U.S. Securities and Exchange Commission
                             Washington, D.C. 20549

                                   FORM 10-KSB
(Mark One)
[x]ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                                   ACT OF 1934

                      For the year ended December 31, 2000

[ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

                         Commission file number 0-25037
                              stereoscape.com, inc.
                 (Name of small business issuer in its charter)

                      Nevada                             06-1469654
   (State or other jurisdiction              (IRS Employer identification no.)
of incorporation  or  organization)

      3440 Highway 9 South, Freehold, New Jersey          07728
       (Address of principal executive offices)        (Zip Code)

                                 (732) 462-7767
                           (Issuer's telephone number)
                        ---------------------------------
 Securities registered under section 12(b) of the Exchange Act:

      Title of each class            Name of each exchange on which registered
_________________________________   ___________________________________________

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

                         Common Stock, $0.001 par value
                                (Title of class)

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

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

     State issuer's  revenues for its most recent fiscal year:  Revenues for the
year ended December 31, 2000 were $ 2,275,335.

     State the aggregate market value of the voting stock held by non-affiliates
computed  by  reference  to the  price at which  the  stock  was  sold,  as of a
specified  date within the past 60 days.  (See  definition  of affiliate in Rule
12b-2 of the  Exchange  Act).  Note;  If  determining  whether  a  person  is an
affiliate will involve unreasonable effort and expense, the issuer may calculate
the aggregate  market value of the common equity held by  non-affiliates  on the
basis of reasonable assumptions, if the assumptions are stated.

     The aggregate market value of the voting stock held by non-affiliates as of
December 31, 2000 is $751,745.00.

                         (ISSUERS INVOLVED IN BANKRUPTCY
                     PROCEEDINGS DURING THE PAST FIVE YEARS)
     Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d)of the  Exchange Act after the  distribution  of
securities under a plan confirmed by a court. Yes .......No ....... N/A

                   (APPLICABLE ONLY TO CORPORATE REGISTRANTS)
     State the number of shares  outstanding of each of the issuer's  classes of
common equity as of the latest practicable date.

          Title of Each Class                    Number of Shares Outstanding
Common Stock, $.001 par value per share        (December 31, 2000)  119,178,610
                       DOCUMENTS INCORPORATED BY REFERENCE
     If the following documents are incorporated by reference,  briefly describe
them and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc.) into
which the document is incorporated:  (1) any annual report to security  holders;
(2) any proxy or information statement; and (3) any prospectus filed pursuant to
rule 424(b) or (c) of the Securities Act of 1933 ("Securities  Act"). The listed
documents should be clearly described for identification  purposes (e.g., annual
report to security holders for fiscal year ended December 24, 1990).

     Transitional Small Business Disclosure Format (Check one): Yes  ;No x
<PAGE>
         PART I

         Item 1.Business

                Description of Business

     stereoscape.com, inc. ("SSCP" or the "Company") was incorporated on June 8,
1988 as a corporate shell developed to generate capital  resources which were to
be used to acquire or participate in a business or business entity.  The Company
began as a Development Stage Company, and on April 17, 1997 acquired 100% of the
outstanding  shares of American Buyers Club  International,  Inc.,  ("ABC") in a
business  combination  accounted  for as a purchase.  ABC became a wholly  owned
subsidiary  of the Company  through the  exchange  of  10,980,000  shares of the
Company's common stock for all of the outstanding shares of ABC.
     Effective  October 1, 2000 the  Company  acquired  100% of the  outstanding
shares of Marx Toys, Inc. ("Marx") in a business combination  accounted for as a
purchase.  Marx became a wholly  owned  subsidiary  of the  Company  through the
exchange  of  15,000,000  shares of the  Company's  common  stock for all of the
outstanding shares of Marx.
     On August 23, 2000 The Company  entered   into a stock  purchase  agreement
with the  principals of  epiggybank.com,  inc.  ("epiggybank"),  a financial and
educational  web site for  children.  The terms of the  agreement  included  the
transfer,  to The Company, of the "epiggybank" name, trademarks and intellectual
properties,  and other  assets being used in the  seller's  business.  Since the
sellers have been  unable  to  deliver  a valid  trademark for  "epiggybank" the
Company is in the process  of  rescinding  the  transaction, and to that end has
halted the shares issued in the transaction.
     ABC  sells  its  products   via  the  internet  and  through   print  media
advertising,  and in addition  through its  subsidiary,  Alpha Sound and Vision,
Inc., ("Alpha") which operates a retail store in Freehold, New Jersey.
     Marx, the brand which was  founded in 1919,  by Louis  Marx, was one of the
world's largest  toy  manufacturers   through much  of the 20th  century.  Their
operation includes executive offices in Miami, Florida, while the  manufacturing
is done in Mexico and Ohio.  Marx has been selling its product  via the internet
and through telemarketing.  In the future they  plan to   expand  their sales to
include  major  toy  retailers. The  Marx  brand  is synonymous with quality and
value.
     References  herein the "SSCP" or "the Company" unless  otherwise  indicated
include stereoscape.com, ABC, Alpha, and Marx.

                Products.

     Although  ABC and Alpha  (collectively  the "Home  Theater  Company")  sell
through  different  media, the majority of the products they sell are identical.
ABC and  Alpha  sells  products  such  as  amplifiers,  receivers,  televisions,
speakers,  CD players,  DVD players,  satellite  systems,  home automation,  and
cassette players.
     The Home  Theater  Company  offers  a broad  range  of name  brands  of the
products listed above, at several different price points, with a greater product
depth at higher  price  levels than most of its  competitors.  The  products are
manufactured by companies such as: JVC,  Panasonic,  Sony, Yamaha,  Denon, Krix,
Klipsch,  Hitachi,  Canton,  Apature, Jamo, NHT, Samsung, Sherwood, and Kenwood.
     The Marx products  being sold include play sets,  such as Fort  Apache(TM),
Battleground(TM),  Cape  Canaveral,  and Remember The Alamo!  In addition,  Marx
sells action figures, which include the highly detailed Noble Knights,  Vikings,
the coveted April Dancer,  the ever popular Johnny West(TM) series,  Warriors of
the World,  Geronimo and General Custer.

                                       2
<PAGE>

                  New Products and Expansion.

     The Home  Theater  Company is  continuously  evaluating  new  products  and
services to expand its product line.  They are focusing on expanding their sales
by forming alliances with builders of home developments, interior decorators and
architects,  in order to enter the business to business  arena.  The proprietary
knowledge and experience that The Company has in design and installation of home
theatre  equipment is a valuable  tool that these  companies  can offer to their
clientele.  The Company feels that the home entertainment field is growing,  and
with the advent of new and better  technology being offered by satellite,  cable
other  entertainment  service companies,  the "recreation room" of the past will
become the "home  entertainment  room" of the future. This transition will drive
the growth of a new  industry,  that through the use of  computers  will "marry"
various services,  such as home safety, home  entertainment,  lighting and other
functions,  to a control  center able to be operated  from within or outside the
home. The Company is presently evaluating its present resources and what it will
need to enter this new and exciting world.
     While Marx is primarily  bringing back many of their toys that were coveted
throughout the years, they are evaluating  arrangements to manufacture new toys.
Marx is also  pursuing  promotional  deals  for some of their  vintage  toys and
exploring arrangements to make their toys interactive with the internet.

                  Product Line Exclusivity License & Trademark Agreements.

     The Home  Theater  Company  does not have  exclusive  licenses or trademark
agreements with any of its suppliers.
     Marx is currently licensing the rights to manufacture,  and distribute, the
well-known line of Marx Trains(TM).  These are carefully  crafted,  scale trains
made of  qualified  lithographed  tin  plate  metal.  They  are made to the same
specifications  that Marx made their metal  trains  from 1933 to 1955.  Marx has
also  entered  into  licensing  and  trademark  agreements  with  several  other
companies to produce Marx Toy products.

                  Government Regulations.

     The costs and effects of compliance with  governmental  regulations are not
material to the Home Theater Company's or Marx operations.

                  Research & Development.

     The Home Theater  Company depends on the  manufacturers  of the products it
sells for the research and development of new products or enhanced products. The
Company is researching  the sale of other products that can be integrated into a
complete system for home automation,  which will simplify the installation,  and
design controls, for various home services used by the consumer.
     Marx is in the process of  negotiating a licensing  deal for one its highly
recognized products, while updating it with current state of the art technology.
In  addition,  Marx is working  on a deal that  would  make its  action  figures
computer interactive.

                  Cost and Effects of Compliance with Environmental Laws

     The  costs  and  effects  of  compliance  with  environmental  laws are not
material to the Home Theater Company' or Marx operations.


                  Current Employees

     The Company  currently  employs 11  persons,  all are on a full time basis.
None of the Company's employees are members of unions.

                                       3
<PAGE>


         Item 2.  Description of Property

     SSCP leases a 4,064 square foot facility at 3440 Highway 9 South, Freehold,
New Jersey  07728,  of which  approximately  1,000  square feet serves as retail
space.  This facility serves as SSCP's  headquarters as well as the Home Theater
Company's warehouse  facility.  The facility is leased at a basic rent of $3,048
per month or $36,576  annually.  The lease has a five year term,  which began in
1999,  with rent  escalation  of $1.00 per square foot at the end of each of the
first four years.  Marx is subleasing  facilities for its executive  office,  in
Miami,  Florida,  on a monthly  basis.  In  addition,  Marx entered into a lease
agreement,  effective April 15, 2001, for warehouse facilities in Sebring, Ohio.
The lease is for a 14,000  square foot space,  with a basic rental of $3,500 per
month or  $42,000  annually.  The  lease  has a 5 year  term,  however  Marx can
terminate the lease after one year, with three months advance notification.


         Item 3.  Legal Proceedings

     The Company has no material legal proceedings by or against the Company, or
any of its subsidiaries.


         Item 4.  Submission of Matters to a Vote of Security Holders

                  None

                                       4
<PAGE>


         PART II

         Item 5.  Market for Common Equity and Related Stockholder Matters

     The Company's  Common Shares are traded on the  Electronic  Bulletin  Board
under the symbol SSCP. The following  table sets forth the range of high and low
bid quotations for the common stock for the period indicated, as reported on the
Electronic  Bulletin Board.  On October 3, 2000 the Company  effected a 15 for 1
forward stock split.  All  calculations  and share amounts have been adjusted to
reflect the post-split value.
     The  quotations  are  inter-dealer  prices in the  over-the-counter  market
without retail mark-ups,  markdowns or commissions, and may not represent actual
transactions.

                                     2000                        1999
                                Common Shares               Common Shares
       Period                 High           Low          High           Low
                        --------------------------------------------------------

January 1 - March 31         0.2625        0.0250        0.1313        0.0667

April 1 - June 30            0.1333        0.0229        0.1437        0.0354

July 1 - September 30        0.2479        0.0375        0.0750        0.0229

October 1 - December 31      0.2344        0.0156        0.0917        0.0250


     As of April 13,  2001,  there were 53  holders  of record of the  Company's
common stock.
     The  Company  has not paid a cash  dividend  on its common  stock since its
inception.  The Company  expects that for the foreseeable  future,  any earnings
will be retained for use in the business or other corporate purposes,  and it is
not expected that cash or share  dividends will be paid.  However,  there are no
restrictions on the payment of dividends, either by contract or regulation.

                                       5
<PAGE>


         Item 6.   Management's Discussion and Analysis or Plan of Operation

     Management's  Discussion and Analysis of Financial Condition and Results of
Operations should be read in conjunction with the Audited Consolidated Financial
Statements and related notes which are contained elsewhere in this report.

     Results of operations for stereoscape.com,  inc. and subsidiaries are being
presented on a consolidated basis.


     Year Ended December 31, 2000 Compared to Year Ended December 31, 1999

     Net sales for the year ended December 31,2000 decreased 44.8% to $2,269,233
from  $4,112,334  for the year ended  December  31,  1999.  The decrease was the
result of reduction in consumer spending caused by outside economic factors, and
a  restructuring  of the product  line.  In order to be  competitive  with large
volume chains the Company had to sell more lower margin products.  The sales for
the year ended December 31, 2000 included $111,623,  for Marx Toys, from October
1, 2000, the effective date of acquisition, through December 31, 2000.

     Gross  profit for the year  ended  December  31,  2000  decreased  50.4% to
$389,411 from $784,502 for the year ended  December 31, 1999. As a percentage of
net sales,  gross profit decreased to 17.2% in the 2000 period compared to 19.1%
in the 1999 period.  The  decrease  was the result of  increased  sales of lower
margin products, and purchasing of reduced quantities, thereby not being able to
take  advantage  of bulk  discounts.  In  addition,  a  reduction  in mail order
consumer  spending  created more intense  competition,  that forced  promotional
sales prices.

     Selling,  general and  administrative  expenses for year ended December 31,
2000  increased 4.3% to $1,067,775  from  $1,023,636 for the year ended December
31, 1999. The increase in selling,  general and administrative was the result of
additional  by the  operating  expenses  incurred by Marx Toys during the period
October 1 to December 31, 2000.

     Net losses for the year ended  December  31,  2000  increased  to a loss of
($678,364)  compared to a loss of  ($239,134)  for the year ended  December  31,
1999.  This  increase  was due to decrease in sales of 44.8% and gross profit of
52.7%.

     Liquidity and Capital Resources

     At December  31, 2000 the Company had a net equity of  $802,514  versus a
deficit equity of ($556,276) at December 31, 1999.

     The Company has  historically  financed its business through cash flow from
operations and borrowings  from  executives,  which may be utilized from time to
time.

     Subsequent to the year end the Company entered into a financing arrangement
for  $300,000,  the  transaction  includes  for an option to purchase  3,000,000
shares of its common stock.

                                       6
<PAGE>

     The Company expects to require additional capital to finance production for
its Toy Company and to acquire inventory for its audio products and home theatre
expansion.  The Company has completed a financing  package that includes  bridge
financing in the form of a promissory  note to private  investors  and a funding
agreement  with an investment  banking firm to a maximum of $10 million,  should
the Company need the funds.

     While no specific  acquisitions  are  presently  under  consideration,  the
Company  is  actively  seeking  acquisitions  and  anticipates  it  may  require
additional  capital in order to fund any  acquisitions or substantial  growth in
its current business.

     Anticipated Future Growth

     Management  believes  that the  future  growth of the  Company  will be the
result  of  focusing  on the  restructuring  of  its  core  businesses,  thereby
increasing  the  profitability.  In this effort the Company  intends to consider
these four  efforts;  (1) expand the toy sales to  include  major  national  and
regional retailers,  (2) expand home theatre sales to go beyond the consumer and
reach out to  industrial  markets and  business to business  relationships,  (3)
pursue promotional deals for the sale of vintage Marx products on a large scale,
(4) consider acquisitions of other companies in the toy and home theatre related
industries.


     Forward Looking Statements

     Management's  Discussion and Analysis of Financial Condition and Results of
Operations contains information regarding management's planned growth, financing
and prospective  business  acquisitions and opportunities.  These statements are
forward looking statements that involve risks and  uncertainties.  The following
is a list of factors,  among others,  that could cause actual  results to differ
materially from the forward looking  statements:  business conditions and growth
in the  Company's  market and industry and in the general  economy;  competitive
factors including increased competition and price pressures; availability of raw
materials  and  purchased  products at  competitive  prices;  and  inadequate or
unsatisfactory financing sources.

                                       7
<PAGE>


         Item 7.  Financial Statements

     Response  submitted as a separate section of this report commencing on page
F-1.


         Item 8.  Changes in and Disagreements With  Accountants  on  Accounting
                  and Financial Disclosure

                           None


         PART III

         Item 9.  Directors, Executive Officers, Promoters and Control Persons

     Incorporated  by reference  from the proxy  statement,  which will be filed
within 30 days of the filing of this report.


         Item 10. Executive Compensation

     Incorporated  by reference  from the proxy  statement,  which will be filed
within 30 days of the filing of this report.


         Item 11. Security Ownership of Certain Beneficial Owners and Management

     Incorporated  by reference  from the proxy  statement,  which will be filed
within 30 days of the filing of this report.


         Item 12. Certain Relationships and related Transactions

     Incorporated  by reference  from the proxy  statement,  which will be filed
within 30 days of the filing of this report.

                                       8
<PAGE>

         Item 13.          Exhibits and Reports on Form 8-K

     (a) (1) and (2) The  response to this  portion of Item 13 is submitted as a
separate report commencing on Page F-1.


     (a) (3)

  Exhibit No.       Description of Exhibit                                  Note

      3.1         Certificate of Incorporation, as amended                   1
      3.2         By-laws, as amended1
     10.1         1998 Incentive and Non-Qualified Stock Option Plan         1
     10.2         Acquisition Agreement of American Buyers Club Int'l, Inc.  1
     10.3         Employment Agreement for Steve Wise                        1
     10.4         Employment Agreement for David Bannon                      1
     10.5         Acquisition Agreement of Marx Toys, Inc.                   2
     21           Subsidiaries of the Registrant                             1

         Note 1: Filed with the  Company's  Form 10SB filed on November 6, 1998,
         and incorporated by reference herein.

         Note 2: Filed herein.


(b)      Reports on Form 8-K.

     Form 8-K was filed on March 30, 2001, to report the acquisition of Marx.

                                       9
<PAGE>

                                   SIGNATURES

     In accordance  with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                 stereoscape.com, inc.


                 By:   /s/ Mario Bassani                   April 16, 2001
                       -------------------
                       Mario Bassani
                       Chief Executive Officer (Principal Executive Officer)
                       Chairman of the Board of Directors

     In  accordance  with the Exchange Act, this report has been signed below by
the following  persons on behalf of the  registrant and in the capacities and on
the dates indicated


                 By:   /s/ Mario Bassani                   April 16, 2001
                       -------------------
                       Mario Bassani
                       Chief Executive Officer (Principal Executive Officer)
                       Chairman of the Board of Directors


                 By:   /s/ Gary B. Hyman                   April 16, 2001
                       -------------------
                       Gary B. Hyman
                       Chief Financial Officer (Principal Accounting Officer)
                       Director

                 By:   /s/ Steven Wise                     April 16, 2001
                       -------------------
                       Steven Wise
                       Director



                                       10
<PAGE>


                      stereoscape.com, inc. and Subsidiary
                                      Index

                              Financial Statements

Included in Part II

Report of Independent Certified Public Accountants

Consolidated Balance Sheet at December 31, 2000

Consolidated Statements of Operations for the Years Ended
   December 31, 2000 and 1999

Consolidated Statements of Cash Flows for the Years Ended
   December 31, 2000 and 1999

Consolidated Statements of Changes in Stockholders' Equity for the Years Ended
   December 31, 2000 and 1999

Notes to Consolidated Financial Statements


                                       F-1
<PAGE>

                          INDEPENDENT AUDITORS' REPORT

Board of Directors
stereoscape.com, inc.
Freehold, New Jersey

We have audited the accompanying  consolidated balance sheet of stereoscape.com,
inc.  and  subsidiary  companies  as of  December  31,  2000,  and  the  related
consolidated statements of operations,  changes in stockholders' equity and cash
flows for the years ended December 31, 2000 and 1999. These financial statements
are the  responsibility of the Company's  management.  Our  responsibility is to
express an opinion on the financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards. Those standards require that we plan and perform the audits 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 provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material  respects,  the financial  position of  stereoscape.com,
inc. and  subsidiary  companies as of December 31, 2000,  and the results of its
operations  and cash flows for the years  ended  December  31,  2000 and 1999 in
conformity with generally accepted accounting principles.

/s/  Ehrenkrantz Sterling & Co., LLC
Certified Public Accountants
Livingston, New Jersey
April 14, 2001


                                      F-2
<PAGE>

                 stereoscape.com, inc. AND SUBSIDIARY COMPANIES
                           CONSOLIDATED BALANCE SHEET
                                DECEMBER 31, 2000

       ASSETS
Current Assets

          Cash                                                        $ 210,188

          Accounts and notes receivable                                  23,362

          Inventories                                                   277,148

          Other current assets                                           62,699
                                                                    ------------
            Total Current Assets                                        573,397
                                                                    ------------

Property and Equipment,  Net                                            952,033

Other Assets                                                             25,303
                                                                    ------------

TOTAL ASSETS                                                        $ 1,550,733
                                                                    ============

                     LIABILITIES AND STOCKHOLDERS' EQUITY

     LIABILITIES

Current Liabilities

          Accounts payable                                            $ 222,353

          Accrued expenses and other current liabilities                279,893

          Merchandise credits                                           100,221

          Notes and loans payable                                       145,752
                                                                    ------------
            Total Current Liabilities                                   748,219
                                                                    ------------

Commitments and Contingencies                                                 -

                              STOCKHOLDERS' EQUITY

Common Stock
          Par value, $.001, 200,000,000 shares authorized,
             119,178,610 shares issued and outstanding                  119,179

Additional paid in capital                                            2,112,350

Deficit                                                              (1,429,015)
                                                                    ------------
Total Stockholders' Equity                                              802,514
                                                                    ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                          $ 1,550,733
                                                                    ============

                 See notes to consolidated financial statements.

                                      F-3
<PAGE>

                 stereoscape.com, inc. AND SUBSIDIARY COMPANIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                                             Years Ended
                                                             December 31,
                                                         2000           1999
                                                  ------------------------------

Sales                                                 $2,269,233     $4,112,334


Cost of sales                                          1,879,822      3,327,832
                                                  ------------------------------

Gross profit                                             389,411        784,502


Selling, General and Administrative expenses           1,067,775      1,023,636
                                                  ------------------------------


Net Loss                                              $ (678,364)    $ (239,134)
                                                  ==============================


Net Loss per share, basic and diluted                   $ (0.009)      $ (0.006)

Weighted average number of
   shares, basic and diluted                          73,262,341     42,268,020


                 See notes to consolidated financial statements.


                                      F-4
<PAGE>


                 stereoscape.com, inc. AND SUBSIDIARY COMPANIES
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                     YEARS ENDED DECEMBER 31, 2000 AND 1999


                                                Additional
                             Common Stock        Paid-in
                           Shares     Amount     Capital     Deficit     Total
                      ----------------------------------------------------------

Balance at
  December 31, 1998     40,303,395   $40,303     $34,697   $(511,517) $(436,517)

Issuance of common stock 4,416,510     4,417     114,959                119,376

Net Loss                                                    (239,134)  (239,134)
                      ----------------------------------------------------------

Balance at
  December 31, 1999     44,719,905    44,720     149,656    (750,651)  (556,275)

Issuance of stock for
  acquisitions          24,000,000    24,000     756,938                780,938

Issuance of common stock
under private placements 2,903,505     2,904     107,096                110,000

Issuances for options
  and other             47,555,200    47,555   1,098,660              1,146,215

Net Loss                                                    (678,364)  (678,364)
                      ----------------------------------------------------------


Balance at
  December 31, 2000    119,178,610  $119,179  $2,112,350  $(1,429,015) $802,514
                      ==========================================================


                 See notes to consolidated financial statements.


                                      F-5
<PAGE>
                 stereoscape.com, inc. AND SUBSIDIARY COMPANIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                              Years Ended
                                                              December 31
                                                          2000            1999
                                               ---------------------------------
Cash flows from operating activities:
          Net loss                                   $ (678,364)     $ (239,134)
Adjustments to reconcile net loss to net cash
   used in operations:
          Depreciation and amortization                  12,479           3,783
     Changes in operating assets:
          Accounts and notes receivable                 (12,397)          6,956
          Inventories                                   (23,969)        (49,792)
          Other current assets                          (20,443)         (3,508)
     Changes in operating liabilities:
          Accounts payable                              (41,845)         75,538
          Accrued expenses payable                     (333,715)        168,741
          Customer deposits                             100,221         (35,819)
          Notes and loans payable                       145,752               -
                                               ---------------------------------

Net cash used in operating activities                  (852,281)        (73,235)
                                               ---------------------------------

Cash flow from investing activities:
          Purchases of fixed assets                    (105,777)         (3,074)
          Acquisition of other assets                   (25,303)              -
                                               ---------------------------------

Net cash used in investing activities                  (131,080)         (3,074)
                                               ---------------------------------

Cash flow from financing activities:
          Issuance of capital stock                   1,186,992          84,375
          Repayment of loan payable                           -          (8,117)
                                               ---------------------------------

Net cash provided by financing activities             1,186,992          76,258
                                               ---------------------------------

Increase (decrease) in cash                             206,631             (51)

Cash, beginning of year                                   3,557          3,608
                                               ---------------------------------

Cash, end of year                                     $ 210,188         $ 3,557
                                               =================================

Supplemental disclosure of cash flow information:
          Interest paid                                 $ 3,951         $ 1,385
          Income Taxes paid                                   -               -
Supplementary Disclosure of Non-Cash Transactions:
          Shares issued to unrelated parties for
            services rendered                                 -          35,000
          Shares issued in payment of debt            1,125,000               -
          Shares issued to purchase subsidiaries     24,000,000               -

                 See notes to consolidated financial statements.


                                      F-6
<PAGE>

                 stereoscape.com, inc. AND SUBSIDIARY COMPANIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


         NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         ORGANIZATION

     stereoscape.com,  inc. ( "Company") was  established in 1988 under the name
Alliance Health Enterprises, Inc. In April 1997 the Company's Board of Directors
approved a change in the Company's name to Alliance Technologies,  Inc. at which
time the Company acquired  American Buyers Club  International,  Inc. ("ABC") In
April,  1997  ABC  formed  Alpha  Sound  and  Vision,  Inc.  as a  wholly  owned
subsidiary.  In December of 1998 the  Company's  Board of  Directors  approved a
change in the Company's name to stereoscape.com, inc.
     On August 23, 2000 The Company entered into a stock purchase agreement with
the  principals  of  epiggybank.com,   inc.  ("epiggybank"),   a  financial  and
educational  web site for  children.  The terms of the  agreement  included  the
transfer,  to The Company, of the "epiggybank" name, trademarks and intellectual
properties,  and other  assets being used in the  seller's  business.  Since the
sellers  have been  unable to deliver a valid  trademark  for  "epiggybank"  the
Company is in the process of  rescinding  the  transaction,  and to that end has
halted the shares issued in the transaction.
     Effective  October 1, 2000 the Company  acquired Marx Toys, Inc.  ("Marx").
Marx" is located in North Miami,  Florida and sells  collectible  action figures
and play sets primarily through the internet and via telemarketing.
     "ABC" is located in  Freehold,  New  Jersey  and sells  high  quality  home
entertainment   equipment.   Substantially  all  business  is  obtained  through
advertising in trade magazines and via the internet.

         FINANCIAL STATEMENT PRESENTATION

     The consolidated  financial  statements include the accounts of the Company
and its wholly owned subsidiary  companies.  All material  intercompany balances
are eliminated.

         INVENTORIES

     Inventories  are stated at the lower of cost or market as determined by the
first-in, first-out method.

         DEPRECIATION AND AMORTIZATION

     Depreciation  and  amortization  is computed  utilizing  the  straight-line
method over the estimated  useful  lives,  which range between three and fifteen
years.

         ADVERTISING COSTS

     The  Company  expenses  production  costs of print,  radio  and  television
advertisements  as of the first date the  advertisements  take place.  All other
advertising  costs are expensed as incurred.  Advertising  expenses  included in
selling,  administrative  and general expenses were $82,493 in 2000 and $120,891
in 1999.

         EARNINGS PER COMMON SHARE

     In the fourth quarter of 1997, the company  adopted  Statement of Financial
Accounting  Standards No. 128, "Earnings per Share" (SFAS 128), which supersedes
Accounting  Principles  Board Opinion No. 15. Under SFAS 128 earnings per common
share is computed by dividing net income (loss) available to common shareholders
by the  weighted-average  number of common shares outstanding during the period.
On October 4, 2000 the Company effected a 15 for 1 stock split. All calculations
and share  amounts  have been  adjusted  to  reflect  the split  value.  Diluted
earnings  per share do not reflect the  potential  dilution  that could occur if
securities or other contracts to issue common shares were exercised or converted
into common shares or resulted in the issuance of common shares as the impact of
such would be antidilutive given the net losses incurred.

                                      F-7
<PAGE>

         REVENUE RECOGNITION AND FINANCIAL STATEMENTS

     Net sales are recognized at the time merchandise is shipped to customers.

     In December 1999, the  Securities and Exchange  Commissions  ("SEC") issued
SEC Staff Accounting Bulletin ("SAB") No. 101, "Revenue Recognition in Financial
Statements." SAB 101 summarized certain of the SEC's views in applying generally
accepted accounting  principles to revenue recognition in financial  statements.
SAB 101 will be  effective  for the Company in the first  quarter of fiscal year
2001.  The  Company  is  reviewing  the  requirements  of SAB 101 and  currently
believes that its revenue  recognition policy is consistent with the guidance of
SAB 101.

          FAIR VALUE OF FINANCIAL INSTRUMENTS

     The fair value of a financial instrument represents the amount at which the
instrument could be exchanged in a current  transaction between willing parties,
other  than a forced  sale or  liquidation.  Significant  differences  can arise
between the fair value and  carrying  amount of financial  instruments  that are
recognized at historical cost amounts.

         USE OF ESTIMATES

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

         WARRANTY

     A  subsidiary  of the Company  sells its products  with the  manufacturer's
factory warranty.  In addition,  the Company offers extended  warranties,  at an
additional  cost. The extended  warranties are underwritten by a third party for
which the Company pays a fixed fee.

         NEW ACCOUNTING PRONOUNCEMENTS

     Effective in 1998, the Company  adopted  Statement of Financial  Accounting
Standards No. 130, Reporting  Comprehensive Income ("SFAS No. 130"). The Company
has no items of comprehensive income.

     The  Company  adopted  Statement  Financial  Accounting  Standard  No.131,"
Disclosure  about  Segments  of an  Enterprise  and  Related  Information".  The
Company's  implementation  of this  standard  does not have  any  effect  on the
financial statements.

                                      F-8
<PAGE>

         LONG-LIVED ASSETS

     In  accordance  with  SFAS  No.  121,  "Accounting  for the  Impairment  of
Long-Lived  Assets and for  Long-Lived  Assets to be  Disposed  of,"  long-lived
assets to be held and used by the Company are reviewed to  determine  whether an
event or change in circumstances indicates that the carrying amount of the asset
may not be recoverable.  For long-lived  assets to be held and used, the Company
bases its evaluation on such impairment  indicators as the nature of the assets,
the  future   economic   benefit  of  the  assets,   any  historical  or  future
profitability  measurements,  as well as other  external  market  conditions  or
factors that may be present. If such impairment  indicators are present or other
factors  exist that  indicate  that the carrying  amount of the asset may not be
recoverable,  the Company  determines whether an impairment has occurred through
the use of an undiscounted cash flows analysis of assets at the lowest level for
which  identifiable  cash flows exist.  If impairment has occurred,  the Company
recognizes  a loss  for the  difference  between  the  carrying  amount  and the
estimated  value of the  asset.  The fair value of the asset is  measured  using
discounted  cash flow  analysis or other  valuation  techniques.  No  impairment
expense was recognized in either the year ended December 31, 2000 or 1999.

         CERTAIN TRANSACTIONS INVOLVING STOCK COMPENSATION

     In March 2000, FASB issued FASB Interpretation No. 44 (FIN 44), "Accounting
for Certain Transactions Involving Stock Compensation--an  Interpretation of APB
Opinion No. 25." FIN 44 clarifies the  following:  the definition of an employee
for  purposes of  applying  APB opinion  No. 25; the  criteria  for  determining
whether a plan qualifies as a noncompensatory  plan; the accounting  consequence
of various  modifications  to the terms of the previously fixed stock options or
awards;  and the  accounting for an exchange of stock  compensation  awards in a
business combination.  FIN 44 is effective July 1, 2000, but certain conclusions
in FIN 44 covers specific events that occurred after either December 15, 1998 or
January 12, 2000. Management does not expect the application of FIN 44 to have a
material impact on the Company's financial position or results of operations.

         INCOME TAXES

     The Company  accounts  for income  taxes in  accordance  with  Statement of
Financial  Accounting Financial Standards No. 109, "Accounting for Income Taxes"
(SFAS  109).  Under the asset and  liability  method of SFAS 109,  deferred  tax
assets  and  liabilities   are  recognized  for  the  future  tax   consequences
attributable to differences between the financial statements carrying amounts of
existing  assets and  liabilities  and their  respective tax bases and operating
loss and tax credit  carryforwards.  Deferred  tax assets  and  liabilities  are
measured  using  enacted tax rates  expected  to apply to taxable  income in the
years in which those  temporary  differences  are  expected to be  recovered  or
settled.  Under SFAS 109,  the effect of a change in tax rates on  deferred  tax
assets and  liabilities  is recognized in income in the period that includes the
enactment date.

         CONCENTRATION OF CREDIT RISK

     The Company  maintains its cash with various  financial  institutions.  The
Company performs  periodic  evaluations of the relative credit standing of these
institutions.

                                      F-9
<PAGE>

         NOTE 2 - ACQUISITIONS

     Effective  October 1, 2000, the Company acquired Marx Toys, Inc., which was
accounted for as a purchase whereby Marx became a wholly-owned subsidiary of the
Company.  Marx sells collectible  action figures and play sets primarily through
the  internet and  telemarketing.  In  connection  with the  accounting  for the
acquisition,  the Company  issued  16,500,000  shares of common  stock valued at
$.0469 per share.

     The  operation  and  financial  position of Marx were  accounted for in the
consolidated  financial statements of the Company beginning October 1, 2000. The
excess purchase price over the net assets acquired was approximately $847,000.

     Selected  unaudited  proforma  combined results of operations for the years
ended December 31, 2000 and 1999,  assuming the acquisition  occurred on January
1, 2000 and 1999 are as follows:


                                         2000              1999
                                        -----              ----

          Total revenues             $2,438,300        $4,224,400

          Net (loss)                  ($841,200)        ($250,100)

          Net loss per common share      ($.012)           ($.006)

     On August 23, 2000 The Company entered into a stock purchase agreement with
the  principals  of  epiggybank.com,   inc.  ("epiggybank"),   a  financial  and
educational  web site for  children.  The terms of the  agreement  included  the
transfer,  to The Company, of the "epiggybank" name, trademarks and intellectual
properties,  and other  assets being used in the  seller's  business.  Since the
sellers  have been  unable to deliver a valid  trademark  for  "epiggybank"  the
Company is in the process of  rescinding  the  transaction,  and to that end has
halted the shares  issued in the  transaction.  For  purposes  of balance  sheet
presentation  the shares  issued in the  transaction  have been  recorded at par
value.

         NOTE 3 - PROPERTY AND EQUIPMENT, at cost

     Fixed assets consist of the following at December 31, 2000:

           Furniture and equipment                     $   41,138
           Leasehold improvements                           5,974
           Molds                                          942,162
                                                         --------
                                                          989,274
           Less-accumulated depreciation                  (37,241)
                                                         --------
                                                       $  952,033
                                                         ========

     Depreciation and  amortization  expense was $12,479 and $3,783 for 2000 and
1999, respectively.

                                      F-10
<PAGE>

         NOTE 4 - COMMITMENTS

     The Company and a subsidiary  lease  office  facilities  in  Freehold,  New
Jersey and warehouse  facilities in Sebring,  Ohio requiring minimum annual rent
of approximately  $78,576.  The leases expire between April 2004 and April 2006.
The leases  require  the Company to pay various  operating  expenditures  of the
facilities and contain  provisions for rent  escalations.  Rent expense  totaled
$39,633 and $35,581 for 2000 and 1999, respectively.

     Future minimum  commitments  under operating lease  arrangements are due as
follows:

    Years Ending December 31,                             Amount
 ---------------------------------------------------------------------

             2001                                       $ 73,438
             2002                                         89,752
             2003                                         93,816
             2004                                         55,208
                                                        =========
                                                       $ 312,214
                                                        =========


         NOTE 5 - INCOME TAXES

     The  Company  has   available  net   operating   loss  carry   forwards  of
approximately  $1,460,000  for federal and state income taxes  expiring  between
2003 and 2119 to offset future taxable income.
     A deferred tax asset  results from the benefit of utilizing  net  operating
loss carry forwards in future years. A valuation allowance has been provided for
the entire benefit.
     During the years  ended  December  31, 2000 and 1999,  the  increase in the
valuation  allowance  was  $240,140  and $82,510,  respectively.  These  charges
reflect increases in the valuation allowance related to the deferred tax asset.
     The Company  will  continue to assess the  recoverability  of its  deferred
income  tax  asset  and  adjustments  may be  necessary  based  on the  evidence
available at that time. The difference  between the expected rate of tax and the
actual tax expense  relates  entirely  to state tax  expense  and the  valuation
allowance.

                                      F-11
<PAGE>

              NOTE 6 - STOCK PLANS

     The Company's  1998 Incentive and  Nonqualified  Stock Option Plan provides
for the  granting  of  options  to  purchase  shares of common  stock to certain
employees of the Company.  Exercise and vesting terms for options  granted under
this plan are  determined  at each grant date.  All options when granted will be
granted  at not less than  fair  market  value at dates of grant.  At the end of
2000,  21,453,240 options were available for grant under the plan and 21,453,240
shares of common stock were reserved for issuance  under the 1998  Incentive and
Nonqualified  Stock Option Plan. As of December 31, 2000 the  following  options
were granted and exercised under this plan.
     SFAS No. 123 "Accounting for Stock-Based Compensation" ("SFAS No. 123") was
effective for the Company for fiscal 1998. SFAS No. 123 encourages (but does not
require)  compensation  expense to be measured based on fair value of the equity
instrument  awarded.  In accordance with APB No. 25 "Accounting for Stock Issued
to  Employees" no  compensation  cost has been  recognized  in the  Consolidated
Statements of Income for the Company's stock option plans. If compensation  cost
for the company's  stock option plans had been determined in accordance with the
fair value method  prescribed by SFAS No. 123, the company's net loss would have
been  $2,761,012  and  $602,241 for 2000 and 1999  respectively.  This pro forma
information  may not be  representative  of the amounts to be expected in future
years as the fair value method of accounting  prescribed by SFAS No. 123 has not
been applied to options granted prior to 1996.

         Stock options transactions are summarized as follows:


                                       2000 Options             1999 Options
                                               Weighted                 Weighted
                                                Average                  Average
                                               Exercise                 Exercise
                                    Shares      Price        Shares       Price
--------------------------------------------------------------------------------

Outstanding, beginning of year   15,525,000    $0.0300

Granted                          51,615,495    $0.0401    18,300,000     0.0289

Exercised                       (33,696,760)   $0.0375    (2,775,000)    0.0349

Forfeited                       (13,368,735)   $0.0380
--------------------------------------------------------------------------------


Outstanding, end of year         20,075,000    $0.0392    15,525,000     0.0278
                               =================================================

Options and warrants
   exercisable at year-end       15,855,000    $0.0364    15,525,000     0.0278
                               =================================================

Weighted-average fair value of     $ 0.0404                 $ 0.0289
   options granted during the year


     The fair  value of each  option  granted is  estimated  on the date of each
grant using the Black-Scholes  option-pricing  model with the following weighted
average  assumptions used for grants in 2000 and 1999,  respectively:  Risk free
interest rate 5.5% and 5.5%;  vested  immediately;  expected life within 5 years
and within 5 years;  expected volatility of 335% and 111%; dividend yield 0% and
0%. The fair values generated by the  Black-Scholes  model may not be indicative
of the future benefit, if any, that may be received by the option holder.


         NOTE 7 - SUBSEQUENT EVENTS

     In April 2001,  the Company  entered into an agreement  with an investor to
provide up to $10,000,000 in funding under an equity line of credit.
     Additionally,  Company  entered into a financing  arrangement for $300,000,
the transaction  includes an option to purchase  3,000,000  shares of its common
stock.

                                      F-12