $1.00 per share. As of June 30, 2004,
all of the loans and accrued interest had been converted into shares of our
common stock.

        We do not currently maintain a line of credit or term loan with any
commercial bank or other financial institution. To date, our capital needs have
been principally met through the receipt of proceeds from sales of our equity
and debt securities.

        We believe that our current cash resources will not be sufficient to
sustain our current operations for the next twelve (12) months, and that we will
need to raise additional capital to execute our business plan. We intend to
obtain additional cash resources within the next twelve (12) months through
sales of debt or equity securities. The sale of additional equity or convertible
debt securities would result in additional dilution to our shareholders. The
issuance of additional debt would result in increased expenses and could subject
us to covenants that may have the effect of restricting our operations. We have
not made arrangements to obtain additional financing and we can provide no
assurance that financing, if required, will be available in amount or on terms
acceptable to us, if at all. If we are unable to obtain additional funds when
they are needed or if such funds cannot be obtained on terms favorable to us, we
may be required to delay or scale back any plans we may have to acquire such
companies, businesses, assets or technologies.

OFF-BALANCE SHEET ARRANGEMENTS

        As of March 31, 2004, we did not have any relationships with
unconsolidated entities or financial partners, such as entities often referred
to as structured finance or special purpose entities, that had been established
for the purpose of facilitating off-balance sheet arrangements or other
contractually narrow or limited purposes. As such, we are not materially exposed
to any financing, liquidity, market or credit risk that could arise if we had
engaged in such relationships.


                                       32
<PAGE>

CRITICAL ACCOUNTING POLICIES

        Our discussion and analysis of our financial condition and results of
operations are based upon our consolidated financial statements and accompanying
notes, which have been prepared in accordance with accounting principals
generally accepted in the United States. The preparation of these financial
statements requires management to make estimates and assumptions that affect the
reported amounts of assets, liabilities, revenues and expenses, and related
disclosure of contingent assets and liabilities. When making these estimates and
assumptions, we consider our historical experience, our knowledge of economic
and market factors and various other factors that we believe to be reasonable
under the circumstances. Actual results may differ under different estimates and
assumptions.

        The accounting estimates and assumptions discussed in this section are
those that we consider to be the most critical to an understanding of our
financial statements because they inherently involve significant judgments and
uncertainties.

REVENUE RECOGNITION

        We intend to recognize revenue in accordance with Statement of Position
97-2, SOFTWARE REVENUE RECOGNITION ("SOP 97-2"). Significant management
judgments and estimates must be made and used in connection with the revenue
recognized in any accounting period. Specifically, in connection with each
transaction involving our products, we must evaluate whether persuasive evidence
of an arrangement exists, the product has been delivered, title and risk of lost
has been transferred to the customer, the fee is fixed or determinable, and
collection of the resulting receivable is reasonably assured. Material
differences may result in the amount and timing of recognized revenue for any
period if we make different judgments or utilize different estimates.

ITEM 7.   FINANCIAL STATEMENTS

          See Financial Statements beginning on page F-1.

ITEM 8.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

        Not applicable.

ITEM 8A.  CONTROLS AND PROCEDURES

        An evaluation of the effectiveness of our "disclosure controls and
procedures" (as such term is defined in Rules 13a-15(e) or 15d-15(e) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) was carried
out by us under the supervision and with the participation of Graham
Norton-Standen, our then current chief executive officer and chief financial
officer. Based upon that evaluation, Mr. Norton-Standen concluded that, as of
the end of the period covered by this Annual Report, our disclosure controls and
procedures were effective to provide reasonable assurance that information we
are required to disclose in reports


                                       33
<PAGE>

that we file or submit under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the Securities and Exchange
Commission rules and forms. There has been no change in our internal control
over financial reporting identified in connection with that evaluation that
occurred during our most recent fiscal quarter that has materially affected, or
is reasonably likely to materially affect, our internal control over financial
reporting.

                                    PART III

ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

        The following sets forth certain information about each of our directors
and executive officers.

Name                     Age                     Positions Held
----                     ---                     --------------
Graham Norton-Standen    47      Chairman of the Board, Chief Executive Officer,
                                 President and Secretary
Roger B. Ponting         39      Chief Financial Officer and Treasurer
Tim Dean-Smith           38      Deputy Chairman

        The following is a brief summary of the business experience of each of
our directors and executive officers:

        GRAHAM NORTON-STANDEN has been our Chairman, Chief Executive Officer and
Secretary since the closing of the merger on March 25, 2004, and has been the
Chairman and Chief Executive Officer of MK Secure Solutions Limited since March
2004. Since April 2001, Mr. Norton-Standen has been the Chairman and Chief
Executive Officer of Applied Intelligence Group, Inc., a provider of business
transformation and structured investment services covering Europe, North America
& Asia Pacific. From September 1999 to April 2001, Mr. Norton-Standen was the
Chief Executive Officer of Gartner International, an information technology
research company, where he was responsible for the business conducted by the
company outside the United States. Mr. Norton-Standen was the President of the
Strategic Growth Markets Group within Electronic Data Systems Corporation
("EDS"), an outsourcing company, from June 1996 to June 1999, where he oversaw
the group's operations in 13 countries throughout Europe, the Middle East and
Africa, and prior to that was the Managing Director for EDS' Communications and
Media Division. Prior to that, Mr. Norton-Standen was employed by Digital
Equipment Corporation in a number of management roles, and acted in an advisory
capacity for a number of organizations, including the United States Trade and
Investment Council in Brussels, the Electrical Power Research Institute in the
United States, the Centre for European Policy Studies in Brussels and the
Federation of Electronics Industry in the United Kingdom. Mr. Norton-Standen has
also acted as an advisor for a number of companies, including British Telecom,
Hewlett Packard, Deutsche Bank, Reuters and ING Baring.

        ROGER B. PONTING has been our Chief Financial Officer since June 1,
2004. Mr. Ponting has a diversified background based upon experience gained from
both practice and industry within the software development and Internet service
provider sectors. From August 2002 to May 2004, Mr. Ponting was involved in
various ongoing financial management activities,


                                       34
<PAGE>

including being employed as a consultant to various private equity clients. From
September 2003 to May 2004, Mr. Ponting was the Chief Financial Officer of Net
Acquisitions, Inc., an internet service provider outsourced management vehicle.
>From November 2000 to July 2002, Mr. Ponting held various senior financial
positions with FFastfill plc, an independent software development vendor listed
on the London Alternative Investment Market. From July 1997 to October 2000, Mr.
Ponting was employed by PricewaterhouseCoopers, an international accounting
firm, where he operated in both audit and transaction services management roles.
Prior to that, Mr. Ponting was an accountant with various provincial accounting
firms, gaining considerable financial experience working with small to
medium-sized enterprises. Mr. Ponting has also worked on a consulting basis with
a number of private equity clients. Mr. Ponting is a Chartered Certified
Accountant. In addition, Mr. Ponting has an MBA that he received from the
University of Hertfordshire during 2002.

        TIM DEAN-SMITH has been our Deputy Chairman since the closing of the
merger on March 25, 2004. Mr. Dean-Smith founded MK Secure Solutions Limited,
our now wholly-owned subsidiary, and served as its Chairman and Chief Executive
Officer from its inception in March 2003 until February 2004. Mr. Dean-Smith has
been providing venture capital and/or management and fund-raising services to
the following companies since the dates specified: (i) Polestar Space
Applications, an internet/GPS asset tracking business specializing in the
commercial shipping and yachting markets, since October 1998; (ii) Nextbus, a
San Francisco based company that provides real time bus arrival information to
passengers via the internet and mobile phone networks, since March 1996; (iii)
ByBox, a logistics solutions company that produces locker banks that can be
remotely programmed to enable the secure delivery of letters and parcels by
couriers for consumers and businesses, since August 1999; (iv) Siam Supper Club,
a restaurant and jazz bar located in Phuket, Thailand, since November 2002; and
(v) Power Pacific, a real estate brokerage firm located in Phuket, Thailand that
engages in the acquisition, disposition and leasing of residential and
non-residential real estate, since November 2002. In November 1998, Mr.
Dean-Smith was an early investor in Valuad, a financial analysis software
company that was acquired in July 2001, and in April 1999 was an early investor
in Ibidlive, a technology company that enabled real time bidding in auctions via
the internet, fixed phone lines and mobile phones and in which QXL PLC acquired
a controlling stake in December 1999. Mr Dean-Smith was a founding investor and
Chairman of Cube8 Group, an internet investment company, from August 1999 until
its merger with Room Service Deliveries (UK) Limited in January 2002. From 1992
to 1996, Mr. Dean-Smith engaged in the purchase, investment and development or
refurbishment of commercial property and residential properties in London,
England. Mr. Dean-Smith studied for an MBA at London Business School and the
Haas School of Business (University of California, Berkeley), receiving his MBA
in 1995, and studied law at King's College in London, graduating with an LLB
with Honors in 1997.

BOARD OF DIRECTORS

        Our Board of Directors is currently comprised of Graham Norton-Standen
and Tim Dean-Smith. Each of Messrs. Norton-Standen and Dean-Smith will serve as
Directors until the next annual meeting of shareholders or until their
respective successor is duly elected and qualified. Directors are elected at the
annual meeting of shareholders or by written consent of the shareholders, and
each Director holds office until his successor is duly elected and qualified or
he resigns, unless sooner removed. Officers are elected annually by our Board of
Directors and


                                       35
<PAGE>

serve at the discretion of the Board. During the fiscal year ended March 31,
2004, the Board of Directors held no meetings. All actions of the Board of
Directors were taken by written consent. We do not currently have any committees
of our Board of Directors.

DIRECTOR COMPENSATION

        We paid compensation in the amount of $97,500 to each of Messrs. Shaffer
and Bills during the fiscal year ended March 31, 2004. Each payment consisted of
a grant of 650,000 shares of our common stock. The grants were made under our
2001 Employee Stock Compensation Plan for the services they performed since the
date of their appointment to the Board in November 2002. The value of the
compensation was calculated based on the closing price of $.15 per share on the
OTC Bulletin Board on March 25, 2004, the date of grant. No other compensation
was paid to any of our other Directors during the fiscal year ended March 31,
2004.

        With the exception of Tim Dean-Smith, members of our Board of Directors
receive no compensation for serving on our Board. Mr. Dean Smith receives annual
compensation of approximately $136,500 for services rendered as our Deputy
Chairman. Members of our Board are entitled to be reimbursed for the reasonable
costs and expenses incurred in attending Board meetings.

DIRECTOR NOMINATIONS

        We currently have approximately 23 employees and conduct limited
operations. As a result, our Board of Directors is currently comprised of only
two individuals, Graham Norton-Standen and Tim Dean-Smith. Each of Messrs.
Norton-Standen and Dean-Smith are integrally involved with our business and
operations and are able to contribute valuable insights into the identification
of suitable candidates for nomination to the Board. As a result, we believe that
it is in our best interest that our entire Board oversee the composition and
operations of our Board of Directors and therefore, we have not created a
standing nominating committee of the Board.

SHAREHOLDER COMMUNICATIONS

        In light of the limited operations we conduct and the limited number of
record and beneficial shareholders that we have, we have not implemented any
formal procedures for shareholder communication with our Board of Directors. Any
matter intended for the Board, or for any individual member or members of the
Board, should be directed to our corporate secretary at MailKey Corporation, 130
Shaftesbury Avenue, London, England W1D 5EU. In general, all shareholder
communication delivered to the corporate secretary for forwarding to the Board
or specified Board members will be forwarded in accordance with the
shareholder's instructions. However, the corporate secretary reserves the right
to not forward to Board members any abusive, threatening or otherwise
inappropriate materials.


                                       36
<PAGE>

AUDIT COMMITTEE AND AUDIT COMMITTEE FINANCIAL EXPERT

        Our Board of Directors has not created a standing audit committee of the
Board. Instead, our full Board of Directors acts as our audit committee.

        To date, we have conducted limited operations since inception and have
not yet generated any revenue. In light of the foregoing, and upon evaluating
our internal controls, our Board of Directors determined that our internal
controls are adequate to insure that financial information is recorded,
processed, summarized and reported in a timely and accurate manner in accordance
with applicable rules and regulations of the Securities and Exchange Commission.
Accordingly, our Board of Directors concluded that the benefits of retaining an
individual who qualifies as an "audit committee financial expert," as that term
is defined in Item 401(e) of Regulation S-B promulgated under the Securities
Act, would be outweighed by the costs of retaining such a person. As a result,
no member of our Board of Directors is an "audit committee financial expert."

SECTION 16 BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

        Section 16(a) of the U.S. Securities and Exchange Act of 1934, as
amended (the "Exchange Act"), requires our officers and directors and persons
who own more than ten percent (10%) of our common stock to file with the SEC
initial reports of ownership and reports of changes in ownership of our common
stock. Such officers, directors and ten percent (10%) stockholders are also
required by applicable SEC rules to furnish to us copies of all forms filed with
the SEC pursuant to Section 16(a) of the Exchange Act. Based solely on our
review of the copies of such forms received by us or written representations
from such persons that no other reports were required for such persons, we
believe that during the fiscal year ended March 31, 2004, all Section 16(a)
filing requirements applicable to our officers, directors and ten percent (10%)
stockholders were satisfied in a timely fashion.

CODE OF BUSINESS CONDUCT AND ETHICS

        We have adopted a Code of Business Conduct and Ethics that applies to
our principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar functions. Our
Code of Business Conduct and Ethics is designed to deter wrongdoing and promote:
(i) honest and ethical conduct, including the ethical handling of actual or
apparent conflicts of interest between personal and professional relationships;
(ii) full, fair, accurate, timely and understandable disclosure in reports and
documents that we file with, or submit to, the SEC and in our other public
communications; (iii) compliance with applicable governmental laws, rules and
regulations; (iv) the prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and (v) accountability for
adherence to the Code of Ethics.

        A copy of our Code of Business Conduct and Ethics is attached hereto as
Exhibit 14.1 and incorporated by reference herein. You may also obtain a copy of
our Code of Business Conduct and Ethics by visiting our website at
www.mailkey.com.


                                       37
<PAGE>

ITEM 10.  EXECUTIVE COMPENSATION

        The following table provides certain summary information concerning
compensation paid to or accrued by the executive officers named below during the
fiscal years ended March 31, 2004, 2003 and 2002.

<TABLE>
<CAPTION>
                                        SUMMARY COMPENSATION TABLE

                                                        ANNUAL COMPENSATION
Name and                                                                                All Other
Principal Position                  Fiscal Year      Salary ($)        Bonus ($)        Compensation ($)
------------------                  -----------      ----------        ---------        ----------------

<S>                                    <C>              <C>                <C>                 <C>
Graham Norton-Standen                  2004             7,182             -0-                 -0-
CHAIRMAN, CHIEF EXECUTIVE
OFFICER AND SECRETARY

Andrew J. Kacic (1)                    2004               -0-             -0-               3,750 (2)
FORMER CHAIRMAN AND                    2003               -0-             -0-                 -0-
CHIEF EXECUTIVE OFFICER
</TABLE>

(1) Mr. Kacic was an executive officer and Director of the Company from November
2002 until his resignation on March 26, 2004.

(2) Consisted of 25,000 shares of our common stock issued to Mr. Kacic under the
Company's 2001 Employee Stock Compensation Plan, calculated based on the closing
price of $.15 per share on the OTC Bulletin Board on March 25, 2004, the date of
grant.

        Graham Norton Standen, our Chairman, Chief Executive Officer and
Secretary, receives annual compensation in the amount of approximately $420,000.
Roger B. Ponting, our Chief Financial Officer, receives annual compensation in
the amount of approximately $140,000.

                      OPTION/SAR GRANTS IN LAST FISCAL YEAR
                               (INDIVIDUAL GRANTS)

        We did not grant any stock options or stock appreciation rights to any
of our named executive officers during the fiscal year ended March 31, 2004.


                                       38
<PAGE>

                       AGGREGATED OPTION/SAR EXERCISES IN
             LAST FISCAL YEAR AND FISCAL YEAR-END OPTION/SAR VALUES

        No stock options or stock appreciation rights were exercised by any of
our named executive officers during the fiscal year ended March 31, 2004, and no
stock appreciation rights were issued and outstanding at the end of such fiscal
year.

        The following table provides certain summary information concerning the
number of stock options exercised by such executive officers during the fiscal
year ended March 31, 2004, and the aggregate number and value of options issued
and outstanding at the end of such fiscal year.

<TABLE>
<CAPTION>
                                                              Number of Securities       Value of Unexercised
                                                                  Underlying                 In-the-Money
                                                               Unexercised Options           Options at
                                Shares                       at Fiscal Year-End (#)        Fiscal Year-End ($)
                              Acquired on        Value            Exercisable/              Exercisable/
Name                           Exercise        Realized          Unexercisable              Unexercisable (1)
----                           --------        --------          -------------              -------------
<S>                            <C>             <C>           <C>                        <C>
Graham Norton-Standen            ---             ---         366,600 / 1,133,400 (2)    1,173,120 / 3,626,880
Andrew J. Kacic                  ---             ---                  ---                         ---
</TABLE>

(1) The last price of our common stock as reported on the OTC Bulletin Board on
March 31, 2004, was $3.20 per share.

(2) Mr. Norton-Standen was granted options to acquire 15,000 ordinary shares of
MK Secure Solutions Limited on December 1, 2003, in connection with his
appointment as the Chairman and Chief Executive Officer of MK Secure Solutions
Limited. Upon our acquisition of MK Secure Solutions Limited on March 25, 2004,
these securities automatically converted into options to acquire 1,500,000
shares of our common stock.

            LONG-TERM INCENTIVE PLANS AND AWARDS IN LAST FISCAL YEAR

        We did not make any awards under long-term incentive plans to any of our
named executive officers during the fiscal year ended March 31, 2004.


                                       39
<PAGE>

                      EQUITY COMPENSATION PLAN INFORMATION

        The following table provides information as of March 31, 2004 with
respect to shares of our common stock that may be issued under our existing
equity compensation plan.

<TABLE>
<CAPTION>
                                                                                             Number of securities
                                                   Number of             Weighted-           remaining available
                                               securities to be           average            for future issuance
                                                 issued upon           exercise price            under equity
                                                  exercise of          of outstanding        compensation plans
                                                  outstanding             options,          (excluding securities
                                               options, warrants          warrants               reflected in
                                                  and rights             and rights                column (a))
                                                     (a)                    (b)                        (c)
<S>                                             <C>                <C>                          <C>
Equity compensation plans
   approved by security holders (1)                    ---             Not applicable             3,675,000

Equity compensation plans not                          ---             Not applicable             1,500,000
   approved by security holders (2)
                                                       ---             Not applicable             5,175,000
         Total
</TABLE>

(1) Consists of the 2001 Employee Stock Compensation Plan.

(2) Consists of the MK Secure Solutions Limited Employee Benefit Trust.


DESCRIPTION OF PLANS NOT APPROVED BY SECURITY HOLDERS

        In March 2004, the board of directors of MK Secure Solutions Limited
adopted the MK Secure Solutions Limited Employee Benefit Trust (the "Trust").
The Trust provides for the distribution by one or more trustees ("Trustees") of
income, property and other assets of the Trust ("Trust Property") to current and
former employees and directors of MK Secure Solutions Limited, or any parent to
or subsidiaries of MK Secure Solutions Limited, as well as members of such
persons' immediate family (the "Beneficiaries"). The Trust was formed for the
purpose of providing incentives to the Beneficiaries to exert maximum efforts
for the success of MK Secure Solutions Limited.

        The Trust has been funded with approximately $12,500 and 1,500,000
shares of our common stock. Under the terms of the Trust, Trustees may
distribute the Trust Property for the benefit of any one or more of the
Beneficiaries in such manner as the Trustees determine in their sole discretion.
The Trustees are entitled to remuneration for services performed as well as
reimbursement of reasonable expenses incurred in the performance of such
services. Trustees may be appointed to and removed from the Trust in MK Secure
Solutions Limited's sole discretion. The current Trustee is Confiance Limited, a
Guernsey private limited company.

        As of June 30, 2004, the Trustee had not made any distributions of Trust
Property to any Beneficiaries.


                                       40
<PAGE>

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

        The following table sets forth, as of July 9, 2004, information with
respect to the securities holdings of all persons that we, pursuant to filings
with the SEC and our stock transfer records, have reason to believe may be
deemed the beneficial owner of more than five percent (5%) of the common stock.
The following table also sets forth, as of such date, the beneficial ownership
of the common stock by all of our executive officers and directors, both
individually and as a group. The beneficial owners set forth below have been
determined in accordance with Rule 13d-3 under the Securities Exchange Act of
1934, as amended. Unless otherwise indicated, each person or entity named below
has sole voting and investment power with respect to all common stock
beneficially owned by that person or entity, subject to the matters set forth in
the footnotes to the table below, and has an address of 130 Shaftesbury Avenue,
London, England W1D 5EU.

<TABLE>
<CAPTION>
                                                                           Amount and
                                                                            Nature of               Percentage
Name and Address of Beneficial Owner                                  Beneficial Ownership         of Class (1)
------------------------------------                                  --------------------         ---------
<S>                                                                    <C>                           <C>
Graham Norton-Standen                                                    1,500,000 (2)                 4.9%

Tim Dean-Smith                                                           4,982,752 (3)                16.9%

Roger B. Ponting                                                            30,000                       *

Westvale Consultants Limited                                             3,332,752 (4)                11.4%

Andrew J. Kacic                                                                ---                       *
7025 E. First Avenue
Suite 5
Scotsdale, Arizona 85251

Confiance Limited, as Trustee for                                        1,500,000 (5)                 5.1%
   MK Secure Solutions Limited
   Employee Benefit Trust
5-7 Victoria Road
St. Peter Port
Guernsey Channel Islands GY1 1HU

Mercury Limited                                                          1,600,000 (6)                 5.5%
CTV House
La Pouquelaye
St. Helier
United Kingdom JE2 3GF

All directors and executive officers as a group                            6,512,752                  21.0%
</TABLE>
---------------------


                                       41
<PAGE>

* Less than one percent (1%).

(1) The percentages have been calculated based upon 29,355,251 shares of common
stock outstanding as of July 9, 2004 plus, for each person or group, the number
of shares of our common stock issuable upon the exercise of any convertible
securities beneficially owned by such person or group.

(2) Includes 1,500,000 shares issuable upon the exercise of outstanding options.

(3) Includes 3,332,752 shares owned by Westvale Consultants Limited, over which
Mr. Dean-Smith has sole voting and investment power, and 150,000 shares issuable
upon the exercise of outstanding options.

(4) The power to vote and dispose of these shares is controlled by Mr.
Dean-Smith.

(5) The power to vote and dispose of these shares is controlled by the members
of the board of directors of MK Secure Solutions Limited.

(6) The power to vote and dispose of these shares is controlled by Paul Hesketh.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

        On February 12, 2004, we issued 200,000 shares of our common stock and a
warrant to acquire 200,000 shares of our common stock to Corporate
Communications Network, Inc. for total consideration of $65,000. At the time of
the issuance, Corporate Communications Network, Inc. was the beneficial owner of
more than five percent (5%) of our common stock.


                                       42
<PAGE>

ITEM 13.  EXHIBITS, LIST AND REPORTS ON FORM 8-K

(a)     The following documents are filed as exhibits to this report.


Exhibit No.                                        Description
-----------                                        -----------

     3.1        Articles of Incorporation (incorporated by reference to Exhibit
                3.1(1) to the Company's Registration Statement on Form 10SB
                filed with the SEC on February 3, 2000 (the "Registration
                Statement"))

     3.2        Bylaws (incorporated by reference to Exhibit 3.2 to the
                Registration Statement)

     3.3        Articles of Amendment to Articles of Incorporation (incorporated
                by reference to Exhibit 3.1(2) to the Registration Statement)

     3.4        Articles of Amendment to Articles of Incorporation (incorporated
                by reference to Exhibit 3.1(3) to the Company's Annual Report on
                Form 10-KSB for the year ended March 31, 2003)

     3.5        Certificate of Correction to Articles of Amendment to Articles
                of Incorporation (incorporated by reference to Exhibit 3.1(4) to
                the Company's Annual Report on Form 10-KSB for the year ended
                March 31, 2003)

     4.1        Specimen Stock Certificate (incorporated by reference to Exhibit
                4.1 to the Registration Statement)

    10.1        Stock Purchase and Sale Agreement, dated as of February 5, 2003,
                by and between MailKey Corporation (f/k/a/ Sutton Trading
                Solutions, Inc.) and Link Investment Holdings Inc. Limited
                (incorporated by reference to Exhibit 10.1 to the Company's
                Quarterly Report on Form 10-QSB for the quarter ended December
                31, 2002)

    14.1        Code of Business Conduct and Ethics

    21.1        Subsidiaries of the Company

    31.1        Certification of Chief Executive Officer of the Company required
                by Rule 13a-14(a) under the Securities Exchange Act of 1934, as
                amended

    31.2        Certification of Chief Financial Officer of the Company required
                by Rule 13a-14(a) under the Securities Exchange Act of 1934, as
                amended

    32.1        Certification of Chief Executive Officer and Chief Financial
                Officer of the Company required by Rule 13a-14(b) under the
                Securities Exchange Act of 1934, as amended


                                       43
<PAGE>

(b)     Reports on Form 8-K.

        None.

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

        The following table presents fees for professional audit services
performed by L J Soldinger Associates, LLC for the audit of our annual financial
statements for the fiscal year ended March 31, 2004 and fees billed for other
services rendered by L J Soldinger Associates, LLC during such year, and
professional audit services performed by Spicer Jeffreys LLC for the audit of
our annual financial statements for the fiscal year ended March 31, 2003, and
fees billed for other services rendered by Spicer Jeffreys LLC during such year.

                                                  2004                   2003
                                                  ----                   ----

Audit Fees:                                  $[______]                 $6,000

Audit-Related Fees:                          $[______]                    -0-

Tax Fees:                                          -0-                    -0-

All Other Fees:                                    -0-                    -0-
                                       ----------------        ---------------

Total:                                       $[______]                 $6,000
                                       ================        ===============

AUDIT FEES consist of fees billed for professional services rendered for the
audit of our financial statements and review of the interim financial statements
included in quarterly reports and services that are normally provided by our
independent accountants in connection with statutory and regulatory filings or
engagements.

AUDIT-RELATED FEES consist of fees billed for assurance and related services
that are reasonably related to the performance of the audit or review of our
consolidated financial statements and are not reported under "Audit Fees."

TAX FEES consists of fees billed for professional services for tax compliance,
tax advice and tax planning. These services include assistance regarding federal
and state tax compliance, tax audit defense, customs and duties, and mergers and
acquisitions.

ALL OTHER FEES consist of fees billed for products and services provided by the
principal accountant, other than those services described above.

AUDIT COMMITTEE PRE-APPROVAL PROCEDURES

        Our Board of Directors serves as our audit committee. Our Board of
Directors approves the engagement of our independent auditors, and meets with
our independent auditors to approve


                                       44
<PAGE>

the annual scope of accounting services to be performed and the related fee
estimates. It also meets with our independent auditors, on a quarterly basis,
following completion of their quarterly reviews and annual audit and prior to
our earnings announcements, if any, to review the results of their work. During
the course of the year, our chairman has the authority to pre-approve requests
for services that were not approved in the annual pre-approval process. The
chairman reports any interim pre-approvals at the following quarterly meeting.
At each of the meetings, management and our independent auditors update the
Board of Directors with material changes to any service engagement and related
fee estimates as compared to amounts previously approved. During the fiscal year
ended March 31, 2004, all audit and non-audit services performed by our
independent accountants were pre-approved by the Board of Directors in
accordance with the foregoing procedures.



                                       45

<PAGE>



                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)

                              FINANCIAL STATEMENTS


                                 MARCH 31, 2004

<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)

<TABLE>
<CAPTION>
                                                                                 Page(s)
                                                                               ----------
<S>                                                                            <C>
Report of Independent Registered Public Accounting Firm                           F-2

Consolidated Balance Sheets                                                       F-3

Consolidated Statements of Operations                                             F-4

Consolidated Statements of Comprehensive Loss                                     F-5

Consolidated Statements of Cash Flows                                             F-6

Consolidated Statements of Shareholders' Deficit                               F-7 - F-10

Notes to Financial Statements                                                     F-11
</TABLE>

<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders
Mailkey Corporation
Road Town, Tortola, British Virgin Islands

We have audited the accompanying consolidated balance sheets of Mailkey
Corporation and subsidiaries (a development stage entity) as of March 31, 2004
and December 31, 2003, and the related consolidated statements of operations,
comprehensive loss, shareholders' deficit and cash flows for the three months
ended March 31, 2004 and the period March 11, 2003 (inception) through December
31, 2003. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Mailkey
Corporation and subsidiaries as of March 31, 2004 and December 31, 2003 and the
consolidated results of its operations, comprehensive loss, shareholders'
deficit, and cash flows for the three months ended March 31, 2004 and the period
March 11, 2003 (inception) through December 31, 2003, in conformity with
accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming the company
will continue as a going concern. As discussed in Note 4 to the financial
statements, the company has incurred net losses since inception. Also, the
Company has not recognized any revenue and does not have sufficient funds to
execute its business plan. These conditions raise substantial doubt about the
Company's ability to continue as a going concern. Management's plans regarding
those matters are also described in Note 4. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.

L J SOLDINGER ASSOCIATES LLC


Deer Park, Illinois
July 13, 2004


                                      F-2
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                           Consolidated Balance Sheets

<TABLE>
<CAPTION>
                                                      ASSETS
                                                      ------
                                                                                    March 31,         December 31,
                                                                                      2004                2003
                                                                                  ------------        ------------
Current Assets
<S>                                                                                <C>                 <C>
   Cash                                                                            $  437,523          $   68,282
   Prepaid assets                                                                      57,941              13,262
   Subscription receivable-collected April 2004                                       403,000                   -
                                                                                  ------------        ------------

Total Current Assets                                                                  898,464              81,544

Property and equipment, net                                                            63,259              34,816
                                                                                  ------------        ------------

Total Assets                                                                       $  961,723          $  116,360
                                                                                  ============        ============

                                      LIABILITIES AND SHAREHOLDERS' DEFICIT
                                      -------------------------------------

Current Liabilities
    Short-term loan payable - related party                                        $   43,087          $   61,660
    Short-term loans payable                                                          465,701                   -
    Accrued liabilities                                                               582,681             203,728
                                                                                  ------------        ------------

Total Current Liabilities                                                           1,091,469             265,388
                                                                                  ------------        ------------

Commitments and Contingencies

Shareholders' Deficit
    Minority interest                                                                       -                   -
    Common shares $0.001 par, 100,000,000 and 470,000,000 shares
      authorized, 28,865,238 and 21,895,000 issued and outstanding, at
      2004 and 2003, respectively                                                      28,865              21,895
    Additional paid-in capital                                                      6,688,205           1,977,481
    Accumulated foreign exchange translation adjustment                                 6,204               9,251
    Deficit accumulated during the development stage                               (4,667,885)         (2,157,655)
    Deferred compensation                                                          (1,922,635)                  -
    Subscriptions receivable                                                         (262,500)                  -
                                                                                  ------------        ------------

Total Shareholders' Deficit                                                          (129,746)           (149,028)
                                                                                  ------------        ------------

Total Liabilities and Shareholders' Deficit                                        $  961,723          $  116,360
                                                                                  ============        ============
</TABLE>

                 See notes to consolidated financial statements.

                                      F-3
<PAGE>

                       MAILKEY CORPORATIONAND SUBSIDIARIES
                          (A Development Stage Entity)
                      Consolidated Statements of Operations

<TABLE>
<CAPTION>
                                                                January 1, 2004          March 11,
                                                                       to             (Inception) to
                                                                 March 31, 2004      December 31, 2003
                                                                ---------------      -----------------
<S>                                                               <C>                  <C>
Revenues                                                          $          -         $          -

Operating Expenses
    Software development and other compensation                      1,607,561            1,474,195
    Consulting fees - related party                                    260,530              246,637
    Legal and professional fees                                        246,337              227,446
    Other selling, general and administrative                          325,320              210,541
                                                                ---------------      -----------------

Total Operating Expenses                                             2,439,748            2,158,819
                                                                ---------------      -----------------

Loss from Operations                                                (2,439,748)          (2,158,819)

Interest expense                                                       (70,605)                  -
Interest income                                                            123                  753
                                                                ---------------      -----------------

Loss Before Minority Interest                                       (2,510,230)          (2,158,066)

Minority Interest in Losses of Subsidiaries                                  -                  411
                                                                ---------------      -----------------

Net Loss                                                          $ (2,510,230)        $ (2,157,655)
                                                                ===============      =================

Basic and Diluted Loss Per Share                                  $      (0.11)        $      (0.16)
                                                                ===============      =================

Weighted Average Shares Outstanding                                 23,558,027           13,615,177
                                                                ===============      =================
</TABLE>

                 See notes to consolidated financial statements.

                                      F-4
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                  Consolidated Statements of Comprehensive Loss

<TABLE>
<CAPTION>
                                                                January 1, 2004          March 11
                                                                      to              (Inception) to
                                                                March 31, 2004       December 31, 2003
                                                                ---------------      -----------------
<S>                                                               <C>                  <C>
   Net loss                                                       $ (2,510,230)        $ (2,157,655)

    Foreign Currency Translation Adjustments                           (3,047)                9,251
                                                                ---------------      -----------------

    Comprehensive Loss                                            $ (2,513,277)        $ (2,148,404)
                                                                ===============      =================
</TABLE>

                 See notes to consolidated financial statements.

                                      F-5
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                  January 1, 2004         March 11
                                                                         to            (Inception) to
                                                                   March 31, 2004    December 31, 2003
                                                                 ----------------    -----------------
Cash Flows from Operating Activities
<S>                                                                <C>                  <C>
    Net loss                                                       $ (2,510,230)        $ (2,157,655)
    Adjustments to reconcile net loss to net cash
        used in operating activities:
      Depreciation and amortization                                       5,127                9,785
      Amortization of debt discount and beneficial
        conversion feature                                               62,428                    -
      Amortization of deferred compensation                             163,888                    -
      Stock-based compensation                                          970,200              658,522
      Minority interest share in losses of subsidiaries                       -                (411)
      Increase (decrease) in cash flows due to changes in
        operating assets and liabilities:
      Prepaid assets                                                    (44,679)             (13,262)
      Accounts payable and accrued liabilities                          378,953              203,728
                                                                 ----------------     ----------------

Net Cash Used in Operating Activities                                  (974,313)          (1,299,293)
                                                                 ----------------     ----------------

Cash Flows from Investing Activities
    Acquisition of property and equipment                               (33,570)             (44,601)
                                                                 ----------------     ----------------

Net Cash Used in Investing Activities                                   (33,570)             (44,601)
                                                                 ----------------     ----------------

Cash Flows from Financing Activities
    Proceeds of short-term loans payable -
      related party                                                      19,857               61,660
    Repayment of proceeds of short-term loans payable -
      related party                                                     (38,430)                   -
    Issuance of subsidiary shares to minority interests                       -                  411
    Issuance of common share capital                                    842,500            1,490,644
    Expenditures for offering costs                                     (93,756)            (149,790)
    Proceeds from short-term debt and
      related warrants                                                  650,000                    -
                                                                 ----------------     ----------------

Net Cash Provided by Financing Activities                             1,380,171            1,402,925
                                                                 ----------------     ----------------

Effect of Exchange Rate Changes on Cash                                  (3,047)               9,251
                                                                 ----------------     ----------------

Net Increase in Cash                                                    369,241               68,282

Cash, Beginning of period                                                68,282                    -
                                                                 ----------------     ----------------

Cash, End of period                                                $    437,523         $     68,282
                                                                 ================     ================

Supplemental Disclosures of Cash Flow Information
    Cash paid during the period for:
       Interest                                                    $          -         $          -
                                                                 ================     ================
       Income Tax                                                  $          -         $          -
                                                                 ================     ================
</TABLE>

                 See notes to consolidated financial statements.

                                      F-6
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                Consolidated Statements of Shareholders' Deficit

<TABLE>
<CAPTION>
                                                                                 Common Shares
                                                  Minority            --------------------------------------
                                                  Interest                Shares               Amount
                                                --------------        ----------------    ------------------
<S>                                                 <C>                                          <C>
Balance at March 11, 2003
  (Date of Inception)                               $     -                       -              $      -

Issuance of "founders" shares
  at $0.001 per share - March                             -               8,692,900                 8,693

Issuance of shares at $0.05 per share
  for $0.001 cash and $0.0499                             -               5,110,397                 5,110
  services - October

Issuance of shares at $0.05 per share
  for cash - October                                      -               1,976,318                 1,976

Issuance of shares at $0.05 per share
  for services - October                                  -                 483,800                   484

Issuance of shares and warrants at
  $0.25 per share plus 1/2 of a warrant - Jun - Aug       -               3,306,000                 3,306

Issuance of shares valued at $0.1919
  per share for services - Jun - Aug                      -               1,230,585                 1,231

Issuance of shares and warrants at
  $0.50 per share plus 1/2 of a warrant - Aug - Nov       -                 490,000                   490

Issuance of shares valued at $0.3878
  per share for services - Aug - Nov                      -                 230,000                   230

Issuance of shares and warrants at
  $0.85 for one share plus 1/2 of a warrant- Nov - Dec    -                 375,000                   375

Consulting fees paid in conjunction
  with 2003 share issuances                               -                       -                     -

Options issued for services                               -                       -                     -

Issuance of minority interest in
  subsidiary                                            411                       -                     -

Foreign currency translation
  adjustments                                             -                       -                     -

Minority interest in loss                              (411)                      -                     -

Net loss                                                  -                       -                     -
                                                --------------        ----------------      ----------------

Balance, December 31, 2003                           $    -              21,895,000              $ 21,895
                                                ==============        ================      ================
</TABLE>

                 See notes to consolidated financial statements.

                                      F-7
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                Consolidated Statements of Shareholders' Deficit

<TABLE>
<CAPTION>
                                                                  Accumulated          Deficit
                                                                    Foreign          Accumulated
                                                  Additional        Exchange          During the
                                                   Paid-in        Translation        Development
                                                   Capital         Adjustment            Stage             Total
                                               ---------------    -------------    ----------------   ---------------
<S>                                              <C>                <C>              <C>                <C>
Balance at March 11, 2003
  (Date of Inception)                               $      -        $       -        $          -       $         -

Issuance of "founders" shares
  at $0.001 per share - March                         (7,824)               -                   -               869

Issuance of shares at $0.05 per share
  for $0.001 cash and $0.0499 services - Oct         250,921                -                   -           256,031

Issuance of shares at $0.05 per share
  for cash - October                                  96,845                -                   -            98,821

Issuance of shares at $0.05 per share
  for services - October                              23,703                -                   -            24,187

Issuance of shares and warrants at $0.25
  for one share plus 1/2 of a warrant - Jun - Aug    823,194                -                   -           826,500

Issuance of shares valued at $0.1919 per
  share for services - Jun - Aug                     235,041                -                   -           236,272

Issuance of shares and warrants at $0.50
  per share plus 1/2 of a warrant - Aug - Dec        244,510                -                   -           245,000

Issuance of shares valued at $0.3878 per
  share for services Aug - Nov                        88,986                -                   -            89,216

Issuance of shares and warrants at 0.85
  for one share plus 1/2 of a warrant - Nov - Dec    318,375                -                   -           318,750

Consulting fees paid in conjunction
  with 2003 share issuances                         (149,790)               -                   -          (149,790)

Options issued for services                           53,520                -                   -            53,520

Issuance of minority interest in
  subsidiary                                               -                -                   -               411

Foreign currency translation
  adjustments                                              -            9,251                   -             9,251

Minority interest in loss                                  -                -                   -              (411)

Net loss                                                   -                -          (2,157,655)       (2,157,655)
                                               ---------------    -------------    ----------------   ---------------

Balance, December 31, 2003                       $ 1,977,481        $   9,251        $ (2,157,655)      $  (149,028)
                                               ===============    =============    ================   ===============
</TABLE>

                 See notes to consolidated financial statements.

                                      F-8
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                Consolidated Statements of Shareholders' Deficit

<TABLE>
<CAPTION>
                                                                                   Common Shares
                                                 Minority              ---------------------------------------
                                                 Interest                  Shares                 Amount
                                               --------------          ----------------       ----------------

<S>                                             <C>                       <C>                      <C>
Balance at December 31, 2003
  Restated for division of stock                $        -                21,895,000               $ 21,895

Transfer of shares $0.6468 per share
  for employee benefit trust                             -                 1,500,000                  1,500

650,000 warrants issued in connection
  with notes payable of $650,000
  beneficial conversion feature on notes
  payable - January 23 to February 23, 2004              -                         -                      -

Issuance of shares at $0.85 per share
  for cash - March 24                                    -                   950,000                    950

Issuance of shares on exercise of
  warrants at $0.50 -  March 24                          -                 1,001,000                  1,001

Issuance of shares on exercise of
  warrants at $1 - March 24                              -                   100,000                    100

Issuance of shares on exercise of
  options at $0.125 - March 24                           -                   800,000                    800

Consulting fees incurred in conjunction
  with 2004 share issuances                              -                         -                      -

Options issued to consultants in
  connection with services in
  January 2004                                           -                         -                      -

Amortization of options issued to
  consultants                                            -                         -                      -

Shares deemed issued in recapitalization
  transaction - March 25, 2004                           -                 2,619,238                  2,619

Foreign currency translation                             -                         -                      -

Net loss                                                 -                         -                      -
                                               --------------          ----------------       ----------------

Balance, March 31, 2004                          $       -                28,865,238               $ 28,865
                                               ==============          ================       ================
</TABLE>

                 See notes to consolidated financial statements.

                                      F-9
<PAGE>

                      MAILKEY COROPRATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                Consolidated Statements of Shareholders' Deficit

<TABLE>
<CAPTION>
                                                                                          Accumulated    Deficit
                                                                                            Foreign    Accumulated
                                            Additional                                     Exchange     During the
                                             Paid-in       Subscription      Deferred     Translation  Development
                                             Capital        Receivable     Compensation    Adjustment      Stage         Total
                                          ------------     ------------    ------------   -----------  ------------   -----------
<S>                                        <C>              <C>            <C>              <C>        <C>            <C>
  Balance at December 31, 2003             $ 1,977,481      $       -      $         -      $ 9,251    $(2,157,655)   $  (149,028)


Transfer of shares $0.6468 per share
  for employee benefit trust                   968,700              -                -            -              -        970,200

650,000 warrants issued in connection
  with notes payable of $650,000
  beneficial conversion feature on
  notes payable - January 23 to
  February 26, 2004                            246,727              -                -            -              -        246,727

Issuance of shares at $0.85 per share
  for cash - March 24                          806,550       (212,500)               -            -              -        595,000

Issuance of shares on exercise of
  warrants for $0.50 - March 24                499,499              -                -            -              -        500,500

Issuance of shares on exercise of
  warrants at $1 - March 24                     99,900        (50,000)               -            -              -         50,000

Issuance of shares on exercise of
  options at $0.125 - March 24                  99,200              -                -            -              -        100,000

Consulting fees incurred in conjunction
  with 2004 share issuances                    (93,756)             -                -            -              -        (93,756)

Options issued to consultants in
  conjunction with services in
  January 2004                               2,086,523              -       (2,086,523)           -              -              -

Amortization of options issued to
  consultants                                        -              -          163,888            -              -        163,888

Shares deemed issued in recapitalization
  transaction - March 25, 2004                  (2,619)             -                -            -              -              -

Foreign currency translation
  adjustments                                        -              -                -       (3,047)             -         (3,047)

Net loss                                             -              -                -            -     (2,510,230)    (2,510,230)
                                          -------------    -----------    -------------    ---------  -------------   ------------

Balance, March 31, 2004                    $ 6,688,205      $(262,500)     $(1,922,635)     $ 6,204    $(4,667,885)   $  (129,746)
                                          =============    ===========    =============    =========  =============  =============
</TABLE>

                 See notes to consolidated financial statements.

                                      F-10
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements


1. NATURE OF BUSINESS

          On March 25, 2004, pursuant to an Agreement and Plan of Merger, Global
     Diversified Acquisition Corp. ("GDAC"), acquired all of the outstanding
     capital stock of MK Secure Solutions Ltd ("MKSS"), a holding company
     incorporated on March 11, 2003, under the laws of the British Virgin
     Islands. The transaction was effected by the issuance of shares such that
     the former MKSS shareholders owned approximately 90% of the outstanding
     Mailkey stock after the transaction. GDAC then changed its name to Mailkey
     Corporation ("Mailkey") and now Mailkey, conducts its principal
     administrative, research and development operations in the United Kingdom
     through a wholly - owned subsidiary and conducts additional operations
     through a 60% owned subsidiary in Singapore. Sales and marketing efforts
     are conducted from offices in those countries. Mailkey and its majority
     owned subsidiaries (collectively, "Group" or "Company") seeks to eventually
     sell in most of the world.

          Mailkey was the legal acquirer in the merger. MKSS was the accounting
     acquirer since its shareholders acquired a majority of the outstanding
     common stock of Mailkey. The merger transaction has been treated as
     recapitalization of MKSS and the financial statements presented for the
     period prior to the merger are those of MKSS as if MKSS had always been the
     reporting Company. The capital accounts, share disclosures and weighted
     average shares outstanding for the period prior to the merger have been
     retroactively restated to reflect the current equivalent shares based on
     the exchange ratio used in the merger. The activities of Mailkey, the
     parent company, are only included in the Group consolidated financial
     statements from March 25, 2004 forward.

          The Group designs, develops, and intends to sell and support an
     integrated software product Mailkey Message Manager that is a multi-device,
     multi-message platform that allows network administrators and network
     operators to protect their individual users through filtration from
     unwanted electronic mail.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Basis of Presentation

          The company's financial statements are prepared on the accrual basis
     of accounting in accordance with accounting principles generally accepted
     in the United States of America, and have been presented on a going concern
     basis which contemplates the realization of assets and the satisfaction of
     liabilities in the normal course of business.

          Since the inception of the Company, management has been in the process
     of designing and developing its products, raising capital, hiring personnel
     and obtaining customers. Accordingly, the Company is a development stage
     enterprise, as defined in Statement of Financial Accounting Standards
     ("SFAS") No. 7, Accounting and Reporting for Development Stage Enterprises.
     Under SFAS No. 7, certain additional financial information is required to
     be included in the financial statements for the period from inception of
     the company to the current balance sheet.

     Use of Estimates

          The preparation of financial statements in conformity with accounting
     principles generally accepted in the United States of America requires
     management to make estimates and assumptions that affect the amounts
     reported in the financial statements and the accompanying notes. Actual
     results could differ from those estimates.


                                      F-11
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

     Revenue Recognition

          As of the balance sheet date, the Group had not delivered product or
     provided services to customers that provide the group with revenue. The
     company will recognize revenue in accordance with Statement of Position
     ("SOP") 97-2 SOFTWARE REVENUE RECOGNITON, and SOP 98-9 - MODIFICATION OF
     SOP 97-2, SOFTWARE REVENUE RECOGNITON, WITH RESPECT TO CERTAIN TANSACTIONS
     to its specific business.

     Consolidation

          The consolidated financial statements include the financial position
     and results of MKSS and its 100%-owned subsidiary, MK Secure Solutions Ltd,
     a company incorporated under the laws of the United Kingdom and its
     60%-owned subsidiary, Mailkey Asia PTE, Ltd. in addition to Mailkey. The
     consolidated financial statements exclude all intercompany balances and
     transactions. The losses of subsidiaries are allocated to the minority
     interests to the extent of their equity capital. Losses in excess of
     minority interests' equity are charged to the Group.

     Research and Development

          The Group expenses software research costs in accordance with SFAS No.
     86 - "ACCOUNTING FOR THE COST OF COMPUTER SOFTWARE TO BE SOLD, LEASED, OR
     OTHERWISE MARKETED" ("SFAS 86"). Under SFAS No. 86, software development
     costs are expensed as incurred until management determines that the
     software is technologically feasible as evidenced by detailed program
     designs or by a working mode. Capitalization ceases when the products are
     available for general release to customers, at which time amortization of
     the capitalized costs will begin. Amortization for the period will be
     computed using the greater of (a) the ratio of the product's current gross
     revenues to the total of current gross revenues and management's estimate
     of future gross revenues or (b) the straight-line method computed by
     dividing the remaining unamortized cost by the estimated remaining economic
     life of the product. At each balance sheet date, the unamortized capital
     costs are compared to the net realizable value. The amount of capitalized
     costs which exceed the net realizable value is written off.

          Research and development costs relating principally to the design and
     development of products are expensed as incurred. The Company incurred
     $665,000 and $385,000 of research and development expense for the period
     ended December 31,2003 and the three months ended March 31,2004

     Property and Equipment

          Property and equipment, consisting of furniture, fixtures and
     equipment, are stated at cost less accumulated depreciation. Depreciation
     is provided by the straight-line methods over the estimated useful lives of
     three to five years.

     Income Taxes

          Each corporation within the Group files its own separate corporate tax
     returns. Income taxes are recorded in the period in which the related
     transactions are recognized in the financial statements, net of valuation
     allowances, which have been recorded against deferred tax assets. Deferred
     tax assets and liabilities are recognized for the estimated future tax
     consequences attributable to differences between the financial statement
     carrying amounts of existing assets and liabilities and their respective
     tax bases. Net deferred tax assets and liabilities are recognized for
     future tax benefits such as net operating loss and credit carryforwards.
     Deferred tax assets and liabilities are measured using enacted tax rates
     expected to apply to taxable income in the years in which those temporary
     differences are expected to be recovered or settled. The effect on the
     deferred tax assets and liabilities of a change in tax rates is recognized
     in income in the period that includes the enactment date. A valuation
     reserve has been recorded against deferred tax assets because management
     has determined it is more

                                      F-12
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

     likely than not that the deferred tax assets will not be realized. No
     provision has been made for the United States income tax effects of
     undistributed earnings or unrealized losses of non-US subsidiaries as
     management expects these earnings to be reinvested indefinitely or received
     substantially free of additional tax.

     Loss Per Share

          Loss per common share is calculated in accordance with SFAS No. 128,
     Earnings Per Share. Basic loss per common share is computed based upon the
     weighted average number of shares of common stock outstanding for the
     period and excludes any potential dilution. Shares associated with the
     3,375,000 stock options and 3,142,354 warrants outstanding at March 31,
     2004 and the 1,780,700 stock options, and 2,085,500 warrants that were
     outstanding at December 31, 2003 were not included because their inclusion
     would be antidilutive (i.e. reduce the net loss per share).

     Stock Based Compensation

          The Group follows the provisions of SFAS No. 123 - "ACCOUNTING FOR
     STOCK BASED COMPENSATION". As permitted under SFAS No. 123, the Group has
     continued to utilize APB 25 "Accounting For Stock Issued To Employees", and
     related interpretations, in accounting for its stock-based compensation to
     employees and directors. Had compensation expense for the three month
     period ended March 31, 2004 and the period from March 11, 2003 (inception)
     to December 31, 2003 been determined under the fair value provisions of
     SFAS No. 123, as amended by SFAS No. 148 - "AN ACCOUNTING FOR STOCK BASED
     COMPENSATION - TRANSITION AND DISCLOSURE - AN AMENDMENT OF SFAS 123," the
     Group net loss and net loss per share would have differed as follows:

<TABLE>
<CAPTION>
                                                                  March 31, 2004   December 31, 2003
                                                                  --------------   -----------------

     <S>                                                           <C>                <C>
     Net loss, as reported                                         $(2,510,230)       $(2,157,655)
     Add:  Stock-based employee compensation expense included
         in reported net income determined under APB No. 25,
         net of related tax effects                                         --             53,520
       Deduct:  Total stock-based employee compensation expense
        determined under fair-value-based method for all awards,
        net of related tax effects                                    (107,889)           (76,412)
                                                                   -----------        -----------

     Pro forma net income                                          $(2,618,119)       $(2,180,547)
                                                                   -----------        -----------

     Earnings per share:

        Basic and diluted - as reported                            $     (0.11)       $     (0.16)
        Basic and diluted - pro forma                              $     (0.11)       $     (0.16)
</TABLE>

          These pro forma amounts may not be representative of future
     disclosures since the estimated fair value of stock options is amortized to
     expense over the vesting period and additional options may be issued in
     future years. The estimated fair value of each option granted was
     calculated using the Black-Scholes option pricing model. The following
     summarizes the weighted average of the assumption used in the model.


                                      F-13
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

                                                    2004    2003
                                                   -----    ----
     Risk free rate                                3.0%     3.1%
     Expected years until exercise                 4.7        5
     Expected stock availability                   150%     150%
     Dividend yield                                 --       --

     Foreign Currency Translation

          The Group's functional currency is the UK Pound Sterling. The Group's
     reporting currency is the US dollar. All assets and liabilities recorded in
     the functional currency have been translated at exchange rates in effect at
     each balance sheet date. Revenue, expenses and cash flows have been
     translated at the weighted-average exchange rates for the period. The
     resulting adjustments have been charged or credited directly to foreign
     exchange translation adjustments in the statement of "other comprehensive
     loss".

     Comprehensive Loss

          The Company has included a statement of comprehensive loss in
     accordance with SFAS No. 130, "Reporting Comprehensive Income". SFAS No.
     130 requires the reporting of comprehensive income, or loss, in addition to
     net loss from operations. Comprehensive income is a more inclusive
     financial reporting methodology that includes disclosures of certain
     financial information that historically has not been recognized in the
     calculation of net income. As of March 31,2004 December 31, 2003, the
     Company's comprehensive loss consists of net loss and foreign currency
     translation adjustments.

     Fair Value of Financial Instruments

          The carrying value of prepaid assets and accrued expenses approximates
     fair value due to the relatively short maturity of these instruments. The
     face value of the note payable is $650,000 as of March 31, 2004 but is
     reflected at a discount in these financial Statements

3.   RECAPITALIZATION TRANSACTION

          On March 25, 2004, pursuant to an Agreement and Plan of Merger between
     Global Diversified Acquisition Corp ("GDAC"), G.D. Acquisition Corp ("GD
     Corp"), a subsidiary of GDAC, MK Secure Solutions, Ltd ("MKSS") and
     Westvale Consultants, Ltd. ("Westvale"), a principal shareholder of MKSS,
     GD Corp was merged with and into MKSS, with MKSS remaining as the surviving
     entity and becoming a wholly-owned subsidiary of GDAC.

     Pursuant to the terms of the merger agreement,

     (i)   GDAC issued 26,246,000 shares of its common stock to the holders of
           MKSS's capital stock, in exchange for all of the issued and
           outstanding shares of MKSS's capital stock, representing
           approximately 90% of the then total issued and outstanding stock of
           GDAC.

     (ii)  GDAC's incumbent board members agreed to resign as directors of GDAC.

     (iii) MKSS received the right to appoint new members of GDAC's board.


                                      F-14
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements

3.   RECAPITALIZATION TRANSACTION (Continued)

     (iv) All of the MKSS outstanding warrants, options and loan units, became
          convertible intooptions, warrants and loan units of GDAC adjusted at
          the rate of one hundred for one and the strike prices for the
          individual options, warrants and loan units were adjusted at a rate of
          one hundredth of the original strike prices.

          As a result of the terms of the merger agreement as stated above, the
     merger is deemed to have involved a change in control of GDAC. The
     combination of MKSS and GDAC is being treated as a recapitalization of
     MKSS. GDAC is the legal acquirer in the merger. The Company is the
     accounting acquirer since their shareholders acquired a majority ownership
     interest in GDAC. Consequently, the financial statements of MKSS have
     become those of GDAC. GDAC subsequently changed its name to Mailkey
     Corporation

4.   GOING CONCERN

          The accompanying financial statements have been prepared assuming that
     the Group will continue as a going concern. The Group incurred a net loss
     of $2,510,230 with no net revenue during the period January 1,2004 to March
     31, 2004, and, as of that date, had a shareholder's deficit of $129,746.
     Those conditions raise substantial doubt about the Group's ability to
     continue as a going concern. The financial statements do not include any
     adjustments that might result from the outcome of this uncertainty.

          Management plans to raise additional capital through private placement
     equity offerings in 2004. These funds, in addition to its cash and
     subscription receivables held at March 31, 2004, will be needed in order to
     finance the Company's currently anticipated needs for operating and capital
     expenditures for fiscal 2004.

          The Company's ability to continue as a going concern is dependent upon
     raising capital through debt and equity financing. There can be no
     assurance that the Company will successfully raise the required future
     financing on terms desirable to the Company. If the Company does not obtain
     the needed funds, it will likely be required to delay development of its
     products, alter its business plan, or in the extreme situation, cease
     operations. The financial statements do not include any adjustments that
     might result from the outcome of this uncertainty.

5.   PROPERTY AND EQUIPMENT

          Property and equipment consisted of the following at December 31,
     2003:

                                        March 31,   December 31,
                                          2004          2003
                                        ---------   ------------

      Office equipment                   $14,868      $13,652
      Computer equipment                  63,562       30,949
                                         -------      -------

                                          78,430       44,601

      Less:  Accumulated depreciation     15,171        9,785
                                         -------      -------

                                         $63,259      $34,816
                                         =======      =======

          Depreciation expenses for the three months ending March 31, 2004 and
     the period december 31, 2003 was $5,386 and $9,785, respectively


                                      F-15
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements


6.   SHORT-TERM LOAN PAYABLE--RELATED PARTY

          The short-term loan payable from a related party represents an advance
     from a company controlled by a family member of one of the Group's
     directors. The loan has a maximum borrowing amount of 35,500 pounds
     Sterling ($65,242 at March 31, 2004) of which 23,445 pounds ($43,080 at
     March 31, 2004) was outstanding at March 31, 2004 and $61,660 was
     outstanding as of December 31, 2003. The note bears interest at the base
     rate of Barclays bank + 1% (4.75% at March 31, 2004). The due date of the
     note is dependent on the date of certain capitalization provisions as
     defined in the document and was originally scheduled to be repaid May 31,
     2004. However, in 2004 the due date was extended to September 30, 2004.

7.   SHORT-TERM LOANS PAYABLE

          The Group has obtained bridge loans to meet their short-term working
     capital needs. During January 1 through March 31, 2004, the Group borrowed
     $650,000 though this process. These loans were to be repaid or converted by
     July 31, 2004 and bear interest at an annualized rate of 10%. The loan
     holders have the right at any time through June 30, 2004, to convert their
     loan principal into common shares at a rate of $0.85 per share. As
     additional consideration for each loan unit which consisted of a loan of
     $50,000, the lenders were granted 50,000 warrants. Each warrant entitles
     the holder to purchase one common share at an exercise price of $1.00 per
     share at any time through to October 31, 2005.

          Using the Black-Scholes model the Group estimated the fair value of
     the warrants and allocated $201,058 of the $650,000 proceeds received to
     the warrants which was recorded as a discount on the notes payable.

          Also, on the dates of the issuance of the notes payable, the Group's
     common stock had an estimated value per share that, based on the terms of
     the conversion associated with the notes, created an intrinsic value
     associated with the beneficial conversion feature estimated at $45,669,
     which was recorded as a discount on the notes payable.

          $62,428 of the above discussed discounts was expensed as interest
     expense in the three months ended March 31, 2004.

8.   WARRANTS

          Each warrant entitles the holder to purchase one common share at a
     stated exercise price any time through a stated expiration date. The
     warrants outstanding were as follows:

                                                       March 31,    December 31,
                                                         2004           2003
                                                       ---------    ------------

     Exercise price $0.50, expiration October 2005       652,000     1,653,000

     Exercise price $1.00, expiration October 2005     1,839,354       432,500

     Exercise price $2.00, expiration March 2005         650,500            --
                                                       ---------     ---------

     Total                                             3,141,854     2,085,500
                                                       =========     =========

          During the three months ended March 31, 2004, the Company issued
     650,500 warrants with a $2.00 exercise price and a March 2005 expiration to
     existing holders of the $0.50 and $1.00 warrants to induce them to exercise
     1,001,000 and 100,000 warrants, respectively.


                                      F-16
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements

9.   COMMITMENTS

          As of March 31, 2004, the Group had commitments under operating leases
     that required minimum payment that approximates $50,500 through March 31,
     2005. Rent expense for the three months ended March 31, 2004 and for the
     period March 11 (inception) through December 31, 2003 was $37,114 and
     $64,734, respectively.

10.  INCOME TAX

          The Company's principal activities have been conducted by the United
     Kingdom operating company and its subsidiaries. No provision has been made
     for the United States income tax effects of undistributed earnings or
     unrealized losses of non-US subsidiaries as management expects these
     earnings to be reinvested indefinitely or receive treatment substantially
     free of additional tax. Consequently the income tax provision consists
     principally of United Kingdom taxes. Certain expenses incurred by MKSS are
     estimated by management to not be deductible for United States or United
     Kingdom purposes, thereby giving rise to permanent difference.

          Deferred income taxed reflect the net tax effects of temporary
     differences between the carrying amounts of assets and liabilities
     reflected on the financial statements and the amounts used for income tax
     purposes and net operating loss carryforwards. The tax effects of temporary
     differences and net operating loss carryforwards that give rise to
     significant portions of the deferred tax assets recognized as of March 31,
     2004 and December 31, 2003 are presented below:

                                                       March 31,    December 31,
                                                         2004           2003
                                                     ------------   ------------
     Deferred tax assets:
       Principally, temporary differences
        related to copensation and net
        operating loss carryforward                  $ 1,050,000    $   650,000
                                                     -----------    -----------

     Less:  valuation allowance                       (1,050,000)      (650,000)
                                                     -----------    -----------

            Total deferred tax assets                $        --    $        --
                                                     ===========    ===========

          Income tax (expense) benefit for the three months ended March 31, 2004
     and the period March 11 (inception) to December 31, 2003 consisted of the
     following:

                                                       March 31,    December 31,
                                                         2004           2003
                                                       ---------    ------------
     Deferred:
       Increase in tax benefit of temporary differences
        related to copensation and net operating
       Loss carryforward                               $ 400,000    $ 650,000
       (Increase) in valuation allowance                (400,000)    (650,000)
                                                       ---------    ---------

            Total deferred tax assets                  $      --    $      --
                                                       =========    =========

          The Company has loss carryforwards of approximately $1,710,000 as of
     March 31, 2004 that may be offset against future UK taxable income. This
     carryforward has no expiration. Management has determined that realization
     of deferred tax assets is less likely than not and accordingly has
     established a valuation allowance of $1,050,000 and $650,000 at March 31,
     2004 and December 31, 2003 respectively. In addition, the Company has an
     estimated net operating loss carryover for United States income tax
     purposes of approximately $380,000 resulting from operations of GDAC prior
     to its becoming part of the Group for financial reporting purposes. Because
     of the change in ownership occurring in the merger transaction and previous
     transactions entered into by GDAC these US carryovers are subject to severe
     limitations as to their use and related deferred tax assets have not been
     included in the accompanying disclosures.


                                      F-17
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements

10. INCOME TAX (Continued)

           The following table presents the principal reasons for the difference
      between the Company's effective tax rates and the United Kingdom statutory
      income tax rate.

                                                       March 31,    December 31,
                                                         2004           2003
                                                       ---------    ------------

      United Kingdon statutory income tax                     30%           30%
      Income tax (benefit) at statutory rate           $(750,000)    $(650,000)
      Expenses not deductible for income tax purposes    350,000            --
      Increase (decrease) in valuation allowance for
        income tax benefit                               400,000       650,000
                                                       ---------     ---------

            Income tax expense                         $      --     $      --
                                                       =========     =========

            Effective income tax rate                          0%            0%
                                                       =========     =========

11.  STOCK OPTIONS

          Stock option activity during the periods indicated is as follows:

                                                              Weighted-
                                              Number of        Average
                                                Shares     Exercise Price
                                             ----------    --------------
     Balance at March 11, 2003 (inception)           --      $       --

     Granted                                  1,780,700            0.52
     Cancelled                                       --              --
     Exercised                                       --              --
                                             ----------      ----------

     Balance at December 31, 2003             1,780,700      $     0.52

     Granted                                  2,394,500            0.71
     Cancelled                                       --              --
     Exercised                                 (800,000)           0.12
                                             ----------      ----------

     Balance at March 31, 2004                3,375,000      $     0.75
                                             ==========      ==========

          The following table summarizes information about stock options
     outstanding as of March 31, 2004:

                      OPTIONS OUTSTANDING              OPTIONS EXERCISABLE
           --------------------------------------   --------------------------
            Number of
           Outstanding      Weighted     Weighted       Number       Weighted
Range of    Shares at       Average      Average    Exercisable at    Average
Exercise    March 31,      Remaining     Exercise     March 31,      Exercise
 Prices        2004      Contract Life    Price          2004          Price
--------   -----------   -------------   --------   --------------   ---------

 $ 0.25-
 $ 0.85     3,375,000      4.7 years      $  0.75       38,675       $  0.85


                                      F-18
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements

11. STOCK OPTIONS (Continued)

           The following table summarizes information about stock options
outstanding as of December 31, 2003:

                      OPTIONS OUTSTANDING              OPTIONS EXERCISABLE
           --------------------------------------   --------------------------
            Number of
           Outstanding      Weighted     Weighted       Number       Weighted
Range of    Shares at       Average      Average    Exercisable at    Average
Exercise   December 31,    Remaining     Exercise     Decmber 31,      Exercise
 Prices        2003      Contract Life    Price          2003          Price
--------   -----------   -------------   --------   --------------   ---------
 $ 0.125-
 $ 0.85     1,780,700      2.8 years      $  0.52       800,000       $  0.125

          Approximately 1,650,000 of the above options are held by the CEO and
     depty chairman of the Company

12.  INTELLECTUAL PROPERTY

          A Director applied for multiple patents through the United Kingdom
     Patent Office for various proprietary applications of the Company's
     products. Under the terms of an assignment agreement, the patent rights,
     title and interest therein have been assigned to the Company.

13.  STOCKHOLDERS' EQUITY

          In 2003 and 2004 up to the date of the consummation of the merger the
     Company had various share issuances for consulting services rendered, which
     were valued based on the value of the share price of recent privates
     placements which the Company had completed at near the date of the services
     were provided.

          On the date of the merger MKSS shareholders exchanged all of their
     shares in return for a total of 26,246,000 of GDAC common stock. The
     remaining outstandin 2,619,238 shares of the GDAC common stock were held by
     incumbent officers, shareholders and service providers of GDAC

          During 2003, the Company decided to simplify its capital structure.
     For all classes of stock issued or issuable, the number of shares and
     warrants issued was adjusted at a rate of one for one hundred from the
     shares and warrants that were originally to be issued. All shares
     references in these financial statements reflect this simplification.

14.  EMPLOYEE BENEFIT TRUST AND STOCK COMPENSATION PLANS

          On March 16, 2004, the Company entered into a trust deed, whereby MK
     Secure Solutions Limited Employee Benefit Trust was established. The
     original trustee of the trust is Confiance Limited, a unrelated entity
     located in St. Peter Port. Guernsey. The trust satisfies the conditions of
     Section 86 of the Inheritance Act of 1984 of Great Brittain. The Company is
     required to make an initial payment of approximately $12,138. In January
     2004 the company subsequently transferred 1,500,000 of the Company's common
     shares, at an approximate market value of $970,200, to the trust. The
     beneficiary of the trust can be an employee or former employee of the
     Company or a relative of such employee. The trust period is the earlier of
     (a) the expiration of 100 years or (b) such earlier date as the trustee
     shall revocably or irrevocably by deed with the Company's prior written
     consent declare to the trust period. The Company recorded $982,328 as
     expense in connection be with end of these contributions.


                                      F-19
<PAGE>

                      MAILKEY CORPORATION AND SUBSIDIARIES
                          (A Development Stage Entity)
                   Notes to Consolidated Financial Statements

14.  EMPLOYEE BENEFIT TRUST AND STOCK COMPENSATION PLANS (Continued)

          In February 2001, the Company approved the 2001 Employee Stock
     Compensation Plan (the "Plan"). The maximum number of shares of common
     stock that may be granted by the Company under the plan is 5,000,000 shares
     during the period of the Plan, however, no awards may be made that would
     bring the total of all outstanding Plan shares under the Plan to more than
     20% of the total number of shares of common stock of the Company at the
     time outstanding. As of March 31, 2004, there were 1,325,000 shares were
     outstanding under the Plan.

15.  SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES

          During the three months ended March 31, 2004, the Company issued stock
     and was sued $665,500 in stock subscriptions receivables. Subsequent to
     March 31, 2004, $403,000 of the above subscription receivables have been
     collected and the remaining balance is outstanding.

          The Company recorded $246,727 discount related to the bridge loans and
     the related warrants to account for the value of the warrants and the
     beneficial conversion feature.

          The Company recorded $2,086,523 of deferred compensation in relation
     to options issued to third-party consultants in January 2004.

16.  SUBSEQUENT EVENTS

          In June 2004, under the terms of the bridge loan agreement, the
     holders of the loans converted their entire outstanding debt and related
     interest for 792,962 shares of the common stock of the Company.

17.  CONSULTING FEES  - RELATED PARTY

          Two of the Company's primary officers provide their services to the
     Company through outside consulting firms. The costs of these services
     approximated $187,000 for the three month period ended March 31, 2004. The
     cost of these services approximated $133,000 for the period from March 11,
     2003 (inception) through December 31, 2003.

          The minority interest holder in Mailkey Asia PTE, Ltd. controls a
     company that provides consulting services to the Company. The costs of
     these services approximated $73,000 and $113,000 for the three month period
     ended March 31, 2004 and for the period from March 11, 2003 (inception)
     through December 31, 2003, respectively.

17. RECENT ACCOUNTING PRONOUNCEMENTS

           In January 2003, the Financial Accounting Standards Board ("FASB")
     issued Financial Interpretation No. 46, "Consolidation of Variable Interest
     Entities - An Interpretation of ARB No. 51" (FIN 46 or Interpretation). FIN
     46 is an interpretation of Accounting Research Bulletin 51, "Consolidated
     Financial Statements," and addresses consolidation by business enterprises
     of variable interest entities (VIEs). The primary objective of the
     Interpretation is to provide guidance on the identification of, and
     financial reporting for, entities over which control is achieved through
     means other than voting rights; such entities are known as VIEs. The
     Interpretation requires an enterprise to consolidate a VIE if that
     enterprise has a variable interest that will absorb a majority of the
     entity's expected losses if they occur, receive a majority of the entity's
     expected residual returns if they occur or both. An enterprise is required
     to consider the rights and obligations conveyed by its variable interests
     in making this determination. On October 9, 2003, the FASB issued Staff
     Position No. 46-6 which deferred the effective date for applying the
     provisions of FIN 46 for interests held by public entities in variable
     interest entities or potential variable interest entities created before
     February 1, 2003. On December 24, 2003, the FASB issued a revision to FIN
     46. Under the revised interpretation, the effective date was delayed to
     periods ending after March 15, 2004 for all variable interest entities,
     other than SPEs. The adoption of FIN 46 is not expected to have an impact
     on the Company's financial condition, results of operations.

           In April 2003, the FASB issued SFAS No. 149, Amendment of Statement
     No. 133 on Derivative Instruments and Hedging Activities. This statement
     amends and clarifies financial accounting and reporting for derivative
     instruments, including certain derivative instruments embedded in other
     contracts, and for hedging activities under SFAS No. 133, Accounting for
     Derivative Instruments and Hedging Activities. SFAS No. 149 requires that
     contracts with comparable characteristics be accounted for similarly. The
     statement is effective for contracts entered into or modified after June
     30, 2003 and for hedging relationships designated after June 30, 2003. The
     provisions of SFAS No. 149 generally are to be applied prospectively only.
     The adoption of SFAS No. 149 did not have a material impact on the
     Company's results of operations or financial position.

           In May 2003, the FASB issued SFAS No. 150, Accounting for Certain
     Financial Instruments with Characteristics of both Liabilities and Equity.
     SFAS No. 150 establishes standards for classification and measurement by an
     issuer of certain financial instruments with characteristics of both
     liabilities and equity. The statement requires that an issuer classify a
     financial instrument that is within its scope as a liability (or asset in
     some circumstances). Many of those instruments were previously classified
     as equity. This Statement also addresses questions about the classification
     of certain financial instruments that embody obligations to issue equity
     shares. This statement is effective for financial instruments entered into
     or modified after May 31, 2003, and otherwise is effective at the beginning
     of the first interim period beginning after June 15, 2003, except as it
     relates to consolidated limited-life subsidiaries. The FASB indefinitely
     deferred the effective date of this statement as it relates to certain
     mandatorily redeemable non-controlling interests in consolidated
     limited-life subsidiaries. The adoption of the effective provisions of SFAS
     No. 150 did not have a material impact on the Company's results of
     operations or financial position.

           On December 17, 2003, the Staff of the Securities and Exchange
     Commission (or SEC) issued Staff Accounting Bulletin No. 104 ("SAB 104"),
     Revenue Recognition, which supersedes Staff Accounting Bulletin No. 101,
     Revenue Recognition in Financial Statements ("SAB 101"). SAB 104's primary
     purpose is to rescind the accounting guidance contained in SAB 101 related
     to multiple-element revenue arrangements that was superseded as a result of
     the issuance of EITF 00-21, Accounting for Revenue Arrangements with
     Multiple Deliverables. Additionally, SAB 104 rescinds the SEC's related
     Revenue Recognition in Financial Statements Frequently Asked Questions and
     Answers issued with SAB 101 that had been codified in SEC Topic 13, Revenue
     Recognition. While the wording of SAB 104 has changed to reflect the
     issuance of EITF 00-21, the revenue recognition principles of SAB 101
     remain largely unchanged by the issuance of SAB 104, which was effective
     upon issuance. The adoption of SAB 104 did not have a material effect on
     the Company's financial position or results of operations.


                                      F-20
<PAGE>

                                   SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                      MAILKEY CORPORATION


Date:  July 14, 2004                  /s/  Graham Norton-Standen
                                      -----------------------------------
                                      Graham Norton-Standen
                                      Chairman and Chief Executive Officer


        Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities on the dates indicated.

<TABLE>
<CAPTION>
<S>                                                                             <C>
Signature                        Title                                   Date
---------                        -----                                   ----


/s/  Graham Norton-Standen       Chairman and Chief Executive Officer    July 14, 2004
--------------------------       (Principal Executive Officer)
Graham Norton-Standen


/s/  Roger B. Ponting            Chief Financial Officer (Principal      July 14, 2004
---------------------            Financial and Accounting Officer)
Roger B. Ponting


/s/  Tim Dean-Smith              Deputy Chairman                         July 14, 2004
-------------------
Tim Dean-Smith
</TABLE>


                                       46
<PAGE>

                                  EXHIBIT INDEX


Exhibit Number             Description
--------------             -----------

     14.1       Code of Business Conduct and Ethics

     21.1       Subsidiaries of the Company

     31.1       Certification of Chief Executive Officer of the Company required
                by Rule 13a-14(a) under the Securities Exchange Act of 1934, as
                amended

     31.2       Certification of Chief Financial Officer of the Company required
                by Rule 13a-14(a) under the Securities Exchange Act of 1934, as
                amended

     32.1       Certification of Chief Executive Officer and Chief Financial
                Officer of the Company required by Rule 13a-14(b) under the
                Securities Exchange Act of 1934, as amended