SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                                  ANNUAL REPORT

                                   Form 10-K/A

                                 Amendment No. 1

                                  ANNUAL REPORT
                     PURSUANT TO SECTION 13 or 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                   For the Fiscal Year Ended December 31, 2001

                             BREK ENERGY CORPORATION
               (Exact Name of Registrant as Specified in Charter)

              Nevada                  0-27753                 98-0206979
   (State or Other Jurisdiction     (Commission             (IRS Employer
        of Incorporation)           File Number)         Identification No.)

   19th Floor, 80 Gloucester Road, Wan Chai, Hong Kong            SAR
         (Address of Principal Executive Offices)              (Zip Code)

       Registrant's telephone number, including area code (852) 2801-5181

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

                                      None

           Securities registered pursuant to Section 12(g) of the Act:
                    Common Stock, par value $0.001 per share

Indicate  by check  mark  whether  the  registrant:  (1) has filed  all  reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  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 [_]

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not 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-K or any amendment to this
Form 10-K. [X]

Aggregate  market value of the voting and non-voting  common equity held by non-
affiliates of the registrant as of March 28,2002 was $13,233,022.

The  Registrant  hereby  files  this  report on Form  10-K/A to amend its Annual
Report on Form 10-K,  as filed on April 9, 2002 for the year ended  December 31,
2001, to amend Part III, Item 11 "Executive  Compensation",  to correct the data
therein  presented,  2) to file a copy of its Amended and  Restated  Articles of
Incorporation  which were filed with the State of Nevada on January 31, 2002, 3)
to present the analysis of  replacement  stock  options as part of the report of
the  Compensation  Committee of Board of Directors of the  Registrant  and 4) to
provide corrected data as to market  capitalization,  outstanding shares, recent
sales of  securities,  liquidity and  percentage  ownership.  The amendment also
reflects  the  addition  of  Andrew  Leitch as a  director  in April  2002,  the
resignation  of Marc Bruner from the Board of Directors on May 4, 2002,  and the
issuance by Gasco Energy,  Inc. of 9,500,000 shares of common stock in May 2002.
No other items in the registrant's Annual Report on Form 10-K for the year ended
December 31, 2001 are amended.

Number  of  shares  of  Common  Stock  outstanding  as of  March  28,  2002  was
22,055,037.

Documents incorporated by reference: None
<PAGE>

ITEM 1. BUSINESS

Brek Energy  Corporation  operates  through its  subsidiaries in the oil and gas
exploration and the electronic payment processing businesses.  Before the middle
of 2001, its emphasis had been on the electronic  payment  processing  business.
Since it acquired an interest in Gasco Energy,  Inc., an oil and gas exploration
company,  in July 2001,  Brek's focus has been on that  industry.  Brek recently
acquired an interest in another  company  engaged in oil and gas  exploration  -
Vallenar Energy Corp.

Brek remains in development stage. It has earned insignificant revenues from its
electronic  processing  operations  in its first  three years  through  December
31,2001, and has not received any revenue from the oil and gas business.  Brek's
longer-term ability to emerge from development stage depends upon developing its
oil and gas  business  and  developing  sufficient  markets  and  demand for its
electronic processing business.

Brek has incurred  operating losses of $11.46 million,  $12.81 million and $6.35
million for the years ended December 31, 2001, 2000 and 1999. In addition,  Brek
had a recovery from discontinued  operations of $1.49 million for the year ended
December 31, 2001 versus a loss of $4.22 million for the year ended December 31,
2000. As at December 31, 2001 Brek's accumulated deficit was approximately $35.1
million.  Brek  expects  its  accumulated  deficit  to grow for the  foreseeable
future.  Brek did not raise any equity funds during the year ended  December 31,
2001 and Brek will  either have to raise new equity  funds,  sell some assets or
obtain debt financing sufficient to support Brek's requirements through the year
ended  December  31,  2002.  Any sale of equity by Brek  will  likely  result in
substantial dilution to its shareholders.

Oil and Gas Exploration By Gasco Energy, Inc.

By agreement  dated July 5, 2001,  Brek acquired a series of preferred  stock of
Gasco Energy,  Inc. which is convertible into approximately 26% of the equity of
Gasco.  Brek has  elected to convert  half of this  preferred  stock into common
stock. In February 2002, Brek entered into agreements with certain  shareholders
of Gasco which provide for Brek to acquire additional 7,000,000 shares of common
stock of Gasco in exchange for 19,250,000  shares of Brek common stock. The only
condition to the exchange is the approval of the stockholders of Brek.

Gasco is engaged in locating and  developing  hydrocarbon  prospects,  primarily
located in the Rocky Mountain  region.  It applies new  technologies to generate
and develop high-potential  prospects.  All of Gasco's properties are located in
the western United States.

Riverbend Project.  Gasco's Riverbend Project consists of approximately  117,000
gross acres in the Uinta Basin of northeastern  Utah, some of which is leased by
Gasco,  some of which is subject to farmout  and other  agreements  under  which
Gasco may earn leasehold interests,  and some of which is held by third parties.
Gasco's  geologic and  engineering  focus is  concentrated  on three  tight-sand
formations in the basin: the Wasatch, Mesaverde and Mancos formations.

In December  2000,  Gasco entered into an agreement with Phillips  Petroleum,  a
major oil and gas company,  that defined a 60,000-acre  Area of Mutual Interest,
referred to herein as an AMI, within the Riverbend project,  not all of which is
currently leased by either Gasco or Phillips. Under the terms of this agreement,
Phillips paid  $1,000,000 to Gasco upon  execution of the  agreement,  and later
expended  $8,000,000 in connection with drilling and completing  three producing
wells. As a result of Phillips' drilling,  Gasco earned additional acreage under
certain farmout  agreements during 2001. The agreement further afforded Phillips
the right to  acquire an


                                     - 2 -
<PAGE>

80% interest in all of Gasco's leases and farmout  agreements  within the AMI by
assigning two leases within the AMI to Gasco.

There has been some  uncertainty  as to whether  Phillips  timely  exercised its
right to acquire the 80% interest in all of Gasco's leases and contracts  within
the  AMI.  However,  Gasco  has  indicated  its  willingness,   subject  to  the
satisfaction of certain conditions,  to accept the assignment of the two leases,
which have since been tendered by Phillips,  and to proceed with the  assignment
of the 80% interest to Phillips,  and Phillips has indicated  that it will begin
drilling a new earning  well in the AMI on April 17,  2002.  Gasco is  currently
considering whether or not to participate in this well.

During  January 2002,  Gasco entered into an agreement with  Halliburton  Energy
Services under which Halliburton has the option to earn a participation interest
proportionate  to its investment  (not to exceed 50%) by funding the completions
of Wasatch wells. Gasco, at its option, may elect to limit Halliburton's funding
and the resulting participation interest to 25%. Gasco and Halliburton will also
share  technical  information  through the formation of a joint  technical team.
Gasco  began  drilling  the first  Wasatch  well  during  February  2002.  Gasco
anticipates  drilling  three  gross (1.5 net) wells in this area during 2002 and
has set its  capital  budget  for this  purpose at  $3,000,000.  After the wells
drilled under this  agreement  have reached a payout  status,  as defined in the
agreement,  Halliburton  will  retain an interest  equal to 5% of Gasco's  total
interest prior to payout.

Greater Green River Basin  Project.  In Wyoming,  Gasco  established an AMI with
Burlington  Resources  covering  approximately  330,000 acres in Sublette County
within the Greater  Green River Basin.  As of March 15,  2002,  Gasco had leased
approximately 67,000 acres in this area. The exploration agreement governing the
AMI  requires  Burlington  to  drill  two  wells  and  to  shoot  180  miles  of
high-resolution  two-dimension  seismic.  During 2001,  three shallow wells were
drilled in this area for the purpose of holding  acreage  and  earning  expiring
leasehold.  Two of the  wells  tested  only  the  Fort  Union  and  Upper  Lance
formations  and the third well  tested all zones.  All of these  wells have been
cased and are in various stages of completion. They did not evaluate the deeper,
high-potential  Middle and Lower Lance formations,  which are prolific producers
in the nearby Jonah Field and Pinedale  Anticline area. Gasco and Burlington are
targeting  these deeper  formations  with their ongoing  seismic and exploration
activities.

In 2001,  Burlington drilled two wells and shot 80 miles of seismic. As of March
15, 2002, one of the wells drilled was being  completed.  Burlington has advised
Gasco that it plans to complete  the second well,  complete the seismic  program
and drill additional wells during 2002. Gasco  anticipates  participating in the
drilling of one gross well in this area and has set its 2002 capital  budget for
this purpose at $750,000.

During  2002,  Gasco  purchased  additional  real  property in Sublette  County,
Wyoming:  a 50% interest in 21,613  acres for  approximately  $1,411,000;  a 20%
interest in 4,098 acres for  approximately  $107,000;  and  leasehold  interests
covering approximately 16,606 acres for approximately  $1,500,000. In connection
with this last  acquisition,  Gasco received an exclusive  option to purchase an
additional 72,583 acres in this area.  Monthly payments of $300,000 are required
during 2002 in order to maintain  this  option.  Gasco may elect to exercise its
option to complete the transaction at any time.

On February 26, 2002,  Gasco began drilling a well in the Southwest  Jonah field
located in the Greater Green River Basin in Sublette County,  Wyoming.  This was
the  first  well  drilled  within a newly  created  AMI with  Cabot Oil and Gas,
consisting of nine sections (5,760 gross acres,  1,440 net acres).  The well was
drilled to a total depth of 11,000 feet. The well  encountered  natural gas, but
not in sufficient quantities to be deemed economic. Gasco has an option to drill
additional wells within the AMI if the new  interpretation of the well's data in
integration  with the seismic data warrants such testing.  The net dry hole cost
of this well is estimated at $500,000.


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<PAGE>

Southern  California  Project.  Gasco currently leases  approximately  3,900 net
acres in the Kern and San Luis Obispo Counties of southern California. It has no
drilling  or  development  plans  for this  acreage  during  2002,  but plans to
continue  paying  leasehold  rentals and other  minimum  geological  expenses to
preserve this acreage. Gasco may consider selling this acreage in the future.

Productive Gas Wells.  The following  table  summarizes  Gasco's  productive and
shut-in gas wells as of December 31, 2001.  Productive wells are producing wells
and wells  capable of  production.  Shut-in  wells are wells that are capable of
production but are currently not producing.  Gross wells are the total number of
wells  in  which  Gasco  has an  interest.  Net  wells  are the  sum of  Gasco's
fractional interests owned in the gross wells.

                                                                   Gross     Net

Producing gas wells                                                  4       1.5
Shut-in gas wells                                                    4       3.2
                                                                     -       ---

           Total                                                     8       4.7
                                                                     =       ===

Gasco does not operate any of these wells.

Oil and Gas Acreage.  The following table sets forth the  undeveloped  leasehold
acreage,  by area, held by Gasco as of December 31, 2001.  Undeveloped acres are
acres on which wells have not been  drilled or  completed  to a point that would
permit the  production  of commercial  quantities of oil and gas,  regardless of
whether or not such acreage contains proved reserves.  Gross acres are the total
number of acres in which Gasco has a working interest.  Net acres are the sum of
Gasco's  fractional  interests  owned in the gross  acres.  In  certain  leases,
Gasco's  ownership is not the same for all depths;  therefore,  the net acres in
these leases are calculated using the lowest ownership interest at any depth.

                                                         Gross               Net

Utah                                                   116,997            81,034
Wyoming                                                 52,363            45,232
California                                               3,868             3,866
                                                       -------           -------

           Total acres                                 173,228           130,132
                                                       =======           =======

In  2002,  the  Company  acquired   approximately   42,317  gross  (28,233  net)
undeveloped acres in Sublette County Wyoming.  On March 7, 2002, Gasco completed
a strategic  exchange of acreage  within the Uinta Basin in  northeastern  Utah,
whereby it  received  3,359 gross  acres  (2,474 net) in exchange  for 320 gross
acres  (160  net)  and  the   contractual   right  to  earn  Wasatch  rights  on
approximately 2,463 net Uinta Basin acres.

Gasco has an option to acquire  72,583  acres in the Greater  Green River Basin.
Gasco can also earn a 37.5%  interest in an additional  21,760 acres in Sublette
County Wyoming if it  participates in the drilling of one well prior to November
2002.  Gasco also has the right to earn a 20%  interest  in 21,951  gross  acres
within the Uinta Basin by  participating  in the drilling of four wells prior to
February 2004.

Drilling  Activity.  The following  table sets forth Gasco's  drilling  activity
during the year ended December 31, 2001.  Gasco had no drilling  activity during
the years ended December 31, 2000 and 1999.

                                                                   Gross     Net
Exploratory Wells:
Productive                                                           4       1.6
Dry                                                                  2         2
                                                                     -       ---

Total wells                                                          6       3.6
                                                                     =       ===


                                     - 4 -
<PAGE>

Oil and Gas Exploration Projects by Vallenar Energy Corp.

In March 2002, Brek acquired 2,512,500 shares of common stock of Vallenar Energy
Corp.  which,  together  with the 733,333  shares of common stock  issuable upon
conversion of preferred stock of Vallenar held by Brek, represents approximately
25% of  Vallenar's  equity.  For as long as at least  one-half of the  preferred
stock is  outstanding,  it is  entitled  as a class to at least 26% of the total
voting power of Vallenar. Brek has agreed, subject to exceptional circumstances,
not to dispose of any shares of preferred stock issuable upon conversion thereof
within the first three  years.  Brek is entitled to  designate  one director who
must sit on the  executive  committee of the board or  additional  voting rights
accrue to the preferred stock. All decisions of this executive committee must be
unanimous. Brek is playing an active role in the management of Vallenar.

Vallenar  holds leases  covering  approximately  8,540 acres in the  Rocksprings
Prospect,  which is located in central Edwards County,  Texas,  and is a part of
the Geronimo Creek Prospect. The Geronimo Creek Prospect is a shallow, heavy oil
play within the Cretaceous  aged Glen Rose limestone and Travis Peak  sandstone.
It is a north-south oriented,  faulted anticline having approximately 75 feet of
closure covering  approximately 29,500 acres.  Vallenar has advised Brek that it
intends  to  complete  a  one-to-two  well,  controlled  situation  core test to
determine  the  recovery  factor of the oil.  Assuming the core test results are
favorable,  Vallenar's management has recommended that a five-acre pilot program
then be implemented to test recovery methods.

Electronic Payment Processing

Brek was formed on September 16, 1998 with the name of First Ecom.com,  Inc., to
facilitate  electronic payment  processing of e-commerce  transactions for banks
and their  merchants  through the medium of the  Internet.  It  continues  to do
business in this area  through its wholly  owned  subsidiary  First Ecom Systems
Limited, referred to herein as FESL. FESL has developed an electronic gateway to
convert  consumers'  credit  card  information  collected  by  merchants  on the
Internet  into a format that can be processed  by banks.  FESL acts as a payment
system service  provider  between  banks,  online  merchants and consumers.  The
principal  geographic  area in which FESL  provides its  services is  throughout
Asia. FESL charges banks service fees for processing  transactions  through this
gateway on their behalf.  Brek's electronic payment processing  business has not
generated any significant  revenues to date, and management is reviewing various
options for this business.

     Payment Processing Over the Internet.

To purchase goods or services over the Internet,  a customer  generally visits a
merchant's  web site to view and select these goods or services.  Purchases  are
almost  invariably paid for by credit card, and prior to furnishing the goods or
services a merchant  requires the customer to submit his credit card details and
seek authorization to charge the card for the purchase.

To accept  payment by credit card, a merchant must establish a bank account with
a financial  institution  and  configure his web site for this purpose by credit
cards for goods or  services  ordered  from him online.  Payment  then occurs in
three steps: authorization, settlement and funds transfer.

After  completing  the  order  form  and  shipping  details  on  a  FESL-enabled
merchant's  web site, a customer is  redirected to a secure FESL payment page on
the site.  The data is  encrypted  and sent to the FESL's  gateway.


                                     - 5 -
<PAGE>

The payment gateway then routes the  authorization  request into the appropriate
card network (e.g. VISA, MasterCard, American Express), where it is forwarded to
the bank that issued the customer's credit card.

The  issuing  bank  approves  or  declines  the  transaction.  If it  approves a
transaction,  it blocks the relevant amount of funds in the consumer's  account,
reducing the cardholder's  available credit limit by the authorized  amount. Its
response is routed back through the  appropriate  card network to FESL's payment
gateway  and  finally  over  the  Internet  to the  merchant's  web site and the
consumer  simultaneously.  The  entire  process  typically  takes  less  than 10
seconds,  so the  consumer  is  advised  almost  immediately  whether or not his
purchase has been approved. The merchant may from time to time review the status
of  transactions  by  accessing  the  Merchant  Accounting  &  Reporting  System
(referred to as MARS), FESL's proprietary software, using a web browser over the
Internet. This software records the status of all purchases made by consumers on
a FESL-enabled merchant's web site.

In the case of approved  purchases  the merchant  must ship the goods or provide
the  services.  Once this has been done,  the  merchant is  permitted to request
settlement of the transaction,  and does so by initiating the settlement request
in his MARS account, usually on a batch-by-batch basis.

The settlement  request from the merchant is routed to the merchant's  acquiring
bank.  The  acquiring  bank will  request  payment from the bank that issued the
consumer's  credit  card.  The  issuing  bank  then  releases  the  funds to the
merchant's bank, completing the payment process.

     FESL's Operations and Technology.

FESL  continues the program,  started in 2000, of working  directly with various
banks who in turn offer electronic payment services to their merchant customers.
FESL has  enabled  two  banks,  which  currently  have some 60  merchants  whose
e-commerce  transactions  are  authorized  and approved  through  FESL's payment
gateway. From the time they were enabled in 2000 through January 31, 2002, these
banks executed over 250,000 transactions using the FESL's payment gateway.

In August  2001,  FESL  entered  into an  agreement  with United  Overseas  Bank
(Malaysia)  Bhd to process  its  ecommerce  transactions.  To date one  merchant
customer of this bank has been activated.

In 2002, FESL was certified by American Express to handle ecommerce transactions
for its merchants in the Asia Pacific  region.  The first merchants are expected
to be activated in the first half of 2002.

FESL owns and  operates  its own payment  gateway  technology  and its  merchant
accounting  and  reporting  systems on  redundant  servers  in Hong  Kong.  FESL
maintains  engineers at all times to monitor the gateway.  The servers have been
in constant operation since September 1999 without failure.

The software  FESL  provides to  merchants to connect  their web sites to FESL's
gateway  encrypts  the  transaction  information  sent over the  Internet to the
gateway, which in turn encrypts the information that it sends to payment switch.
This  encryption  is 128-bit key  strength.  A version of this software has been
developed  in  conjunction  with  Microsoft  Corporation  as a "plug-in"  to the
Microsoft Site Server Commerce Edition suite of programs.

Sold or Discontinued Businesses

Until March 31, 2001, Brek provided  systems  integration  services  through its
wholly owned subsidiary,  Asia Internet Limited, which was acquired on March 31,
2000.  In February 2001 Brek  decided,  due to the downturn in Internet  related
business in Hong Kong and the surrounding area, to terminate this business. Asia
Internet Limited ceased operations effective as of March 31, 2001.


                                     - 6 -
<PAGE>

In June 2001 Brek acquired the remaining 50% of the equity of, and loans payable
by,  First  Ecommerce  Data  Services  Limited,  referred to as FEDS,  which was
headquartered  in Bermuda,  from the Bank of Bermuda  for cash of $4.25  million
plus the  cancellation  of options to  purchase  500,000  shares of Brek  common
stock.  On October  19,  2001,  Brek sold its 100%  interest in FEDS for cash of
$1,663,986  plus 40% of FEDS  operating  profits for the next three years with a
minimum  guaranteed  amount  of $2  million  and a  maximum  of $3  million.  In
addition, Brek was paid back loans totaling $1,336,014.

In September  2001, Brek  terminated its  relationship  with the Bank of Bermuda
pursuant to which it had acted as a master merchant for the bank.

Employees

Brek has  significantly  reduced  its work  force and as at  February  15,  2002
employed 17 full-time  personnel.  Of these 9 work within the payment processing
business and the remainder  support Brek's  corporate  functions and oil and gas
business. It is expected that additional personnel will be hired for the oil and
gas business to accomplish  Brek's business plans. None of Brek's employees is a
member of a labor union.

Sales and Marketing

The  principal  markets for any oil and gas  produced  by Brek are  transmission
pipeline   companies,   utilities,   refining  companies  and  private  industry
end-users.

The  principal  market  for  FESL's  ecommerce  services  are  banks  and  their
merchants.  In order for merchants to sell goods and services over the internet,
they and their banks must be able to accept and process  ecommerce  transactions
on widely-held  credit cards such as MasterCard and Visa.  FESL will continue to
focus its sales  efforts in Hong Kong and other  Asian  markets.  Its  principal
marketing office is located in Hong Kong with representatives  located in Europe
and Malaysia.

Competition

Oil and Gas Exploration. Brek's natural gas and petroleum exploration activities
take place in a highly  competitive  and  speculative  business  atmosphere.  In
seeking  suitable  natural gas and petroleum  properties for  acquisition,  Brek
competes  with a number of other  companies  operating in its areas of interest,
including  large oil and gas  companies  and other  independent  operators  with
greater financial resources. Management does not believe that Brek's competitive
position in the petroleum and natural gas industry will be significant.

Competition in the petroleum and natural gas exploration industry also exists in
the form of  competition  to  acquire  the most  promising  acreage  blocks  and
obtaining  the most  favorable  prices for  transporting  the  product.  Brek is
relatively  small  compared  to other  petroleum  and  natural  gas  exploration
companies and may have difficulty acquiring additional acreage or projects,  and
may have difficulty  arranging for the  transportation of product,  in the event
Brek is successful in its exploration efforts.

Brek  anticipates a tight market for obtaining  drilling rigs and services,  and
the manpower to run them. The current high level of drilling  activity in Brek's
areas of  exploration  may have a significant  adverse  impact on the timing and
profitability of Brek's operations. In addition Gasco will be required to obtain
drilling permits for its wells, and there is no assurance that such permits will
be available timely or at all.

     The prices of oil and gas are controlled by domestic and world markets.


                                     - 7 -
<PAGE>

     Electronic Payment Processing. The most dominant participant in credit card
     processing is First Data  Corporation,  which enjoys a near monopoly of the
     industry in North America. Outside of North America, however, First Data is
     not dominant.  In Asia, FESL's principal market  competition will come from
     three sources:

     o    Large merchants having their own gateways;

     o    Merchant banks maintaining their own gateways; and

     o    Internet service  providers and similar  businesses that host merchant
          web sites maintaining their own gateways.

Many of these  competitors  are  substantially  larger  than Brek,  have  longer
operating histories and have much greater resources at their disposal.

FESL  believes  that  competition  will be on the basis of price and  quality of
service.  Because  FESL's  gateway is shared by many  merchants and banks,  FESL
believes  that its prices will be  competitive  on the grounds of  economies  of
scale.  It should be cheaper for each bank and merchant to share the cost of the
FESL's  gateway  rather than  maintain its own.  FESL also believes that it will
have an advantage over merchants and banks in maintaining the highest quality of
service possible.  Competitors of FESL, however,  will have greater resources to
allocate to the  development  and maintenance of a gateway should they choose to
do so.

Governmental Regulations and Environmental Laws

Brek,  or a venture in which it  participates,  will be required to obtain local
government and other permits for drilling oil or gas wells.

Exploration and production activities relating to oil and gas leases are subject
to numerous  environmental laws, rules and regulations.  The Federal Clean Water
Act requires the construction of a fresh water  containment  barrier between the
surface of each drilling site and the underlying water table.

Various federal,  state and local laws and regulations covering the discharge of
materials into the environment,  or otherwise  relating to the protection of the
environment,  may affect Brek's operations and costs through their effect on oil
and gas exploration,  development and production operations.  Environmental laws
and regulations have changed  substantially  and rapidly over the last 30 years,
and Brek anticipates that there will be continuing changes. Laws and regulations
protecting the environment have generally become more stringent in recent years,
and may in certain  circumstances impose "strict liability,"  rendering a person
liable for  environmental  damages  without regard to negligence or fault on the
part of such person.  Such laws and regulations may expose Brek to liability for
the conduct of operations or  conditions  caused by others,  or for acts of Brek
which were in  compliance  with all  applicable  laws at the time such acts were
performed.  Increasingly strict environmental  restrictions and limitations have
resulted in increased  operating costs for Brek and other businesses  throughout
the  United  States,  and it is  possible  that  the  costs of  compliance  with
environmental  laws and regulations will continue to increase.  The modification
of existing  laws or  regulations  or the  adoption  of new laws or  regulations
relating to environmental matters could have a material adverse effect on Brek's
operations. In addition, Brek's existing and proposed operations could result in
liability for fires, blowouts, oil spills, discharge of hazardous materials into
surface and subsurface aquifers and other environmental damage, any one of which
could result in personal injury, loss of life, property damage or destruction or
suspension of operations.

The  Comprehensive  Environmental  Response,   Compensation  and  Liability  Act
("CERCLA"),  also known as the "Superfund" law, requires payments for cleanup of
certain  abandoned  waste  disposal  sites,  even  though  such


                                     - 8 -
<PAGE>

waste  disposal  activities  were  undertaken  in  compliance  with  regulations
applicable  at the time of  disposal.  Under the  Superfund  law, one party may,
under  certain  circumstances,  be required  to bear more than its  proportional
share of cleanup  costs at a site where it has  responsibility  pursuant  to the
legislation,  if payments  cannot be obtained  from other  responsible  parties.
Other  legislation  mandates  cleanup of certain  wastes at facilities  that are
currently being operated.  States also have regulatory programs that can mandate
waste cleanup.  CERCLA  authorizes the  Environmental  Protection Agency ("EPA")
and, in some cases,  third parties to take actions in response to threats to the
public  health or the  environment  and to seek to recover from the  responsible
classes of persons the costs they incur. The scope of financial  liability under
these laws involves inherent uncertainties.

It is not  anticipated  that Brek will be  required in the near future to expend
material amounts because of environmental laws and regulations,  but inasmuch as
such laws and regulations are frequently changed,  Brek is unable to predict the
ultimate future cost of compliance.

Brek believes it is presently in compliance with all applicable  federal,  state
or local environmental laws, rules or regulations; however, continued compliance
(or  failure to comply)  and future  legislation  may have an adverse  impact on
Brek's present and contemplated business operations.

The  foregoing  is only a brief  summary of some of the  existing  environmental
laws, rules and regulations to which Brek's business operations are subject, and
there are many  others,  the  effects of which  could have an adverse  impact on
Brek.  Future  legislation  in this area will no doubt be enacted and  revisions
will be made in current  laws. No assurance can be given as to what effect these
present and future laws,  rules and regulations  will have on Brek's current and
future operations.

     The Company

Brek was  incorporated on February 12, 1999 in the state of Nevada in the United
States.  On February 12, 1999,  before issuing any shares of capital stock, Brek
consummated an agreement and plan of merger with JRL Resources  Corp., a Florida
corporation,  whereby JRL's 12,040,000  outstanding  shares of common stock were
converted into 12,040,000 shares of Brek's common stock on a one-for-one  basis.
JRL was  incorporated  in Florida on November 13, 1996 and was inactive from the
time of its formation  until its merger with Brek.  Before August 18, 1998,  JRL
was named Vantage Sales Corp.  Shortly before this merger,  JRL had acquired all
the outstanding  capital stock of First  Ecommerce Asia Limited,  which was then
Brek's only direct subsidiary, and is located in Hong Kong.

First  Ecommerce  Asia Limited was  incorporated  in Hong Kong on September  16,
1998. Before December 10, 1998, it was named Gold Pacific Management Limited. On
January 28, 1999 all of First  Ecommerce  Asia Limited's  outstanding  shares of
common  stock were  exchanged  for 985,000 of JRL's  1,025,000  then-outstanding
shares  plus  3,015,000  newly  issued  shares,  and it  became a  wholly  owned
subsidiary of JRL. For accounting  purposes,  this transaction was treated as an
acquisition of JRL by First Ecommerce Asia Limited,  and therefore the financial
information contained herein is only presented from September 16, 1998, the date
on which First Ecommerce Asia Limited was formed.  JRL had no operations  before
this date.  When JRL was merged into Brek,  First  Ecommerce Asia Limited became
the subsidiary of Brek.

Brek's  shareholders  approved  changing the name of the corporation  from First
Ecom.com,  Inc. to Brek Energy  Corporation at the Annual Meeting on January 29,
2002.  The  amended  articles  of Brek  were  filed  with the State of Nevada on
January 31, 2002.

Brek's headquarters are presently located at 19th Floor, 80 Gloucester Road, Wan
Chai, Hong Kong SAR.


                                     - 9 -
<PAGE>

Risk Factors

Brek is in development stage and an investment in Brek's common stock involves a
high  degree  of risk.  Brek's  business  and  results  of  operations  could be
seriously  harmed and the trading  price of Brek's  common  stock could  decline
should any of these risks come to fruition.

General Risks

Brek's Limited Operating History May Prevent it From Achieving Success

Brek's date of inception  was  September  16, 1998.  It has a limited  operating
history, which may prevent it from achieving success.  Brek's revenue and income
potential are unproven. It will encounter challenges and difficulties frequently
encountered by early-stage companies in new and rapidly evolving markets.

Chief among these challenges and difficulties are:

     o    Persuading banks to outsource their Internet credit card processing

     o    Processing a sufficient  volume of Internet  credit card  transactions
          which, particularly in Asia, may not be present in sufficient quantity
          to generate required revenues

     o    persuading  banks and  others to  purchase  the  e-Acquirer  and other
          products

     o    Gasco being able to adequately prove up its resources

     o    Locating and acquiring proper acquisition targets

     o    Locating and acquiring direct interests in oil and gas prospects

     o    Raising adequate additional equity and/or adequate financings

     o    Potential acquisitions being able to prove up their resources

It may  fail to  address  any of these  challenges  and  failure  to do so would
seriously harm Brek's business and operating  results.  In addition,  because of
Brek's limited  operating  history,  it has limited insight into trends that may
emerge and affect Brek's business.

Brek has Incurred Losses and Expects Future Losses

Brek has experienced operating losses in each period since inception and expects
these operating  losses to continue in the foreseeable  future.  On December 31,
2001,  Brek  had an  accumulated  deficit  of  approximately  $35.1  million,  a
significant  portion of this loss,  $10,461,322,  was  incurred  during the year
ended December 31,2001,  which included a non-recurring charge of $3.16 million,
a further  write  down of the  investment  in uniView  of $0.314  million  and a
recovery from  discontinued  operations of $1.49 million.  Brek has recorded the
non-recurring charge to reduce the carrying value of it assets to net realizable
value.  These  assets  were  subsequently  sold  for  and  amount  equal  to the
written-down  value.  Brek may not have  sufficient  resources  to increase  its
revenues  enough to  achieve  profitability.  Brek's  failure  to  increase  its
revenues  significantly  would  seriously  harm Brek's  business  and  operating
results. In fact, Brek may not have any revenue growth.


                                     - 10 -
<PAGE>

Financing Risks

Brek has relied on the sale of its equity  capital to fund  working  capital and
the  acquisition of its prospects and related  leases.  Brek will be required to
raise additional  capital in 2002. There is no assurance that additional funding
will be available to fund the  acquisition,  exploration  or  development of any
additional  properties.  There  can be no  assurance  that  Brek will be able to
obtain adequate financing in the future or that the terms of such financing will
be favorable. Any future financing will likely result in substantial dilution to
Brek's  stockholders.  Failure  to  generate  operating  cash  flow or to obtain
additional  financing could result in substantial dilution of Brek's oil and gas
interests,  or delay or cause indefinite postponement of further exploration and
development  of its  oil  and  gas  prospects  with  the  possible  loss of such
properties.

Substantial Upcoming Dilution

In  addition  to the  dilution  that is  likely  to occur  upon  raising  future
financing,  Brek has agreed to issue  19,250,000  shares of its common  stock in
order to obtain an increased  percentage of Gasco. Brek expects this issuance to
occur in the second quarter of 2002.  This issuance will represent  86.5% of the
shares of common stock presently outstanding.

Future Operating Results Will Likely Fluctuate

Brek's quarterly operating results will likely vary significantly in the future.
As a result,  period-to-period  comparisons of Brek's operating results will not
be  meaningful  and should not be relied  upon as  indicators  of Brek's  future
performance.   In  the  future,  Brek's  operating  results  may  be  below  the
expectations of securities analysts and investors.  Brek's failure to meet these
expectations  would likely  depress the market price of Brek's common stock.  To
date,   Brek  has  not  had   sufficient   operating   results   to  gauge   any
period-to-period fluctuations.

Brek plans to generate  revenues  from both the direct  operation of oil and gas
prospects acquired and through acquisition of existing operational  entities. To
date, Brek has not acquired any direct prospects or other entities.  Any revenue
generated  from the oil and gas  business  depends  on  acquisitions  and  their
inherent revenues. Brek has no acquisition targets as yet.

Brek Faces Substantial Competition

Brek's  competitors have longer operating  histories and  significantly  greater
operating financial,  technical,  marketing and other resources than Brek. These
competitors may adopt aggressive pricing policies.

Brek Must Manage Its Growth and Expansion

Brek's historical growth has placed, and any future growth is likely to continue
to place, a significant strain on Brek's resources. There can be no assurance of
any future growth. Any failure to manage growth effectively could seriously harm
Brek's  business and  operating  results.  To be  successful,  Brek will need to
continually   update  management   information   systems,   improve   operating,
administrative,  financial  and  accounting  systems  and  controls,  train  new
employees  and  maintain  close   coordination   among   executive,   technical,
accounting, finance, marketing, sales and operations organizations. In addition,
Brek's  growth has  resulted,  and any future  growth will result,  in increased
responsibilities  for  management  personnel.  In the event Brek needs to employ
additional personnel, Brek will need to recruit qualified personnel to staff our
operations.  Brek  believes  that such  personnel  currently  are  available  at
reasonable  salaries and wages in the  geographic  areas in which Brek operates.
There can be no assurance, however, that such personnel will be available in the
future.  In addition,


                                     - 11 -
<PAGE>

we cannot predict  whether the labor staffing at any of Brek's  projects will be
unionized, which may result in potentially higher operating costs.

Brek Must Retain and Attract Key Personnel

Brek's success depends largely on the skills, experiences and performance of the
members of its senior  management and other key personnel.  Brek needs employees
with knowledge of Internet and computer technology,  banking, Internet marketing
strategy  and credit  card  processing  as well as those with  expertise  in the
various  facets  of oil and gas  exploration  and  development.  Brek may not be
successful in attracting,  assimilating,  or retaining qualified  personnel.  In
addition,  Brek's  future  success  will  depend on Brek's  ability to  continue
attracting and retaining highly skilled personnel.  Like other companies in Hong
Kong, Brek faces intense competition for qualified personnel.

Reliance On Key Personnel

Brek considers Gregory M. Pek and Kenneth G.C. Telford to be key employees.  The
loss of either of them  could  seriously  harm  Brek's  business.  Brek does not
maintain key man life insurance for any of these employees.

Thin Public Market for Brek's Common Stock; Stock Price May Fluctuate

Brek's common stock is sometimes very thinly  traded.  Its trading price may not
be an accurate  reflection  of Brek's  value.  The market price of Brek's common
stock may fluctuate  significantly  in response to a number of factors,  some of
which (such as interest rates, general economic conditions and trading multiples
of comparable  companies) are beyond Brek's control,  and some of which (such as
operating results, announcements of new products, new customers,  acquisition of
potential  oil and gas  entities  and  prospects,  results  of  exploration  and
development) are within Brek's control.

Future Sales of Shares Could Affect Brek's Stock Price

If Brek's  stockholders  sell substantial  amounts of Brek's common stock in the
public market, the market price of Brek's common stock could fall. All of Brek's
outstanding common stock is eligible for sale in the public market immediately.

Shareholders Will Receive No Dividends

Brek has never paid  dividends  and has no current  plans to do so. Given Brek's
financial  position,  it is  unlikely  that it will  pay  any  dividends  in the
foreseeable  future.  Brek plans  instead to retain  earnings,  if any,  to fund
internal growth.

Enforcement of Legal Process

All of the directors,  except Andrew  Leitch,  of Brek reside outside the United
States. A substantial  portion of the assets of such persons are located outside
the United  States.  As a result it may be  difficult  or  impossible  to effect
service of process within the United States upon such persons,  to bring suit in
the United States or to enforce, in the U.S. courts, any judgment obtained there
against such persons predicated upon any civil liability  provisions of the U.S.
federal securities laws.


                                     - 12 -
<PAGE>

Foreign courts may not entertain  original  actions against Brek's  directors or
officers  predicated  solely upon U.S.  federal  securities  laws.  Furthermore,
judgments  predicated  upon any civil liability  provisions of the U.S.  federal
securities laws may not be directly enforceable in foreign countries.

Oil and Gas Exploration Risks

Exploration and Production Risks

The business of exploring  for and  producing oil and gas involves a substantial
risk of investment  loss that even a combination  of  experience,  knowledge and
careful  evaluation  may not be able to  overcome.  Drilling  oil and gas  wells
involves  the risk  that  the  wells  will be  unproductive  or  that,  although
productive,  the wells do not  produce  oil and/or gas in  economic  quantities.
Other hazards, such as unusual or unexpected geological  formations,  pressures,
fires, blowouts,  loss of circulation of drilling fluids or other conditions may
substantially   delay  or  prevent  completion  of  any  well.  Adverse  weather
conditions can also hinder drilling operations.  A major risk affecting drilling
is the need to  obtain  drilling  permits  from  local  authorities.  Delays  in
obtaining drilling permits,  the failure to obtain a drilling permit for a well,
or a permit  with  unreasonable  conditions  or costs  could  have a  materially
adverse effect on Brek's ability to effectively develop its properties.

A productive well may become  uneconomic in the event water or other deleterious
substances are encountered, which impair or prevent the production of oil and/or
gas from the well. In addition,  production from any well may be unmarketable if
it is impregnated with water or other deleterious substances.

As with any petroleum property,  there can be no assurance that oil and gas will
be produced from the  properties  in which Brek,  or any venture,  in which Brek
participates,  may obtain an interest. In addition, the marketability of oil and
gas which may be acquired  or  discovered  will be affected by numerous  factors
beyond the control of Brek.  These factors include the proximity and capacity of
oil and gas pipelines and processing  equipment,  market fluctuations of prices,
taxes,   royalties,   land  tenure,   allowable   production  and  environmental
protection.  The extent of these factors cannot be accurately predicted, but any
one or a  combination  of these  factors  may  result in Brek not  receiving  an
adequate  return on invested  capital.  There is no assurance  that crude oil or
natural gas in commercial  quantities will be discovered by Brek, or any venture
in which Brek participates.

Uninsurable Risks

Although  management  believes the operator of any  properties in which Brek may
acquire interests,  will acquire and maintain appropriate  insurance coverage in
accordance  with  standard  industry  practice,  Brek  may  suffer  losses  from
uninsurable hazards or from hazards which the operator or Brek has chosen not to
insure against  because of high premium costs or other reasons.  Brek intends to
engage in  participating  in the drilling of both  exploratory  and  development
wells.  Exploratory wells have much greater dry hole risk than do wells that are
drilled offsetting established production.  Brek may become subject to liability
for pollution, fire, explosion, blowouts, cratering and oil spills against which
Brek cannot  insure or against  which Brek may elect not to insure.  Such events
could result in substantial  damage to oil and gas wells,  producing  facilities
and other property and personal injury.  The payment of any such liabilities may
have a material, adverse effect on Brek's financial position.

No Assurance of Titles

Brek plans not to undergo the expense of retaining  lawyers to examine the title
to the mineral  interest to be placed under lease or already placed under lease.
Rather,  Brek will rely upon the  judgment  of  petroleum  and natural gas lease
brokers  or land men who  perform  the  fieldwork  in  examining  records in the
appropriate


                                     - 13 -
<PAGE>

governmental  office before  attempting to place under lease a specific  mineral
interest.  This  practice is widely  followed in the  petroleum  and natural gas
industry.

Prior to the drilling of a petroleum  and natural gas well,  however,  it is the
normal  practice in the  petroleum  and natural gas  industry  for the person or
company acting as the operator of the well to obtain a preliminary  title review
of the spacing unit within which the proposed  petroleum and natural gas well is
to be drilled to ensure there are no obvious  deficiencies in title to the well.
It frequently happens,  as a result of such examinations,  that certain curative
work must be done to correct deficiencies in the marketability of the title, and
such curative work entails expense.  The work might include obtaining affidavits
of heirship or causing an estate to be administered.

From  time to  time,  the  examination  made by  title  lawyers  reveals  that a
petroleum and natural gas lease or leases is worthless, having been purchased in
error from a person who is not the owner of the  mineral  interest  desired.  In
such  instances,  the amount  paid for such  petroleum  and natural gas lease or
leases is generally lost.

Environmental Regulations

In general, as noted above, the exploration and proposed  production  activities
of Brek are  subject to certain  federal,  state and local laws and  regulations
relating  to  environmental   quality  and  pollution  control.  Such  laws  and
regulations  increase the costs of these activities and may prevent or delay the
commencement or continuance of a given operation. Compliance with these laws and
regulations  has not had a material  effect on Brek's  operations  or  financial
condition  to date.  Specifically,  Brek is  subject  to  legislation  regarding
emissions into the environment, water discharges, and storage and disposition of
hazardous wastes. In addition,  legislation has been enacted which requires well
and facility  sites to be abandoned and reclaimed to the  satisfaction  of state
authorities.  However, such laws and regulations are frequently changed and Brek
is unable to predict the ultimate cost of compliance.  Generally,  environmental
requirements  do not appear to affect Brek any  differently or to any greater or
lesser extent than other companies in the industry.

Brek believes that its operations  comply,  in all material  respects,  with all
applicable environmental regulations.

Governmental Regulations

Petroleum and natural gas exploration, development and production are subject to
various types of regulation by local,  state and federal  agencies.  Legislation
affecting the petroleum  and natural gas industry is under  constant  review for
amendment and expansion.  Also, numerous departments and agencies,  both federal
and  state,  are  authorized  by  statute  to issue  and have  issued  rules and
regulations binding on the petroleum and natural gas industry and its individual
members,  some of which carry substantial  penalties for failure to comply.  The
regulatory  burden on the  petroleum and natural gas industry  increases  Brek's
cost of doing business and, consequently, affects its profitability. There is no
assurance  that laws and  regulations  enacted in the future will not  adversely
affect the petroleum and natural gas industry.  However, since these regulations
generally  apply to all petroleum and natural gas producers,  management of Brek
believes that these regulations  should not put Brek at a material  disadvantage
with respect to other petroleum and natural gas producers.

Most states in which Brek may own and/or operate properties have statutes, rules
and  regulations  governing  conservation  matters  including the unitization or
pooling of petroleum and natural gas properties,  establishment of maximum rates
of  production  from  petroleum  and  natural  gas wells and the spacing of such
wells.

Petroleum  and  natural  gas  mineral  rights  may be  held  by  individuals  or
corporations and, in certain  circumstances,  by governments having jurisdiction
over the area in which such  mineral  rights  are  located.  As a general  rule,
parties holding such mineral rights grant licenses or leases to third parties to
facilitate the


                                     - 14 -
<PAGE>

exploration and development of these mineral rights. The terms of the leases and
licenses   are   generally    established   to   require   timely   development.
Notwithstanding   the  ownership  of  mineral  rights,  the  government  of  the
jurisdiction  in which mineral rights are located  generally  retains  authority
over the manner of development of those rights.

In addition to royalties paid to freehold owners, each state generally imposes a
production or severance  tax with respect to  production  and sale of crude oil,
natural gas and natural gas liquids within their respective  jurisdictions.  For
the most part,  state production taxes are applied as a percentage of production
or sales.  Payment of these taxes is in the normal  course of  operations in the
petroleum  and natural  gas  industry  and should not have a material  impact on
Brek's financial condition.

Natural Gas and Oil Prices

In recent decades, there have been periods of both worldwide  overproduction and
underproduction of hydrocarbons and periods of both increased and relaxed energy
conservation  efforts. Such conditions have resulted in periods of excess supply
of, and reduced demand for,  crude oil on a worldwide  basis and for natural gas
on a domestic basis. These periods have been followed by periods of short supply
of, and  increased  demand for,  crude oil and natural  gas. The excess or short
supply of crude oil has placed  pressures on prices and has resulted in dramatic
price  fluctuations  even during  relatively  short  periods of seasonal  market
demand.

Competition

The  petroleum  and  natural  gas  industry is  intensely  competitive  and Brek
competes  with other  companies,  which  have  greater  resources.  Many of such
companies not only explore for and produce  crude  petroleum and natural gas but
also carry on refining  operations and market  petroleum and other products on a
regional,  national or worldwide  basis.  Such companies may be able to pay more
for productive petroleum and natural gas properties and exploratory prospects to
define,  evaluate,  bid for and  purchase  a greater  number of  properties  and
prospects than Brek's  financial or human  resources  permit.  Brek's ability to
acquire  additional  properties  and to discover  reserves in the future will be
dependent  upon its ability to evaluate and select  suitable  properties  and to
consummate  transactions  in a  highly  competitive  environment.  There is also
competition  between the petroleum and natural gas industry and other industries
with  respect  to the supply of energy and fuel to  industrial,  commercial  and
individual  customers.  There  is  no  assurance  that  Brek  will  be  able  to
effectively compete against such companies.

Electronic Payment Processing Risks

Brek Depends on the Growth of Its Customer Base

Brek's success in the payment processing business is substantially  dependent on
the growth of its customer base of banks that use its e-Acquirer  system.  If it
fails to increase its customer base, its business and operating  prospects would
be  seriously  harmed.  Brek's  ability to attract  customers  will  depend on a
variety of  factors,  including  the price and  quality of Brek's  products  and
services  as  well as  Brek's  ability  to  market  its  products  and  services
effectively.

The Processing Market is Highly Competitive

Brek's  payment   processing  markets  are  new,  rapidly  evolving  and  highly
competitive,  and it expects this  competition  to persist and  intensify in the
future.  Brek's failure to maintain and enhance its  competitive  position could
seriously  harm  its  business  and  operating  prospects.   It  will  encounter
competition from a number of sources. Brek's competitors have extensive customer
bases and strong  customer  relationships  that they could


                                     - 15 -
<PAGE>

leverage,  including  relationships with Brek's current and potential customers.
These  competitors also have  significantly  more  established  customer service
organizations than Brek does.

Brek Needs to Develop  and Expand Its  Payment  Processing  Sales and  Marketing
Capabilities

Brek has only been marketing its payment  processing  services since early 1999.
Brek's services require sophisticated sales effort targeted at senior management
of  Brek's  prospective  customers,   which  are  principally  banks  and  large
international  conglomerates.  Brek  needs to  expand  its  marketing  and sales
operations in order to increase market awareness of Brek's services and generate
increased  revenues.  Competition  for  qualified  sales  personnel  is intense,
however,  and Brek may not be able to hire enough  qualified  individuals in the
future.

Brek Depends on Continued Use of the Internet and Growth of E-commerce

Rapid growth in the use of the Internet has occurred only recently. As a result,
its  acceptance and use may not continue to develop at historical  rates,  and a
sufficiently  broad base of  consumers  may not adopt,  or continue to use,  the
Internet  and other online  services as a medium of commerce.  Demand and market
acceptance for recently  introduced  services and products over the Internet are
subject to a high level of uncertainty,  and there exist few proven services and
products.

The Internet  may not be accepted as a long-term  commercial  marketplace  for a
number of reasons, including potentially inadequate development of the necessary
network  infrastructure  or delayed  development  of enabling  technologies  and
performance improvements.  Brek's success will depend, in large part, upon third
parties  maintaining the Internet  infrastructure  to provide a reliable network
backbone  with the necessary  speed,  data  capacity,  security and hardware for
reliable Internet access and services.

Cautionary Statement Regarding Forward-Looking Statements

In the interest of providing the shareholders with certain information regarding
Brek's future plans and  operations,  certain  statements set forth in this Form
10-K relate to  management's  future plans and  objectives.  Such statements are
forward-looking  statements within the meanings 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 in
this report, including,  without limitation,  statements regarding Brek's future
financial position,  business strategy,  budgets,  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,"  "expect,"  "intend,"
"project,"  "estimate,"  "anticipate,"  "believe," or "continue" or the negative
thereof  or  similar  terminology.   Although  any  forward-looking   statements
contained in this Form 10-K or otherwise  expressed by or on behalf of Brek are,
to the  knowledge  and in the judgment of the  officers  and  directors of Brek,
believed  to be  reasonable,  there  can be no  assurances  that  any  of  these
expectations will prove correct or that any of the actions that are planned will
be  taken.  Forward-looking  statements  involve  known  and  unknown  risks and
uncertainties,  which may cause Brek's actual  performance and financial results
in  future  periods  to  differ  materially  from any  projection,  estimate  or
forecasted  result.  Important factors that could cause actual results to differ
materially  from  Brek  expectations  ("Cautionary  Statements")  include  those
discussed in this report under the caption "Risk Factors", above. All subsequent
written and oral  forward-looking  statements  attributable  to Brek, or persons
acting  on  its  behalf,  are  expressly  qualified  in  their  entirety  by the
Cautionary   Statements.   Brek   assumes  no  duty  to  update  or  revise  its
forward-looking   statements   based  on  changes  in  internal   estimates   or
expectations or otherwise.


                                     - 16 -
<PAGE>

ITEM 2. PROPERTIES

Brek  currently  leases an  office of  approximately  2,500  square  feet at the
address of its  headquarters  in Hong Kong for $6,870 per month plus  government
rates.  This lease expires on February 28, 2003. Gasco and Vallenar hold oil and
gas leases as described above, and each leases office space.

ITEM 3. LEGAL PROCEEDINGS

Neither Brek, Gasco nor Vallenar is a party to any legal proceedings,  which, in
Brek's opinion,  after  consultation  with legal counsel,  could have a material
adverse effect on Brek.

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

At Brek's 2000 Annual Meeting held on January 19, 2001, the shareholders elected
the six Board  Members for terms which  expire at the 2001 Annual  Meeting.  The
shareholders also ratified the appointment of Deloitte Touche Tohmatsu as Brek's
Independent Accountants.  At Brek's 2001 Annual Meeting held on January 29, 2002
the  shareholders  elected the seven Board Members for terms which expire at the
2002 Annual  Meeting,  ratified the  appointment of Deloitte  Touche Tohmatsu as
Brek's  Independent  Accountants,  approved  the  creation  of  the  2001  Stock
Option/Warrant  Plan and  approved  amending  the articles of Brek to change its
name to Brek Energy  Corporation and to increase the number of authorized common
shares from 200 million  share with a par value of $0.001 to 300 million  shares
with a par value of $0.001.  Although a proposal  to amend  Brek's  articles  to
create 50 million preferred shares received more affirmative votes than negative
ones,  it did not  receive the  approval  of a majority  of all the  outstanding
stock, as required by Nevada law.

ITEM 5.  MARKET  FOR THE  REGISTRANT'S  COMMON  EQUITY AND  RELATED  STOCKHOLDER
MATTERS

Brek's  common stock has traded on the National  Market under the symbol  "FECC"
from June 6, 2000 until February 19, 2002 when the symbol was changed to "BREK".
Prior to that it traded on the OTC under the symbol  "FECC" since March 8, 1999.
Brek's  common  stock  has also  traded  on the  Berlin  over-the-counter  stock
exchange  since  January  27,  2000 and has been  listed  on the  Bermuda  Stock
Exchange  since  December  23, 1999.  In  addition,  Brek's Units (each of which
consists of one share of common  stock and a warrant to purchase  one third of a
share of common stock) were listed on the Bermuda  Stock  Exchange from December
23, 1999 until March 12,  2001 when the units were  "unbundled"  after which the
units only consist of a warrant to purchase one third of a share of common stock
of Brek. The following  table sets forth the high and low closing prices for the
common stock for the periods indicated.

Year/Quarter                                            High                Low
                                                        ----                ---

                                                        2001

Fourth Quarter                                          0.62                0.30
Third Quarter                                           0.90                0.32
Second Quarter                                          1.35                0.81
First Quarter                                           1.88                0.75

                                                        2000

Fourth Quarter                                        $ 4.00               $0.75
Third Quarter                                          10.03                4.34
Second Quarter                                         23.00                7.88
First Quarter                                          32.50                7.94


                                     - 17 -
<PAGE>

As of February  28, 2002 there were  approximately  107 holders of record of the
common stock.  On March 28, 2002, the closing sales price of Brek's common stock
was $0.60 per share.

Brek has not paid any cash  dividends on its Common Stock and does not presently
intend to do so.  Future  dividend  policy  will be  determined  by its Board of
Directors  on  the  basis  of  its  earnings,  capital  requirements,  financial
condition and other factors deemed relevant.

The transfer  agent and  registrar of Brek's  Common stock is Nevada  Agency and
Trust  Company,  50 West Liberty,  Suite 880, Reno,  Nevada 895O1.  The transfer
agent and  registrar  of Brek's  Units is The Bank of Bermuda  Limited,  6 Front
Street, Hamilton, Bermuda.

Recent Sales of Unregistered Securities

In March 2002,  Brek issued  2,845,000  shares of its common  stock at $0.50 per
share  in  transactions  exempt  from  the  registration   requirements  of  the
Securities  Act of 1933 pursuant to  Regulations D and S. Ian Robinson,  Gregory
Pek and Kenneth Telford were among the subscribers for these shares.

ITEM 6. SELECTED FINANCIAL DATA

The following  selected financial data should be read in conjunction with Brek's
audited  consolidated  financial  statements appearing elsewhere herein. For the
period from  September 16, 1998 (date of  inception)  to December 31, 1998,  the
consolidated financial statements are not presented as all amounts are $Nil.

<TABLE>
<CAPTION>
                                                      Year ended         Year ended         Year ended
                                                  December 31, 2001  December 31, 2000  December 31, 1999
                                                  -----------------  -----------------  -----------------
<S>                                                  <C>                <C>                <C>
Revenue

Payment processing                                       301,978             38,223              2,634

Operating expenses

Sales and marketing                                      611,628          2,113,149          1,563,246

General and administrative                             7,153,141          8,297,692          4,241,389
Systems and technology                                   836,134          1,489,056            552,221
Charges for impairment of certain
long-lived and prepaid assets                          3,159,505            949,418                 --
                                                     -----------        -----------        -----------

Total expenses                                        11,760,408         12,849,315          6,356,856

Loss from operations                                 (11,458,430)       (12,811,092)        (6,354,222)
                                                     -----------        -----------        -----------

Other income/(expenses)
Interest income                                          704,725          1,527,959             36,761
Interest expense                                              --             (2,121)          (471,424)
Loss on write down of marketable securities             (314,339)        (1,632,353)                --
                                                     -----------        -----------        -----------

                                                         390,386           (106,515)          (434,663)
                                                     -----------        -----------        -----------

Equity in loss of affiliates                            (882,146)          (292,118)                --
                                                     -----------        -----------        -----------

Loss from continuing operations                      (11,950,190)       (13,209,725)        (6,788,885)
                                                     -----------        -----------        -----------

Income (loss) from discontinued operations
Net income (loss)                                       (236,683)        (4,219,736)                --
Gain on discontinuance (net of $Nil
tax effects)                                           1,725,551                 --                 --
                                                     -----------        -----------        -----------

                                                       1,488,868         (4,219,736)                --
                                                     -----------        -----------        -----------

Loss before cumulative effect
of accounting change                                 (10,461,322)       (17,429,461)        (6,788,885)

Cumulative effect of accounting change                        --           (380,000)                --
                                                     -----------        -----------        -----------

Net loss                                             (10,461,322)       (17,809,461)        (6,788,885)
                                                     ===========        ===========        ===========

Basic and diluted loss per share
applicable to common stockholders
Continuing operations                                      (0.62)             (0.73)             (0.56)
Discontinued operations                                     0.08              (0.23)                --
Cumulative effect of accounting change                        --              (0.02)                --
                                                     -----------        -----------        -----------

                                                           (0.54)             (0.98)             (0.56)
Weighted average shares used in
computing per share amounts                           19,210,037         18,064,980         12,043,662
                                                     ===========        ===========        ===========

<CAPTION>
Balance Sheet Data:
                                                         2001               2000               1999
                                                          US$                US$                US$
<S>                                                  <C>                <C>                <C>
Current Assets                                         2,596,852         32,282,424         12,159,946
Note Receivable                                        1,865,244                 --                 --
Loan Receivable                                          270,055                 --                 --
Property and Equipment                                   257,321            578,866          1,046,237
Total Assets                                          23,497,378         35,969,172         13,206,183
Deferred Rent                                                 --                 --             62,017
Obligation under capital lease                                --                 --              3,788
(including current installments)
Total Liabilities                                        271,379            509,373          1,263,936
Stockholders Equity                                   23,225,999         35,459,799         11,942,247
</TABLE>


                                     - 18 -
<PAGE>

ITEM 7. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

General

During 2001 Brek  rationalized its operations,  changed its primary focus to oil
and gas  exploration,  combined its payment gateway and related  products into a
new e-Acquirer product,  and limited its marketing  objectives to enabling banks
in Asia. Brek  discontinued  the systems  integration  business of Asia Internet
Limited  as  part  of the  rationalization  of  operations.  Brek  acquired  the
remaining 50% of First Ecommerce Data Services  Limited from the Bank of Bermuda
and later in the year sold 100% of it to Transworld Payment Solutions.

During 2001, Brek acquired a 26% non-dilutable  voting interest in Gasco Energy,
Inc.  for $19 million and  advanced  $270,055 to Vallenar  Energy  Corp.,  which
subsequent to the year end formed part of the $350,000  acquisition of preferred
shares of Vallenar, which have a 26% non-dilutable voting interest.

The majority of Brek's revenues during 2001 came from the operations  carried on
through First Ecommerce Data Services  Limited during the period of time that it
was a  wholly-owned  subsidiary  however,  Brek  is  still a  development  stage
enterprise and has insufficient operating history on which to base an evaluation
of its business and prospects.  Any such evaluation must be made in light of the
risks frequently  encountered by companies in their early states of development,
particularly  for  companies  in the  rapidly  evolving  sector  related  to the
Internet. See "Item 1. Business - Risk Factors". There is no assurance that Brek
will be  successful  in  addressing  these  risks and if it fails to do so,  its
financial  condition  and results of operations  would be  materially  adversely
affected.


                                     - 19 -
<PAGE>

Crititical Accounting Policies

Brek  prepares  its  consolidated   financial   statements  in  accordance  with
accounting  principles  generally accepted in the United States of America.  The
preparation  of Brek's  financial  statements  requires it to make estimates and
assumptions  that affect the amounts of assets and liabilities  reported and the
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the amount of revenues and expenses  reported  during the period
covered by the financial  statements.  On an on-going basis,  Brek evaluates its
estimates and  judgments,  including  those related to its  investments.  Actual
results may differ from those used in making any such estimates and judgments.

The  following  critical   accounting   policies  affect  the  more  significant
assumptions  and  estimates  used  in the  preparation  of  Brek's  consolidated
financial statements.

Investment in Affiliate

Brek has accounted for its interest in Gasco using the equity method.  Gasco has
incurred  operating  losses  since  Brek's  investment  in July 2001.  Sustained
operating  losses of this  affiliate  or other  adverse  events  could result in
Brek's  inability to recover the  carrying  value of the  investment,  which may
require Brek to record an impairment charge in the future.  Through December 31,
2001, Brek has not recorded an impairment charge for this investment.

Income Taxes

Brek  records a valuation  allowance  to reduce its  deferred  tax assets to the
amount that it believes is more likely than not to be realized. If in the future
Brek  determines  that it will be able to  realize  its  deferred  tax assets in
excess  of  their  recorded  amount,  it will  adjust  the  deferred  tax  asset
accordingly, which will increase income in the period the determination is made.
Likewise,  if Brek determines that it will not be able to realize all or part of
its net  deferred  tax asset in the future,  an  adjustment  to the deferred tax
asset would be charged to income in the period the determination is made.

Impairment of Assets

Brek reviews all assets on a regular basis to ensure that there is no impairment
in the carrying value. If it determines that there has been a permanent  decline
in, or Brek has become unable to recover,  the carrying  value of the asset,  an
impairment  charge  will be  recorded,  which will have an adverse  effect  upon
Brek's future operating results.

Results of Operations

Revenues

Total  revenues for 2001 were $301,978 as compared to $38,223 in 2000 and $2,634
in 1999.  The systems  integration  revenue of  $816,648  in 2000 which  related
directly  to Asia  Internet  Limited  which was  acquired  on March  31,2000 was
reclassified to discontinued operations.  Of the total revenue, $250,567 was due
to  consolidation  of FEDS  revenue for the period from June 19, 2001 to October
19, 2001.

Operating Expenses

Total  operating  expenses  incurred for 2001,  2000 and 1999 were  $11,760,408,
$12,849,315 and $6,356,856, respectively. The year 2001 included a non-recurring
charge of $3,159,505  for  impairment of long-lived  assets,  resulting from the
write-down of the carrying value of First Ecommerce Data Services  Limited as at


                                     - 20 -
<PAGE>

September 30, 2001 based on the sale proceeds in October 2001,  versus a similar
charge of $949,418, which resulted from a review of the carrying value of Brek's
electronic payment processing assets, in the 2000 year and no charge in 1999. Of
the total operating expenses, $936,586 was due to consolidation of FEDS expenses
for the period  June  19,2001  to October  19,2001.  A  reclassification  of the
expenses in 2000 of Asia Internet  Limited to discontinued  operations was made.
Significant  components of operating expenses for 2001 and 2000 consisted of the
following

Expenses                                                   Amount
                                                           ------

                                              2001          2000         1999
                                              ----          ----         ----

Operating expenses

Sales and marketing                           611,628     2,113,149    1,563,246
General and administrative                  7,153,141     8,297,692    4,241,389
Systems and technology                        836,134     1,489,056      552,221
Charges for impairment of certain
long-lived and prepaid assets               3,159,505       949,418           --
                                           ----------    ----------    ---------

Total expenses                             11,760,408    12,849,315    6,356,856
                                           ==========    ==========    =========

The decrease in expenses during the 2001 year is attributable to Brek decreasing
the number of employees to a low of 14,  decreased sales and marketing  efforts,
decreased systems  development and the  discontinuance of the operations of Asia
Internet Limited.

Other Income and Expenses

Interest income  decreased to $704,725 in 2001 as compared to $1,527,959 in 2000
and $36,761 in 1999.  This  decrease was due to Brek's  decreased  cash position
during  the  year  and a  significant  reduction  in  interest  rates.  The most
significant aspect related to the decrease in cash was due to the acquisition of
the preferred stock in Gasco Energy, Inc.

Interest  expense  reduced  to $nil in 2001 as  compared  to  $2,121 in 2000 and
$471,424 in 1999 as Brek did not have any borrowings during 2001.

The equity in loss of affiliates for 2001 of $882,146  consisted of Brek's share
of the losses  before the  acquisition  of the  remaining  50% interest of First
Ecommerce  Data Services  Limited on June 18, 2001, of $390,052 and Brek's share
of the losses of Gasco Energy, Inc. after the acquisition of its preferred stock
on July 19, 2001. Of $492,094  versus  $292,118 in 2000  attributable  wholly to
First Ecommerce Data Services Limited and $nil in 1999.

During 2001,  Brek recorded a loss of $314,339 on the write down its  investment
in shares of uniView  Technologies  Corporation,  a NASDAQ listed company.  Brek
purchased 735,295 shares,  since reduced to 91,912 due to a share  consolidation
in September 2001, of uniView in a August 2000 private placement for $2 million.
The closing market price on December 31, 2001 was $0.58. Brek recorded a loss of
$1,632,353 during the year ended December 31, 2000.

During  2001,  Brek  discontinued  the  operations  of its  systems  integration
business  carried  on  through  its  subsidiary  Asia  Internet   Limited.   The
discontinuation of these operations  resulted in a recovery of $1,488,868 due to
the  reversal  of  unvested  stock  compensation  costs  of  $1,852,570.   These
operations  had an  operating  loss


                                     - 21 -
<PAGE>

of  $236,683  during 2001 versus a loss of  $4,219,736  for 2000.  There were no
systems integration operations during 1999.

There is no cumulative effect of accounting change this year as compared to last
year.

Liquidity and Capital Resources

Brek did not have any fund raising activities during 2001.

On March  28,  2002,  Brek had  $2.5  million  of  cash,  cash  equivalents  and
marketable  securities available to fund operations.  Brek significantly lowered
its ongoing  expenditures  and  overhead  during the 2001 year by  reducing  the
number of employees,  closing offices and leasing more affordable  office space.
Although  Brek  believes  that its  current  cash  balances,  cash  equivalents,
investments  and equity  holdings  could meet its  working  capital  and capital
expenditure needs for 2002, Brek does expect that it will need to raise funds in
order to achieve its desired business objectives on a more timely basis. Because
Brek is not currently  generating  sufficient cash to fund its operations,  Brek
may need to rely on  external  financing  to meet future  capital and  operating
requirements. Any projections of future cash needs and cash flows are subject to
substantial  uncertainty.   Brek's  capital  requirements  depend  upon  several
factors,  including  the rate of market  acceptance,  its  ability to expand its
customer base and increase revenues, its level of expenditures for marketing and
sales,  purchases  of  equipment,  acquisitions  of oil  and  gas  entities  and
prospects and other factors. If Brek's capital requirements vary materially from
those  currently  planned,  Brek may require  additional  financing  sooner than
anticipated.  Brek can make no  assurance  that  financing  will be available in
amounts or on terms  acceptable  to Brek,  if at all.  Further,  if Brek  issues
equity securities,  stockholders may experience  additional  dilution or the new
equity securities may have rights,  preferences or privileges senior to those of
existing holders of common stock, and debt financing, if available,  may involve
restrictive  covenants  which could restrict Brek's  operations or finances.  If
Brek cannot raise funds, if needed, on acceptable terms, Brek may not be able to
continue  its   operations,   grow  market  share,   take  advantage  of  future
opportunities or respond to competitive pressures or unanticipated  requirements
which could negatively  impact Brek's business,  operating results and financial
condition. Brek leases office and other premises under non-cancellable operating
leases that call for payments of $216,419 during 2002 and $76,032 during 2003.

Brek does not anticipate  receiving any income from its  investments in Gasco or
Vallenar  for the  foreseeable  future.  The  Note  Receivable  is due,  without
interest, as follows:

          March 1,  2003 -  $350,000  March 1, 2004 -  $650,000  March 1, 2005 -
          $1,000,000

Brek has entered into  employment  agreements  with all of its employees.  These
agreements require severance payments ranging from four to 16 weeks' salary upon
termination  without cause. If the employees were all terminated  without cause,
Brek would have a liability for minimum severance pay of approximately $330,000.

SELECTED UNAUDITED QUARTERLY CONSOLIDATED RESULTS OF OPERATIONS

The following table sets forth unaudited quarterly statements of operations data
for the four  quarters  ended  December  31,  2001 and  2000.  We  believe  this
unaudited  information has been prepared  substantially on the same basis as the
annual audited  consolidated  financial  statements  appearing elsewhere in this
report. We believe this data includes all necessary adjustments, consisting only
of normal recurring  adjustments,  necessary for fair  presentation.  You should
read the quarterly data together with the consolidated  financial statements and
the  notes  to  those  statements   appearing  elsewhere  in  this  report.  The
consolidated   results  of  operations  for  any  quarter  are  not  necessarily
indicative of the  operating  results for any future  period.  We expect that or
revenues


                                     - 22 -
<PAGE>

may fluctuate  significantly  and in fact may be  significantly  less due to the
closure of the systems integration business.

<TABLE>
<CAPTION>
                                              Three months ended  Three months ended   Three months ended    Three months ended
                                               December 31, 2001  September 30, 2001      June 30, 2001        March 31, 2001
                                               -----------------  ------------------      -------------        --------------
<S>                                               <C>                <C>                   <C>                   <C>
Revenue

Payment processing                                     59,142            205,928                24,152                12,756
                                                  -----------        -----------           -----------           -----------

Operating expenses

Sales and marketing                                   217,317            206,049                15,506               172,756
General and administrative                          1,970,356          1,725,000             1,581,343             1,876,442
Systems and technology                                171,599            483,860                62,187               118,488
Charges for impairment of certain
long-lived and prepaid assets                              --          3,159,505                    --                    --
                                                  -----------        -----------           -----------           -----------

Total expenses                                      2,359,272          5,574,414             1,659,036             2,167,686
                                                  -----------        -----------           -----------           -----------

Loss from operations                               (2,300,130)        (5,368,486)           (1,634,884)           (2,154,930)
                                                  -----------        -----------           -----------           -----------

Other income/(expenses)
Interest income                                        13,921             56,504               246,698               387,602
Interest expense                                           --                 --                    --                    --
Loss on write down of marketable securities            (6,434)          (307,905)                   --                    --
                                                  -----------        -----------           -----------           -----------

                                                        7,487           (251,401)              246,698               387,602
                                                  -----------        -----------           -----------           -----------

Equity in loss of affiliates                         (336,393)          (155,701)             (194,653)             (195,399)
                                                  -----------        -----------           -----------           -----------

Loss from continuing operations                    (2,629,036)        (5,775,588)           (1,582,839)           (1,962,727)
                                                  -----------        -----------           -----------           -----------

Income (loss) from discontinued operations
Net income (loss)                                      (7,627)                --                 2,271              (231,327)
Gain on discontinuance                                     --                 --                    --             1,725,551
                                                  -----------        -----------           -----------           -----------

                                                       (7,627)                --                 2,271             1,494,224
                                                  -----------        -----------           -----------           -----------

Loss before cumulative effect
of accounting change                               (2,636,663)        (5,775,588)           (1,580,568)             (468,503)

Cumulative effect of accounting change                     --                 --                    --                    --
                                                  -----------        -----------           -----------           -----------

Net loss                                           (2,636,663)        (5,775,588)           (1,580,568)             (468,503)
                                                  ===========        ===========           ===========           ===========

Basic and diluted loss per share
applicable to common stockholders
Continuing operations                                   (0.14)             (0.30)                (0.08)                (0.10)
Discontinued operations                                    --                 --                    --                  0.08
                                                  -----------        -----------           -----------           -----------

                                                        (0.14)             (0.30)                (0.08)                (0.02)
Weighted average shares used in
computing per share amounts                        19,210,037         19,210,037            19,210,037            19,210,037
                                                  ===========        ===========           ===========           ===========
</TABLE>


                                     - 23 -
<PAGE>

<TABLE>
<CAPTION>
                                              Three months ended    Three months ended  Three months ended  Three months ended
                                                 Dec 31, 2000         Sept 30, 2000       June 30, 2000       March 31 2000
                                                 ------------         -------------       -------------       -------------
<S>                                               <C>                  <C>                  <C>                <C>
Revenue

Payment processing                                     10,336               17,355                5,730              4,802
System integration revenue                            178,814              233,133              404,701                 --
                                                  -----------          -----------          -----------        -----------

Total revenue                                         189,150              250,488              410,431              4,802

Direct costs                                          226,765              269,279              340,244                 --
                                                  -----------          -----------          -----------        -----------

Gross profit                                          (37,615)             (18,791)              70,187              4,802
                                                  -----------          -----------          -----------        -----------

Operating expenses

Sales and marketing                                  (250,338)             491,206              698,203            519,983
General and administrative                          2,697,181            2,223,961            2,742,270          1,872,501
Systems and technology                                729,081            1,251,266            1,424,850            244,369
Non-recurring charges for impairment of
certain long-lived and prepaid assets               2,405,829                   --                   --                 --
                                                  -----------          -----------          -----------        -----------

Total expenses                                      5,581,753            3,966,433            4,865,323          2,636,853

Operating loss                                     (5,619,368)          (3,985,224)          (4,795,136)        (2,632,051)

Other income/(expenses)
Interest income                                       398,944              476,273              474,090            179,603
Interest expense                                         (387)                 (85)              (1,385)              (264)
Loss on write down of marketable
securities                                         (1,448,553)            (183,800)                  --                 --
                                                  -----------          -----------          -----------        -----------

Total other income (expenses)                      (1,049,996)             292,388              472,705            179,339
                                                  -----------          -----------          -----------        -----------

Equity in loss of affiliates                         (177,695)            (114,423)                  --                 --

Loss before cumulative effect of
accounting change                                  (6,847,060)          (3,807,259)          (4,322,431)        (2,452,712)
                                                  -----------          -----------          -----------        -----------

Cumulative effect of accounting
change                                               (380,000)                  --                   --                 --

Net loss                                           (7,227,060)          (3,807,259)          (4,322,431)        (2,452,712)
                                                  ===========          ===========          ===========        ===========

Basic and diluted loss per share
applicable to common stockholders
Before cumulative effect of accounting
change                                                  (0.36)               (0.20)               (0.24)             (0.15)
Cumulative effect of accounting change                  (0.02)                  --                   --                 --
                                                  -----------          -----------          -----------        -----------

                                                        (0.38)               (0.20)               (0.24)             (0.15)
                                                  ===========          ===========          ===========        ===========

Weighted average shares used in
computing per share amounts                        19,210,037           18,935,312           18,210,037         15,879,359
                                                  ===========          ===========          ===========        ===========
</TABLE>

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Exchange Risk

Brek intends to continue  marketing its payment processing  services  throughout
Hong Kong and the Asia-Pacific  region as well as North America and Europe. As a
result,  its  financial  results could be affected by factors such as changes in
foreign currency exchange rates or weak economic  conditions in its existing and
potential  markets,  however,  the  fact  that  the  Hong  Kong  dollar,  Brek's
functional currency, is pegged to the U.S. dollar reduces Brek's risk.

Brek  expects  that its initial oil and gas  acquisitions  will be in the United
States.  If Brek makes  acquisitions  outside of the United States its financial
results  could be  affected  by factors  such as  changes  in  foreign  currency
exchange rates or weak economic conditions.

Financial Instruments

Brek primarily invests in fixed rate investments with short maturities, which do
not present a material  interest rate risk,  however,  Brek's interest income is
sensitive to changes in the general level of Hong Kong and U.S.  interest rates.
There have been no significant  changes in Brek's  exposure to changes in either
interest  rates or foreign  currency  exchange rates for the year ended December
31, 2001. Its exposure to interest rates is limited as it does not have variable
rate and long-term borrowings. Brek is subject to variable interest rates on its
bank deposits that are cash and short-term  investments.  These  investments are
held at cost because  there are no  significant  market price  movements.  As of
December 31, 2001, a hypothetical 10% immediate increase or decrease in interest
rates would increase or decrease  Brek's annual  interest  expense and income by
approximately $nil and $1,617,000, respectively.


                                     - 24 -
<PAGE>

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The consolidated  financial  statements and reports of Brek's independent public
accountants are filed as part of this report on pages F-1 through F-35.

The  consolidated  financial  statements and reports of the  independent  public
accountants of Gasco Energy, Inc. are filed as part of this report on pages F-36
through F-55.

ITEM  9.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURE

Brek has had no disagreements with its Independent Accountants on accounting and
financial disclosure.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The names, ages, and terms of office of directors and executive officers of Brek
are set forth below:

Name (1)                      Position With Company

Gregory M. Pek                Director, President, and Chief Executive Officer
Ravi K. Daswani               Director
Douglas Moore                 Director
Ian G. Robinson               Director, Chairman of the Board
James Pratt                   Director
Andrew Leitch (2)             Director
Kenneth G.C. Telford          Secretary, and Chief Financial Officer

     (1)  None of Brek's officers or directors, other than Andrew  Leitch, is  a
          resident or citizen of the United States

     (2)  Mr.  Leitch was  appointed a Member of Brek's  Board of  Directors  in
          April 2002.

Gregory M. Pek, 46, has been a Director of Brek since March 3, 1999 and has been
a Director of First  Ecommerce  Asia Limited  since its  inception.  Mr. Pek was
President and Chief  Executive  Officer since March 3, 1999 until June 27, 2000.
Mr. Pek assumed the position of  President  and  co-Chief  Executive  Officer on
October 16, 2000 until  August 31, 2001 when he became Chief  Executive  Officer
upon the resignation of Mr. Daswani.  He was from March 1994 to February 1999 an
executive  officer of David Resources  Company Limited,  Kong Tai  International
Holdings  Company Limited and from September 1998 to February 1999 a director of
Singapore Hong Kong Properties  Investment  Limited.  Before 1994, Mr. Pek was a
director and officer of a number of public companies in Canada.

Ravi K.  Daswani,  35, has been a Director of Brek since March 3, 1999 and was a
Director of First  Ecommerce  Asia Limited since its inception  until July 2001.
Mr. Daswani was Chief Operating  Officer of Brek from March 3, 1999 until August
31,2001 and co-Chief  Executive  Officer from October 16, 2000 to August 31,2001
when he  retired to pursue  other  business  interests.  From  December  1997 to
February  1999 Mr.  Daswani  was the  managing  director  and  co-owner  of Asia
Internet  Limited,  a Hong Kong Internet service  provider.  For more than three
years before  December  1997,  he was the managing  director of a wholesale  and
retail apparel business. He has established  international operations trading in
dry goods, consumer electronics,  apparel and Internet services in Africa, Latin
America and Asia.

Ian  Robinson,  62, has been a Director of Brek since  February  24,  2000,  was
appointed  Vice-Chairman  on November 29, 2000 and Chairman on January 19, 2001.
Mr.  Robinson has 45 years of  experience  as a


                                     - 25 -
<PAGE>

Chartered  Accountant and was a former senior partner of the Hong Kong office of
the international accountancy firm Ernst & Young. He has been based in Hong Kong
since 1980 servicing the Asia region and has had  experience in major  countries
around the world. Mr. Robinson  specializes in corporate rescue,  restructuring,
insolvency,  investigation,  business valuation and trouble shooting  generally.
Mr.  Robinson also holds a number of  directorships  including being a member of
the  Supervisory  Board and member of the  Executive  Committee of the Hong Kong
Housing Society.

Douglas Moore, 43, has been a Director of Brek since October 27, 1999. Mr. Moore
is the Chief Executive  Officer of Henderson Cyber Limited,  the high technology
subsidiary of the Henderson  Group,  which comprises  Henderson Land Development
Company  Limited and its  subsidiaries.  Mr. Moore is also the Head of Strategic
Planning of Henderson  Land. Mr. Moore is also a  non-executive  director of Blu
Spa, a botanical beauty product  company.  From 1994 until early 2000, Mr. Moore
was the Head of the Hong Kong  Market of Credit  Suisse and a director of Credit
Suisse  Investment  Advisory  (Hong  Kong)  Limited.  Prior to 1994,  Mr.  Moore
practiced  international  and  Canadian  tax law with the Hong  Kong  office  of
McMillan  Binch,  a major  Canadian  law firm.  He is a Canadian and a Hong Kong
lawyer.

James Pratt,  53, was  appointed to Brek's Board of Directors in June 2000.  Mr.
Pratt is Deputy  Chairman  of the GSM  Association.  Mr.  Pratt  was  previously
Managing Director of Asia Wireless, a division of Telstra International, Telstra
Corporation  of  Australia  where he  oversaw  all of Telstra  Group's  wireless
operations and  investments  throughout the Asia Pacific  Region.  Mr. Pratt was
formerly Chief Executive Officer of Peoples Phone in Hong Kong since 1996. Prior
to this he was general manager of the telecommunications  division of Mitsubishi
Electric  Australia.   Mr.  Pratt  has  more  than  thirty  years  international
management experience in the Asia Pacific telecommunications industry.

Mr. Andrew  Leitch,  58, was  appointed to Brek  Energy's  board of directors in
April 2002. Mr. Leitch is both a Chartered  Accountant  (Canada) and a Certified
Public Accountant (USA). He has an international and diversified career spanning
some 25 years with Deloitte & Touche and has held senior executive  positions in
certain  varied  commercial  enterprises.  Mr.  Leitch  has  20  plus  years  of
experience in international  business.  He worked as the Chief Operating Officer
for  Vapotronics  Inc. in San Diego from  2000-2001.  While Mr.  Leitch was with
Deloitte & Touche,  Hong Kong from  1994-2000,  he was the Vice  Chairman of the
Management  Committee  (1997-2000) and Executive  Director of Corporate  Finance
(1994-1997).   Mr.  Leitch  currently  holds  a  board  position  with  Citicorp
Everbright China Fund Limited.

Kenneth G.C. Telford,  52, has been Brek's Chief Financial Officer and Secretary
since July 1, 2000.  Mr.  Telford is both a Chartered  Accountant  (Canada)  and
Certified Public  Accountant  (USA). Mr. Telford has been a partner in Sadovnick
Telford + Skov,  Chartered  Accountants in Canada and Telford  Sadovnick,  PLLC,
Certified  Public  Accountants  in the United States since 1994. Mr. Telford was
also previously a partner in the international accounting firm Touche Ross & Co.
(now Deloitte & Touche) as well as Chief  Operating  Officer and Chief Financial
Officer of an  automotive  rental  company.  Mr.  Telford has  advised  numerous
companies, operating in both North America and Asia Pacific, on a broad range of
financial and business matters including the financial  management  requirements
of U.S. publicly listed companies.


                                     - 26 -
<PAGE>

ITEM 11. EXECUTIVE COMPENSATION

<TABLE>
<CAPTION>
                                                 Annual compensation                         Long term compensation
                                                                                               Awards      Payouts

                                                                                             Shares of
                                                                               Restricted    common stock
                                                              Other annual     stock         underlying    LTIP      All Other
Name and Principal Position Year     Salary       Bonus       compensation     award(s)      options       Payouts   Compensation
<S>                         <C>      <C>          <C>             <C>              <C>      <C>               <C>         <C>
Gregory Pek, CEO            2001     $218,710     $107,097        $15,484                     75,000
                            2000      238,172           --             --          --        200,000          --          --
                            1999      167,742           --             --          --        100,000          --          --

Ravi Daswani, Co-CEO [1]    2001      154,839      109,677          4,473                     75,000
                            2000      238,172           --             --          --        200,000          --          --
                            1999      167,742           --             --          --        100,000          --          --

Kenneth Telford, CFO        2001      259,994      117,419         13,005                    200,000

                                     Does not
                            2000   exceed 100,000                                            100,000

Steve Corbin, President,
First Ecom Systems
Limited                     2001      202,581       45,800          1,548          --         50,000          --          --

                            2000     Does not           --             --          --         30,000          --          --
                                      exceed
                                      100,000

                            1999     Does not           --             --          --         20,000          --          --
                                      exceed
                                      100,000

Barry Conn, Senior Vice
President, First Ecom
Systems Limited             2001      157,419           --          1,548          --         25,000          --          --

                            2000     Does not           --             --          --         20,000          --          --
                                      exceed
                                      100,000
</TABLE>

(1)  resigned as co-ceo on August 31, 2001

     Directors  and  executive  officers  were  granted  options to purchase the
     Company's common stock during the year as follows:

Option grants in Fiscal year ended Dec. 31, 2001


                                     - 27 -
<PAGE>

<TABLE>
<CAPTION>
Option grants in Fiscal year ended Dec. 31, 2001
                                                                          Individual grants
                                                                                                  Potential realizable value
                                                                                                  at assumed annual rates of
                                                                                                   Stock price appreciation
                                                                                                       for option term
                            Number of        Percent of
                            securities     Total options
                            underlying       granted to      Exercise                             Value at
                         options granted    employees in     of base      Market  Expiration     grant date
Name                          (1)           fiscal year   price ($/Sh)    price      Date          0%         5%         10%
<S>                          <C>                <C>           <C>         <C>      <C>           <C>        <C>         <C>
Gregory Pek, CEO              75,000             5.9%         $0.40       $0.41    31-Oct-06       750       9,246      19,523
Ravi Daswani (2)              75,000             5.9%          0.40        0.41    31-Oct-06       750       9,246      19,523
Ian Robinson                  75,000             5.9%          0.40        0.41    31-Oct-06       750       9,246      19,523
Douglas Moore                125,000             9.8%          0.40        0.41    31-Oct-06     1,250      15,409      32,539
James Pratt                   75,000             5.9%          0.40        0.41    31-Oct-06       750       9,246      19,523
Marc Bruner (3)               75,000             5.9%          0.40        0.41    31-Oct-06       750       9,246      19,523
Ken Telford                  200,000            15.6%          0.40        0.41    31-Oct-06     2,000      24,655      52,062
Steve Corbin                  50,000             3.9%          0.40        0.41    31-Oct-06       500       6,164      13,015
Barry Conn                    25,000             2.0%          0.40        0.41    31-Oct-06       250       3,082       6,508
</TABLE>

(1)  All of the options granted are fully vested and  exercisable  until October
     31, 2006

(2)  Resigned as Co-CEO August 2001.

(3)  Resigned May 4, 2002.

Total effective options as at Dec. 31, 2001 1,280,000

No share options were exercised  during the year;  share options  outstanding in
the hands of  directors  and senior  management  as of December 31, 2001 were as
follows:

<TABLE>
<CAPTION>
                                                     Number of securities underlying        Value of Unexercised In-The-
                                                      unexercised options at fiscal         Money options at fiscal year
                            Shares                             year end(#)                         end (1) ($)
                          acquired on     value        ----------------------------         ----------------------------
          Name           exercise (#)  realized ($)     Exercisable       Unexercisable   Exercisable      Unexercisable
<S>                         <C>           <C>            <C>                  <C>            <C>             <C>
Gregory Pek, CEO            0             0               75,000              0              $0              0
Ravi Daswani (2)            0             0               75,000              0               0              0
Ian Robinson                0             0               75,000              0               0              0
Douglas Moore               0             0              125,000              0               0              0
James Pratt                 0             0               75,000              0               0              0
Marc Bruner (3)             0             0               75,000              0               0              0
Ken Telford                 0             0              200,000              0               0              0
Steve Corbin                0             0               50,000              0               0              0
Barry Conn                  0             0               25,000              0               0              0
</TABLE>

(1)  Based on a December 31, 2001 closing price of US$0.40 per share.

(2)  Resigned as Co-CEO August 2001.

(3)  Resigned May 4, 2002.


                                     - 28 -
<PAGE>

Directors' Compensation

Directors,  who are not  officers of the  Company,  are paid fees of $10,280 per
year in connection  with their  serving on the Board.  The Chairman of the Board
receives $54,000 per year.  Directors are reimbursed for out-of-pocket  expenses
incurred with attending Board meetings.

Employment Agreements

Gregory Pek.

Brek entered into an  employment  agreement  with Gregory Pek, its President and
Chief  Executive  Officer,  the term of which  commenced in January  1999.  This
agreement  provided that Brek would pay Mr. Pek a monthly  salary of HK $100,000
(approximately  USD 12,820) plus an additional  month's salary per calendar year
of service as a year-end  payment.  In January 2000 Mr. Pek's monthly salary was
increased to HK $150,000  (approximately USD 19,230);  however, in December 2000
Mr. Pek agreed to have his  monthly  salary  temporarily  reduced to HK $100,000
(approximately  USD  12,820).   Brek  entered  into  new  six-month   employment
agreements  with Mr. Pek  covering  the period  from March 1, 2001 to August 31,
2001.  During this period,  Mr. Pek's  aggregate  monthly salary was HK $165,000
(approximately  USD 21,150) plus an  additional  lump-sum  payment equal to four
months'  salary was paid to Mr. Pek in August 2001.  In August 2001 Brek entered
into new  one-year  employment  agreements  with Mr.  Pek  that  provide  for an
aggregate  monthly  salary of HK $165,000  (approximately  USD  21,150)  plus an
additional  month's  salary per calendar year of service as a year-end  payment.
These agreements will terminate on August 31, 2002 unless Brek chooses to extend
the terms of such  agreements.  If Brek does not  choose to extend  the terms of
such agreements, the agreements provide that Brek must pay a termination payment
to Mr. Pek in August 2002 equal to three months' salary.

Ravi Daswani.

Brek entered into an employment  agreement with Ravi Daswani,  who served as the
Senior Vice  President  and Chief  Operating  Officer until his  resignation  in
August  2001,  the term of which  commenced  in  January  1999.  This  agreement
provided  that Brek  would  pay Mr.  Daswani  a  monthly  salary of HK  $100,000
(approximately  USD 12,820) plus an additional  month's salary per calendar year
of service as a year-end  payment.  In January 2000 Mr. Daswani's monthly salary
was increased to HK $150,000  (approximately USD 19,230);  however,  in December
2000 Mr.  Daswani agreed to have his monthly  salary  temporarily  reduced to HK
$100,000   (approximately  USD  12,820).  Brek  entered  into  a  new  six-month
employment  agreement with Mr. Daswani covering the period from March 1, 2001 to
August 31, 2001. Under this agreement, Mr. Daswani was paid (i) a monthly salary
of HK $150,000  (approximately USD 19,230),  (ii) an additional lump-sum payment
equal to four months' salary on August 31, 2001 and (iii) a prorated  portion of
one month's salary,  equal to HK $100,000  (approximately USD 12,820), on August
31, 2001.

Kenneth Telford.

Brek  entered  into  employment  agreements  with  Kenneth  Telford,  its  Chief
Financial Officer, the terms of which commenced in March 2001. Pursuant to these
agreements,  Brek paid Mr.  Telford an aggregate  monthly  salary of HK $165,000
(approximately USD 21,250),  for the period from March 1, 2001 through September
30, 2001, issued Mr. Telford warrants to purchase 50,000 shares of Brek's common
stock  at an  exercise  price  of USD 1.25 per  share  and paid Mr.  Telford  an
additional  lump-sum  payment in August 2001 equal to four months'  salary.  The
agreements  also provided for an additional  month's salary per calendar year of
service as a year-end  payment.  In August 2001 Brek  entered  into new one-year
employment  agreements  with Mr.  Telford that provide for an aggregate  monthly
salary of HK $165,000  (approximately  USD 21,250)  plus an  additional  month's
salary per calendar year of service as a year-end  payment.  This agreement will
terminate  on August  31,  2002  unless  Brek  chooses to extend the term of the
agreement.  If Brek does not  choose to extend  the term of the  agreement,  the
agreement  provides that Brek must pay a termination  payment to Mr.  Telford in
August 2002 equal to three months' salary.


                                     - 29 -
<PAGE>

Report of Compensation Committee
of the Board of Directors

Notwithstanding  anything to the contrary set forth in any of Brek's previous or
future filings under the  Securities Act of 1933 or the Securities  Exchange Act
of 1934 (the "Exchange Act') that might incorporate this Form 10-K Annual Report
or future filings with the Securities  and Exchange  Commission,  in whole or in
part, the following  report shall not be deemed to be  incorporated by reference
into any such filing.

Membership and Role of the Compensation Committee

The Compensation Committee consists of the following non-employee members of
Brek's Board of Directors: Douglas Moore, Ian Robinson and James Pratt. The
Compensation Committee reviews and determines Brek's executive compensation
objectives and policies, administers Brek's stock plans and grants stock
options.

In Hong Kong, competition for executive talent is intense in our industry.  With
this perspective,  the Compensation  Committee reviews and sets the compensation
of Brek's executive officers.

Executive Compensation Program

Objectives

     The objectives of Brek's executive compensation program are to:

o    Attract and retain highly talented and productive executives

o    Provide incentives for superior performance

o    Align the  interests of  executive  officers  with the  interests of Brek's
     stockholders by basing a significant  portion of  compensation  upon Brek's
     performance

Components

Brek's executive compensation program combines the following two components,  in
addition  to the  benefit  plans  offered  to all  employees:  base  salary  and
long-term incentive compensation consisting of stock option grants.

It  is  Brek's  policy  to  set  base  salary  levels  and  long-term  incentive
compensation  on  a  comparable  level  with  an  average  of  those  of  select
corporations   to  which  Brek   compares   itself  for  purposes  of  executive
compensation.  Brek  selects  such  corporations  on the  basis of a  number  of
factors, such as their size and complexity,  the nature of their businesses, the
regions in which they operate, the structure of their compensation  programs and
the availability of compensation information. The corporations selected for such
comparison  may vary from year to year based upon market  conditions and changes
in both Brek's and the  corporations'  businesses  over time. Brek believes that
competitive  compensation  levels  are  necessary  to  attract  and  retain  the
high-caliber executives necessary for the successful conduct of Brek's business.

Each  component  of Brek's  executive  compensation  program  serves a  specific
purpose  in  meeting  Brek's  objectives.  The  components  of Brek's  executive
compensation program are described below, except for any variations arising from
individual provisions of employment agreements that Brek enters into upon hiring
an executive.

Base Salary

The Compensation  Committee  annually reviews the salaries of Brek's executives.
When  setting  base salary  levels in a manner  consistent  with the  objectives
outlined  above,  the Committee  considers  competitive  market  conditions  for
executive  compensation,  Company  performance and individual  performance.  The
measures of individual performance considered in setting 2001 salaries included,
to the  extent  applicable  to an  individual  executive  officer,  a number  of
quantitative  and  qualitative  factors  such as Brek's  historical  and  recent
financial  performance  in the principal area of  responsibility  of the officer
(including such measures as gross margin, net income,  sales, customer count and
market share), the individual's  progress toward  non-financial goals within his
area  of  responsibility,   individual  performance,  experience  and  level  of
responsibility  and other  contributions  to Brek's  success.  The  Compensation
Committee has not found it practicable, nor has it attempted, to assign relative
weights to the specific factors used in determining base salary levels,  and the
specific factors used may vary among individual officers. As is typical for most
corporations,  payment of base salary is not conditioned upon the achievement of
any specific, pre-determined performance targets.


                                     - 30 -
<PAGE>

Long-term incentive compensation.

Brek believes  that option grants align  executive  interests  with  stockholder
interests by creating a direct link between compensation and stockholder return,
give executives a significant,  long-term  interest in Brek's success,  and help
retain key executives in a competitive market for executive talent.

Brek's  Stock Option Plan  authorizes  the  Committee to grant stock  options to
executives.  Option  grants  are  made  from  time to time to  executives  whose
contributions  have  or will  have a  significant  impact  on  Brek's  long-term
performance.  Brek's determination of whether option grants are appropriate each
year  is  based  upon  individual  performance  measures  established  for  each
individual.  Options are not necessarily  granted to each executive  during each
year.  Generally,  options  granted to executive  officers  vest in equal annual
installments  over a period of two years and expire  five years from the date of
grant.

Replacement Option Grants

(On October 31, 2001, the named executives set forth below rescinded options and
warrants to purchase Brek's common stock,  and Brek reissued a new number of new
options having  five-year terms and exercise prices equal to the then-fair value
of the stock  (which  were lower than the  exercise  prices of the  options  and
warrants  rescinded).  See  "Report of  Compensation  Committee  of the Board of
Directors."

<TABLE>
<CAPTION>
                                                                                                    Length (months) of
                                                                            Exercise price of      option/warrant term
                                               Number of options/warrants   options/warrants       remaining at Date of
                                                        rescinded              rescinded               Replacement
                                   New         ------------------------- ----------------------     -------------------
                     Number of     exercise
Name                 new options   price       Options     Warrants       Options     Warrants      Options      Warrants
<S>                  <C>             <C>       <C>           <C>           <C>          <C>           <C>          <C>
Gregory Pek, CEO      75,000         0.40      150,000           --        5.05           --          46           --
                                                50,000           --        7.65           --          32           --
Ravi Daswani(1)       75,000         0.40      150,000           --        5.05           --          46           --
                                                50,000           --        7.65           --          32           --
Ian Robinson          75,000         0.40       50,000       50,000        5.05         1.25          46           53
Douglas Moore        125,000         0.40      100,000       30,000        5.05         1.25          46           53
James Pratt           75,000         0.40       50,000       30,000        5.05         1.25          46           53
Ken Telford          200,000         0.40      100,000       50,000        5.05         1.25          46           53
Steve Corbin          50,000         0.40       20,000       50,000        5.05         1.25          46           53
                                                10,000           --        7.65           --          32           --
Barry Conn            25,000         0.40       20,000       25,000        5.05         1.25          46           53
</TABLE>

(1)  Resigned as Co-CEO August 2001.

Benefits.  Brek  believes that it must offer a  competitive  benefit  program to
attract and retain key executives.

During 2001, Brek provided medical and other benefits to its executive  officers
that are generally available to Brek's other employees.

Compensation  of the Chief  Executive  Officer.  The chief  Executive  Officer's
compensation  plan for 2001 included the same elements and performance  measures
as the plans of Brek's other executive officers.

Submitted by:                    Douglas Moore
                                 Ian Robinson
                                 James Pratt


                                     - 31 -
<PAGE>

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the current beneficial ownership of Brek's common
stock by (i) each person known by Brek to beneficially  own five percent or more
of Brek's  outstanding  common stock,  (ii) Brek's Chief  Executive  Officer and
Directors and (iii) all of Brek's  Executive  officers and Directors as a group.
Except as  otherwise  indicated,  all  shares of Common  Stock are  beneficially
owned, and investment and voting power is held, by the person named as owner.

Name and Address of                              Number of Shares     Percentage
Beneficial Owner                                Beneficially Owned     Ownership
                                               ------------------     ---------

Gregory M. Pek                                     1,782,500(3)          8.05%
Ravi K. Daswani                                      485,461(3)          2.19%
Power Broadcasting Inc.                            1,333,333(1)          5.96%
Douglas Moore                                        391,667(2)          1.76%
Ian Robinson                                         595,000(3)          2.69%
James Pratt                                           95,000(3)          0.43%
Andrew Leitch                                              0             0.00%
Kenneth Telford                                      300,000(4)          1.35%
Steve Corbin                                          65,415(5)          0.30%
Barry Conn                                            25,000(6)          0.11%

Executive Officers and
Directors as a group                               3,740,043(7)         16.39%

(1)  Includes warrants to purchase 333,333 shares of common stock.

(2)  Includes options to purchase 125,000 shares and warrants to purchase 66,667
     shares of common stock.

(3)  Includes options to purchase 75,000 shares of common stock.

(4)  Includes options to purchase 200,000 shares

(5)  Includes options to purchase 50,000 shares.

(6)  Includes options to purchase 25,000 shares.

(7)  Includes options to purchase 700,000 shares and warrants to purchase 66,667
     shares of common stock.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

During 2001, Brek paid consulting fees of $28,629 to former directors.

During  2001,  Brek  advanced  $270,055 to Vallenar  Energy Corp. A director and
officer of Brek are also  directors of  Vallenar,  and certain  shareholders  of
Brek's affiliate, Gasco, are also shareholders of Vallenar.

Mssers.  Pek,  Robinson and Telford  agreed in February  2002 to  subscribe  for
200,000 , 500,000 and  100,000  shares of Brek common  stock,  respectively,  at
$0.50 per share,  the  prevailing  market  price of the stock at the time of the
agreement. These transactions were completed in March 2002.

Brek believes that the above  transactions are on terms at least as favorable to
it as could have been obtained in an arm's length transaction.


                                     - 32 -
<PAGE>

ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, AND REPORTS ON FORM 8-K

FINANCIAL STATEMENTS

(See pages F-1 to F-55 below)

EXHIBITS

3.1  Amended and Restated Articles of Incorporation**

3.2  By-laws*

4.1  Specimen Stock Certificate*

11.1 Computation of Earnings (Loss) Per Share***

21.1 List of Subsidiaries***

23.1 Consent of Deloitte Touche Tohmatsu**

23.2 Consent of KPMG***

23.3 Consent of Deloitte & Touche, LLP***

23.4 Consent of Wheeler Wasoff, P.C.***

23.5 Consent of HJ & Associates, LLC***

*    Incorporated by reference to the Company's  Registration  Statement on Form
     10 filed October 21, 1999

**   Filed herewith.

***  Previously filed.

REPORTS ON FORM 8-K

Form 8-K  Filed on  January  10,  2000 in Regard to  Private  Placement  Made in
December 1999

Form 8-K Filed on March 17,  2000 in Regard to Private  Placement  Completed  on
March 6, 2000

Form 8-K Filed on September  25, 2000 in Regard to  Resignation  of  Independent
Accountants and Appointment of New Independent Accountants

Form 8-K Filed on December 1, 2000 in Regard to Status of Company Operations

Form 8-K Filed on January 30, 2001 in Regard to Status of Company Operations

Form 8-K Filed on April 5, 2001 in Regard to  Financial  Results  for the Fiscal
Year ended December 31, 2000

Form 8-K Filed on May 14, 2001 in Regard to Memorandum of Understanding to merge
with Gasco Energy, Inc.

Form 8-K  Filed on May 21,  2001 in Regard to  Financial  Results  for the First
Quarter ended March 31, 2001

Form 8-K Filed on June 22, 2001 in Regard to Acquisition  of Remaining  interest
of FEDS


                                     - 33 -
<PAGE>

Form 8-K  Filed on July 23,  2001 in Regard  to  Acquisition  of Shares of Gasco
Energy, Inc.

Form 8-KA Filed on  September  18, 2001 in Regard to  Acquisition  of  Remaining
interest of FEDS

Form 8-K Filed on November 2, 2001 in Regard to Disposal of FEDS Shares

Form 8-KA Filed on November 7, 2001 in Regard to  Acquisition of Shares of Gasco
Energy, Inc.

Form 8-KA Filed on December 3, 2001 in Regard to Disposal of FEDS Shares

Form 8-K Filed on February 1, 2002 in Regard to Results of Annual Meeting

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Independent Auditors' Reports

<TABLE>
<S>                                                                  <C>
Deliotte Touche Tohmatsu                                             F-1

KPMG                                                                 Previously filed.

Consolidated Balance Sheets at December 31, 2001 and 2000.           F-2

Consolidated Statements of Operations for the years ended
December 31, 2001, 2000, 1999 and for the period from
September 16, 1998 to December 31, 2001.                             F-3

Consolidated Statements of Stockholders' Equity for the years ended
December 31, 2001, 2000, 1999 and for the period from September 16,
1998 to December 31, 2001.                                           F-4

Consolidated Statements of Cash Flows for the years ended
December 31, 2001, 2000, 1999 and for the period from September 16,
1998 to December 31, 2001                                            F-5 & F-6

Notes to Consolidated Financial Statements                           F-7 - F-34
</TABLE>

                               GASCO ENERGY, INC.
                        Consolidated Financial Statements
                        and Independent Auditors' Reports
                       For the years ended 2001, 2000 and
                    1999 and for the period from inception to
                                December 31, 2001

           INDEX TO FINANCIAL GASCO ENERGY, INC. FINANCIAL STATEMENTS
<TABLE>
<S>                                                                  <C>
Independent Auditors' Reports                                        Previously filed.

Consolidated Balance Sheets at December 31, 2001 and 2000            Previously filed.

Consolidated Statements of Operations for the Years Ended
December 31, 2001, 2000 and 1999                                     Previously filed.

Consolidated Statements of Stockholders' Equity for the Years
Ended December 31, 2001, 2000 and 1999                               Previously filed.

Consolidated Statements of Cash Flows for the Years Ended
December 31, 2001, 2000 and 1999                                     Previously filed.

Notes to Consolidated Financial Statements                           Previously filed.
</TABLE>


                                     - 34 -
<PAGE>

INDEPENDENT AUDITORS' REPORT

TO THE BOARD OF DIRECTORS AND STOCKHOLDERS OF BREK ENERGY CORPORATION  (Formerly
First Ecom.com, Inc.)

We have  audited the  accompanying  consolidated  balance  sheets of Brek Energy
Corporation and subsidiaries (a development stage company) ("the Company") as of
December  31,  2001  and  2000,  and  the  related  consolidated  statements  of
operations,  stockholders' equity, and cash flows for each of the three years in
the period ended  December 31, 2001 and the period from September 16, 1998 (date
of inception) to December 31, 2001. These consolidated  financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these  financial  statements  based on our  audit.  The  Company's
consolidated financial statements as of and for the year ended December 31, 1999
and the period from September 16, 1998 (date of inception)  through December 31,
1999 (not  presented  separately  herein) were audited by other  auditors  whose
report,  dated  February 28, 2000,  expressed  an  unqualified  opinion on those
statements.  The consolidated financial statements for the period from September
16, 1998 (date of inception)  through  December 31, 1999 reflect total  revenues
and net loss of $2,634 and $6,788,885,  respectively, of the related totals. The
other auditors' report has been furnished to us, and our opinion,  insofar as it
relates to the amounts  included for such prior  period,  is based solely on the
report of such other auditors.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  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 audits and the report of
other auditors provides a reasonable basis for our opinion.

In our  opinion,  based on our  audits and the  report of other  auditors,  such
consolidated  financial statements present fairly, in all material respects, the
consolidated financial position of the Company as of December 31, 2001 and 2000,
and the results of its operations and its cash flows for each of the three years
in the period ended December 31, 2001 and for the period from September 16, 1998
(date of  inception)  to  December  31,  2001,  in  conformity  with  accounting
principles generally accepted in the United States of America.

As discussed in note 2 to the  consolidated  financial  statements,  Brek Energy
Corporation changed its method of accounting for certain convertible instruments
during the year ended  December 31, 2000 and during the year ended  December 31,
2001, the Company  changed its method of accounting for goodwill to conform with
transitional  provisions of Statement of Financial Accounting Standards No. 142,
"Goodwill  and Other  Intangible  Assets"  that  require the  discontinuance  of
goodwill and indefinite life intangible assets amortization for acquisitions and
investments made after June 30, 2001.

Deloitte Touche Tohmatsu
Hong Kong
March 20, 2002, except for note 20(f) as to which the date is April 8, 2002.


                                      F-1
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
                           CONSOLIDATED BALANCE SHEETS

                (In United States dollars, except share amounts)

<TABLE>
<CAPTION>
                                                                                 December 31,
                                                                                 ------------

                                                                              2001             2000
                                                                              ----             ----
<S>                                                                      <C>               <C>
                                           ASSETS

Current Assets:
Cash and cash equivalents ..........................................     $  2,088,484      $ 31,211,711
Trade accounts receivable (net of allowance for doubtful accounts
    of $Nil and $11,558 at December 31, 2001 and 2000) .............           28,858            71,015
Accrued interest receivable ........................................            3,326            85,586
Marketable securities (Note 3) .....................................           53,309           367,648
Prepaid insurance ..................................................          288,869           256,361
Rental deposits ....................................................           39,226           168,325
Other prepaid expenses and deposits ................................           94,780           121,778
                                                                         ------------      ------------

                Total current assets ...............................        2,596,852        32,282,424
Note receivable (Note 5) ...........................................        1,865,244                --
Loan receivable (Note 6) ...........................................          270,055                --
Property and equipment, net (Note 7) ...............................          257,321           578,866
Investment in and advances to affiliates (Note 9) ..................       18,507,906         3,107,882
                                                                         ------------      ------------

                Total assets .......................................     $ 23,497,378      $ 35,969,172
                                                                         ============      ============

                           LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Accounts payable ...................................................     $     15,389      $    120,974
Accrued professional and consulting fees ...........................           65,611           208,654
Accrued salaries ...................................................          129,032            40,256
Accrued printing costs .............................................           30,000                --
Other accrued liabilities ..........................................           31,347           133,885
Deferred revenue ...................................................               --             5,604
                                                                         ------------      ------------

                Total current liabilities ..........................          271,379           509,373
                                                                         ------------      ------------

Commitments and Contingencies (Note 18)

Stockholders' equity:
Common stock 200,000,000 shares authorized, $0.001 par value,
    shares issued and outstanding: 2001: 19,210,037;
    2000: 19,210,037 ...............................................           19,211            19,211
Additional paid-in capital .........................................       58,266,456        60,038,934
Deficit accumulated during the development stage ...................      (35,059,668)      (24,598,346)
                                                                         ------------      ------------

                Total stockholders' equity .........................       23,225,999        35,459,799
                                                                         ------------      ------------

                Total Liabilities and Stockholders' Equity .........       23,497,378      $ 35,969,172
                                                                         ============      ============
</TABLE>

                See notes to consolidated financial statements.


                                      F-2
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                (In United States dollars, except share amounts)

<TABLE>
<CAPTION>
                                                                                                                       Cumulative
                                                                                                                          from
                                                                                                                        September
                                                                                                                     16, 1998 (date
                                                                                  Year ended December 31,           of inception) to
                                                                                  -----------------------              December 31,
                                                                           2001            2000           1999             2001
                                                                           ----            ----           ----             ----
<S>                                                                    <C>             <C>             <C>             <C>
Revenue
Payment processing .................................................   $    301,978    $     38,223    $      2,634    $    342,835
                                                                       ------------    ------------    ------------    ------------

Operating expenses:
Sales and marketing (including stock based compensation costs
(recovery) of $(108,352), $285,482, $233,528 and $410,658 for the
years ended December 31, 2001, 2000 and 1999 and the period from
September 16, 1998 (date of inception) to December 31, 2001 ........        611,628       2,113,149       1,563,246       4,288,023
General and administrative (including stock based
         compensation costs of $312,246, $1,443,530, $256,369 and
         $2,012,145 for the years ended December 31, 2001, 2000 and
         1999 and the period from September 16, 1998 (date of
         inception) to December 31, 2001 ...........................      7,153,141       8,297,692       4,241,389      19,692,222
Systems and technology (including stock based compensation
         costs (recovery) of $(123,802), $59,307, $156,635 and
         $92,140 for the years ended December 31, 2001, 2000 and
         1999 and the period from September 16, 1998 (date of
         inception) to December 31, 2001 ...........................        836,134       1,489,056         552,221       2,877,411
Charges for impairment of certain long-lived and prepaid
         assets (Notes 8 and 9) ....................................      3,159,505         949,418              --       4,108,923
                                                                       ------------    ------------    ------------    ------------

                Total operating expenses ...........................     11,760,408      12,849,315       6,356,856      30,966,579
                                                                       ------------    ------------    ------------    ------------

Loss from operations ...............................................    (11,458,430)    (12,811,092)     (6,354,222)    (30,623,744)
                                                                       ------------    ------------    ------------    ------------

Other income (expenses):
Interest income ....................................................        704,725       1,527,959          36,761       2,269,445
Interest expense ...................................................             --          (2,121)       (471,424)       (473,545)
Loss on write down of marketable securities (Note 3) ...............       (314,339)     (1,632,353)             --      (1,946,692)
                                                                       ------------    ------------    ------------    ------------

                Total other income (expenses) ......................        390,386        (106,515)       (434,663)       (150,792)
                                                                       ------------    ------------    ------------    ------------

Equity in loss of affiliates (Note 9) ..............................       (882,146)       (292,118)             --      (1,174,264)
                                                                       ------------    ------------    ------------    ------------

Loss from continuing operations ....................................    (11,950,190)    (13,209,725)     (6,788,885)    (31,948,800)
                                                                       ------------    ------------    ------------    ------------

Income (loss) from discontinued operations (Note 15)
Net loss ...........................................................       (236,683)     (4,219,736)             --      (4,456,419)
Gain on discontinuance (net of $Nil tax effects) ...................      1,725,551              --              --       1,725,551
                                                                       ------------    ------------    ------------    ------------

                Total income (loss) from discontinued operations ...      1,488,868      (4,219,736)             --      (2,730,868)
                                                                       ------------    ------------    ------------    ------------

Loss before cumulative effect of accounting change .................    (10,461,322)    (17,429,461)     (6,788,885)    (34,679,668)

Cumulative effect of accounting change .............................             --        (380,000)             --        (380,000)
                                                                       ------------    ------------    ------------    ------------

Net loss ...........................................................   $(10,461,322)   $(17,809,461)   $ (6,788,885)   $(35,059,668)
                                                                       ============    ============    ============    ============

Basic and diluted loss per share applicable to
common stockholders
Continuing operations ..............................................          (0.62)          (0.73)          (0.56)          (1.78)
Discontinued operations ............................................           0.08           (0.23)             --           (0.15)
Cumulative effect of accounting change .............................             --           (0.02)             --           (0.02)
                                                                       ------------    ------------    ------------    ------------

.....................................................................          (0.54)          (0.98)          (0.56)          (1.95)
                                                                       ============    ============    ============    ============

Weighted average shares used in computing per share amounts ........     19,210,037      18,064,980      12,043,662      17,947,593
                                                                       ============    ============    ============    ============
</TABLE>

                See notes to consolidated financial statements.


                                      F-3
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                (In United States dollars, except share amounts)

<TABLE>
<CAPTION>
                                                                                                  Deficit
                                                                                                accumulated
                                                       Common stock           Additional         during the         Total
                                                       ------------             paid-in         development      stockholders'
                                                    Shares       Amount         capital            stage            equity
                                                    ------       ------         -------            -----            ------
<S>                                               <C>            <C>         <C>               <C>               <C>
Balance at September 16, 1998
(date of inception) .........................             --     $    --     $         --      $         --      $         --
                                                  ----------     -------     ------------      ------------      ------------

Balance at December 31, 1998 ................             --          --               --                --                --
Impact of merger with JRL
Resources Corp. .............................      4,040,000       4,040           (4,940)               --              (900)
Issuance of shares of common stock
in lieu of organizational costs .............      8,000,000       8,000          300,000                --           308,000
Issuance of common stock and
warrants ....................................      2,916,667       2,917       17,364,583                --        17,367,500
Stock based compensation ....................             --          --          646,532                --           646,532
Proceeds received on issuance of debt
securities with detachable warrants .........             --          --          410,000                --           410,000
Net loss for the year .......................             --          --               --        (6,788,885)       (6,788,885)
                                                  ----------     -------     ------------      ------------      ------------

Balance at December 31, 1999 ................     14,956,667      14,957       18,716,175        (6,788,885)       11,942,247
Issuance of common stock (net of
issuance cost of $2,095,562) ................      3,228,500       3,229       20,915,835                --        20,919,064
Fair value of warrants issued with
common stock ................................             --          --        7,656,124                --         7,656,124
Stock-based compensation ....................             --          --        3,947,837                --         3,947,837
Shares issued in business
combination (Note 1) ........................         24,870          25          623,963                --           623,988
Shares issued on exercise of warrants .......      1,000,000       1,000        7,799,000                --         7,800,000
Cumulative effect of accounting change
for beneficial feature of convertible debt ..             --          --          380,000                --           380,000
Net loss for the year .......................             --          --               --       (17,809,461)      (17,809,461)
                                                  ----------     -------     ------------      ------------      ------------

Balance at December 31, 2000 ................     19,210,037      19,211       60,038,934       (24,598,346)       35,459,799
Issuance of warrants ........................             --          --          174,900                --           174,900
Cancellation of stock options relating
to discontinued operations ..................             --          --       (1,947,378)               --        (1,947,378)
Net loss for the year .......................             --          --               --       (10,461,322)      (10,461,322)
                                                  ----------     -------     ------------      ------------      ------------

Balance at December 31, 2001 ................     19,210,037     $19,211     $ 58,266,456      $(35,059,668)     $ 23,225,999
                                                  ==========     =======     ============      ============      ============
</TABLE>

                See notes to consolidated financial statements.


                                      F-4
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                (In United States dollars, except share amounts)

<TABLE>
<CAPTION>
                                                                                                                Cumulative
                                                                                                                   from
                                                                                                                 September
                                                                                                                  16, 1998
                                                                           Year ended December 31,             (inception) to
                                                                           -----------------------              December 31,
                                                                     2001           2000            1999            2001
                                                                     ----           ----            ----            ----
<S>                                                             <C>             <C>             <C>             <C>
Cash flows from operating activities:
Net loss ....................................................   $(10,461,322)   $(17,809,461)   $ (6,788,885)   $(35,059,668)
Adjustments to reconcile net loss to net cash used
in operating activities:
Equity loss in affiliates ...................................        882,146         292,118              --       1,174,264
Organizational costs in excess of cash paid .................             --              --         300,000         300,000
Stock compensation costs (recovery) .........................     (1,772,478)      3,947,837         646,532       2,821,891
Depreciation ................................................        446,366         575,587         250,382       1,272,335
(Gain) loss on disposal of equipment ........................        125,537          (6,085)          3,804         123,256
Loss on disposal of equipment from discontinued operations ..          6,943              --              --           6,943
Accretion of discount on loan ...............................             --              --         410,000         410,000
Cumulative effect of accounting change for
beneficial feature of convertible debt ......................             --         380,000              --         380,000
Amortization of goodwill ....................................        325,672         291,282              --         616,954
Loss recognized on write down of marketable securities ......        314,339       1,632,353              --       1,946,692
Charges for certain long-lived and prepaid assets ...........      3,159,505       2,405,829              --       5,565,334
Changes in operating assets and liabilities
net of business acquired:
Trade accounts receivable and accrued interest receivable ...         96,852         (52,548)             --          44,304
Prepaid financial advisory fee ..............................             --         672,022        (672,022)             --
Other prepaid expenses and deposits .........................        110,906        (651,061)       (375,778)       (915,933)
Amounts due from stockholders ...............................             --          12,540         (12,540)             --
Accounts payable ............................................        (96,706)        183,506         235,340         322,140
Accrued professional and consulting fees ....................       (143,043)        102,821         105,833          65,611
Accrued salaries ............................................         88,776          40,256              --         129,032
Other accrued liabilities ...................................        (81,969)       (261,085)         30,313        (312,741)
Amounts due to related companies ............................             --        (239,727)        239,727              --
Deferred rent ...............................................             --         (62,017)         62,017              --
Deferred revenue ............................................         (5,604)        (12,471)         18,075              --
                                                                ------------    ------------    ------------    ------------

Net cash used in operating activities .......................     (7,004,080)     (8,558,304)     (5,547,202)    (21,109,586)
                                                                ------------    ------------    ------------    ------------

Cash flows from investing activities:
Purchase of property and equipment ..........................       (316,323)       (520,614)     (1,199,172)     (2,036,109)
Proceeds from disposal of equipment .........................         33,284          22,803           5,806          61,893
Proceeds from sale of subsidiary ............................      1,418,473              --              --       1,418,473
Effect of acquisition of subsidiary on cash .................     (2,232,059)     (1,409,319)             --      (3,641,378)
Investment in marketable securities .........................             --      (2,000,000)             --      (2,000,000)
Investment in and advances to affiliate .....................     (1,752,467)     (3,400,000)             --      (5,152,467)
Acquisition of Gasco Energy, Inc. ...........................    (19,000,000)             --              --     (19,000,000)
Loan receivable .............................................       (270,055)             --              --        (270,055)
                                                                ------------    ------------    ------------    ------------

Net cash used in investing activities .......................    (22,119,147)     (7,307,130)     (1,193,366)    (30,619,643)
                                                                ------------    ------------    ------------    ------------

Cash flows from financing activities:
Proceeds from issuance of common stock ......................             --      30,670,750      18,133,000      48,803,750
Share issue cost paid .......................................             --      (2,460,458)       (318,750)     (2,779,208)
Proceeds from exercise of warrants ..........................             --       7,800,000              --       7,800,000
Proceeds from short term loans with detachable warrants .....             --              --       1,000,000       1,000,000
Proceeds from short term loans ..............................             --              --         750,000         750,000
Repayment of short term loan ................................             --         (27,007)     (1,722,993)     (1,750,000)
Principal payments under capital lease obligations ..........             --          (5,746)         (1,083)         (6,829)
                                                                ------------    ------------    ------------    ------------

Net cash provided by financing activities ...................             --      35,977,539      17,840,174      53,817,713
                                                                ------------    ------------    ------------    ------------

Net increase (decrease) in cash and cash equivalents ........    (29,123,227)     20,112,105      11,099,606       2,088,484
Cash and cash equivalents at beginning of year/period .......     31,211,711      11,099,606              --              --
                                                                ------------    ------------    ------------    ------------
Cash and cash equivalents at end of year/period .............   $  2,088,484    $ 31,211,711    $ 11,099,606    $  2,088,484
                                                                ============    ============    ============    ============
Supplemental cash information:
Cash paid during the year/period:
Interest ....................................................   $         --    $      2,121    $     61,624    $     63,745
                                                                ============    ============    ============    ============
</TABLE>


                                      F-5
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
                CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

                (In United States dollars, except share amounts)

Non-cash transactions during the year ended December 31, 2001:

(a) In  conjunction  with  the  sale of its  subsidiary,  First  Ecommerce  Data
Services Limited, the Company received from the purchaser a note receivable with
a minimum guarantee amount of $2 million (Notes 5 and 9).

Non-cash transactions during the year ended December 31, 2000:

(a) In connection with the issue of 3,228,500  common shares on March 6, 2000 by
the Company,  warrants to purchase  250,848 shares of the Company's common stock
were granted to an investment bank, in addition to cash commission.

(b) In conjunction  with the acquisition of Asia Internet  Limited,  the Company
issued 24,870 shares with a fair value of $623,988.

Non-cash transactions during the year ended December 31, 1999:

(a) Property and  equipment  amounting to $4,871 were  acquired  under a capital
lease during the year ended December 31, 1999.

(b) Issuance of 8,000,000 shares to financial  advisors for services rendered in
connection  with  organization  activities  of the  Group at a  deemed  value of
$300,000, in excess of $8,000 cash received.

(c) During the year ended December 31, 1999,  $646,532 in  compensation  expense
was recorded for options granted.

                See notes to consolidated financial statements.


                                      F-6
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                (In United States dollars, except share amounts)

1. ORGANIZATION AND PRINCIPAL ACTIVITIES

First Ecommerce Asia Limited ("FEAL") was incorporated in Hong Kong on September
16, 1998 with two shares of HK$1 per share  issued and  outstanding.  On January
28, 1999,  FEAL entered into an agreement  and plan of merger with JRL Resources
Corp., a company  incorporated in the State of Florida on November 13, 1996 with
1,025,000 common shares issued and outstanding ("JRL Resources"), which had been
inactive since its formation. Pursuant to the terms of the agreement and plan of
merger and related  agreements,  3,015,000  newly issued shares of JRL Resources
and 985,000 shares held by existing shareholders of JRL Resources were exchanged
for the two shares of FEAL,  and FEAL became a  wholly-owned  subsidiary  of JRL
Resources.

The merger  between JRL Resources  and FEAL was a merger of a private  operating
company (FEAL) into a non-operating  public shell  corporation  with nominal net
assets that resulted in the owners and management of the private  company (FEAL)
having  operating  control of the combined  company after the  transaction.  For
accounting  purposes,  the transaction has been treated as a reverse acquisition
of JRL Resources by FEAL with FEAL deemed to be the accounting acquirer.

Pursuant  to an  agreement  and plan of merger  dated  February  12,  1999,  JRL
Resources  was merged  with and into Brek  Energy  Corporation  (formerly  First
Ecom.com,  Inc.) ("BREK" or the "Company"),  a company incorporated in the State
of Nevada on February 12, 1999, with no shares issued and outstanding.  Pursuant
to the agreement and plan of merger,  all of the 12,040,000  outstanding  common
shares of JRL Resources were  exchanged on a one-for-one  basis for newly issued
shares  of BREK,  with BREK  being the  surviving  corporation.  For  accounting
purposes, this merger is treated as a re-incorporation of JRL Resources as BREK.

Details of the issuance of common stock are set out in note 13.

The Company was  established  to  facilitate  electronic  payment  processing of
e-commerce transactions for merchants and banks across the Internet. The Company
has  developed  an  electronic   gateway  to  convert   consumers'  credit  card
information  collected by  merchants  on the Internet  into a format that can be
processed by banks.  The Company acts as an intermediary  payment system service
provider  between  on-line   merchants,   consumers  and  banks.  The  principal
geographic area in which the Company  provides its services is throughout  Asia.
The Company charges its merchants and banks service fees to process transactions
through this gateway.

During  2001,  the Company  changed its primary  business to that of oil and gas
exploration and on July 19, 2001,  acquired a 26% non-dilutable  voting interest
in  Gasco  Energy,  Inc.  ("Gasco").  While  the  main  focus of the oil and gas
exploration  business has been  centered in the United  States,  the Company has
been investigating various prospects throughout the world (see Notes 9 and 20).

Since its inception,  the Company has been in the development stage. The Company
has acquired and  developed  its software and hardware and been  developing  its
markets  for  the  electronic  payment  processing  business,  however,  through
December 31, 2001, the Company had insignificant  revenues from operations.  The
Company's  affiliate,  Gasco  has  been  accumulating  oil and gas  acreage  and
commenced  drilling  to  determine  the extent of  natural  gas  resources.  The
Company's ability to emerge from development stage is ultimately  dependent upon
the operations, including developing sufficient markets.


                                      F-7
<PAGE>

                            BREK ENERGY CORPORATION
                        (Formerly First Ecom.com, Inc.)
                         (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

1. ORGANIZATION AND PRINCIPAL ACTIVITIES (continued)

These  financial  statements  have  been  prepared  on the going  concern  basis
notwithstanding  that the Company has recurring  operating losses and continuing
negative cash flows from  operations.  The directors of the Company believe that
the Company's  cash and cash  equivalents  as of December 31, 2001;  the private
placement completed  subsequent to the year end (see Note 20); and the Company's
ability to borrow funds and/or raise  additional  equity are adequate to satisfy
the Company's working capital requirements for the foreseeable future.

On March 31, 2000, the Company  acquired the entire issued share capital of Asia
Internet  Limited  ("AIL"),  a  company  incorporated  in Hong  Kong,  for  cash
consideration  of $1.2 million and the issuance of 24,870 shares of common stock
at a fair value of $25.09 per share. AIL provided systems integration  services.
The  acquisition  of AIL  has  been  accounted  for by the  purchase  method  of
accounting and, accordingly, the results of operations for the period from March
31, 2000 are included in the consolidated financial statements.  Assets acquired
and liabilities  assumed have been recorded at their estimated fair values.  The
excess  of the  purchase  price  over the fair  value  of net  assets  of AIL of
$1,747,693 was initially recorded as goodwill,  which was to be amortized over 3
years.  The amount of goodwill was  subsequently  subject to an impairment test.
The results of the impairment  test determined that such goodwill be written off
during the year ended December 31, 2000 (see Note 8).

The following unaudited pro forma financial  information presents the results of
operations  of AIL that would have been included in the  consolidated  financial
statements  as if the  acquisition  had occurred as of the beginning of 2000 and
1999,  after giving effect to certain  adjustments,  including  amortization  of
goodwill.  The unaudited pro forma  financial  information  does not necessarily
reflect the results of AIL's operations that would have occurred had the Company
and AIL constituted a single entity during such periods.

<TABLE>
<CAPTION>
                                                                            Period from
                                                                           September 16,
                                              For the year ended           1998 (date of
                                                 December 31,              inception) to
                                                 ------------               December 31,
                                             2000             1999              2001
                                             ----             ----              ----

                                         (Unaudited)      (Unaudited)       (Unaudited)
<S>                                       <C>              <C>              <C>
Pro forma revenue included in
discontinued operations ...........       $ 966,164        $  46,203        $ 1,012,367
                                          =========        =========        ===========

Pro forma loss ....................       $(468,951)       $(783,317)       $(1,252,268)
                                          =========        =========        ===========

Basic pro forma loss per share ....       $   (0.03)       $   (0.06)
                                          =========        =========
</TABLE>

     The basic pro forma loss per share  amounts are based on the pro forma loss
     for the  respective  periods and  weighted  average  number of  outstanding
     shares for the years ended  December  31, 2000 and 1999 of  18,071,096  and
     12,068,532, respectively.


                                      F-8
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

1. ORGANIZATION AND PRINCIPAL ACTIVITIES (continued)

AIL ceased  operations on March 31, 2001, and its operations  have been recorded
as discontinued operations. Results for the period April 1, 2000 to December 31,
2000 have been reclassified in the financial statements for comparative purposes
(see Note 15).

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation - The consolidated  financial statements include the
financial  statements  of the  Company  and its  subsidiaries.  All  significant
intercompany  balances and transactions  have been eliminated in  consolidation.
Affiliated  companies  (20% to 50% owned  companies)  in which the  Company  has
significant  influence are accounted for using the equity method.  The Company's
share of earnings  (losses) of these  companies is included in the  accompanying
consolidated statement of operations.

The financial  statements as of and for the year ended December 31, 1999 and for
the period  prior to the merger  with JRL  Resources  reflect  the  consolidated
financial position and results of operations of FEAL.  Subsequent to the merger,
the financial statements reflect the consolidated financial position and results
of  operations  of BREK (as  successor  to JRL  Resources  subsequent  to BREK's
formation and JRL Resources  prior to BREK's  formation) and its subsidiary FEAL
as well as AIL from the date of its acquisition by BREK.

Cash and cash  equivalents  - Cash and cash  equivalents  include  cash on hand,
demand deposits and highly liquid instruments with maturities of three months or
less when purchased.

Marketable  securities - The Company  considers  all  marketable  securities  as
available-for-sale.  All securities are recorded at fair value. Unrealized gains
and losses,  which are  temporary,  on marketable  securities  are reported as a
component of other  comprehensive  income and  classified as  accumulated  other
comprehensive income (loss) in shareholders'  equity.  Realised gains and losses
and unrealized  losses which are other than  temporary on marketable  securities
are  included in  earnings  and are derived  using the  specific  identification
method. Marketable securities consist of equity securities.

Investments - The Company accounts for its investments in entities where it does
not have  majority  voting or  management  control,  but does  have  significant
influence,  using the equity basis.  The gains (losses) from equity  investments
are reported as a component of income (loss).

Financial  Instruments and Financial Risk - The Company's financial  instruments
consist of current assets and liabilities,  a note receivable, a loan receivable
and its  investment  in its equity  affiliate.  The fair  values of the  current
assets and liabilities  approximate  the carrying  amounts due to the short-term
nature of these instruments.  The fair value of the note receivable approximates
its carrying  value.  The fair value of the loan  receivable of $1,865,244 is an
estimate  based on current rates  available to the issuer for credit of the same
remaining duration.


                                      F-9
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Goodwill - Goodwill is  amortized  on a  straight-line  basis over the  expected
benefit period, estimated at three to seven years, from the date of acquisition.

Property  and  equipment  -  Property  and  equipment  is stated  at cost,  less
accumulated  depreciation.  Depreciation  is  provided  using the  straight-line
method over the estimated useful lives of the assets as follows:

                                                            Over the term
     Leasehold improvements                                 of the leases
     Computer equipment and processing system               3 years
     Furniture, fixtures and office equipment               5 years

Impairment - The company  accounts for long-lived  assets in accordance with the
provisions  of  Statement of Financial  Accounting  Standards  ("SFAS") No. 121,
"Accounting for the Impairment of Long-lived Assets and for Long-lived Assets to
Be Disposed  Of." This  statement  requires that  long-lived  assets and certain
identifiable  intangibles be reviewed for impairment  whenever events or changes
in  circumstances  indicate  that the  carrying  amount  of an asset  may not be
recoverable.  Recoverability  of  assets  to be held and used is  measured  by a
comparison of the carrying  amount of an asset to future net cash flows expected
to be generated by the asset. If such assets are considered to be impaired,  the
impairment  to be  recognized  is measured  by the amount by which the  carrying
amount of the assets exceeds the fair value of the assets. Assets to be disposed
of are  reported  at the lower of  carrying  amount or fair  value less costs to
sell.

Software  development  costs - Internal and external  costs  incurred to develop
internal-use computer software are expensed during the preliminary project stage
and  capitalized  during the  application  development  stage and amortized over
three  years.  During the years ended  December  31,  2001,  2000,  1999 and the
cumulative  period  from  inception,  Nil,  $130,816,  $94,590  and  $225,406 of
internal-use computer software development costs were expensed, respectively. As
of  December  31,  2001  and  2000,  capitalized  software  net  of  accumulated
amortization and impairment charges (Note 8) was $68,411 and $Nil, respectively.

Debt issued with stock  purchase  warrants - Debt issued with  detachable  stock
purchase  warrants  is  accounted  for in  accordance  with  the  provisions  of
Accounting Principles Board Opinion No. 14, "Accounting for Convertible Debt and
Debt Issued with Stock Purchase  Warrants" ("APB No. 14"). Under APB No. 14, the
portion of the proceeds of debt securities issued with detachable stock purchase
warrants  which is  allocable to the  warrants is  accounted  for as  additional
paid-in capital.  The allocation is based on the relative fair values of the two
securities at the time of issue.  Any resulting  discount or premium on the debt
securities  is  accounted  for as such and  amortized  over the term of the debt
securities.

Revenue and cost  recognition  - Fees  generated  by  transactions  processed on
behalf of banks and merchants are recognized  when the transaction is processed,
the  fee  is  determinable,  collectibility  is  probable  and  evidence  of the
arrangement  exists. One time fees received for the initiation of online payment
processing  are  recognized  when  services   provided.   Revenue  from  systems
integration  services  are  recognized  over  the  contract-term  based  on  the
percentage of completion.


                                      F-10
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

2. Summary of Significant Accounting Policies (continued)

Costs  directly  related to a contract that would not have been incurred but for
that contract  (incremental direct costs) are deferred and charged to expense in
proportion to the revenue recognized. All other costs, such as costs of services
performed under the contract,  general and administrative expenses,  advertising
expenses and costs  associated  with the  negotiation  of a contract prior to it
being consummated, are charged to expense as incurred.

Use of estimates - Management  has made a number of  estimates  and  assumptions
relating  to the  reporting  of assets and  liabilities  and the  disclosure  of
contingent  assets and  liabilities  to prepare  these  financial  statements in
conformity with generally accepted accounting  principles.  Actual results could
differ from those estimates.

Foreign  currency  translation - The  functional  currency of the Company is the
Hong Kong dollar.  The  reporting  currency of the Company is the United  States
dollar.  Balance sheet accounts of the Company are translated into United States
dollars at exchange rates of the balance sheet date.  Income statement items are
translated  at the average  rates  during the year.  Net  translation  gains and
losses are recorded as a separate  component of  stockholders'  equity.  Foreign
currency  transaction  gains and losses are included in the determination of net
loss.

Income taxes - Deferred  income taxes are provided using the asset and liability
method.  Under  this  method,  deferred  income  taxes  are  recognized  for all
significant   temporary   differences  and  operating  loss  carry  forward  are
classified  as  current or  non-current  based  upon the  classification  of the
related  asset or  liability  in the  financial  statements  or  their  expected
reversal if they do not relate to a balance sheet item. A valuation allowance is
provided to reduce the amount of deferred  tax assets if it is  considered  more
likely than not that some  portion of, or all of, the  deferred  tax assets will
not be realized.

Research  and  development  and  advertising  -  Research  and  development  and
advertising  costs are expensed as  incurred.  Research  and  development  costs
amounted to $Nil in each of the years ended  December 31, 2001,  2000,  1999 and
the cumulative  period from  inception.  Advertising  costs amounted to $87,607,
$241,485,  $252,179 and $581,271,  respectively  in the years ended December 31,
2001, 2000, 1999 and the cumulative period from inception, respectively.

Start-up and pre-operating costs - Start-up and pre-operating costs are expensed
as incurred.

Comprehensive  income  - The  Company  has  adopted  SFAS  No.  130,  "Reporting
Comprehensive  Income", which establishes standards for reporting and display of
comprehensive  income,  its components and accumulated  balances.  Comprehensive
income  is  defined  to  include  all  changes  in equity  during a period  from
non-owner sources.  The Company had no items of other  comprehensive  income for
the three years ended December 31, 2001.


                                      F-11
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Stock-based  compensation - The Company  accounts for  stock-based  compensation
arrangements  with  employees in  accordance  with the  provisions of Accounting
Principles  Board  Opinion No. 25,  "Accounting  for Stock Issued to  Employees"
("APB No.  25") and  complies  with the  disclosure  provisions  of SFAS No. 123
"Accounting  for  Stock-Based  Compensation".  Under  APB No.  25,  compensation
expense  is based  on the  difference,  if any,  between  the fair  value of the
Company's  stock and the exercise  price of options issued on the date of grant.
The unearned  compensation  is being  amortized  over the vesting  period of the
individual options.

The  Company  accounts  for  equity   instruments  issued  to  non-employees  in
accordance  with the  provisions of SFAS No. 123 and Emerging  Issues Task Force
("EITF")   96-18.   All   transactions  in  which  goods  or  services  are  the
consideration  received for the issuance of equity instruments are accounted for
based on the fair value of the  consideration  received or the fair value of the
equity instrument, whichever is more reliably measurable.

Net  income  (loss)  per  share  ("EPS") - Basic EPS  excludes  dilution  and is
computed by dividing net income (loss)  attributable  to common  stockholders by
the weighted  average of common shares  outstanding for the period.  Diluted EPS
reflects  the  potential  dilution  that  could  occur  if  securities  or other
contracts  to issue  common  stock  (convertible  preferred  stock,  warrants to
purchase common stock and common stock options) were exercised or converted into
common stock using the treasury  stock  method.  Potential  common shares in the
diluted EPS  computation  are excluded in net loss periods as their effect would
be antidilutive.  For the years ended December 31, 2001, 2000 and 1999,  options
to  purchase  3,069,500,  4,272,250  and  1,572,500  shares of common  stock and
warrants to purchase  2,158,682,  2,893,682 and 1,516,667 shares of common stock
were outstanding at various times  throughout the reported years,  respectively.
Also for the year ended December 31, 1999, one convertible  security to purchase
125,000  shares  of  common  stock  at  $8.00  per  share  was  outstanding  for
approximately 5 months of 1999. The effects of all of these  securities were not
included  in the  computation  of diluted  EPS,  as the Company is in a net loss
position  for all periods  since the  beginning of  operations.  At December 31,
2001,  2000 and 1999,  options to purchase  1,280,000,  1,809,500  and 1,512,500
shares of  common  stock and  warrants  to  purchase  1,893,682,  1,893,682  and
1,516,667 shares of common stock were outstanding, respectively.


                                      F-12
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Recent  accounting  pronouncements  - In June  1998,  the  Financial  Accounting
Standards  Board  ("FASB")  issued  SFAS No.  133,  "Accounting  for  Derivative
Financial  Instruments  and Hedging  Activities",  which  requires  companies to
record  derivative  financial  instruments  on their balance sheets as assets or
liabilities,  measured at fair value. Gains and losses resulting from changes in
the values of those  derivatives  would be accounted for depending on the use of
the derivative and whether it qualifies for hedge accounting.  The key criterion
for hedge accounting is that the hedging  relationship  must be highly effective
in achieving  offsetting  changes in fair value or cash flows. In June 1999, the
FASB issued SFAS No. 137,  "Accounting  for Derivative  Instruments  and Hedging
Activities - Deferral of Effective Date of FASB Statement No. 133", which amends
SFAS 133 to be effective for all fiscal years  beginning after June 15, 2000. In
September  2000,  the FASB issued SFAS No. 140,  "Accounting  for  Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities - a Replacement
of FASB No. 125". The Company's adoption of these pronouncements during 2001 did
not have any impact on the results of operations or financial position.

In June 2001, the FASB issued SFAS No. 141,  "Business  Combinations."  SFAS 141
requires the use of the purchase method of accounting for business  combinations
initiated  after June 30, 2001 and eliminates the  pooling-of-interests  method.
The  adoption of SFAS 141 on July 1, 2001 did not have a  significant  impact on
the Company's financial statements.

In June 2001,  the FASB  issued  SFAS No. 142,  "Goodwill  and Other  Intangible
Assets",  which is effective  January 1, 2002.  SFAS 142  requires,  among other
things,  the  discontinuance  of goodwill and  indefinite-life  intangible asset
amortization.   In  addition,   the  standard   includes   provisions   for  the
reclassification  of  certain  existing  recognized   intangibles  as  goodwill,
reassessment  of the useful lives of the existing  recognized  intangibles  with
finite lives, reclassification of certain intangibles out of previously reported
goodwill and the  identification  of  reporting  units for purposes of assessing
potential future impairments of goodwill. SFAS No. 142 also requires the Company
to complete a transitional  goodwill impairment test six months from the date of
adoption.


                                      F-13
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

In 2001,  the Company  adopted  transition  provisions  of SFAS No.  142,  which
require the  discontinuance  of goodwill and indefinite life  intangible  assets
amortization  for  acquisitions  and investments  made after June 30, 2001. As a
result, the excess of cost over the Company's  proportionate share of net assets
of Gasco  Energy,  Inc.,  in which the Company  acquired an interest on July 19,
2001,  has not been  amortized as would have been required prior to the adoption
of the  transition  provisions  of SFAS No. 142. The Company will be required to
adopt the  remaining  provisions  of SFAS No. 142 on  January  1, 2002.  Had the
Company  been  accounting  for its  goodwill  under SFAS No. 142 for the periods
presented, the Company's net loss and loss per share would have been as follows:

<TABLE>
<CAPTION>
                                                                    Year ended December 31,
                                                                    -----------------------

                                                          2001               2000               1999
                                                          ----               ----               ----
<S>                                                  <C>                <C>                <C>
     Reported net loss ..........................    $  (10,461,322)    $  (17,809,461)    $   (6,788,885)
     Add: Goodwill amortization .................           325,671            291,282                 --
                                                     --------------     --------------     --------------

     Adjusted net loss ..........................    $  (10,135,651)    $  (17,518,179)    $   (6,788,885)
                                                     ==============     ==============     ==============

     Reported basic and diluted loss per share ..    $        (0.54)    $        (0.98)    $        (0.56)
     Add: Goodwill amortization, per basic
       and diluted share ........................              0.02               0.02                 --
                                                     --------------     --------------     --------------

     Adjusted basic and diluted loss per share ..    $        (0.52)    $        (0.96)    $        (0.56)
                                                     ==============     ==============     ==============
</TABLE>

In August 2001 the FASB issued SFAS No. 143,  "Accounting  for Asset  Retirement
Obligations".  This  statement  addresses the diverse  accounting  practices for
obligations associated with the retirement of tangible long-lived assets and the
associated  asset  retirement  costs. The Company will be required to adopt this
standard on January 1, 2003. The Company is reviewing the statement to determine
what  effect it will have,  if any,  on its  financial  position  and results of
operations.

The FASB also recently  issued SFAS No. 144,  "Accounting  for the Impairment or
Disposal of  Long-Lived  Assets,"  that is  applicable to the Company on January
2002.  The FASB's new rules on asset  impairment  supersede  FASB Statement 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
Be Disposed  Of," and  portions of APB  Opinion  30,  "Reporting  the Results of
Operations."  This Standard  provides a single  accounting  model for long-lived
assets to be disposed of and significantly  changes the criteria that would have
to be met to classify an asset as held-for-sale. Classification as held-for-sale
is an important distinction since such assets are not depreciated and are stated
at the lower of fair value and carrying  amount.  This  Standard  also  requires
expected future operating losses from discontinued operations to be displayed in
the  period(s)  in  which  the  losses  are  incurred,  rather  than  as of  the
measurement   date  as   presently   required.   The  Company  does  not  expect
implementation  of this  pronouncement  to materially  affect the results of its
operations or financial position.


                                      F-14
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Accounting  change - In November 2000,  the EITF reached a partial  consensus on
Issue  No.  00-27,  "Application  of  Issue  No.  98-5  to  Certain  Convertible
Instruments"  ("EITF  00-27").  Since consensus was reached on Issue No. 98-5 in
May 1999,  there has been diversity in practice as to the measurement of certain
beneficial  features of convertible  instruments.  The consensus reached in EITF
00-27 clarifies the measurement of such beneficial features.  To the extent that
this  represents a change in the manner in which an entity  previously  measured
beneficial  features of instruments  issued  subsequent to May 1999, Issue 00-27
requires  an entity to  re-perform  the  measurement  and report any  additional
charge as a cumulative effect of change in accounting principle.

In connection with  convertible  debt issued in 1999, the Company had previously
recorded a beneficial conversion feature of approximately  $50,000.  However, in
accordance with the guidance set forth in EITF 00-27, the Company has recognized
an additional beneficial conversion charge of approximately $380,000. The charge
is measured by the difference between the effective conversion price of the debt
and the fair value of shares of common stock into which the debt is convertible,
as measured at the date of issuance. This charge is recognized in the year ended
December 31, 2000 as a cumulative  effect of change in  accounting  principle in
the accompanying statement of operations,  and an increase in additional paid-in
capital in the accompanying statement of stockholders' equity.

Reclassifications  - Certain  prior year amounts in the  accompanying  financial
statements have been reclassified to conform to current year presentation. These
reclassifications  had no effect  on the  results  of  operations  or  financial
position for any year/period presented.


                                      F-15
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

3. MARKETABLE SECURITIES

Marketable  securities comprise of 91,912 shares, after an 8 for 1 reverse stock
split on  September  7, 2001,  of  uniView  Technologies  Corporation,  a public
company traded on NASDAQ,  representing a 2.7% equity interest.  The Company has
written down the carrying value of the shares by $314,339, $1,632,353, $ Nil and
$1,946,692  for the  years  ended  December  31,  2001,  2000  and  1999 and the
cumulative  period  from  inception,  respectively.  The  carrying  value of the
marketable  securities  was written  down to its market value as the declines in
value were deemed other than temporary.

4. PREPAID FINANCIAL ADVISORY FEE

In 1999,  the Company paid a fee of  $1,500,000 to a consultant to introduce the
Company to financial institutions and other investors,  assist in negotiation of
debt or equity  financing,  design and implement  public  relations and investor
relations programs, and develop an advertising strategy for the Company.

These  services  were rendered to the Company over the period from March 5, 1999
to August 31, 2000 and the amount paid was deferred and was  amortised  over the
life of the service  agreement  on a  straight-line  basis.  For the years ended
December 31, 2001,  2000,  1999 and the cumulative  period from  inception,  the
Company  recognized  approximately  $Nil,  $672,000,  $828,000  and  $1,500,000,
respectively in operating expenses in respect of the consultant's fee.

5. NOTE RECEIVABLE

On October 19, 2001, the Company  completed the sale of its 100% interest in its
subsidiary,  First  Ecommerce  Data  Services  Limited  ("FEDS"),  to Transworld
Payment Solutions N.V. (Note 9). The guaranteed amount of FEDS operating profits
is receivable in installments of $350,000,  $650,000 and $1,000,000 due March 1,
2003,  2004 and  2005,  respectively.  The  guaranteed  installments  have  been
recorded at their  present  value with imputed  interest of 2% to 3.5%.  Imputed
interest of $9,348 was  recorded as interest  income in the year ended  December
31, 2001.

6. LOAN RECEIVABLE

During 2001, the Company advanced $270,055 and is expecting to advance a further
$79,945 to Vallenar Energy Corp.  ("Vallenar"),  a company investigating various
oil  prospects  in the  southern  part of the United  States of  America.  As at
December 31,  2001,  a third party held  $54,945 of the future  advance in trust
which is  classified  as other  prepaid  expenses and  deposits.  Subsequent  to
December 31, 2001, these amounts were converted to an equity ownership (see Note
20).


                                      F-16
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

7. PROPERTY AND EQUIPMENT, NET

                                                        2001            2000

     Leasehold improvements ....................    $        --     $   318,227
     Computer equipment and processing system ..        513,591         570,824
     Furniture, fixtures and office equipment ..         67,294         280,026
                                                    -----------     -----------

                                                        580,885       1,169,077
     Less accumulated depreciation .............       (323,564)       (590,211)
                                                    -----------     -----------

                                                    $   257,321     $   578,866
                                                    ===========     ===========

Depreciation  expense  charged  to  results of  operations  for the years  ended
December 31, 2001,  2000,  1999 and the  cumulative  period from  inception were
$446,366 (of which $207,125 is  attributable  to FEDS),  $575,587,  $250,382 and
$1,272,335, respectively.

8. CHARGES FOR CERTAIN LONG-LIVED ASSETS AND PREPAID ASSETS

On October 19,  2001,  the Company has  disposed of its  investment  in FEDS and
recognized an impairment loss of $3,159,505 for the year ended December 31, 2001
(see Note 9).

In  addition,  as a result of  certain  changes  that have  occurred  within the
Company and modifications to the Company's  business plan, the Company undertook
an impairment  review of its long-lived assets and certain prepaid assets during
the quarter ended December 31, 2000. In its assessment,  the Company  determined
that the amounts capitalized for its processing system, goodwill relating to AIL
and  certain  prepaid  assets,  totalling  $449,418,  $1,456,411  and  $500,000,
respectively,  were  not  expected  to  generate  positive  cash  flows  in  the
foreseeable  future.  Accordingly,  in the year ended  December  31,  2000,  the
Company  recorded a provision of $2,405,829,  which  represented  the difference
between the book value of these assets and their  estimated  fair value.  Due to
the discontinuance of AIL in March 2001, the impairment charge related to AIL of
$1,456,411  has  been   reclassified  as  a  component  of  the  net  loss  from
discontinued operations for comparative purpose.


                                      F-17
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

9. INVESTMENT IN AND ADVANCES TO AFFILIATES

First Ecommerce Data Services Limited

During  2000,  the  Company  acquired a 50%  interest in FEDS,  a joint  venture
operation with the Bank of Bermuda, a principal shareholder of the Company, from
the Bank of Bermuda for $3 million.  The excess of the  purchase  price over the
Company's  share of net assets of FEDS at the date of investment  based on their
estimated  fair  market  value  at the  date of  acquisition  was  allocated  to
goodwill.  Goodwill  amounted  to  approximately  $1.2  million  and  was  being
amortized  over seven  years.  In  addition,  the Company had  advanced  FEDS an
unsecured, non-interest bearing loan of $400,000.

                                                                   2000
                                                                   ----

     Cost of investment .............................          $ 3,000,000
     Share in losses of affiliate ...................             (292,118)
                                                               -----------

                                                                 2,707,882
     Loan ...........................................              400,000
                                                               -----------

                                                               $ 3,107,882
                                                               ===========

On June 18, 2001, the Company acquired the remaining 50% of the issued shares of
FEDS  such  that FEDS  became a  wholly-owned  subsidiary  of the  Company.  The
purchase  consideration  was $3,581,993  cash for the shares.  In addition,  the
Company  acquired a  shareholder's  loan from the Bank of Bermuda to FEDS in the
amount  of  $668,007.  Total  consideration  paid  to the  Bank of  Bermuda  was
$4,250,000.   Direct  costs  of  $39,542  were   incurred  in  respect  of  this
transaction.

The  acquisition  has  been  accounted  for  using  purchase   accounting,   and
accordingly,  the  results  of  operations  of FEDS  has  been  included  in the
Company's  consolidated  financial  statements  from June 19, 2001 onwards.  The
excess of the Company's costs over the fair value of the identifiable net assets
of $2,480,877  has been recorded as additional  goodwill and has been  amortized
over a straight-line basis over seven years.

Prior to June 18,  2001,  the Company  recorded  its share of the losses of FEDS
under the equity method. The Company's share of such losses was $390,052 for the
period from January 1 to June 18, 2001, and $292,118 for the year ended December
31, 2000.


                                      F-18
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

9. INVESTMENT IN AND ADVANCES TO AFFILIATES (CONTINUED)

     Assets acquired and liabilities assumed in the acquisition were as follows:

     Bank and fixed deposits ..................................    $ 2,057,483
     Trade accounts receivable ................................         11,959
     Prepaid expenses and deposits ............................        164,901
     Property plant and equipment .............................      1,486,077
     Accounts payable and other accrued liabilities ...........        (77,636)
     Long term liabilities ....................................     (1,361,468)
                                                                   -----------

     Estimated fair value of net assets at June 18, 2001 ......    $ 2,281,316
                                                                   ===========

     Consideration:

     Cash, net of shareholders' loan of $668,007 ..............    $ 3,581,993
     Share of net assets (50%) ................................     (1,140,658)
     Direct costs .............................................         39,542
                                                                   -----------

     Goodwill at acquisition ..................................    $ 2,480,877
                                                                   ===========

     Cash outflow from acquisition of subsidiary is made up of:

     Consideration paid .......................................    $ 4,250,000
     Bank and fixed deposits acquired .........................     (2,057,483)
     Direct costs .............................................         39,542
                                                                   -----------

                                                                   $ 2,232,059
                                                                   ===========

On October  19,  2001,  the Company  sold its 100%  interest in FEDS for cash of
$1,663,986  plus 40% of FEDS  operating  profits for the next three years with a
minimum guarantee amount of $2 million and a maximum of $3 million.

The sale of FEDS resulted in no gain or loss being  recorded  during the quarter
ended  December 31, 2001 as the Company had  recognized  an  impairment  loss of
$3,159,505 at September 30, 2001.  Revenues and loss from operations  (including
impairment  loss  of  $3,159,505)   from  FEDS  included  in  the   accompanying
consolidated statements of operations were $250,567 and $664,278,  respectively,
for the period from June 19, 2001 to October 19, 2001.


                                      F-19
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

9. INVESTMENT IN AND ADVANCES TO AFFILIATES (CONTINUED)

Gasco Energy, Inc.

On July 19, 2001, the Company acquired an equity interest in Gasco Energy,  Inc.
("Gasco"),  a Nevada Corporation traded on the Over-the-Counter  Bulletin Board.
The Company paid $19 million for preferred shares which are convertible into 9.5
million common shares at the Company's  option.  These preferred  shares bear no
cumulative dividends.

This acquisition entitles the Company to 26% of the voting power of Gasco, which
will not be  diluted  by  further  issuances  of common  stock.  The  Company is
entitled to a seat on Gasco's board of directors and a position on the executive
committee,  which will be largely  responsible  for  operating  the  business of
Gasco.  The  Company's  shares are also  entitled  to vote as a class on certain
extraordinary  matters for extraordinary  circumstances.  The Company has agreed
not to dispose of its stake for three years,  however,  the Company is permitted
to dispose of up to 10% of its holdings annually.

The  Company  accounts  for its  interest  in Gasco  using the equity  method of
accounting. The total cost of Gasco acquisition is allocated to the tangible and
intangible  assets  acquired and liabilities  assumed based on their  respective
fair market values at the effective date of the  acquisition.  Such  allocations
ultimately  will be based on further  management  studies and due  diligence and
consequently are preliminary and subject to revision.

The Company's  equity in losses of Gasco during the year ended December 31, 2001
is $492,094.

Summarized financial information of Gasco is shown below.

                                                          2001         2000
                                                          ----         ----

     Assets, liabilities and stockholders' equity:

     Current assets ................................ $ 12,453,684   $ 1,007,984
     Non current assets ............................    9,204,841     1,999,275
     Current liabilities ...........................      593,100     1,428,354
     Non current liabilities .......................           --            --
     Stockholders' equity ..........................   21,065,425     1,578,905

<TABLE>
<CAPTION>
                                                          2001         2000         1999
                                                          ----         ----         ----
<S>                                                  <C>            <C>           <C>
     Operating results:

     Net sales ..................................... $     36,850   $        --   $     --
     Loss from continuing operations ...............   (4,129,459)     (843,261)  (736,834)
     Net loss ......................................   (4,129,459)     (843,261)  (736,834)
     Deemed distribution on preferred shares .......  (11,400,000)           --         --
     Net loss attributable to common shareholders ..  (15,529,459)     (843,261)  (736,834)
</TABLE>


                                      F-20
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

9. INVESTMENT IN AND ADVANCES TO AFFILIATES (CONTINUED)

Gasco  recognized  $11,400,000  as a deemed  distribution  to the holders of the
preferred  shares,  being  the  Company,  upon  issuance  due  to  a  beneficial
conversion  feature  of the  preferred  shares  into  Gasco's  common  stock  in
accordance  with  EITF  98-5,   "Accounting  for  Convertible   Securities  with
Beneficial  Conversion Features or Contingently  Adjustable Conversion Ratios to
Certain Convertible  Instruments" and EITF 00-27. The deemed distribution is the
difference  between  the market  price on the date of  issuance  ($3.20) and the
conversion rate.

The  financial  information  for  December  31,  2000 and 1999 is in  respect of
Pannonian Energy, Inc.  ("Pannonian") prior to its merger with Gasco on February
1, 2001.  Gasco  accounted for this  transaction as a reverse  acquisition  with
Pannonian as an accounting acquirer.

10. INCOME TAXES

As the  Company  is in its  development  stage  and  incurred  losses  since its
inception, no income tax expense was recognized for the years ended December 31,
2001, 2000 and 1999.  There were no taxes payable at December 31, 2001, 2000 and
1999.

     The components of net loss are as follows:

<TABLE>
<CAPTION>
                                                                Year ended December 31,
                                                                -----------------------

                                                         2001             2000            1999
                                                         ----             ----            ----
<S>                                                 <C>              <C>              <C>
     United States of America ..................    $ (6,353,148)    $ (9,160,736)    $(3,320,145)
     Hong Kong .................................      (3,748,476)      (6,977,789)     (3,296,455)
     Other countries (British Virgin Islands,
       Bermuda and Canada) .....................        (359,698)      (1,670,936)       (172,285)
                                                    ------------     ------------     -----------

                                                    $(10,461,322)    $(17,809,461)    $(6,788,885)
                                                    ============     ============     ===========
</TABLE>


                                      F-21
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

10. INCOME TAXES (continued)

During the years ended December 31, 2001,  2000 and 1999,  the Company  operated
predominantly in Hong Kong and is therefore  subject to Hong Kong Profits Tax. A
reconciliation  of income taxes  computed at the Hong Kong statutory tax rate of
16% to the income tax expense is as follows:

<TABLE>
<CAPTION>
                                                                   2001            2000            1999
                                                                   ----            ----            ----
<S>                                                            <C>             <C>             <C>
     Income tax benefit at statutory tax rate .............    $ 1,673,812     $ 2,849,514     $ 1,086,222
     Effect of rate differential on transactions subject
       to rates of other tax jurisdictions ................      1,462,612         393,723         291,300
     Non-deductible items

       Stock-based compensation ...........................        283,596        (631,654)       (103,445)
       Charge on write down of marketable securities ......        (50,294)       (261,176)             --
       Charge for long-lived assets and amortization
           of goodwill ....................................        (52,108)       (313,026)             --
       Other ..............................................             --        (171,062)             --
     Non-taxable items primarily interest income ..........         53,731         193,217           1,942
     Valuation allowance ..................................     (3,371,349)     (2,059,536)     (1,276,019)
                                                               -----------     -----------     -----------

                                                               $        --     $        --     $        --
                                                               ===========     ===========     ===========
</TABLE>

The components of deferred income tax assets and liabilities are as follows:

<TABLE>
<CAPTION>
                                                                    2001            2000
                                                                    ----            ----
<S>                                                              <C>             <C>
     Deferred tax assets:
       Net operating loss carry forwards ....................    $ 6,798,362     $ 3,441,203
       Less valuation allowance .............................     (6,706,904)     (3,335,555)
                                                                 -----------     -----------

       Net deferred tax assets ..............................         91,458         105,648
     Deferred tax liabilities:
       Property and equipment, principally due to differences
         in depreciation ....................................         91,458         105,648
                                                                 -----------     -----------

     Net deferred tax assets/liabilities ....................    $        --     $        --
                                                                 ===========     ===========
</TABLE>

Net  operating  loss  carryforwards  at December  31,  2001,  2000 and 1999,  of
$17,071,744, $13,076,137 and $5,241,936, respectively, relating to the Company's
operations in Hong Kong can be carried forward indefinitely.  Net unconsolidated
operating  loss carry  forwards of BREK at December 31, 2001,  2000 and 1999, of
$9,033,426, $5,047,907 and $1,618,331,  respectively, can be carried forward for
20 years.  Net operating loss  carryforward  at December 31, 2001 of $4,140,107,
relating  to the  Company's  subsidiary  incorporated  in the  United  States of
America can be carried forward for 15 years.


                                      F-22
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

11. STOCK OPTIONS

The 1999 Stock  Option Plan allows the  Company to grant up to  3,000,000  stock
options to employees  and  directors.  In  addition,  the  Company's  2001 Stock
Option/Warrant Plan allows the Company to grant up to 5,000,000 stock options to
employees, directors and consultants.

     2001 Stock Option/Warrant Plan

     During the year ended December 31, 2001, the Company  granted the following
     share options to employees, directors and consultants:

                           Number of                         Fair Value at
     Date of Grant          Options      Exercise Price      date of grant
     -------------          -------      --------------      -------------

     October 31, 2001      1,260,000         $0.40               $0.41

On  October  31,  2001 the  Company  approved  the  granting  of new  options to
employees and directors with an exercise price of $0.40 per share, providing the
holders first  rescinded their existing grants of options and warrants (if any).
Holders of 825,000  options granted under the 1999 Stock Option Plan and 235,000
warrants  granted on March 29, 2001 elected to rescind their existing grants and
these were replaced with new grants totalling 765,000 options. The fair value of
the  shares at the date of the  replacement  grants  was $0.41  per  share.  The
modified grants were accounted for using variable  accounting  according to FASB
Interpretation  No. 44.  Additionally,  on October 31, 2001, the Company granted
new options to employees,  directors and  consultants  to purchase up to 495,000
shares of the  Company's  common  stock at a price of $0.40 per share.  The fair
value of the  shares at the date of grant was $0.41 per  share.  Of the  495,000
options issued on October 31, 2001,  285,000 options were granted to consultants
to purchase up to 285,000  shares of the  Company's  common  stock at a price of
$0.40 per share.  The fair  value of the  options  amounting  to  $108,300  were
accounted for as operating expenses and the fair value was estimated on the date
of issue  using  the  Black-Scholes  option-pricing  model  with  the  following
assumptions  used:  risk-free  interest rate of 5.5%;  expected life of 5 years;
151% expected volatility; and no dividends.

The options  granted on October 31, 2001 are vested  immediately and will expire
on October 31, 2006.


                                      F-23
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

11. STOCK OPTIONS (CONTINUED)

     1999 Stock Option Plan

     The Company granted the following share options to employees, directors and
     consultants:

                               Number       Exercise Fair            Value at
     Date of Grant           of Options         Price             date of Grant
     -------------           ----------         -----             -------------

     February 1, 2000           797,000          9.90                 10.13
     February 25, 2000           15,000          9.90                 30.00
     March 1, 2000               50,000          9.90                 30.44
     April 1, 2000              315,000          9.90                 25.09
     April 17, 2000              95,000         13.50                 14.00
     May 12, 2000                 7,000         14.00                 14.03
     June 19, 2000               50,000          9.90                 11.25
     August 29, 2000          1,145,750          5.05                  5.91
     August 29, 2000            285,000          5.05                  5.91
     June 22, 1999            1,137,500          7.65                  9.06
     September 15, 1999         100,000          7.65                  6.88
     November 4, 1999           335,000          7.65                  8.06

On August 29, 2000, the Company approved the granting of new options,  providing
the holders first rescinded their existing grants,  with a new exercise price of
$5.05 per share.  Holders of 1,145,750  stock  options  elected to rescind their
grants and these were replaced with a like number of new grants.  The fair value
of the shares at the date of the  replacement  grants  was $5.91 per share.  The
modified grants were accounted for using variable  accounting  according to FASB
Interpretation No. 44.

Additionally, on August 29, 2000, the company granted new options to purchase up
to 285,000  shares of the Company's  common stock at a price of $5.05 per share.
The fair  value of the  shares at the dates of grant  was $5.91 per  share.  All
share options granted under the 1999 Option Plan are exercisable at 50% one year
after the date of issue and the remaining 50% two years after the date of issue.
All  options,  if  remaining  unexercised,  expire  five years after the date of
issue.   All  vested  options  lapse  within  three  months  of  termination  of
employment.

During the year ended  December  31,  2001,  the Company  had a net  recovery of
compensation costs of $1,772,478 relating to stock options after the reversal of
$1,947,378 of unvested stock compensation  costs previously  recorded due to the
forfeiture of 964,500 options upon the termination of staff;  $1,852,570 of such
cost related to the system  integration  business,  which the Company decided to
discontinue  during the  quarter  ended March 31,  2001.  During the years ended
December 31, 2000, 1999 and the cumulative period from inception to December 31,
2001, compensation expense was $3,947,837 (including AIL compensation charges of
$2,159,518 which has been reclassified to discontinued  operations to conform to
current year presentation), $646,532 and $2,821,891, respectively.


                                      F-24
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

11. STOCK OPTIONS (continued)

Had compensation  costs been determined  consistent with the fair value approach
enumerated in SFAS No. 123, the Company's net loss for the years ended  December
31, 2001, 2000 and 1999, would have been as below:

                                                        Year ended
                                                       December 31,
                                              2001         2000         1999
                                              ----         ----         ----

                                                            $            $$
     Net loss              As reported     10,461,322   17,809,461   6,788,885
                           Proforma         9,542,863   20,598,526   8,113,944

     Net loss per share    As reported           0.54         0.98        0.56
                           Proforma              0.50         1.14        0.67

For the stock options  granted during the year ended December 31, 2001, the fair
value of options used in  calculating  the proforma  information  above has been
estimated as of the date of grant using the Black-Scholes  option-pricing  model
with the following  assumptions used:  risk-free interest rate of 5.5% (2000 and
1999: 5.5%);  expected life of 3 and 5 years (2000 and 1999: 3 years);  expected
volatility ranging from 93.15% to 150.69% (2000: 93.15% to 129.54%; 1999: 51.45%
to 91.2%), depending on the date of grant; and no dividends.

A summary of the activity of the  Company's  stock  option  plans are  presented
below:

     2001 Stock Option/Warrant Plan

<TABLE>
<CAPTION>
                                                                                   Weighted
                                                                  Number            average
                                                                of options       exercise price
                                                                ----------       --------------
<S>                                                              <C>                 <C>
     Outstanding at beginning of year .......................           --           $  --
     Granted ................................................    1,260,000            0.40
                                                                 ---------           -----

     Outstanding at end of year .............................    1,260,000            0.40
                                                                 =========           =====

     Total options outstanding and exercisable at year end ..    1,260,000              --
                                                                 =========           =====

     Weighted-average fair value ............................                         0.38
                                                                                     =====
</TABLE>

At  December  31,  2001  the  weighted-average  remaining  contractual  life  of
outstanding options was 4.83 years.


                                      F-25
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                (In United States dollars, except share amounts)

11. STOCK OPTIONS (continued)

1999 Stock Option Plan

<TABLE>
<CAPTION>
                                                                             Year ended December 31,
                                                          2001                        2000                        1999
                                                          ----                        ----                        ----

                                                              Weighted-                   Weighted-                   Weighted-
                                                 Number        average       Number        average       Number        average
                                               of options  exercise price  of options  exercise price  of options  exercise price
                                               ----------  --------------  ----------  --------------  ----------  --------------

                                                                                              $                          $$
<S>                                             <C>             <C>        <C>               <C>        <C>              <C>
     Outstanding at beginning of year ...       1,809,500        5.93       1,512,500        7.65              --          --
     Granted ............................              --          --       2,759,750        7.52       1,572,500        7.65
     Forfeited ..........................        (964,500)       6.21      (1,317,000)       7.98         (60,000)       7.65
     Rescinded ..........................        (825,000)       5.52      (1,145,750)       9.68              --          --
                                               ----------       -----      ----------       -----      ----------       -----

     Outstanding at end of year .........          20,000        9.34       1,809,500        5.93       1,512,500        7.65
                                               ==========       =====      ==========       =====      ==========       =====

     Options exercisable at year end ....          20,000          --         393,750          --              --          --
                                               ==========       =====      ==========       =====      ==========       =====

     Weighted-average fair value ........                       12.03                        7.13                        3.97
                                                                =====                        ====                        ====
</TABLE>

Subsequent to December 31, 2001,  the  remaining  1999 Stock Option Plan options
were forfeited.

12. SHORT TERM LOANS AND WARRANTS

On March 29, 2001, the Company issued 265,000 warrants to certain  directors and
employees to purchase a total of 265,000 shares of the Company's common stock at
$1.25 per share.  The market value of the Company's  shares at the date of issue
was $0.84 per share.  These  warrants are  exercisable  through  March 31, 2004.
During the year ended  December  31, 2001,  30,000  warrants  were  returned and
forfeited and 235,000 warrants were rescinded in exchange for replacement grants
of stock options (Note 11).

On March 6, 2000, the Company sold a total of 3,228,500  units at $9.50 per unit
pursuant to a private  placement,  for cash proceeds of $30,670,750.  Each units
consists of one share of the Company's  common stock and one warrant to purchase
one third of a share of the  Company's  common stock.  The  warrants,  which are
exercisable through March 5, 2005, entitle the holder to purchase one-third of a
share of common stock at $11.40 per share.

The  portion  of the stock  proceeds  which is  allocable  to the  warrants  was
$7,656,124  and has  been  accounted  for as  additional  paid-in  capital.  The
allocation  is based on the  relative  fair value of the warrants and fair value
was estimated on the date of issue using the Black-Scholes  option-pricing model
with the following  assumptions used:  risk-free interest rate of 5.5%; expected
life of 5 years; 116% expected volatility; and no dividends.


                                      F-26
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

12. SHORT TERM LOANS AND WARRANTS (continued)

In connection  with the private  placement on March 6, 2000, the Company granted
warrants to purchase  26,923  shares at $7.80 per share,  and 223,925  shares at
$11.40 per share,  of the Company's  common stock to an investment  bank.  These
warrants expire on March 9, 2005.  Included in the fair value of warrants issued
with common stock of $7,656,124 is $1,374,446 allocated to the fair value of the
warrants issued to the investment bank in connection with the private placement.
The fair  value  was  estimated  on the date of issue  using  the  Black-Scholes
option-pricing  model with the following  assumptions used:  risk-free  interest
rate of  5.5%;  expected  life of 5  years;  116%  expected  volatility;  and no
dividends.

On June 30, 2000,  the Company  issued 50,000  warrants to a former  employee to
purchase  50,000  shares of the Company's  common stock at $8.55 per share.  The
market  value of the  Company's  shares  at the date of issue was  $9.84.  These
warrants will be  exercisable  for a period of two years from the date of issue.
The fair value of the warrants were accounted for as operating expenses and fair
value was estimated on the date of issue using the Black-Scholes  Option-pricing
model with the  following  assumptions  used:  risk-free  interest rate of 5.5%;
expected life of 5 years; 87% expected volatility; and no dividends.

On July 26, 2000,  the holder of a warrant for one million shares of the Company
exercised its right to acquire one million shares at a price of $7.80 per share.

On August 10, 1999,  the Company  entered into an agreement  with a company (the
"Lender") for the advance of $1,000,000 for three months.  Pursuant to the terms
of the  loan  agreement,  the  loan  bears  interest  at 12%  per  annum  and is
convertible  into  the  common  shares  of the  Company  at $8 per  share at the
Lender's  option.  The repayment date of the loan was  subsequently  extended to
January 10, 2000. On December 30, 1999, the loan was fully repaid.

The Lender was also granted at origination,  warrants to purchase 100,000 common
shares of the Company at $8.50 per share,  exercisable for 5 years commencing on
August 10, 1999. The intrinsic  value of the  conversion  feature at the date of
issuance of the loan of $50,000 has been  accounted  for as  additional  paid-in
capital.

The portion of the loan  proceeds  issued which is  allocable to the  detachable
warrants was $360,000 and has been accounted for as additional  paid-in capital.
The allocation is based on the fair value of the loan of $1,000,000 and the fair
value of the warrants at the date of issue $566,000.

The effective interest rate of the loan was calculated to be 280% per annum as a
result of the allocation of a portion of the proceeds to the detachable warrants
and  the  conversion  feature,   the  resultant  discount  of  $410,000  created
therefrom, and the amortisation of the discount to the initial maturity date.

The fair value of warrants  issued was  estimated on the date of issue using the
Black-Scholes   option-pricing  model  with  the  following   assumptions  used:
risk-free  interest  rate of  5.5%;  expected  life of 5 years;  76.7%  expected
volatility; and no dividends.


                                      F-27
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

12. SHORT TERM LOANS AND WARRANTS (continued)

On October 27, 1999 the Company  entered  into a loan  agreement  with a company
wholly-owned  by three  shareholders  of the Company for the advance of $250,000
repayable by January 21, 2000. Pursuant to the terms of the loan agreement,  the
loan bears interest at 12% per annum. On December 30, 1999,  $222,993 was repaid
and the remaining $27,007 was repaid in 2000.

On November 12, 1999,  the Company  entered into a loan  agreement with the same
company wholly owned by three  shareholders  of the Company for the advance of a
$500,000  short-term  loan repayable on or before January 10, 2000.  Pursuant to
the terms of the loan  agreement,  the loan bears interest at 12% per annum.  On
December 30, 1999, this loan was fully repaid.

The Company has warrants to purchase the  following  number of common  shares of
the Company outstanding as at December 31, 2001.

                                    Price
     Number of shares             per share               Expiry date
     ----------------             ---------               -----------

           50,000                   $8.55                 June 30, 2002
          100,000                    8.50                 August 9, 2004
          416,667                    7.80                 December 23, 2004
        1,076,167                   11.40                 March 5, 2005
           26,923                    7.80                 March 9, 2005
          223,925                   11.40                 March 9, 2005

As discussed in Note 2, the Company  recognized a $380,000 deemed financing cost
for the beneficial  conversion feature of the convertible short term notes. This
cost was  recognized in the fourth  quarter of 2000 as a cumulative  effect of a
change in accounting principle.

13. COMMON STOCK

In July 2000, 1,000,000 shares were issued for total proceeds of $7,800,000 upon
warrants issued on November 26, 1999, being exercised.

Pursuant to the  agreement  to acquire all of the  outstanding  shares of AIL in
March  2000,  the  Company  issued  24,870  shares  at a deemed  total  value of
$623,988.


                                      F-28
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

13. COMMON STOCK (continued)

On January 28, 1999,  the Company  issued  8,000,000  common shares to financial
advisors  for  services,  at a deemed  fair value of the  services  provided  of
$300,000,  rendered in connection with organizational  activities of the Company
plus the nominal amount of cash of 8,000, for total consideration of $308,000 or
$0.0385 per share.

On March 3, 1999,  the Company  issued 500,000 common shares at $4 per share for
total net proceeds of $2,000,000.

On September 8, 1999,  the Company  issued 166,667 common shares at $9 per share
for total net proceeds of $1,500,000.

On November 26, 1999,  the Company issued  1,000,000  common shares at $6.50 per
share  for  total  net  proceeds  of  $6,230,000,  net of share  issue  costs of
$270,000.  Each of these shares had attached a five-year warrant to purchase one
new common share for $7.80 per share. These warrants,  which were exercisable at
any time up to November 25, 2004, were exercised in July 2000.

On December 23, 1999, the Company issued  1,250,000  common shares at a price of
$6.50 per share for total  proceeds of  $7,637,500,  net of share issue costs of
$487,500.  Each of these  shares had  attached a  five-year  warrant to purchase
one-third of one new common  share for $7.80 per whole share and is  exercisable
at any time up to December 22, 2004.

14. SHAREHOLDER RIGHTS PLAN

On  December 5, 2001,  the  Company  adopted a rights plan to declare a dividend
distribution of one common share purchase right (a "right") for each outstanding
share of the  Company's  common  stock as of a record  date  which  shall not be
declared later than March 31, 2002 (Note 20(e)).

Each right would  entitle  shareholders  to buy five common  shares at $0.01 per
share if certain  events  occurred  relating to a person or group  acquiring  or
attempting  to acquire  10% or more of the  outstanding  shares of common  stock
without  the  approval  of the  Company's  Board of  Directors.  The  rights are
exercisable until December 31, 2020.


                                      F-29
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

15. DISCONTINUED OPERATIONS

Asia Internet Limited

The  Company  decided in the first  quarter of 2001 to  discontinue  its systems
integration business,  which was carried on through its wholly-owned subsidiary,
AIL.  The  discontinued  operations  resulted  in a gain  on  discontinuance  of
$1,725,551  due to reversal of $1,852,570 of unvested stock  compensation  costs
previously recorded relating to AIL employees, net of severance pay of $127,019.
The  assets and  liabilities  of the  discontinued  operations  included  in the
accompanying  consolidated  balance  sheet at  December  31,  2001 and 2000 were
$7,736,  and  $273,431,  $148,818 and $363,344,  respectively.  Revenues for the
system integration  business were $92,237,  $816,648,  and $908,885 for the year
ended  2001 and 2000 and the period  from  September  16,  1998  (inception)  to
December 31, 2001,  respectively.  Net loss was $236,683 and  $4,219,736 for the
years ended December 31, 2001 and 2000, respectively.

16. RELATED PARTY TRANSACTIONS

During the year ended  December 31, 2001,  the Company paid  consulting  fees to
certain former directors of $28,629.

During 2001, the Company advanced  $270,055 to Vallenar.  A director and officer
of the Company are also directors of Vallenar,  and certain  shareholders of the
Company's affiliate, Gasco, are also shareholders of Vallenar.

AIL was considered a related party to the Company as a 30% shareholder of AIL is
also a director and stockholder of the Company.  AIL provided technical support,
system maintenance and other professional  services to the Company and purchased
computer and office  equipment  on behalf of the Company.  During the year ended
December  31,  2000 and  prior to the  acquisition  of AIL by the  Company,  the
Company paid $91,871 (1999: $465,442) to AIL for the above services.  During the
year ended  December  31,  2000,  the amounts  charged by AIL to the Company for
technical  support,  system  maintenance and other  professional  services,  and
purchase of computer and office  equipment on the Company's behalf were $283,157
for  services  and $15,290  for  purchases,  respectively  (1999:  $401,054  for
services and $148,526 for purchases, respectively).

On March 31, 2000, the Company completed the acquisition of AIL and AIL's assets
and liabilities have been consolidated into the Company's  financial  statements
as of that date.

A  director  and  shareholder  of the  Company  was a partner in a law firm (the
"firm")  to which the  Company  paid legal  fees in the  ordinary  course of its
business. The amount paid by the Company and charged by the firm during the year
ended December 31, 2000 was $373,497 (1999: $315,056 advanced to the firm by the
Company and $395,364 the amount  charged by the firm).  Effective June 15, 2000,
the director  resigned  from the firm and entered into a  consultancy  agreement
directly  with the  Company  for a monthly  fee of  $16,129.  For the year ended
December 31, 2000, $106,153 was paid to this former director.


                                      F-30
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

16. RELATED PARTY TRANSACTIONS (continued)

During the year ended  December  31,  2000,  a director of the Company  received
consulting  fees of $25,000 of which the Company paid in the ordinary  course of
its business.

In 1999, the Company issued 8,000,000 shares to financial  advisors for services
rendered in connection with organizational activities of the Company at a deemed
value of $300,000, in excess of $8,000 cash received.

During 1999, a director of the Company was a partner in a  professional  firm to
which  the  Company  had paid  consultancy  fees in the  ordinary  course of its
business.  The amount  charged by the firm to the Company  during the year ended
December 31, 1999 was  $234,319.  As at December 31, 1999,  the Company owed the
firm $109,227.

17. SEGMENT INFORMATION

In 2001,  the Company  changed the  composition  of its  segments to reflect the
discontinuation of the systems integration  business and to reflect the internal
reorganization  around oil and gas  development  and  exploitation  and  payment
processing.   Prior  year   disclosures   have  been  restated  for   consistent
presentation.

Payment processing is viewed as operating in two different  geographical  areas,
Asia Pacific and Americas.  The Company's oil and gas operations only operate in
the Americas.  The discontinued systems integration  activities only operated in
Asia Pacific.  Summarized  financial  information by segment for the years ended
December 31, 2001, 2000 and 1999, as taken from internal  management  reports is
as follows:

                                          For the year ended December 31,
                                          -------------------------------

                                          2001          2000          1999
                                          ----          ----          ----

     Revenue

     Segments
     Payment processing
       Asia Pacific .............       $ 51,411       $38,223       $2,634
       Americas .................        250,567            --           --
     Oil and gas ................             --            --           --
                                        --------       -------       ------

                                        $301,978       $38,223       $2,634
                                        ========       =======       ======


                                      F-31
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

17. SEGMENT INFORMATION (continued)

                                        For the year ended December 31,
                                        -------------------------------

                                    2001             2000             1999
                                    ----             ----             ----
     Profit and Loss

     Segments
     Payment processing
        Asia Pacific .......    $ (6,673,642)    $(13,087,841)    $(6,788,885)
        Americas ...........      (4,551,979)        (501,884)             --
     Oil and gas ...........        (724,569)              --              --
     Discontinued operations       1,488,868       (4,219,736)             --
                                ------------     ------------     -----------

                                $(10,461,322)    $(17,809,461)    $(6,788,885)
                                ============     ============     ===========

                                                          As at
                                                       December 31,
                                                       ------------

                                                 2001              2000
                                                 ----              ----
     Assets

     Segments
     Payment processing
        Asia Pacific ..................       $   230,561       $32,692,717
        Americas ......................                --         3,127,637
     Oil and gas ......................        23,259,081                --
     Discontinued operations ..........             7,736           148,818
                                              -----------       -----------

                                              $23,497,378       $35,969,172
                                              ===========       ===========

Stock compensation (recovery) expense by segment is as follows:

<TABLE>
<CAPTION>
                                                                                    Cumulative from
                                                                                   September 16, 1998
                                             For the year ended December 31,       (date of inception)
                                             -------------------------------                to
                                          2001             2000            1999     December 31, 2001
                                          ----             ----            ----     -----------------
<S>                                   <C>               <C>             <C>             <C>
     Segments
     Payment processing
       Asia Pacific ............      $    20,007       $1,759,554      $  646,532      $2,426,093
       Americas ................          (28,765)          28,765              --              --
     Oil and gas ...............           88,850               --              --          88,850
     Discontinued operations ...       (1,852,570)       2,159,518              --         306,948
                                      -----------       ----------      ----------      ----------

                                      $(1,772,478)      $3,947,837      $  646,532      $2,821,891
                                      ===========       ==========      ==========      ==========
</TABLE>

Depreciation  expense  for the  payment  processing  segment for the years ended
December 31, 2001,  2000,  1999 and the  cumulative  period from  inception were
$444,687, $553,806, $250,382 and $1,248,875, respectively.  Depreciation expense
for the systems integration segment for the years ended December 31, 2001, 2000,
1999 and the cumulative  period from inception  were $1,679,  $21,781,  $Nil and
$23,460, respectively.

Americas payment processing profit and loss includes $390,052, $292,118 and $Nil
of equity in the losses of investees  accounted for by the equity method for the
years ended December 31, 2001, 2000 and 1999,  respectively.  Oil and gas profit
and loss includes $492,094 of equity in the loss of an investee accounted for by
the equity method for the year ended December 31, 2001.

Oil and gas assets as of December 31, 2001 included $18,507,906 of investment in
an equity method investee. Americas payment processing assets as of December 31,
2000 include $3,107,882 of investment in an equity method investee.


                                      F-32
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

18. COMMITMENTS AND CONTINGENCIES

The Company  leases office and other premises  under  non-cancellable  operating
leases. The lease commitments for the next five years are:

     2002 .........................................                $216,419
     2003 .........................................                  76,032
                                                                   --------

     Total ........................................                $292,451
                                                                   ========

Rent  expense  for the  years  ended  December  31,  2001,  2000,  1999  and the
cumulative   period  from  inception  was  $372,178,   $611,509,   $276,431  and
$1,260,118, respectively.

The Company has entered into  employment  agreements  with its employees.  These
agreements  require  severance  payments of a minimum of four weeks  salary upon
their  termination  without cause. If the employment  agreements were terminated
without  cause,  at December 31, 2001,  the Company  would have a liability  for
minimum contractual severance pay of approximately $330,000.

19. CERTAIN SIGNIFICANT RISKS AND UNCERTAINTIES

Financial instruments, which potentially subject the Company to concentration of
credit risk,  consist  principally of cash and cash equivalents,  trade accounts
receivable,  a note  receivable  and a loan  receivable.  The fair values of the
current assets and liabilities and the note receivable  approximate the carrying
amounts due to the short-term nature of these instruments. The fair value of the
loan receivable of $1,865,244 is an estimate based on current rates available to
the issuer for credit of the same remaining duration.

The Company's  business  activities and accounts  receivable are  principally in
Hong Kong with a limited number of customers.  The largest customer accounts for
52% of the total revenue excluding those post acquisition  revenue recorded from
FEDS which was sold on October 19, 2001.

The Company maintains allowances for estimated potential bad debt losses. During
the years ended  December 31, 2001 and 2000, the Company  maintained  provisions
for doubtful  accounts of $Nil and $11,558,  respectively.  Bad debt expense was
$12,531,  $40,768,  $35,884 and $89,183,  for the years ended December 31, 2001,
2000,  1999  and  the  cumulative  period  from  inception,   respectively.  The
write-offs of bad debt provisions were $24,089, $29,210, $35,884 and $89,183 for
the years ended December 31, 2001,  2000,  1999 and the  cumulative  period from
inception, respectively.


                                      F-33
<PAGE>

                             BREK ENERGY CORPORATION
                         (Formerly First Ecom.com, Inc.)
                          (A Development Stage Company)
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                (In United States dollars, except share amounts)

20. SUBSEQUENT EVENTS

Subsequent to December 31, 2001:

(a) At the Company's  annual  meeting of  stockholders  held on January 29, 2002
resolutions  to change of the Company's name from First  Ecom.com,  Inc. to Brek
Energy Corporation and to increase of authorized capital from 200,000,000 common
shares to 300,000,000 common shares were approved.

(b) On January 16, 2002 the Company  entered  into  agreements  with  holders of
7,000,000  common shares of Gasco to exchange  their Gasco shares for a total of
19,250,000  shares of the  Company,  subject to the  approval  of the  Company's
shareholders.

(c) On March 11,  2002 the  Company  exercised  an option to convert  500 of its
Gasco  preferred  shares into 4,750,000  Gasco common shares.  The remaining 500
Gasco preferred shares retains the 26% voting right in Gasco (see Note 9).

(d) On March 12, 2002 the Company converted its loan receivable of $325,000 (see
Note 6) plus an additional  $25,000 into 733,333 Series 'A' Preferred  Shares of
Vallenar. In addition,  the Company acquired 2,512,500 common shares of Vallenar
for $12,562.  After additional equity financing being undertaken by Vallenar, it
is anticipated that the Company will hold a 26% equity interest.

(e) On March 20,  2002,  the  Company  declared a dividend  of one common  share
purchase right for each  outstanding  share of common stock of the Company.  The
dividend is payable to the  shareholders of record on that date. The Company has
reserved 96,050,185 treasury shares for the exercise of these rights.

(f) In March  2002,  the  Company  issued  2,845,000  common  shares by way of a
private  placement to various  insiders  and  affiliates  for total  proceeds of
$1,422,500.


                                      F-34
<PAGE>

                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned hereunto duly authorized.

                            BREK ENERGY CORPORATION.


                                        /S/ Kenneth G.C. Telford
                                        ------------------------

                                            Kenneth G.C. Telford
                                            Secretary and Chief
                                            Financial Officer

Signature                                  Title                      Date
                                           -----                      ----


/S/ Gregory M. Pek           Director, President, and Chief       May 7, 2002
------------------------     Executive Officer (principal
Gregory M. Pek               executive officer)


/S/ Ravi K. Daswani          Director                             May 7, 2002
------------------------
Ravi K. Daswani


/S/ Douglas Moore            Director                             May 7, 2002
------------------------
Douglas Moore


/S/ Ian G. Robinson          Director & Chairman of the Board     May 7, 2002
------------------------
Ian G. Robinson


/S/ James Pratt              Director                             May 7, 2002
------------------------
James Pratt


/S/ Andrew Leitch            Director                             May 7, 2002
------------------------
Andrew Leitch


/S/ Kenneth G.C. Telford     Secretary & Chief Financial Officer  May 7, 2002
------------------------     (principal accounting officer)
Kenneth G.C. Telford


                                     - 86 -