United States 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 fiscal year ended June 30, 2001

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

      For the transition period from _________ to __________________

                       Commission File Number:  0-29285

                           ONLINE INNOVATION, INC.
               (Name of Small Business Issuer in its charter)

             Delaware                                         52-2058364
             --------                                         ----------
     (state or other jurisdiction of                  (I.R.S. Employer I.D. No.)
      incorporation or organization)

            1118 Homer Street, #218, Vancouver, British Columbia V6B 6L5
            ------------------------------------------------------------
                       (Address of principal executive offices)

                                    (604) 669-7564
                                    --------------
                              Issuer's telephone number

    _______________________________________________________________________
  Former name, former address, and former fiscal year, if changed since last
                                       report

             Securities registered pursuant to Section 12(b) of the Act:
                                         None

             Securities registered pursuant to Section 12(g) of the Act:
                                     Common Stock

Check whether the issuer (1) filed all reports required to be filed by sections
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 not contained in this form, and no disclosure will be

<PAGE>
Page 2

contained, to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [X]

As of June 30, 2001, the registrant did not report any revenues.

As of September 20, 2001, the aggregate market value of the voting common equity
held by non-affiliates of the registrant was $1,846,600 based on the closing
trade reported on the NASD Over the Counter Bulletin Board. Shares of common
stock by each officer and director and by each person who owns 5% or more of the
outstanding common stock have been excluded from this calculation as such
persons may be considered to be affiliated with the registrant.

                   PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Check whether the registrant has 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 ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

As of September 20, 2001 the registrant's outstanding common stock consisted of
14,595,000 shares.

                       DOCUMENTS INCORPORATED BY REFERENCE

Transitional Small Business Disclosure Format (Check one):  YES [ ]  NO [X]

<PAGE>
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                            ONLINE INNOVATION, INC.

                                   FORM 10KSB
                               TABLE OF CONTENTS

Part   Item(s)                                                          Page No.
----   -------                                                          --------

I       1   Description of Business
        2   Description of Property
        3   Legal Proceedings
        4   Submission of Matters to a Vote of Security Holders
II      5   Market for Common Equity and Related Stockholder Matters
        6   Plan of Operation
        7   Financial Statements
        8   Changes In and Disagreements With Accountants
            on Accounting and Financial Disclosure
III     9   Directors, Executive Officers, Promoters and Control Persons;
            Compliance with Section 16(a) of the Exchange Act
       10   Executive Compensation
       11   Security Ownership of Certain Beneficial Owners
            and Management
       12   Certain Relationships and Related Transactions
       13   Exhibits and Reports on Form 8-K

            Signatures
            Exhibits

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                                      PART I

ITEM 1:   DESCRIPTION OF BUSINESS

Business Development

     Online Innovation, Inc. (the "Company") is a web asset development company.
The Company has created a website that is designed to facilitate social
interaction between single adults, with an emphasis on entertainment and
matchmaking. The Company's website enables site visitors to interact socially
in a variety of contexts.  The Company's flagship website located on the
worldwide web at www.VirtuallyDating.com, provides real time communication,
entertainment and matchmaking between single adults.  The target market for
VirtuallyDating is single North American men and women over the age of 18 that
have exhausted the traditional ways of meeting new people.

     During the period covered by this report, the Company focused primarily on
completing the development of its website and securing equity financing to fund
the Company's ongoing operations. The Company launched partial services of its
website in July, 2000. Although the website is operational in terms of member
services, the e-commerce infrastructure and other key functional components of
the website are not yet launched. Consequently, the Company is not charging the
membership fee described in the section headed Principal Products and Services.
The Company is currently offering free memberships and will begin charging
membership fees once the e-commerce infrastructure and key value added
components of the website have been launched.  As of September 17, 2001, the
website had 35,137 registered members. The Company intends to generate revenue
through the sale of memberships, banner advertising and merchandise.

     The Company was incorporated on May 7, 1997 pursuant to the General
Corporation Law of the State of Delaware, U.S.A. under the name Micro Millennium
Inc. On September 30, 1997, the Company acquired the option to earn a 60%
interest in 4 mineral properties located in the state of Sinaloa, Mexico. The
Company changed its name from Micro Millennium, Inc., to Sinaloa Gold Corp. on
October 16, 1997 and operated as a mineral exploration and development company
until January of 1999. Between September of 1997 and January of 1999, the
Company's primary business focus was attempting to finance the exploration and
development of its mineral properties.

     Depressed metal prices and lack of investor interest in resource stocks
during this period made financing difficult. As a result, the Company chose not
to exercise its option and decided to abandon its interest in its mineral
properties and to acquire and develop its current website development business.
Pursuant to an agreement dated April 2, 1999, the Company acquired from Online
Innovation, a non-reporting private unincorporated entity, a 100% interest in
all of its proprietary and intellectual property associated with its business
plan and concepts and its worldwide web site domain name,
www.VirtuallyDating.com. As consideration for the acquisition of the assets of
Online Innovation, the Company issued 400,000 common shares at a deemed value of
$0.50 per share to Mr. Darin Wong, the sole proprietor of Online Innovation.
The Company changed its name from Sinaloa Gold Corp. to Online Innovation, Inc.
on April 8, 1999, after acquiring the assets of Online Innovation as described
above. Since the acquisition the Company has developed and continues to develop

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the property and concepts acquired from Online Innovation. In addition, it has
been forging partnerships and strategic alliances in the internet industry and
seeking financing to further its development goals.

Business of the Company

Principal Products and Services

     The Company's principal product/service is a website on the worldwide web
(www.VirtuallyDating.com) which internet users can utilize to engage in various
forms of social interaction with other users. The focus is on entertainment and
matchmaking for single adults. The website is multi-faceted and allows users to
interact socially in a number of different forums, described in greater detail
below. The main webpage, located at www.VirtuallyDating.com, provides links to
the other pages that comprise the site. These pages contain the various
interactive/entertainment functions and services offered by the Company. In
order to utilize the website, internet users are required to become members.
The Company intends to charge a membership fee, but at present, the Company is
offering free memberships. Once an individual becomes a member, he or she can
utilize the various webpages created by the Company to interact with other
members.  Applying web-based technology to create virtual communities,
VirtuallyDating.com combines traditional on-line matchmaking features with
interactive entertainment concepts to emulate real world experiences and social
environments.

     The website offers several ways for members to meet, interact, and have fun
through its many features, while always maintaining privacy and discretion.
While the intention may be for members to find a love connection or friendship,
the site's primary focus is entertainment. The interactive entertainment
features of the site may also lead to or enhance a friendship or romantic
liaison.

     Member Profiles
     ---------------

     Members of the site complete a survey in which they compile information
such as gender, height, geographic location, lifestyle choices, interests,
hopes, dreams and desires. This information provides a personal profile for
each member. Once the member completes the survey, the information is
incorporated into a personal profile and is entered into a database with other
users.  Members will also have the option of personalizing their profile
further by including their photograph. The personal profile is then posted in a
member profile viewing gallery. All information from the member profiles is
placed in a searchable database that other members can utilize to find suitable
companions.

     AutoMatch Function
     ------------------

     The AutoMatch option allows members to match automatically with other
members who have similar interests. This option allows members to create a
personal "short list" of member profiles to view and serves as an alternative to
completing a more time-consuming survey of each member in the viewing gallery.

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     Searching Member Profiles
     -------------------------

     In addition to the AutoMatch function, a search engine enables members to
search the database for a suitable companion. Members engaging in such a search
are required to identify the key qualities they are seeking in a companion.
Utilizing the criteria set out by the member, the search engine searches the
database and the member is provided with other member profiles that meet his/her
criteria.

     Internal Messaging Service
     --------------------------

     Each member is provided with an internal messaging service that operates
throughout the website. Privacy is maintained because home and office e-mail
addresses are not utilized. Once a member selects the profile of a person whom
he or she wishes to contact, the member can send a personal electronic message
to that member as a first means of direct communication. The recipient can
retrieve the message and respond at his or her own discretion.

     Chat Rooms
     ----------

     Chat rooms are sites where large numbers of members interact through real
time messaging. All members participating in a chat room discussion can read
messages that are sent to other participants in the room. Chat rooms provide
"chatters" with the opportunity to discuss common interests and themes. Chat
rooms also provide an alternative to the static member profile gallery as a
means of meeting other members. For those members who are shy, and for whom
connecting for the first time through internal messaging is too direct, the chat
rooms provide the opportunity to get to know members first, before escalating
the communication to a one-on-one basis.

     The Company provides three different sets of chat rooms organized around
three different themes. The chat rooms emulate a natural setting in which
people tend to meet, and are graphically enhanced to look and feel like an
actual themed environment.

     Friendship/Companionship Chat Rooms
     -----------------------------------

     The Friendship/Companionship set of chat rooms are designed to attract
members who are looking to meet others who have the same interests and are not
looking for romantic involvement. There are four themed chat rooms available to
these types of members.

     Romance & Love Chat Rooms
     -------------------------

     The Romance & Love set of chat rooms are designed to attract members who
are serious about finding a love match and embarking on an experience of
romance. Four themed chat rooms emulate the environments where singles most
often look for love.


     The Red Light District
     ----------------------

     In these chat rooms members can discuss more personal issues that are
sexual in nature. The Company hopes that by providing a separate set of chat

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rooms for sexual discussions, it will help prevent this type of interaction from
occurring in the Friendship/Companionship and Romance & Love chat rooms.

     Private Rooms
     -------------

     If a member connects with someone special in a chat room, he or she has the
option of forming a private discussion where the two can send real time messages
and interact one-on-one. The room is completely private. Only the two members
involved are able to read the other's messages and participate in the
conversation.

     The Dressing Room
     -----------------

     The Dressing Room allows members to design their own "avatar", a
personalized caricature which represents the member throughout the site.
Members enter the Dressing Room and have a selection of graphic representations
of body parts and other accessories with which to create their own caricature.
By utilizing simple navigation methods, members are easily guided through the
creation of their avatar, choosing from a library of components (eyes, hair,
body type, accessories, etc.). The avatar represents the member in all
interactive sections of the Virtually Dating site. In chat rooms, multi-player
games, or on the member's personal profile, the avatar serves to introduce
members to other members and provide another way in which members can express
themselves.

     Multi Player Avatar Based Games
     -------------------------------

     The website contains an interactive Games Lounge in which members can
congregate to play games with one another. Current games include a multi player
card game and one on one backgammon board game. Each player/member
participating in these games are represented by their avatar. Members utilizing
this area of the site also have the ability to chat real time with one another.

     Send a Gift
     -----------

     The company intends to combine online dating with online shopping. Once a
member has found that special someone, he or she will be able to send a gift to
that person. Gifts will range from greeting cards or "virtual" bouquets of
flowers that are sent electronically, to merchandise which is mailed to the
recipient. Currently, animated greeting cards and virtual gifts are available to
be sent within the website. Members are able to customize a message and then
send it along with a virtual card or a virtual gift from their VirtuallyDating
mailbox (10 animated cards to start with, future plans to increase the Gallery's
inventory). Within the first year of launch of the e-commerce component of the
site, the Company hopes to develop the site to permit the purchase and delivery
of merchandise.

     When merchandise becomes available, members will be able to view a select
inventory of Private Collection gifts with the click of a mouse and purchase the
gift directly, without having to leave the site.  The Company's initial plan is
to keep the recipient mailing information so that privacy of the member's
location will be maintained. The sender will never know the address of the
recipient, and vice versa. All gifts in the Private Collection will be tasteful

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and in the spirit of romance so that intended recipients need not fear receiving
something offensive in the mail.

     Dear Bridgette
     --------------

     The website will offer members third party love advice, relationship advice
or dating advice through the use of a "Dear Abby" persona known as Bridgette.
Bridgette's one on one advice will only be available to paying members. Dear
Bridgette is currently not available, but the Company is presently developing
this section of the site.

     Horoscopes
     ----------

     The Company has negotiated an agreement with KnowledgeWeb, Inc.
("KnowledgeWeb"), pursuant to which the horoscope content of KnowledgeWeb's
website will be made available to the Company's members. KnowledgeWeb provides
an online horoscope service through its website located at www.Astrology.net.
The Company entered into an Affiliate Agreement with KnowledgeWeb on November 8,
1999.  Pursuant to the terms of the Affiliate Agreement, the Company is
permitted to provide its members with access to content provided on the
Astrology.net website. Access is provided by direct links from the Company's
website to the Astrology.net website.  Astrology.net provides some horoscope
content to its users free of charge (e.g. daily horoscopes) and charges users
for other content (e.g. personalized charts). KnowledgeWeb pays the Company
commissions on purchases of content/services provided by Astrology.net made by
persons who are linked to the Astrology.net website directly from the Company's
website (10% for aggregate purchases of up to $1,000 in any given month and 20%
for aggregate purchases exceeding $1,000 per month).

     Dating Safety Tips
     ------------------

     Dating safety tips and advice for using the VirtuallyDating site are
available to all members. This advice includes online dating and off-line
dating safety tips for members.

     Banner Advertising
     ------------------

     In addition to membership fees and online shopping, the Company intends to
generate revenue through the sale of banner advertising. Banner advertisements
are advertisements which appear on banners on the perimeter of a computer user's
screen while viewing a website. Once traffic on the Company's website reach
1,000,000 page views per month, the website will be marketable to major
corporations for banner advertising. A page view is the number of times each
page throughout the site has been viewed by multiple users.

     The Company intends to target corporations whose business will enhance the
general spirit of the website so that members will not feel that they are being
blatantly advertised to. General floating banner spots will be made available
to all prospective advertisers throughout the website's pages, but will not be
available in the themed chat rooms. Banner advertisements in the themed chat
rooms will be sold exclusively to corporations that sell products that are
related to the theme of and will directly enhance the atmosphere in the chat
room. For example, the Company intends to create a chat room with a "coffee
house" theme. The Company intends to reserve banner advertisements in the
"coffee house" chat room for corporations that sell coffee related products.

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Banner advertising on the website will be sold for $12 per unit. A unit is
1,000 impressions. An impression is an occurrence of a banner advertisement on
a webpage while that webpage is being viewed. Thus, a banner advertisement may
appear for a few seconds or minutes while a person is viewing a webpage and then
be replaced by another advertisement. Each time an advertisement appears is one
impression.

Distribution Method

     The Company's primary means of distribution for its products and services
is the internet. The Company's primary product is the information and
interactive functions which are contained on the website. The information is
accessible to internet users who are members.  Merchandise that may eventually
be available through the "Send a Gift" service, once that service is
functioning, will be distributed through the mail or courier services.

Competition

     The Company competes with numerous entities that provide matchmaking/dating
services to the public in a variety of manners. The Company has identified four
sources of competition: traditional "offline" dating agencies, personal
advertisements, telepersonals and other online dating services.

Traditional Dating Agencies

     The Company competes with traditional "offline" dating agencies that
provide matchmaking services to single adults. These are typically local
services which serve defined and limited geographic areas. These services
typically charge clients a fee for their service and do not facilitate
interaction beyond introducing their clients to one another. By virtue of
delivering its services via the internet, the Company can reach a market which
is international in scope. Marketing efforts focus primarily on Canada and the
U.S., but the Company is in a position to deliver its services anywhere in the
world. This represents a significant advantage for the Company relative to
traditional local dating agencies.  In addition, the Company offers a range of
services and forums which facilitate interaction between single people prior to
their actually meeting in person. This type of service has traditionally not
been provided by traditional dating agencies. Finally, the Company's internet
based service allows delivery of the service directly to an individual's home.
This allows members to interact socially from the comfort of their own home,
until such time as they wish to interact with other members in a more direct
fashion. The primary competitive disadvantage for the Company relative to
"offline" dating services, is the Company's reliance on the internet to deliver
its services, which limits the Company's market to personal computer users with
internet access. Traditional dating services have no such market restriction.
Nonetheless, for the reasons discussed above, the Company believes that its use
of the internet as a means of service/product delivery is also the Company's
primary competitive advantage over traditional dating services. In addition,
the Company expects the use of the internet to increase dramatically in the
coming years, significantly offsetting any advantage "offline" dating agencies
may have in this regard.

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Personal Ads

     Single adults seeking companionship or romance often place personal
advertisements in newspapers and other periodical publications. The Company
thus competes with newspapers and other periodicals for a portion of the market
share. Similar to "offline" dating agencies, periodicals are subject to the
same geographic restrictions with respect to the market. They can be costly and
do not have an interactive component as the Company's internet based service
does.  Without an interactive component, participants are forced to communicate
directly, either via telephone or in person, perhaps more quickly than they
would like. As discussed above, the Company's internet based service allows
members to interact from the comfort and security of their homes prior to
arranging person to person contact with a prospective companion.  Personal
advertisements also have the advantage of being accessible to individuals
without computers and internet access.  As discussed above, however, the
Company believes that the use of the internet will increase dramatically in the
coming years, thereby offsetting a significant portion of the advantage of
offline services in this regard.

Telepersonals

     Telepersonal services enable users to record personal advertisements that
can then be accessed by other individuals over the telephone. Fees are often
based on time spent using the service. Telepersonal advertisements have some of
the same drawbacks relative to the Company's internet based service that the
other services described above have. They do not facilitate any social
interaction prior to a person to person or telephone meeting with a prospective
companion. Telephone use is, however, much more widespread than internet use.
This provides telepersonal matchmaking service providers with a significant
competitive advantage over the Company. This competitive advantage will only be
overcome if internet use becomes as widespread as telephone use, making the
Company's products and services as accessible as those of telepersonal
matchmaking services.

Online Dating Services

     There are many other websites that provide services similar to those that
are provided by the Company. The information below provides a summary of what
the Company believes to be the most successful direct competition:

     Match.com
     ---------

     Match.com was purchased in 1999 by Ticket Master for a reported $50
million.  Match.com is considered a leading online matchmaking and dating
service that targets single adults and provides them with a convenient and
private environment for meeting other singles. Match.com reports that it has
more than 9 million user registrations with an estimated 1.5 million active
users generating more than 100 million monthly page views. Match.com derives the
majority of its revenue from subscription fees and advertising sales.

     MatchMaker.com
     --------------

     MatchMaker.com was purchased in August 2000 by Lycos for a reported $45
million (Lycos was subsequently purchased by Terra Networks SA and is now Terra

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Lycos).  Matchmaker.com can be considered a leading online matchmaking and
dating service that offers single adults a convenient and private environment
for meeting other singles. At the time of purchase, MatchMaker.com reported
having over 4.5 million user registrations. MatchMaker.com derives the majority
of its revenue from subscription fees and advertising sales.

     MatchNet, PLC
     --------------

     MatchNet, PLC considers itself to be 1 of the 3 top online dating and
romance companies worldwide. They report more than 3.6 million registered users
throughout their network of online dating and romance websites. MatchNet,PLC's
network consists of a number of sites worldwide: AmericanSingles.com and
SocialNet.com catering to the United States; MatchNet.de catering to Germany;
MatchNet.co.uk catering to the United Kingdom; MatchNet.com.au catering to
Australia; and, MatchNetFrance.com catering to France. MatchNet,PLC also owns
and operates Jdate.com targeting the Jewish online dating population. MatchNet,
PLC derives the majority of its revenue from subscription fees and advertising
sales generated across its network of sites.

     Web Portals
     ------------

     Web portals such as Yahoo, AOL and MSN have developed an online dating
presence by hosting personal ads in specific sections of their portals. These
personal ads offer far fewer features and functionality than those offered by
Match.com, Matchmaker.com, MatchNet, PLC's network, and VirtuallyDating.com.

     General
     -------

     While the Company provides certain products and services that management
believes are not currently being provided by the Company's online competitors,
the Company is still at a competitive disadvantage relative to the online
competitors listed above because of their established market presence. The
Company will have to capture a market share before it can effectively compete
with established online competitors. Established competitors have revenues to
further develop and enhance their products and services, while the Company is
dependent on additional financing to do so. Refer to "Assessment of Competition"
below for a discussion of the relative competitive advantages of established
online matchmaking service providers.

Assessment of Competition

     The Company's primary competition comes from other online dating services.
The Company's management is of the view that online matchmaking/dating services
are superior to services provided by offline competitors and that the major
barrier to their success relative to offline competitors is current lack of
access to the internet by a large segment of the population. Management is of
the view that once internet access becomes more widespread, online matchmaking
services should displace offline competition. The interactive component of the
online service, particularly the potential to foster extensive interaction prior
to person to person meetings, should make use of online services more appealing
than offline services to single adults seeking companionship. There is no
guarantee, however, that access to and use of the internet will increase. Even

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if access to and use of the internet do increase, there is no guarantee that
online services will displace offline competitors or that the Company will
capture a substantial portion of the online market.

     The Company's primary website and related webpages are currently
functional. However, established competitors have an advantage over the Company
in that they have already captured a share of the market and thus have an
established market presence. Achieving critical mass with respect to market
share is critical for a business of the nature of the Company's. The Company's
service will only be useful to consumers once a certain level of membership is
attained. Competitors who already have an established market share are,
therefore, in a better competitive position than the Company. The Company hopes
to offset any such competitive advantages by offering products and services that
are superior in quality and more appealing than those of their competitors and
by launching an effective marketing campaign.

     The Company's primary objectives in the immediate future are to market its
products/services and attain a broadly based diverse membership. To do so will
require capital. The Company relies on equity financing to acquire capital for
marketing and product development. There is no guarantee that financing
sufficient to enable the Company to meet its objectives will be available in the
future. The Company will thus be at a competitive disadvantage relative to more
established competitors with greater access to capital. Established competitors
with cash flow from revenues may be in a better position to capture a share of
the available market.

Intellectual Property Rights

     The Company relies on copyrights, trademarks, trade secret laws and
contractual restrictions to establish and protect its proprietary rights in its
services and products. The Company does not at this time have any patented
technology that would prevent competitors from entering into its market. In
addition, the Company has not registered any of its copyrighted software or
trademarks. There can, therefore, be no assurance that the Company will be able
to protect its proprietary rights from use by its competitors. The Company's
management believes, however, that the steps taken by the Company to protect its
intellectual property are consistent with industry standards for online
businesses. The Company protects proprietary software primarily by maintaining
secrecy with respect to source codes and other information pertaining to the
Company's software. Consultants conducting development work on the Company's
technology are bound by confidentiality clauses that restrict dissemination of
proprietary technical information related to the Company's products. The
Company also relies on third party software licenses in the conduct of its
business.

     To date, the Company has received no notification that its services or
products infringe the proprietary rights of third parties. Third parties could,
however, make such claims of infringement in the future. Any future claims that
do occur may have a material adverse effect on the Company and its business.
Refer to "Risk Factors" herein.

Government Regulation

     As at the date of filing, there are few laws and regulations that apply
specifically to access to or commerce on the internet. Due to the increasing
popularity of use of the internet, however, it is possible that laws and

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regulations with respect to the internet may be adopted at federal, state and
even local levels, covering issues such as user privacy, freedom of expression,
pricing, characteristics and quality of products and services, taxation,
advertising, intellectual property rights, information security and the
convergence of traditional telecommunications services with Internet
communications. Such future regulations may end up having a material adverse
affect on the Company and its business. Refer to "Risk Factors" herein.

Employees and Consultants

     The Company has no full or part time employees. The Company retains
consultants to provide it with services related to the administration,
management and development of the Company. The Company pays $2,500 per month to
MCS Management Ltd., a private company wholly owned by Marlene Schluter,
director, secretary and treasurer of the Company, for management and
administrative services provided by MCS Management Ltd. The Company pays $2,500
per month to Netgain Management Solutions Inc., a private company wholly owned
by Chad Lee, director and president of the Company, for management and
administrative services provided by Netgain Management Solutions Inc.

     Until May 2001, services related to the design and development of the
Company's website were provided by Stratford Internet Technologies Inc.
("Stratford"). Stratford was retained by the Company pursuant to the terms of a
consulting agreement between Stratford and the Company dated July 30, 1999.
Pursuant to the terms of this agreement, Stratford was to provide services
related to the development, design and maintenance of the Company's internet
based products and services. Stratford was to design, develop and maintain the
following items:

   *  Database Architecture - (software comprising the member registration/
      tracking database system)
   *  Credit card transaction/authorization system for processing memberships
      and maintaining accounts
   *  Interactive "build your own website/profile/avatar" system
   *  Interactive chat rooms
   *  Interactive multi-player games
   *  Audio-technology to provide background music for the website
   *  Direct live video chat connection for members with web camera technology
      on their personal computers
   *  Animated greeting cards and virtual gifts
   *  Personal messaging system
   *  Dear Bridgette Advice system
   *  Daily horoscope service through links with third party service provider
   *  Dating safety tips webpage
   *  Survey systems for surveying members on a variety of issues

     Under the terms of the consulting agreement with Stratford, the Company was
to pay Stratford $400,000 and issue Stratford 300,000 shares of its common stock
in exchange for the services to be provided by Stratford. The Company paid
Stratford a deposit of $275,000 upon execution of the agreement. The balance
was to be paid upon completion of a financing by the Company. The shares were

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to be issued after Stratford performed all of its obligations under the
agreement. Under the agreement, Stratford was obligated to complete the design
and development of the Company's website by November 1999. As indicated
previously, however, the partial launch of the member services portion of the
website was not completed until July of 2000. The e-commerce component and
other contracted deliverables of the Company's website were never completed by
Stratford.

     Despite the fact that services were not performed within the time frame set
forth in the consulting agreement, the Company attempted to provide Stratford
with additional time to enable it to complete the development and design work
that the Company had retained Stratford to perform. Stratford failed to
complete the project by a self imposed deadline of December 31, 2001. Between
July, 2000 and May, 2001, Stratford was experiencing what the Company believed
to be serious financial difficulties.  In March, 2001, Stratford advised the
Company that it was ceasing its operations. A trustee in bankruptcy was
eventually appointed to manage Stratford's affairs. In spite of these
difficulties and in spite of the fact that Stratford was over 1 year late with
respect to the deadline for completion in the development of the Company's
website, Stratford still indicated that it wished to complete its obligations
under the consulting agreement. In May of 2001 the Company asked Stratford to
provide it with a concrete proposal for completion of the project with specific
timelines for performance of the tasks to be completed. The Company advised
Stratford that if it did not receive such a proposal by May 14, 2001, the
Company would retain other consultants to complete development work on its
website.

     No such proposal was ever delivered to the Company by Stratford. The
Company has, therefore, hired 2 independent consultants to complete the
remaining development work on the Company's website. These consultants are
currently operating under the direct supervision of the Company. They are paid
on a monthly basis and payment is tied to and based on the completion of
specific tasks or portions of the development work. No written agreements have
been entered into between the Company and the consultants. The Company has no
obligations to the consultants, and the consultants have no obligations to the
Company, beyond the completion of each specified task or segment of development
work.  The shares which were to be issued to Stratford upon completion of the
website were not issued. The Company paid Stratford an additional $50,000 out
of the $125,000 which was to be paid upon completion of the website.

Risk Factors

     Prospective investors should consider carefully the following risk factors,
in addition to the other information contained in this Report concerning the
Registrant and its business, before making any investment in the Registrant's
securities.

Potential for Failure of the Company's Business

     The Company may not be successful in its effort to further its business.
Even if the Company were to successfully meet the goals it has set for itself
the aforesaid goals may not be achieved within the respective time-frames set
for them herein. The limited extent of the Company's assets and the Company's
stage of development as well as the Company's limited operating history make it
subject to the risks associated with start-up companies. For example, the
Company, like many start-up companies, does not have significant revenues and
may experience cash flow difficulties. It may, therefore, be required to rely

<PAGE>
Page 15

on equity or bank financing to meet any cash needs in the short term. Such
financing may not be available. In addition, the Company does not have an
established presence in its target market and its name is not well known to
consumers in that market. There is no guarantee that the Company will ever
establish a significant presence in its target market. The Company's products
and services are also not completely developed. Earning revenue depends on
successful development of products and services. The Company may require
additional financing to fully develop its products and services and, as
discussed above, such financing may not be available when required.  Any or all
of these factors may cause the Company's business to fail.

Ability to Retain Qualified Management Personnel

     The Company's present management structure, although adequate for the early
stage of its operations, will likely have to be significantly augmented as
operations commence and expand. The ability of the Company to recruit and
retain capable and effective individuals is unknown. The loss of the services
of its current officers, or the inability of the Company to attract, motivate
and retain highly qualified executive personnel in the future could result in
failure of or cause serious disruption to the Company's business.

Competition in the Online and Offline Matchmaking Service Market

     The Company intends to enter into the internet/e-commerce market, which is
relatively new and is, therefore, difficult to predict in terms of the level of
demand for the Company's products and services. In addition, this market is or
likely will be, subject to intense competition from both private and public
businesses nationally and/or around the world, many of whom have greater
financial and technical resources than the Company.  The Company competes with
more established competitors in the internet matchmaking and e-commerce
businesses and may have difficulty establishing a significant market presence.
In addition, the Company competes with the more established offline
matchmaking/dating services industry.  Competition from these sources as well
as any other future competition may be insurmountable for the Company. If the
Company is unable to compete in this marketplace, its business may fail. Refer
to the section entitled "Competition" herein.

Adverse Effects of Incorrect Financial Assumptions

     The Company will rely on internally prepared forecasted financial
statements, which are predicated on certain assumptions, including assumptions
of revenue and expense and the occurrence of certain future events, which in
turn were based on management's considered assessment of prevailing conditions
and management's best estimates of future events. Should, for example, product
yields or prices deviate from the levels assumed in the internal forecasted
statements, then the Company's projected revenue and profits will be less than
projected. Similarly, should the Company's actual costs exceed the assumed
levels, then the Company's projected profits would likewise be less than
projected. In the final analysis, any return to an investor in the Company will
in large part be determined by management's ability to execute the Company's
plan as projected, and there can be no assurances provided of their success with
respect thereto. There can be no assurances whatsoever as to the future
financial performance of the Company. Projections are based upon current
information and certain extrinsic factors, some of which are beyond the control

<PAGE>
Page 16

of the Company, and/or subject to various assumptions, such as the Company's
ability to obtain additional financing and its ability to implement its plan.

Absence of Operating History

     The Company was incorporated on May 7, 1997. As discussed above, however,
the Company was previously a mineral exploration company and it has not had an
extensive operating history in the internet/e-commerce business. The Company
has no revenues from operations, has yet to produce a profit and has no
significant assets. Failure to achieve projected rates of market penetration
could significantly affect the Company's pattern of revenues and expense, and
accordingly future cash flow. Therefore, the Company's stockholders should be
prepared to bear the economic risk of losing their entire investment.

Designation as a Penny Stock

     The Company's securities may be deemed "penny stock" as defined in Rule
3a51-1 of the Securities and Exchange Act of 1934, as amended. Such a
designation could have a material adverse effect on the development of the
public market for shares of the Company's common stock or, if such a market
develops, its continuation, since broker-dealers are required to personally
determine whether an investment in such securities is suitable for customers
prior to any solicitation of any offer to purchase these securities. Compliance
with procedures relating to sale by broker-dealers of "penny stocks" may make it
more difficult for purchasers of the Company's common stock to resell their
shares to third parties or to otherwise dispose of such shares.

Ability To Raise Additional Capital

     The Company may not be able to raise additional funds for expansion and/or
growth. If such funds are not available the Company's business may fail and
investors may lose their entire investment. Additional financing may come in the
form of securities offerings or from bank financing. If additional shares are
issued to raise capital, existing shareholders will suffer a dilution of their
stock ownership in the Company. In the event the Company has not achieved
certain milestones, or consummated further financings, the Company will have
severe cash flow and liquidity problems and may cease at that point to be a
viable commercial entity. Refer to the section entitled "Plan of Operation -
Cash Requirements" for a discussion of the Company's finances.

Potential Conflicts Of Interest

     There are various interrelationships between the officers and directors of
the Company that may create conflicts of interest that may be detrimental to the
Company.  The Company's directors and officers will deal with any such
conflicts of interest, should they arise, in accordance with applicable
corporate law principles.

No Foreseeable Dividends

     The Company does not anticipate paying dividends on its common stock in the
foreseeable future but plans to retain earnings, if any, for the operation,
growth and expansion of its business.

<PAGE>
Page 17

Failure to Obtain Permits and Licenses

     The operations of the Company may require licenses and permits from various
governmental authorities. There can be no assurance that the Company will be
able to obtain all necessary licenses and permits that may be required to carry
out its plan.

Loss of Interest in Intellectual Property / Claims of Infringement by Third
Parties

     The Company does not have any patents for its technology and has not
registered any of its copyrighted software or trademarks. There can, therefore,
be no assurance that the Company will be able to protect its proprietary rights
from use by its competitors. The commercial success of the Company may also
depend upon its products and services not infringing any intellectual property
rights of others and upon no such claims of infringement being made. Management
is currently unaware of any such infringement or actual or potential claim of
infringement. It is possible, however, that such infringements or claims exist.
If any claims of infringement are made, the Company may be held liable for
damages for such infringement and be required to pay cash compensation. The
Company may also be forced to stop using technology upon which it is currently
dependent if use of that technology is found to infringe proprietary rights held
by others.

Currency Fluctuation

     The Company's potential operations make it subject to foreign currency
fluctuation and such fluctuation may adversely affect the Company's financial
position and results. There can be no assurance that steps taken by management
to address foreign currency fluctuations will eliminate all adverse effects and
accordingly, the Company may suffer losses due to adverse foreign currency
fluctuation. Such fluctuations may also influence future contribution margins.

Access to Technology by Competitors

     The technology necessary to create a service such as the one the Company
will be offering exists today and is readily accessible. The Company's line of
business may, therefore, be easily entered by would-be competitors.

Lack of Market Acceptance of the Internet as a Means of Conducting Commercial
Transactions

     Use of the Internet by consumers is at an early stage of development, and
market acceptance of the Internet as a medium is subject to a high level of
uncertainty. The Company expects to experience significant fluctuations in
operating results in future periods due to a variety of factors, including, but
not limited to:

   *  market acceptance of the Internet as a medium for consumers;
   *  the Company's ability to create and deliver internet content in order to
      attract users to its websites to purchase its product and/or services, and
      to attract advertisers to its websites;

<PAGE>
Page 18

   *  the ability of the Company to produce content which will be attractive to
      a sufficient number of users to generate significant revenues;
   *  intense competition from other providers of related content over the
      Internet;
   *  delays or errors in the Company's ability to effect electronic commerce
      transactions;
   *  the Company's ability to upgrade and develop its systems and
      infrastructure in a timely and effective manner;
   *  technical difficulties, system downtime or Internet brownouts;
   *  the Company's ability to attract customers at a steady rate and maintain
      customer satisfaction;
   *  seasonality of the industry;
   *  seasonality of advertising sales;
   *  Company promotions and sales programs;
   *  the amount and timing of operating costs and capital expenditures relating
      to expansion of the Company's business, operations and infrastructure and
      the implementation of marketing programs, key agreements and strategic
      alliances;
   *  the level of returns experienced by the Company; and
   *  general economic conditions and economic conditions specific to the
      Internet, on-line commerce industry.

Dependence on Telecommunication Infrastructure

      The Company's services are dependent on the use of the Internet and
telephone connections. Any interruptions, delays or capacity problems
experienced on the Internet or with the telephone connection could adversely
affect the ability of the Company to provide its services. The
telecommunications industry is subject to regulatory control. Amendments to
current regulations could disrupt or adversely affect the profitability of the
Company's business. The Company's business is highly dependent on its computer
and telecommunications systems for the operation and quality of its services.
The temporary or permanent loss of all or a portion of either system, or
significant replacement delays, for whatever reason, could cause disruption of
the Company's business activities and result in loss of revenues.


ITEM 2:   DESCRIPTION OF PROPERTY

Office Space

     Pursuant to a Lease Agreement between the Company, 570679 B.C. Ltd. and
Marlene Schluter dated November 1, 1999, the Company pays a total of $1,987.50
(Canadian) per month for office space. The lease is for a two-year term and
commenced on November 1, 1999. The lease expires on October 31, 2001 with an
option to renew for a third year.  The Company rents a total of 1,152 feet of
office space pursuant to the lease agreement. Rent payments are made to 570679
B.C. Ltd. Marlene Schluter is party to the Lease Agreement as a guarantor only
and receives no direct or indirect material benefit from the Lease Agreement.

<PAGE>
Page 19

Computer Equipment

     The Company currently leases the following computer equipment at a cost of
$133.67 (Canadian) per month (including applicable taxes):

 * Campus Pentium Celeron 366MMX Processors (2)
 * 17" Flat Screen SVGA Color Monitors (2)
 * Hewlett Packard Scanjet 4200C Printer (1)
 * 60 Watt Power Amplified Speakers (2)
   The Company owns the following computer equipment:
 * Compaq Proliant 1600R Pentium 3 - 500 Megahertz Servers (3)
 * Sun Microsystems E450 Server (1)
 * Sun Microsystems Netra T-1 Server (3)
 * Campus Pentium Celeron 366MMX Processor (1)
 * Campus Pentium 3- 500 Megahertz Processor (1)
 * HP 8200CD Writer (1)
 * 17" Hansol Flat Screen SVGA Color Monitors(1)
 * 17" Samsung Flat Screen SVGA Color Monitor(2)
 * Sun Microsystems Ultra 5 Server (1)
 * APC AP9004 Back Up Power Supply (1)
 * Seagate 8Gb Travan Tape Back Up (1)
 * Xerox DocuPrint Color Printer
 * Cannon B640 Fax Machine

ITEM 3:   LEGAL PROCEEDINGS

There are no legal proceedings reportable pursuant to this section. As of the
date of this report, the Company has not been served with notice of any legal
proceedings and does not contemplate undertaking any legal proceedings.

On October 4, 2000, Mr. Darin Wong and 535424 B.C. Ltd. (a private company owned
by Mr. Wong) (collectively, the "Plaintiffs") filed a Statement of Claim in the
British Columbia Supreme Court, claiming damages against Mr. Chad Lee, Director,
President and CEO of the Company, Ms. Marlene C. Schluter, Director, Secretary
and Treasurer of the Company, Ms. Sharmen Vigouret and Mr. Stanley Ross
(collectively, the "Defendants"). 535424 B.C. Ltd was formerly retained by the
Company to provide consulting services to the Company. The Plaintiffs sued the
Defendants for breach of contract, repudiation, breach of trust and/or
conversion of shares. The Plaintiffs did not name the Company as a Defendant in
the action and no claims have been made against the Company for breach of
consulting agreements.

On October 23, 2000, the Defendants filed a Statement of Defence in the British
Columbia Supreme Court, denying all allegations made by the Plaintiffs in their
Statement of Claim.

On May 11, 2001, the Plaintiffs filed a Consent Dismissal Order in the British
Columbia Supreme Court. The Order states that the Plaintiffs' action is
dismissed without costs to either party. The Order further states that the
dismissal of the Plaintiffs' claim is of the same force and effect as a judgment
of the Supreme Court rendered after a hearing on the merits. The Plaintiffs did

<PAGE>
Page 20

not receive any payment or any other benefit whatsoever from the Defendants.
The parties also executed mutual releases.

ITEM 4:   SUBMISSION OR MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year covered by this report, through the solicitation of
proxies or otherwise.

                                   PART II

ITEM 5:   MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

Principal Markets

The Company's common shares are traded on the over the counter market, with
quotations posted on the NASD Over-the-Counter Bulletin Board under the ticker
symbol ONIN. Prior to May 5, 1999, the common shares of the Company traded under
the ticker symbol SLOG, reflecting the previous name of the Company, Sinaloa
Gold Corp. On May 5, 1999, the Company began trading under the ticker symbol
ONIN.

The Company's shares are also traded on the Third Market Segment (the Regulated
Unofficial Market) of the Frankfurt Stock Exchange under the symbol ONN.

High and Low Bid Information

     The common shares of the Company began trading on February 24, 1998 under
the ticker symbol SLOG on the OTCBB. Between April 6, 2000 and October 23,
2000, the Company's shares were not eligible for quotation on the OTCBB and were
quoted only on the NQSB Pink Sheet Quotation System. Since October 23, 2000,
the Company's shares have been quoted on the OTCBB. The Company's shares are
also traded on the Third Market Segment (the Regulated Unofficial Market) of the
Frankfurt Stock Exchange under the symbol ONN. The following table sets out
high and low sale prices for the Company's common shares for each quarter within
the last two fiscal years.

--------------------------------------------------------------------------------
Quarter Ended                       High                    Low
--------------------------------------------------------------------------------
March 31, 1999                      0.56                    0.18
--------------------------------------------------------------------------------
June 30, 1999                       3.31                    0.21
--------------------------------------------------------------------------------
September 30, 1999                  5.56                    2.37
--------------------------------------------------------------------------------
December 31, 1999                   6.50                    4.50
--------------------------------------------------------------------------------

<PAGE>
Page 21

--------------------------------------------------------------------------------
Quarter Ended                       High                    Low
--------------------------------------------------------------------------------
March 31, 2000                      6.25                    1.25
--------------------------------------------------------------------------------
June 30, 2000                       4.25                    2.50
--------------------------------------------------------------------------------
September 30, 2000                  4.06                    2.25
--------------------------------------------------------------------------------
December 31, 2000                   3.80                    0.63
--------------------------------------------------------------------------------
March 31, 2001                      0.85                    0.45
--------------------------------------------------------------------------------
June 30, 2001                       0.60                    0.30
--------------------------------------------------------------------------------

     Quote data is obtained from Canada Stockwatch. Quotations posted on the
OTCBB and the NQSB Pink Sheet quotation system reflect inter-dealer prices,
without retail mark-up, mark-down or commission and may not necessarily
represent actual transactions.

Holders

     As at September 20, 2001, there were approximately 52 stockholders of
record holding 14,595,000 common shares of the Company.

Dividends

     The Company has not declared any cash dividends on its common shares for
the last 2 fiscal years or any subsequent interim period. The Company does not
intend to pay cash dividends in the foreseeable future.

Recent Sales of Unregistered Securities

     On June 11, 2001 the Company issued 25,000 shares of its common stock to
Action Stocks, Inc. at a deemed price of $0.47 per share (aggregate value
$11,750).  The shares were issued to Action Stocks, Inc. as consideration for
services to be provided by Action Stocks, Inc. pursuant to a Consulting
Agreement between the Company and Action Stocks, Inc. A total of 200,000 shares
were to be issued to Action Stocks, Inc. pursuant to the agreement. The Company
terminated the agreement on July 9, 2001, however, and no further shares of the
Company's common stock were delivered to Action Stocks, Inc. The shares were
issued without registration under the Securities Act of 1933 (the "Securities
Act") in reliance on the exemption from registration contained in sections 4(2)
and 3(b) of the Securities Act and on Regulation D promulgated thereunder.

     On June 19, 2001 the Company completed a sale of issued 50,000 units at a
price of $0.75 per unit for aggregate cash proceeds of $37,500. The units were
issued to Mr. Noble Larsen. Each unit consisted of one share of the Company's
common stock and one share purchase warrant. Each warrant entitles the
purchaser to purchase one additional share of the Company's common stock at a
price of $0.75 at any time during the first year after the purchase of the units
or at a price of $1.00 at any time during the second year after the purchase of
the units. The warrants are exercisable for a period of two years after the

<PAGE>
Page 22

purchase of the units. The units were issued without registration under the
Securities Act in reliance on the safe harbor provisions of Regulation S
promulgated under the Securities Act. The purchaser of the securities was not a
"U.S. person" as that term is defined in Rule 902(o) of Regulation S and the
sale of the securities constituted an "offshore transaction" as that term is
defined in Rule 902(i) of Regulation S.

     On June 25, 2001, the Company issued 640,000 shares of its common stock to
Fusion Capital Fund II, LLC ("Fusion") at a deemed price of $0.54 per share. On
the same date, the Company also issued 320,000 share purchase warrants to
Fusion. The shares and warrants were issued as consideration for Fusion's
agreement to enter into a Stock Purchase Agreement with the Company, the terms
of which are described in more detail below under the heading "Plan of Operation
- Cash Requirements". Each share purchase warrant issued to Fusion entitles it
to purchase one additional share of the Company's common stock at a price of
$0.75. The warrants are exercisable for a period of five years from the date of
issue. The shares and warrants issued to Fusion were issued without
registration under the Securities Act in reliance on the exemption from
registration contained in sections 4(2) and 3(b) of the Securities Act and on
Regulation D promulgated thereunder.

     All of the shares issued during the most recent quarter by the Company and
described above are restricted securities and may not be transferred for at
least an initial period of one year from the date of purchase thereof.
Following this one-year period, shares owned by affiliates may be sold in
brokerage transactions, subject to certain requirements of Rule 144, including
the volume limitation requirements, which provide that such persons would be
entitled to sell, within any three-month period, a number of shares that does
not exceed the greater of (i) 1% of the then outstanding shares of common stock,
or (ii) the average weekly reported trading volume on all national securities
exchanges, the NASDAQ National Market, and the OTC Bulletin Board during the
four calendar weeks preceding such sale. Any "free trading" and unrestricted
shares which may be owned by affiliates of the issuer are likewise subject to
the foregoing limitation on resale without regard to when they were acquired or
how long they have been held. Rule 144 also permits, under certain
circumstances, the sale of shares without any quantity limitation by a person
who has satisfied a two year holding period and who is not, and has not been for
the preceding three months, an affiliate of the Company.

ITEM 6:   PLAN OF OPERATION

General

The Company's business is conducted through its website,
www.VirtuallyDating.com. The website was operational for beta testing in
February, 2000 and became operational in July, 2000.  The website is only
operational in terms of limited member services, however. The e-commerce
portion of the website and key value added components are not yet operational.
Since the e-commerce portion of the website will include the payment
infrastructure for merchandise and membership fees, the Company is not currently
charging membership fees. The Company is currently working with a group of web
development consultants to complete the development and deployment of the
e-commerce component of the website. The Company currently anticipates that the
e-commerce functions will be operational by October 31, 2001. In addition, the
Company will be developing other features and functions for the website (see

<PAGE>
Page 23

"additional website development" below). In addition to website development,
over the next 12 months the Company will also be focusing on marketing and
financing.

Forward Looking Statements

All statements, other than statements of historical facts, included in this
report that address activities, events or developments that the Company expects,
believes, intends or anticipates will or may occur in the future, are
forward-looking statements. Forward-looking statements are inherently subject
to risks and uncertainties, many of which cannot be predicted with accuracy and
some of which might not even be anticipated. Future events and actual results,
financial and otherwise, could differ materially from those set forth in or
contemplated by the forward-looking statements herein. These risks and
uncertainties include, but are not limited to, the Company's reliance on current
revenues; the uncertainties associated with the introduction of new
products/services; management of growth, including the ability to attract and
retain qualified employees; the ability to integrate acquisitions made by the
Company and the costs associated with such acquisitions; dependence on its chief
executive officer; substantial competition from larger companies with greater
financial and other resources than the Company; the success of its marketing
strategy; its dependence on suppliers for some of its products; currency
fluctuations and other risks associated with foreign sales and foreign
operations; quarterly fluctuations in revenues, income and overhead expense; and
potential product liability risk associated with its existing and future
products. Readers are cautioned not to put undue reliance on forward-looking
statements. The Company disclaims any intent or obligation to update publicly
these forward-looking statements, whether as a result of new information, future
events or otherwise.

Marketing Strategies

     General
     -------

Management believes that marketing will be the key to the Company's success in
the short term and in the long term. As a result, management intends to focus
as much of its energies as possible in the upcoming 12 months on marketing
activities. The Company intends to advertise online, through print media and
possibly, depending on the resources available, through television, radio and
billboards. The Company's goal has been to capture 50,000 subscribing members
in each of the three years following the launch of the website, for a total of
150,000 members within three years of launch.  As indicated above, the website
was launched in July, 2000. Member services are fully functional, but the
e-commerce component of the website, which will include the fee payment
infrastructure, is not yet operational. As of September 17, 2001, the Company
had 35,137 members.  The Company hopes to increase this number once it has
secured the financing necessary to undertake more intensive marketing
activities. The Company's inability to secure adequate financing over the past
fiscal year has limited its ability to spend money on marketing. The Company's
ability to undertake marketing activities in the upcoming 12 months will be
dependent on its ability to secure financing. Readers should refer to the
section entitled "Cash Requirements" for a discussion of the Company's attempts
to raise capital in the past year and its plans to raise capital in the upcoming
year.

<PAGE>
Page 24

The target market for the Company's service is single adults, aged 18-49, with
basic computer skills and access to the internet. The Company intends to focus
on the North American market in the short term and consider other markets at a
later date.

     Online Advertising
     ------------------

Online advertising can take a number of different forms. Banner advertising is
the most common form. Banner advertisements are small banners which appear on
the perimeter of another Company's website and provide information about the
advertising company. Generally, a link to the advertising company's website
will be provided. The Company intends to place banner advertisements on those
websites which management believes will enable the Company to most effectively
reach its target market.

Affiliations with other websites also provide an avenue for marketing for
internet companies. Companies with similar markets can form various types of
strategic alliances to promote one another's products and services. The key
component is usually a link to the affiliate company's website. In the upcoming
12 months, the Company will continue with its efforts to forge strategic
partnerships with key industry players. The Company hopes that by doing so it
will be able to increase traffic on its website.

Another form of online advertising being considered by the Company involves
sponsoring e-mails or newsletters sent by other internet companies. Through
payment of a sponsorship fee, the Company would be shown as the sponsor of a
particular e-mail or newsletter sent by an entity to its members. By selecting
an entity with a large membership, the Company can reach large target markets.
A message identifying the sponsor and a link to the sponsor's website are
provided.

Management is exploring the various forms of online advertising available and
focusing its initial energy on this sector because of the relatively low cost
and the ability to reach its target market (i.e. personal computer users)
effectively. It will, however, assess other marketing tools and utilize those
which it feels will enable it to reach its target market in the most efficient
and cost effective manner.

     Print Media, T.V., Radio and Billboards
     ----------------------------------------

While management is of the view that online advertising is the most
cost-effective marketing tool, it also believes that other, more traditional
methods of marketing will be effective and must be developed to the fullest
extent possible. Management envisions placing advertisements in the personals
sections of major newspapers and in high circulation magazines with general
readership to brand the VirtuallyDating name and to expose the Company to a
wider audience. Determination as to whether these types of advertisements will
be placed will depend on funds available in the upcoming 12 months. In
addition, advertisements on television, radio and on billboards will be
considered and utilized if the Company has the capital available to purchase
advertising space/time from these sources.

Additional Website Development

As discussed above, due to the failure of Stratford to complete the development
and launch of the e-commerce functions for the Company's website as per the

<PAGE>
Page 25

agreement between the Company and Stratford, the Company has hired new web
consultants to perform this work. The consultants performing the development
services are under the Company's direct supervision and are paid by the Company
on a monthly basis. Payment is tied to and based on the completion of specific
tasks or portions of the development work. The Company's focus with respect to
website development during the next month will be to complete the development
and launch of the e-commerce functions.  The Company anticipates that this work
will be completed by October 31, 2001. The Company anticipates that it will
cost an additional $75,000 to complete the development and launch the e-commerce
functions.

After the e-commerce functions have been added to the website, the Company
intends to continue to develop new features which will make the website more
attractive to prospective members. Proposed features may include the
development of live video chat functions for members whose personal computers
have the capacity to perform video conferencing/interaction. In addition, the
Company intends to create a webpage entitled "Hey Bartender" which would provide
recipes for alcoholic cocktails. Members would be invited to post their own
favorite recipes on the page. Another section entitled "Postcards From Stanley"
may be created. This section would feature travel reviews of destinations
geared towards singles.

Purchase of Equipment

At this time, the Company does not anticipate the purchase of any significant
equipment.

Employees

The Company currently has no full or part time employees. The Company retains
consultants to provide it with services related to the administration,
management and development of the Company. At this time, the Company does not
anticipate any significant changes in staffing.

Cash Requirements

The Company currently has sufficient working capital to meet its operating
requirements until September 30, 2001. In order to fund business activity
beyond this date, the Company will need to arrange additional financing.
Website development and marketing efforts will be dependent on the Company's
ability to raise such additional financing. Specific plans related to marketing
and any additional website development which may occur in the upcoming months
will be devised once financing has been completed and management knows what
funds will be available for these purposes.

As disclosed in the Company's most recent 8-K filing, the Company recently
entered into a Common Stock Purchase Agreement (the "Stock Purchase Agreement")
with Fusion Capital Fund II, LLC, a Chicago based institutional investor
("Fusion"). Pursuant to the Stock Purchase Agreement, subject to certain terms
and conditions discussed further below, Fusion has agreed to purchase $6,000,000
of the Company's common stock. The stock will be purchased at a rate of $10,000
per trading day, or $200,000 every 20 trading days. The purchase price of the
stock will be based on the market price of the Company's common shares at the
time of purchase. Under the Stock Purchase Agreement, the Company is not
obligated to commence sales of its common stock to Fusion and Fusion is not

<PAGE>
Page 26

obligated to make any purchases of the Company's common stock, until the Company
has filed a registration statement under the Securities Act of 1933 with the
Securities and Exchange Commission respecting at least 2,000,000 of the shares
of the Company's common stock to be issued pursuant to the Stock Purchase
Agreement. In order to secure the funds available under the Stock Purchase
Agreement, therefore, it will be necessary for the Company to focus its energies
on preparing and filing a registration statement with the Securities and
Exchange Commission.  The Company anticipates that this process will cost
approximately $100,000 and take approximately 6 months to complete.

In order to complete the registration process, the Company will have to secure
intermediate financing. The Company is currently exploring various financing
options. There is no guarantee, however, that financing will be secured.
Without additional financing, the Company may be unable to access the funds that
are to be made available under the Stock Purchase Agreement.

The Company intends to use the proceeds of any financing to fund ongoing
operations. Specifically, funds will be utilized for general and administrative
expenses and expenses related to the filing and preparation of a registration
statement respecting the stock to be issued under the Stock Purchase Agreement.
Funds will also be utilized for ongoing development of the Company's internet
based products and services and for marketing of those products and services.



<PAGE>
Page 27

ITEM 7:   FINANCIAL STATEMENTS


                                MOEN AND COMPANY
                              CHARTERED ACCOUNTANTS

PO Box 10129
1400 IBM Tower                                       Telephone:    (604)662-8899
701 West Georgia Street                              Fax:          (604)662-8809
Vancouver, BC   V7Y 1C6

--------------------------------------------------------------------------------



                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------



Board of Directors and Stockholders
Online Innovation, Inc. (A Delaware Corporation)
(A Development Stage Company)

We have audited the accompanying Balance Sheets of Online Innovation, Inc. (A
Delaware Corporation) (A Development Stage Company) as at June 30, 2001, and
June 30, 2000, and the related Statements of Profit and Loss, Retained Earnings
(Deficit), Cash Flows, and Stockholders' Equity for the years then ended. These
financial statements are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform an audit to obtain
reasonable assurance 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.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Company as at June 30,
2001, and June 30, 2000 and the results of its operations and the Statement of
Cash Flows and Stockholders' Equity for the years then ended, in conformity with
United States generally accepted accounting principles (GAAP).




                                              /s/ Moen and Company
                                              Chartered Accountants


Vancouver, British Columbia, Canada
July 28, 2001


<PAGE>
Page 28

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                               Balance Sheet
                               June 30, 2001
                             (In U.S. Dollars)
                (With Comparative Figures at June 30, 2000)


                                  ASSETS                  2001         2000
                                                       -----------  -----------
Current Assets
   Cash                                                $    12,838  $    94,338
   Prepaid expense                                            -           1,343
                                                       -----------  -----------
                                                            12,838       95,681
Deferred tax asset (Notes 12(b) and 13(c))                  52,500       52,500
Fixed assets
   Computer equipment, at cost less accumulated
     depreciation (Note 5)                                  61,128       86,353
Computer software development (Notes 2(c) and 6(b))
   Application development stage costs                     400,000      400,000
                                                       -----------  -----------
                                                       $   526,466  $   634,534
                                                       ===========  ===========

                     LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
   Accounts payable                                    $    29,223  $    23,207
   Due to related parties (Note 4)                          30,000         -
   Agreement payable - Stratford Internet
    Technologies (Note 6(b))                                75,000      100,000
                                                       -----------  -----------
                                                           134,223      123,207
                                                       -----------  -----------
Stockholders' Equity
   Capital Stock (Note 3)
    Authorized:
      75,000,000 common shares at $0.001 par value
        per share
    Issued and outstanding - 14,595,000 common shares
      (2000 - 13,385,000 common shares)                     14,595       13,385
   Paid in capital in excess of par value of stock       2,300,505    1,624,615
Deficit accumulated during development stage (Note 1)   (1,922,937)  (1,126,161)
Cumulative translation (Note 2(b))                              80         (512)
                                                       -----------  -----------
                                                           392,243      511,327
                                                       -----------  -----------
                                                       $   526,466  $   634,534
                                                       ===========  ===========

Approved on Behalf of the Board
      /s/ Chad D. Lee              , Director
-----------------------------------
      /s/ Marlene C. Schluter      , Director
-----------------------------------

          See Accompanying Notes and Independent Auditor's Report

<PAGE>
Page 29

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                        Statement of Profit and Loss
                          Year Ended June 30, 2001
                             (In U.S. Dollars)
<TABLE>
<CAPTION>
                                   Cumulative From
                                   Inception Date
                                    of Aug 1, 1997                       Year Ended                     Quarter Ended
                                     to June 30,                          June 30,                         June 30,
                                                        ------------------------------------  ------------------------------------
                                        2001                  2001               2000              2001               2000
                                  -----------------     -----------------  -----------------  -----------------  -----------------
<S>                               <C>                   <C>                <C>                <C>                <C>
Administration Costs
  Depreciation                    $          53,066     $          32,281  $          20,708  $           8,176   $          7,946
  Compensation on stock options             150,000                  -                30,000               -                  -
  Commitment shares issued under
   funding agreement                        345,600               345,600               -               345,600               -
  Filing and transfer agent fees             17,665                 3,555              8,920                610              2,048
  Financing costs                            22,550                  -                  -                  -                  -
  Management and consulting fees            428,586                86,927            176,134             23,860             60,134
  Office expenses, net                      125,117                38,220             61,592              6,408             19,216
  Option payment, mineral properties         30,000                  -                  -                  -                  -
  Professional fees                         182,293               104,330             46,013             39,779             14,179
  Promotion, investor relations,
   and investor communications               84,277                 1,238             69,109                253                290
  Computer technology and
   software development-preliminary
   development stage costs                  330,755               103,430              7,203            103,430               -
  Website marketing/Banner
   advertising costs                        184,596                72,791             89,046              9,220             50,701
  Travel expenses                            20,932                 8,404              5,264               -                  -
                                  -----------------     -----------------  -----------------  -----------------  -----------------
                                         (1,975,437)             (796,776)          (513,989)          (537,336)          (154,514)
Deferred income taxes                        52,500                  -                10,500               -                  -
                                  -----------------     -----------------  -----------------  -----------------  -----------------
Net loss for the period           $      (1,922,937)    $        (796,776) $        (503,489) $        (537,336) $        (154,514)
                                  =================     =================  =================  =================  =================
Net loss per share, basic and diluted                   $           (0.06) $           (0.03) $           (0.03) $           (0.01)
                                                        =================  =================  =================  =================
</TABLE>


           See Accompanying Notes and Independent Auditors' Report

<PAGE>
Page 30

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                          Statement of Cash Flows
                          Year Ended June 30, 2001
                             (In U.S. Dollars)
<TABLE>
<CAPTION>
                                   Cumulative From
                                   Inception Date
                                    of Aug 1, 1997                       Year Ended                     Quarter Ended
                                     to June 30,                          June 30,                         June 30,
                                                        ------------------------------------  ------------------------------------
                                        2001                  2001               2000              2001               2000
                                  -----------------     -----------------  -----------------  -----------------  -----------------
<S>                               <C>                   <C>                <C>                <C>                <C>
Cash Provided by (Used for)
Operating Activities
  Net loss for the period         $      (1,922,937)    $       (796,776) $         (503,489) $        (537,336) $        (154,514)
  Item not requiring use of cash:
   Depreciation                              53,066               32,281              20,708              8,176              7,946
   Compensation on stock options               -                    -                 30,000               -                  -
   Commitment shares                        345,600              345,600                -               345,600               -
   Shares issued for services                94,000               94,000                -                94,000               -
   Cumulative translation                        80                  592                 543               -                  -
  Changes in non-cash working
     capital items
   Deferred income tax                      (52,500)                -                (10,500)              -                  -
   Prepaid expense (increase)                  -                   1,343              (1,343)             1,325              2,015
   Accounts payable (decrease)               29,223                6,016                (901)             9,626              5,047
   Agreement payable                         75,000              (25,000)            100,000               -               (25,000)
                                  -----------------     -----------------  -----------------  -----------------  -----------------
                                         (1,378,468)             (341,944)          (364,982)           (78,609)          (164,506)
                                  -----------------     -----------------  -----------------  -----------------  -----------------
Investing Activities
  Computer software development
   application development
   stage costs                             (400,000)                 -              (400,000)              -                 -
  Fixed assets purchased                   (114,194)               (7,056)          (106,627)            (7,056)           (1,193)
                                  -----------------     -----------------  -----------------  -----------------  -----------------
                                           (514,194)               (7,056)          (506,627)            (7,056)           (1,193)
                                  -----------------     -----------------  -----------------  -----------------  -----------------
Financing Activities
  Capital stock subscribed                1,875,500               237,500            340,000             37,500            65,000
  Due to related parties                     30,000                30,000            (31,689)              -                 -
                                  -----------------     -----------------  -----------------  -----------------  -----------------
                                          1,905,500               267,500            308,311             37,500            65,000
                                  -----------------     -----------------  -----------------  -----------------  -----------------

Cash increase (decrease)
  during the period                          12,838               (81,500)          (563,298)           (48,165)          (100,699)
Cash, Beginning of period                      -                   94,338            657,636             61,003            195,037
                                  -----------------     -----------------  -----------------  -----------------  -----------------

Cash, End of period               $          12,838     $          12,838  $          94,338  $          12,838  $          94,338
                                  =================     =================  =================  =================  =================
</TABLE>

           See Accompanying Notes and Independent Auditors' Report

<PAGE>
Page 31


                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                  Statement of Retained Earnings (Deficit)
                          Year Ended June 30, 2001
                             (In U.S. Dollars)
<TABLE>
<CAPTION>
                                   Cumulative From
                                   Inception Date
                                    of Aug 1, 1997                       Year Ended                     Quarter Ended
                                     to June 30,                          June 30,                         June 30,
                                                        ------------------------------------  ------------------------------------
                                        2001                  2001               2000              2001               2000
                                  -----------------     -----------------  -----------------  -----------------  -----------------
<S>                               <C>                   <C>                <C>                <C>                <C>
Balance (deficit),
  beginning of period             $            -        $     (1,126,161) $         (622,672) $      (1,385,601) $        (971,647)

Net loss for the period                  (1,922,937)            (796,776)           (503,489)          (537,336)          (154,514)
                                  -----------------     -----------------  -----------------  -----------------  -----------------

Balance (deficit), end of period  $      (1,922,937)    $      (1,922,937) $      (1,126,161) $      (1,922,937) $      (1,126,161)
                                  =================     =================  =================  =================  =================
</TABLE>


           See Accompanying Notes and Independent Auditors' Report

<PAGE>
Page 32

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                     Statement of Stockholders' Equity
           From Date of Inception on August 1, 1997 to June 30, 2001
                             (In U.S. Dollars)
<TABLE>
<CAPTION>
===================================================================================================================================
                            Number of                 Additional         Total       Retained                             Total
                             Common          par       Paid-in          Capital      Earnings         Cumulative     Stockholders'
                             Shares         Value      Capital           Stock       (Deficit)        Translation       Equity
                          ---------------------------------------------------------------------------------------------------------
<S>                       <C>             <C>         <C>             <C>           <C>            <C>               <C>
Net loss for eleven
 month period ended
 June 30, 1998                                                                      $    (144,175)                   $    (144,175)
Issued for cash, @$0.01
 October 23, 1997          1,500,000      $    1,500  $    13,500     $    15,000                                           15,000
Issued for cash, @$0.001
 May 8, 1997                 500,000             500                          500                                              500
Issued for assignment
 of option on mineral
 properties, @$0.0035
 September 30, 1997        8,500,000           8,500       21,500          30,000                                           30,000
                          ---------------------------------------------------------------------------------------------------------
                          10,500,000          10,500       35,000          45,500        (144,175)                         (98,675)

Shares subscribed and
 fully paid and issued,
 @$0.50 April 6, 1999         85,000              85       42,415          42,500                                           42,500
                          ---------------------------------------------------------------------------------------------------------
Balance, June 30, 1998    10,585,000          10,585       77,415          88,000        (144,175)                         (56,175)
 Net loss for year
 ended June 30, 1999                                                                     (478,497)                        (478,497)
 Compensation on stock
 options                                                  120,000         120,000                                          120,000
 Cumulative translation                                                                                  (1,055)            (1,055)
Issued for cash, @$0.50
 April 6, 1999                20,000              20        9,980          10,000                                           10,000
Issued for cash, @$0.50
 April 6, 1999               100,000             100       49,900          50,000                                           50,000
Issued for private
 business(note 7), @$0.50
 April 2, 1999               400,000             400      199,600         200,000                                          200,000
Issued for cash(note 14),
 @$0.50 April 15, 1999     1,600,000           1,600      798,400         800,000                                          800,000
                          ---------------------------------------------------------------------------------------------------------
Balance, June 30, 1999    12,705,000          12,705    1,255,295       1,268,000        (622,672)       (1,055)           644,273
Cumulative translation                                                                                      543                543
Shares subscribed and
 fully paid, @$0.50
 January 4, 2000             450,000             450      224,550         225,000                                          225,000
Net loss for year
 ended June 30, 2000                                                                     (503,489)                        (503,489)
Cumulative translation
 Issued for exercise of
 option @ $0.50
 March 13, 2000              100,000             100       49,900          50,000                                           50,000
Compensation on stock
 options                                                   30,000          30,000                                           30,000
Exercise of warrants
 @ $0.50 May 9, 2000          50,000              50       24,950          25,000                                           25,000
Exercise of warrants
 @ $0.60 June 16, 2000        66,667              67       39,933          40,000                                           40,000
                          ---------------------------------------------------------------------------------------------------------
Balance, June 30, 2000    13,371,667          13,372    1,624,628       1,638,000      (1,126,161)         (512)           511,327
Exercise of warrants
 @$0.60 August 17, 2000       83,333              83       49,917          50,000                                           50,000
Exercise of warrants
 @$0.60 February 9, 2001     250,000             250      149,750         150,000                                          150,000
Issued for services at
 an ascribed price of
 $0.47 per share on
 June 11, 2001               200,000             200       93,800          94,000                                           94,000
Issue for cash, @$0.75
 June 19, 2001                50,000              50       37,450          37,500                                           37,500
Issued as commitment
 shares at an ascribed
 price of $0.54 per
 share on June 25, 2001      640,000             640      344,960         345,600                                          345,600
Net loss for year ended
 June 30, 2001                                                                           (796,776)                        (796,776)
Cumulative translation                                                                                      592                592
                          ---------------------------------------------------------------------------------------------------------
<S>                       <C>             <C>         <C>             <C>           <C>            <C>               <C>
Balance, June 30, 2001    14,595,000      $   14,595  $ 2,300,505     $ 2,315,100   $  (1,922,937) $         80      $      392,243
                          =========================================================================================================
</TABLE>
      See Accompanying Notes and Independent Auditors' Report

<PAGE>
Page 33

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 1.     BUSINESS OPERATIONS

    a) The Company was incorporated on May 7, 1997 under the Company Act of the
       State of Delaware, U.S.A. and commenced inception of business on August
       1, 1997. The Company changed it's name from Micro Millennium, Inc. to
       Sinaloa Gold Corp. on October 16, 1997 and subsequently changed it's name
       from Sinaloa Gold Corp. to Online Innovation, Inc. on April 8, 1999.

    b) The Company is in its development stage in the internet/e-commerce
       industry as a website development company and was previously in the
       mining resource industry and has not generated any revenues from its
       planned operations.  The deficit has been accumulated during the
       development stage.

Note 2.     SIGNIFICANT ACCOUNTING POLICIES

    a) Administration Costs

       Administration costs are written off to operations when incurred.

    b) Translation of Foreign Currency

       The functional currency of the Company is the Canadian Dollar and the
       reporting currency is the United States Dollar.

       The assets, liabilities, and operations of the Company are expressed in
       the functional currency of the Company, the Canadian Dollar, in
       conformity with US GAAP, before they are translated into the reporting
       currency, the United States Dollar.

       Monetary assets and liabilities are translated at the current rate of
       exchange.

       The weighted average exchange rate for the period is used to translate
       revenue, expenses, and gains or losses from the functional currency to
       the reporting currency.

       The gain or loss on translation is reported as a separate component of
       stockholders' equity and not recognized in net income.  Gains or losses
       on remeasurement are recognized in current net income.

       Gains or losses from foreign currency transactions are recognized in
       current net income.

       Fixed assets are measured at historical exchange rates that existed at
       the time of the transaction.

<PAGE>
Page 34

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)


Note 2.     SIGNIFICANT ACCOUNTING POLICIES (cont'd)

   (b) Translation of Foreign Currency (cont'd)

       Depreciation is measured at historical exchange rates that existed at the
       time the underlying related asset was acquired.

       An analysis of the changes in the cumulative translation adjustment as
       disclosed as part of stockholders' equity, is as follows:

                                                     Year Ended
                                                      June 30,
                                       ----------------------------------------
                                               2001                 2000
                                       ------------------    ------------------
          Beginning balance, June 30,
           2000 & 1999                 $             (512)   $           (1,055)
          Changes during the period                   592                   543
                                       ------------------    ------------------
          Ending balance, June 30,
           2001 & 2000                 $               80    $             (512)
                                       ==================    ===================

       Capital accounts are translated at their historical exchange rates when
       the capital stock is issued.

       The effect of exchange rate changes on cash balances is reported in the
       statement of cash flows as a separate part of the reconciliation of
       change in cash and cash equivalents during the year.

    c) Amortization of Computer Software
       Development - Application Development Stage Costs

       The company is in the application development stage relating to the
       development of computer software, and accordingly, costs are capitalized.
       When the company is in the post-implementation / operation stage, costs
       will be expensed as incurred.

       Amortization of computer software costs of $400,000 will commence when
       the software service is available to be marketed.  The amortization
       period is for twenty-six months on a straight-line basis.  The software
       is not available to be marketed as at June 30, 2001, and therefore no
       amortization of this cost has been charged to operations for the year
       ended June 30, 2001.


<PAGE>
Page 35

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 3.     CAPITAL STOCK

    a) Authorized: 75,000,000 common shares at $0.001 par value per share.

    b) Common shares issued and outstanding are as follows:

                                                         Shares          $
                                                       -----------  -----------
       Balance, June 30, 2000                           13,371,667  $ 1,638,000
         Issued for cash, August 17, 2000                   83,333       50,000
         Issued for cash, February 9, 2001                 250,000      150,000
         Issued for services at an ascribed price
          of $0.47 per share on June 11, 2001              200,000       94,000
         Issued for cash, June 19, 2001                     50,000       37,500
         Issued for as commitment shares at an
          ascribed price of $0.54 per share on
          June 25, 2001                                    640,000      345,600
                                                       -----------  -----------
       Balance, June 30, 2001                           14,595,000  $ 2,315,100
                                                       ===========  ===========

    c) Options for National Financial Communication Group, and Fordee Management
       Company. (See Note 13(b) and Note 14)

Note 4.     RELATED PARTY TRANSACTIONS:

    a) (i)    Pursuant to a management agreement effective November 1, 1998,
              the Company pays $2,500 per month to MCS Management Ltd., a
              company wholly owned by Ms. Marlene C. Schluter, Director,
              Secretary, and Treasurer of the Company, for management services
              provided to the Company by MCS Management Ltd.

       (ii)   Pursuant to a management agreement effective July 1, 1999, the
              Company pays $2,500 per month to Netgain Management Solutions
              Inc., a company wholly owned by Mr. Chad D. Lee, President, Chief
              Financial Officer, CEO, and Director of the Company.

    b) Directors and Officers of the Company are beneficial owners of common
       shares of the Company, as follows, at June 30, 2001:

            Chad D. Lee                  5,500,000 common shares
            Marlene C. Schluter          2,500,000 common shares
                                         ---------
                                         8,000,000
                                         =========

    c) As at June 30, 2001 loans to the Company unpaid are as follows:

            Chad D. Lee                  $  20,000
            Marlene C. Schluter             10,000
                                         ---------
                                         $  30,000
                                         =========

       These loans are non interest bearing, are unsecured, and have no
       specific terms of repayment.

<PAGE>
Page 36

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 5     FIXED ASSETS - COMPUTER EQUIPMENT

       The Company depreciates its computer equipment using the declining-
       balance basis at the rate of 30% per annum.

       The cost and accumulated depreciation are as follows:

                                                           June 30,
                                             ----------------------------------
                                                        2001              2000
                                             ---------------   ---------------
       Cost                                  $       114,194   $       107,138
       Accumulated depreciation                      (53,066)          (20,785)
                                             ---------------   ---------------
       Net balance                           $        61,128   $        86,353
                                             ===============   ===============

Note 6.     COMPUTER TECHNOLOGY AND WEBSITE COSTS

    a) Acquisition From Online Innovation

       i)     The Company by resolution dated April 2, 1999, acquired from
              Online Innovation, a non-reporting private Canadian unincorporated
              entity, 100% interest in all of its proprietary and intellectual
              property associated with its business plan and concepts and its
              world wide web site domain name: www.virtuallydating.com.
                                               ------------------------

       ii)    Consideration for this purchase is the issuance of 400,000 common
              shares of the Company at a price of $0.50 per share.  These shares
              were issued on June 2, 1999 and the amount of $200,000 has been
              included as an expense of operations for the year ended June 30,
              1999.

       iii)   Online Innovation has not had any historical revenue or expenses;
              it also has no liabilities and the only asset is a business plan
              and concepts and the abovementioned world wide web site domain
              name.

    b) Agreement with Stratford Internet Technologies.

       By agreement dated July 30, 1999 between the Company and Stratford
       Internet Technologies ("Stratford"), Stratford had been engaged to
       create, maintain, upgrade and supply artwork, computer files, and coding
       for a website at www.virtuallydating.com for the amount of $400,000 US,
                        -----------------------
       which is capitalized in these financial statements, and 300,000 common
       shares of the Company.  The payment schedule is as follows:

       i)     a deposit of $275,000 US was paid upon delivery of the contract,
              and additional payments totaling $50,000 have been paid for a
              total of $325,000.

<PAGE>
Page 37

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 6. COMPUTER TECHNOLOGY AND WEBSITE COSTS (cont'd)

       ii)    the balance of $75,000 US represents the expenditure for
              completion of development of and roll out of the website which is
              due upon completion of development of the website and the Company
              raising secondary financing.  The Company has received $225,000 US
              to December 31, 1999 on the exercise of 450,000 share purchase
              warrants.  The obligation to pay $75,000 US to Stratford is
              disclosed as a current liability as at June 30, 2001, as it is
              expected to be paid within the next twelve months, and the cost of
              $400,000 is carried as a deferred development expense until the
              website is completed.  However, on March 20, 2001, Stratford
              Internet Technologies notified the Company and advised that they
              had ceased operations.  Although a trustee has been appointed to
              handle their affairs, Stratford is attempting to fulfill their
              obligations to the Company pursuant to the agreement with the
              Company.  If Stratford is unable to complete the website's
              development under the existing contract, the Company will hire
              other consultants to continue development, and the expected cost
              to complete the website should not exceed the amount of $75,000.

              The Company's legal council requested that Stratford indicate in
              writing, their plan on completing their commitments in accordance
              with the contract.  Stratford did not produce any solutions by the
              requested date of May 14, 2001 and the Company has since retained
              other consultants to continue development of virtuallydating.com.

       iii)   the issuance of 300,000 common shares, restricted under Rule 144,
              which will bear a one year trading restriction will be issued upon
              contract completion.  The obligation to issue these shares has not
              been recorded in these financial statements but is disclosed as a
              contingent liability in Note 15 (a), below.

Note 7.     LEASE OBLIGATIONS

    a) Computer Lease
       On June 1, 1999, the Company entered into a 36 month lease with Leasing
       Solution (Canada) Inc. for computer equipment to be used by the Company.
       Lease payments are expensed as they are incurred.  Lease obligations for
       the fiscal year ending June 30, 2002 total CAD$1,213.

    b) Lease of Premises
       The Company entered into a lease for offices on November 1, 1999 with
       570679 BC Ltd. for two years for monthly rent and costs of CAD$1,987.50,
       with an option to renew for a third year.

<PAGE>
Page 38

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 8     COMPENSATION/STOCK OPTION/DEFERRED COMPENSATION ARRANGEMENT

    a) At the Annual General Meeting of the Company, the 2000 Incentive Stock
       Plan was approved that provides for the grant, at the discretion of the
       Board of Directors, or a Committee appointed by it, of options and rights
       to purchase an aggregate of not to exceed 1,500,000 common shares of
       common shares of the Company to officers, directors, employees and
       consultants of the Company.

    b) No liability for potential pension costs has been recorded to June 30,
       2001.

Note 9     NET LOSS PER SHARE

       Net loss per common share is computed by dividing net loss by the
       weighted average of shares outstanding during the period.

Note 10    INCOME TAXES

       The Company has losses carried forward to future years of $1,922,937.
       The potential tax benefit has not been recorded, as an equivalent reserve
       has been provided due to uncertainty of application of the losses.

Note 11    FINANCIAL INSTRUMENTS

       The Company's financial instruments consist of cash, accounts payable,
       agreement payable and due to related parties. It is management's opinion
       that the Company is not exposed to significant interest, currency or
       credit risks arising from these financial instruments.  The fair value of
       these financial instruments approximates their carrying values.

Note 12    CONSULTING AGREEMENTS

       National Financial Communications Corp.

       a) By agreement dated February 1, 2000, the company engaged National
          Financial Communications Corp., an arm's length company, to render
          public relations and communication services for a period of one year
          commencing February 1, 2000 and terminating February 1, 2001, at
          $10,000 per month.  The amount of $20,000 has been incurred to March
          31, 2000.  By mutual agreement the services were suspended in April
          2000 until the company becomes fully reporting. As part of the
          agreement, National Financial Communications Corp. is granted options
          on February 1, 2000 to purchase shares of the company, exercisable,
          commencing February 1, 2000, and expiring January 31, 2003.  February
          1, 2000 is the measurement date and the vesting date.  There are five
          options for 50,000 shares each at prices of $2.00, $3.00, $4.00,
          $5.00, $7.00 per share, respectively.

<PAGE>
Page 39

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 12  CONSULTING AGREEMENTS (cont'd)

       b) The compensation of $30,000 is expensed in these financial statements.
          The options are nonforfeitable.

           Option price of 50,000 shares at $2.00 per share           $  100,000
           Market price at date of issuance of option - 50,000
             shares at $2.60                                             130,000
           Compensation added to paid-in capital                      $   30,000
                                                                      ----------
           Deferred income tax - 35% of $30,000                       $   10,500
                                                                      ==========

       c) Action Stocks Incorporated

          The Company accounts for stock-based compensation issued to non-
          employees and consultants in accordance with the provisions of SFAS
          123 and the Emerging issues Task Force consensus in issue No. 96-18
          ("EITF 96-18"), "Accounting for Equity Instruments that are issued to
          Other Than Employees for Acquiring or in Conjunction with Selling,
          Goods or Services".

          On June 11, 2001, the Company entered into a Promotion Agreement with
          Action Stocks Incorporated, providing for the promotion by Action of
          Online Innovation, Inc. to the general investment community for a term
          of 6 months. The compensation to Action under this Agreement consisted
          of 200,000 Common Shares, at $0.47 per share payable over a six month
          period as follows:

              1st Month: 25,000 Common Shares, (upon execution of contract)
              2nd Month: 25,000 Common Shares
              3rd Month: 25,000 Common Shares
              4th Month: 25,000 Common Shares
              5th Month: 50,000 Common Shares
              6th Month: 50,000 Common Shares

       On July 9, 2001, the Company exercised it's right to terminate the
       agreement in accordance with the termination clause of the agreement. The
       company has issued 25,000 common shares under this agreement to Action
       Stocks, Incorporated. The remaining 175,000 shares issued in Action
       Stocks Incorporated name are in the possession of Online Innovation, Inc.
       and will be cancelled and sent back to treasury.

<PAGE>
Page 40

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 13    FORDEE MANAGEMENT COMPANY

    a) As at February 2, 1999 the Company granted to Fordee Management Company
       with stock options to purchase 400,000 common share of the Company at a
       price of $0.20 per share with the expiry date of October 3, 2002.  These
       options are outstanding as at June 30, 2001.

    b) Fordee Management Company is an unrelated third party

    c) The compensation of $120,000 applicable to issuance of this option was
       expensed in the year ended June 30, 1999, and was added to paid-in
       capital, computed as follows:

            Option price of 400,000 shares at $0.20 per share     $     80,000
            Market price at date of issuance of option 400,000
               shares at $0.50 per share                               200,000
                                                                  ------------
            Compensation added to paid-in capital                 $    120,000
                                                                  ============

            Deferred income tax - 35% of $120,000                 $     42,000
                                                                  ============

Note 14    COMMON STOCK PURCHASE AGREEMENT WITH FUSION CAPITAL FUND II, LCC

       On June 25, 2001, Online Innovation, Inc. entered into a Common Stock
       Purchase Agreement with Fusion Capital Fund II, LLC, a Chicago based
       institutional investor. Pursuant to the Agreement, and subject to
       certain terms and conditions, Fusion has agreed to purchase $6,000,000 of
       the Company's common stock. The stock will be purchased at a rate of
       $10,000 per trading day, or $200,000 every 20 trading days. The purchase
       price of the stock will be based on the market price of the Company's
       common shares at the time of purchase.

       The Company will have the right to decrease the daily purchase rate of
       $10,000 at any time. In the event of such a decrease, it will also have
       the right to increase the daily purchase rate back to $10,000 at any
       time. In addition, if the closing price of the Company's shares is above
       $3.00 for five consecutive trading days, the Company will have the right
       to increase the daily purchase rate above $10,000. If the Company chooses
       to increase the daily purchase rate above $10,000 and the closing price
       of the Company's shares falls below $3.00, the daily purchase rate will
       be reduced to $10,000. The Company may, at any time, suspend purchases
       under the Agreement. In addition, no purchase will be made if such
       purchase would cause Fusion, together with any of its affiliates, to own
       in excess of 9.9% of the Company's common stock.

<PAGE>
Page 41

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 14    COMMON STOCK PURCHASE AGREEMENT WITH FUSION CAPITAL FUND II, LCC
           (cont'd)

       The Company will not be obligated to sell and Fusion will not be able to
       purchase any common stock under the Agreement if the purchase price for
       the stock (based on the market price of the Company's shares at the time
       of purchase) would be less than $0.75. The Company may, at its
       discretion, increase this "floor price". The Company may also, with the
       consent of Fusion, decrease the floor price. Fusion is prohibited, during
       the term of the Agreement, from effecting any short sales of the
       Company's common stock or entering into any hedging transaction which
       establishes a net short position with respect to the Company's common
       stock.

       As consideration for entering into the Agreement, the Company has agreed
       to issue 640,000 shares of its common stock to Fusion. In addition, the
       Company has agreed to issue to Fusion share purchase warrants entitling
       Fusion to purchase up to 320,000 shares of the Company's common stock at
       a price of $0.75. The warrants are exercisable for a period of 5 years
       from the date of issue. Subject to certain conditions, Fusion has agreed
       not to transfer or sell any of these shares for 600 trading days from the
       date of the Agreement.

       Under the Agreement, the Company is not obligated to commence sales of
       its common stock to Fusion, and Fusion is not obligated to make any
       purchases of the Company's common stock, until the Company has filed a
       registration statement under the Securities Act of 1933 with the
       Securities and Exchange Commission respecting at least 2,000,000 of the
       shares of the Company's common stock to be issued pursuant to the
       Agreement. The registration statement must also register the 640,000
       commitment shares issued by the Company and any shares to be acquired by
       Fusion pursuant to the exercise of the warrants described above.

       The Company intends to use the proceeds of the financing to fund
       ongoing operations. Funds will be utilized for general and
       administrative expenses, ongoing development of the Company's internet
       based products and services and for marketing of those products and
       services.

       For purposes of these financial statements, the 640,000 commitment shares
       have been recorded as issued at an ascribed price of $0.54 per share.


<PAGE>
Page 42

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 15  CONTINGENT LIABILITIES

    a) Liability to issue common shares
       By agreement dated July 30, 1999 as outlined in Note 6(b), above, the
       Company engaged Stratford Internet Technologies to design and maintain an
       e-commerce website for the Company.  An additional obligation of the
       Company, in this agreement, is the obligation to issue 300,000 common
       shares upon completion of the website in accordance with the contract.
       As the website had not been completed by June 30, 2001 under the terms of
       the contract, these shares are not recorded as at that date and no paid
       up cost or value related thereto has been recorded in these financial
       statements.  However, as disclosed in Note 6(b) (ii), Stratford had
       informed the company that they had ceased operations prior to completing
       their obligation under the terms of the contract dated July 30, 1999.

    b) Terminated Mexican property option agreement
       The Company held the option to acquire an interest in subsurface mineral
       rights on four mineral properties located in the State of Sinaloa,
       Mexico.  The interest was acquired by way of assignment of all rights
       under an option agreement between CL Communications Group, (an
       unincorporated entity wholly owned by the president of the Company) and
       the owner of the interest in the mineral properties [see note 2(a) and
       note 4(d)].  The option agreement was entered into on September 30, 1997.
       The rights under the option agreement were assigned to the Company by CL
       communications Group on the same day.  The owner of the mineral
       properties is an unrelated third party.  The terms of the option
       agreement were set out in part in a written agreement.  Some of the terms
       were agreed upon verbally between the parties.  The option agreement
       required the Company to pay a total of $900,000 in staged payments over
       three years, to incur exploration and development expenditures on the
       properties of  $4,500,000 and to issue 3,000,000 shares to the property
       owner upon signing of a formal joint venture agreement between the
       parties.  Other than an initial cash payment of $30,000 (which was made
       by CL Communications Group and for which the Company issued 8,500,000
       shares to CL Communications Group), the cash and share payments and
       exploration expenditures were to be made solely at the Company's
       discretion.

       If the Company chose not to make further payments, it would earn no
       interest in the properties. Management determined that, under the
       economic conditions prevailing at the time, development of the mineral
       properties was not economically feasible.  As a result, the Company chose
       not to make further payments and, therefore, earned no interest in the
       properties.  The Company has been advised by its counsel that the written
       agreement could be construed as an agreement of purchase and sale, in
       which case the Company could be held liable to make full payment and
       incur the required exploration and development expenditures as set out
       above.  Management of the Company is of the opinion that the likelihood
       of such an assertion being made and upheld is remote.  Management is,
       therefore, of the view that it has no further obligations relating to the
       option agreement and, accordingly, no liabilities are recorded in these
       financial statements relating to this matter.

<PAGE>
Page 43

                           ONLINE INNOVATION, INC.
                          (A Delaware Corporation)
                       (A Development Stage Company)
                       Notes to Financial Statements
                              June 30, 2001
                             (In U.S. Dollars)

Note 16    LEGAL MATTERS - Dismissal of Lawsuit Against Directors, Officers, and
           Third Parties

       On October 4, 2000, Mr. Darin Wong and 535424 B.C. Ltd. (a private
       company owned by Mr. Wong) (collectively, the "Plaintiffs") filed a
       statement of Claim in the British Columbia Supreme Court, claiming
       damages against Mr. Chad Lee, Director, President and CEO of Online
       Innovation, Inc. (the Company), Ms. Marlene C. Schluter, Director,
       Secretary and Treasurer of the Company, Ms. Sharmen Vigouret and Mr.
       Stanley Ross (collectively, the "Defendants").  535424 B.C. Ltd. was
       formerly retained by the Company to provide consulting services.  The
       Plaintiffs sued the Defendants for breach of contract, repudiation,
       breach of trust and/or conversion of shares.  The Plaintiffs did not name
       the Company as a Defendant in the action and no claims have been made
       against the Company for breach of any consulting agreement.

       On October 23, 2000, the Defendants filed a Statement of Defence in the
       British Columbia Supreme Court, denying all allegations made by the
       Plaintiffs in their Statement of Claim.

       On May 11, 2001, the Plaintiffs filed in the British Columbia Supreme
       Court, a Consent Dismissal Order.  The Court Order states that the
       Plaintiffs action be dismissed without costs to either party.  The Court
       Order further states that the dismissal of the Plaintiffs claim is of the
       same force and effect as a judgment of the Supreme Court rendered after a
       hearing on the merits.

       The Plaintiffs did not receive any payment or any other benefit from the
       Defendants.  Mutual Releases were executed by all parties.

NOTE 17    SUBSEQUENT EVENTS

       On July 9, 2001, the Company exercised it's right to terminate the
       agreement with Action Stocks Incorporated as outlined in Note 12(c) in
       accordance with the termination clause of the agreement. The company has
       issued 25,000 common shares under this agreement to Action Stocks
       Incorporated. The remaining 175,000 shares issued in Action Stocks' name
       are in the possession of Online Innovation, Inc. and will be cancelled
       and sent back to treasury.

<PAGE>
Page 44

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

The Company had no changes in or disagreements with accountants on accounting
and financial disclosure of the type referred to in Item 304 of Regulation S-K.


                                      PART III

ITEM 9:   DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

Directors and Executive Officers

     The following table sets forth, as of the date of this registration
statement, the name, age, and position of the officers and directors of the
Company and the date of appointment of such officer or director:


--------------------------------------------------------------------------------
       Name             Age              Position (1)
--------------------------------------------------------------------------------
Chad D. Lee (2)          33             Director, President and CEO
--------------------------------------------------------------------------------
Marlene Schluter (3)     38             Director, Secretary and Treasurer
--------------------------------------------------------------------------------
Harvey H. Cohen (4)      75             Director and Vice President
--------------------------------------------------------------------------------

(1)   Pursuant to the Company's Bylaws, all directors serve until such time as
      their successor has been elected, until they resign or until they are
      removed by majority vote at a meeting of the Company's shareholders.
      Officers are elected by the Company's directors and serve until such time
      as their successor is appointed, until they resign or until they are
      removed by the directors. None of the Company's directors and officers
      hold positions with other reporting companies.

(2)   Marlene Schluter was appointed as Secretary and Treasurer of the Company
      on October 27, 1997.

(3)   Chad Lee was appointed as President of the Company on April 15, 1998.
      Prior to being appointed as President, Mr. Lee acted as Vice-President of
      the Company from October 24, 1997 until he was appointed as President.

(4)   Harvey H. Cohen was appointed as Vice-President of the Company on April
      15, 1998.

Chad D. Lee

     Mr. Lee, the founder of what is now Online Innovation, Inc., is a graduate
of the University of British Columbia where he focused his studies on the field
of Urban Land Economics. He has used his skills in strategic management,
financial analysis and planning, contract negotiation, and business planning to
develop new companies and to assist established companies with operations. Mr.
Lee is also the Principal of CL Communications Group where he has developed and

<PAGE>
Page 45

implemented multi-media marketing strategies for several publicly traded
companies. Mr. Lee brings to the Company expertise in strategic management,
demonstrating strong leadership in visioning, corporate strategy development and
deployment with a clear focus on achieving results. Utilizing his expertise in
strategic visioning, he has diversified the company's focus to the
communications and hi-tech Internet sectors with the acquisition and further
development of the Company's technology assets.

     From March, 1991 to February, 1995 Mr. Lee was employed by Summit Motors, a
motor vehicle dealership located in Vancouver, British Columbia. Mr. Lee was
responsible for warranty claims, invoicing, sales, business development and
quality assurance. From February, 1995 to September, 1996, Mr. Lee was employed
by Ensign Pacific Lease Ltd., a motor vehicle leasing company also based in
Vancouver, British Columbia. He was responsible for invoicing, budgets, credit,
revenue forecasts, business development, customer satisfaction and quality
assurance. From October 1996 to the present, Mr. Lee has been the president and
director of C.L. Communications Group.  Mr. Lee has been a director of the
Company since October 1997 and has acted as its president since April, 1998.

Ms. Marlene C. Schluter

     Ms. Schluter is a graduate of Simon Fraser University with a Bachelor of
Education (B Ed.). She was employed by the public school system at the
elementary and secondary school levels, specializing in Business and Math. In
addition, she was also an active member in the school counseling programs. Ms.
Schluter has furthered her professional career by attending courses in the
Master of Business Administration Program at the University of British Columbia
concentrating in the areas of International Trade and Finance. With this
education, she went on to work in the Financial Industry with Yorkton Securities
where she completed the Canadian Securities Course (CSC) and Series 63 and 67
for qualification in the United States. Ms. Schluter acted as a Broker's
Assistant and as a Broker with Yorkton Securities Inc.  She was employed by
Yorkton Securities Inc. from April 1991 to December 1996. From February 1997 to
July 1997, Ms. Schluter acted as executive assistant and performed investor
relations services for CKD Ventures Ltd., a Vancouver, British Columbia based
mineral exploration company. She has acted as director, corporate secretary and
treasurer of the Company since October of 1997.

Harvey H. Cohen

     Mr. Cohen graduated from the University of British Columbia with a
Bachelor's degree in Physical Sciences / Mining Engineering.  He has been a
registered member of the Association of Professional Engineers and Geoscientists
of British Columbia since 1954 and is also a lifetime member of the Canadian
Institute of Mining, Metallurgy and Petroleum. During the course of his career
he has acted for numerous publicly traded companies in the mining sector.  Mr.
Cohen has been semi-retired for approximately ten years and was involved with
the Company at the outset to provide advice on matters related to its mineral
properties.

Significant Employees

     The Company has no employees. All services are performed by consultants.
Refer to the section headed "Employees and Consultants" under "Business of the
Company" above.

<PAGE>
Page 46

Family Relationships

     There are no family relationships among the Company's directors or
officers.

Involvement in Legal Proceedings

During the past five years, no director or officer of the Company has been:

   *  a general partner or executive officer of a business against which a
      bankruptcy petition was filed;
   *  convicted in a criminal proceeding or is currently subject to a pending
      criminal proceeding;
   *  subject to any order, judgement or decree of any court of competent
      jurisdiction permanently or temporarily enjoining, barring, suspending
      him/her from, or otherwise limiting his/her involvement in, any type of
      business, securities or banking activities; or
   *  found by a court of competent jurisdiction (in a civil action), the
      Securities and Exchange Commission or the Commodity Futures Trading
      Commission to have violated a federal or state securities or commodities
      law.

Compliance with Section 16(a) of the Exchange Act

Section 16(a) of the Exchange Act requires executive officers and directors of
the Company and persons who beneficially own more than ten percent of the
Company's Common Stock to file with the Securities and Exchange Commission
certain reports, and to furnish copies thereof to the Company, with respect to
each such person's beneficial ownership of the Company's equity securities.
Based solely upon a review of the copies of such reports furnished to the
Company and certain representations of such persons, all such persons have
complied with the applicable reporting requirements.

ITEM 10:   EXECUTIVE COMPENSATION

     The following table provides a summary of the compensation paid to the
Company's Chief Executive Officer for the year ended June 30, 2001. No officers
of the Company received in excess of $100,000 in annual salary and bonus. The
Company's Chief Executive Officer has received no compensation other than
salary.

                       Summary Compensation Table

--------------------------------------------------------------------------------
                                                                     Annual
      Name and Principal Position              Year Ended         Compensation
                                                                ----------------
                                                                     Salary
--------------------------------------------------------------------------------

Chad Lee , President & Director               June 30, 2001         $30,000 (1)
--------------------------------------------------------------------------------

(1)   The cash compensation shown was paid to Mr. Lee pursuant to management
      agreements between the Company and a company wholly owned by Mr. Lee.

     As of the date of this report, the Company has not paid any bonuses or
granted any stock awards, options or stock appreciation rights to any officer,

<PAGE>
Page 47

director or employee. The Company has no arrangements for the compensation of
directors and officers for their services as directors and officers.

     At its annual meeting of stockholders held on December 4, 2000, a 2000
Incentive Stock Option Plan (the "Plan") was approved by the Company's
stockholders. Pursuant to a directors' resolution dated October 20, 2000, the
Plan was adopted by the Company's directors subject only to receipt of
stockholder approval. The plan authorizes the granting of options to purchase
up to 1,500,000 of the Company's common shares. Pursuant to the Plan, options
may be granted to directors, officers, employees, consultants and other service
providers. The aggregate fair market value of options that may be held by any
one optionee at any given time may not exceed $100,000. The exercise price of
an option granted must be at least equal to the fair market value of a share of
common stock of the Company on the date the option is granted. No options have
yet been granted pursuant to the Plan, to directors or officers of the Company
or to any other entities.

ITEM 11:   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth certain information regarding the beneficial
ownership of the Company's issued and outstanding common stock as of September
20, 2001 by i) each person who is known to the Company to be the beneficial
owner of more than 5 percent of the Company's common stock; (ii) named directors
and executive officers; and (iii) all directors and executive officers of the
Company as a group:


--------------------------------------------------------------------------------
Name and address of beneficial owner   Amount and nature     Percent of class(1)
                                       of beneficial owner
--------------------------------------------------------------------------------

Chad D. Lee                                5,500,000 (2)            41.8%
(President, Chief Executive Officer
and Director)
61-12411 Jack Bell Drive
Richmond, British Columbia
Canada
--------------------------------------------------------------------------------
Marlene C. Schluter                        2,500,000 (2)            19.0%
(Secretary, Treasurer and Director)
2233 Lillooet Street
Vancouver, British Columbia
Canada
--------------------------------------------------------------------------------
Harvey H. Cohen                                    0 (2)             0.0%
(Vice President and Director)
8278 Tugboat Place
Vancouver, British Columbia
Canada
--------------------------------------------------------------------------------

Directors and Officers as a Group
(3 persons)                                8,000,000                60.8%
--------------------------------------------------------------------------------

<PAGE>
Page 48

(1)   Beneficial ownership is determined in accordance with the rules of the
      Securities and Exchange Commission and generally includes voting or
      investment power with respect to securities.

(2)   The persons named in the table have sole voting and investment power
      with respect to all shares of common stock shown as beneficially owned by
      them.


ITEM 12:   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Pursuant to a management agreement made effective as of November 1, 1997,
the Company pays $2,500 per month to MCS Management Ltd., a company wholly owned
by Ms. Marlene C. Schluter, director, secretary and treasurer of the Company,
for management services provided to the Company by MCS Management Ltd.

     Pursuant to a management agreement made effective as of July 1, 1999, the
Company pays $2,500 per month to Netgain Management Solutions Inc., a company
wholly owned by Mr. Chad D. Lee, president and director of the Company, for
management services provided to the Company by Netgain Management Solutions Inc.

     The Company has not been a party to any other transactions during the past
two years, and is not currently a party to any other transaction, in which any
directors, officers or holders of greater than five percent of the Company's
securities, or any immediate family members of any of the foregoing, have any
direct or indirect material interest.

ITEM 13:   EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits

Exhibit                                                             Sequential
Number         Description                                          Page Number
------         ------------                                         -----------

3(i)**      Certificate of Incorporation dated May 7, 1997;
            Certificate of Amendment dated October 16, 1997;
            and Certificate of Amendment dated April 8, 1999.
3(ii).1**   Bylaws of Micro Millennium, Inc.
3(ii).2**   Resolution of the board of directors approving amendment
            to the By-Laws of Micro Millenium, Inc.
10.1*       Common Stock Purchase Agreement between Fusion Capital
            Fund II, LLC and the Company dated June 25, 2001.

10.2        Consulting Agreement between Action Stocks, Inc. and the
            Company dated June 11, 2001.

10.3**      Consulting Agreement between National Financial
            Communications Corp. and the Company dated February 1,
            2000.

10.4**      Custom Affiliate Agreement between KnowledgeWeb, Inc.
            and the Company, dated November 8, 1999.

<PAGE>
Page 49

10.5**      Lease Agreement between 570679 B.C. Ltd. as Lessor and
            the Company as Lessee, dated November 1, 1999.

10.6**      Agreement between Netgain Management Solutions Inc. and
            the Company, dated November 1, 1999, for management and
            administrative services provided by Netgain Management
            Solutions Inc.

10.7**      Agreement between 535424 B.C. Ltd., the Company, dated
            April 1, 1999, for professional media buying/marketing
            services provided by 535424 B.C. Ltd.

10.8**      Agreement between Stratford Internet Technologies, Inc.
            and the Company dated July 30, 1999, for services related
            to the development, design and maintenance of the Company's
            internet based products and services.

10.9**      Purchase Agreement between Sinaloa Gold Corp. and Online
            Innovation, dated April 2, 1999.

10.10**     Option Agreement between Fordee Management Company and the
            Company, dated February 2, 1999.

10.11**     Agreement between MCS Management Ltd. and the Company, dated
            November 1, 1998, for management and administrative services
            provided by MCS Management Ltd.

10.12**     Agreement in Principle between Minera Fuerte Mayo and CL
            Communications Group, dated September 30, 1997.

10.13**     Assignment Agreement between Sinaloa Gold Corp. and CL
            Communications Group, dated September 30, 1997.

*    Incorporated by reference from the Company's Form 8-K filed on July 10,
     2001, as amended.

**   Incorporated by reference from the Registration Statement on Form 10SB of
     the Company filed with the Commission on February 1, 2000 as amended.

(b)   Reports on Form 8K

On June 25, 2001, the Company entered into a Common Stock Purchase Agreement
with Fusion Capital Fund II, LLC. Pursuant to the Stock Purchase Agreement,
subject to certain terms and conditions, Fusion agreed to purchase $6,000,000 of
the Company's common stock. A Form 8-K describing the Stock Purchase Agreement
was filed with the Securities and Exchange Commission by the Company on July 9,
2001. No other reports on Form 8-K were filed by the Company during the period
covered by this report.



<PAGE>
Page 50

SIGNATURES

     In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


Date:     September 27, 2001                 ONLINE INNOVATION, INC.
     ----------------------------
                                                   (Registrant)


                                          By: /s/ Chad D. Lee
                                             -----------------------------------
                                              Chad D. Lee, President


<PAGE>
Exhibit 10.2

                               Consulting Agreement

     THIS AGREEMENT is entered into and is effective as of June 11, 2001 BY AND
BETWEEN Online Innovation, Inc. with an office at 1118 Homer Street, Suite 218
British Columbia Vancouver, V6B 6L5, Canada (the "Company") AND Action Stocks,
Inc., with principal offices at 990 Highland Drive, Suite 106, Solana Beach, CA
92075 (the "Consultant").

                                    WHEREAS:

         A.   Company wishes to promote itself on Promoter's Website in order to
gain as much exposure as possible.

         B.   Consultant operates a website that individuals can access to learn
more about companies they may not otherwise be exposed to.

         C.   Consultant operates a database of potential investors who will be
contacted routinely via email.

    NOW THEREFORE, in consideration of the premises, the mutual covenants herein
contained, and other good and valuable consideration, the receipt and adequacy
of which is hereby acknowledged, the parties agree as follows:

1.00   Services

       1.01   Website Marketing. Consultant shall place a short profile of
       Company that will include recent press releases and a link to Company's
       website that will include the proper disclosures and disclaimers.

       1.02   Email Services. Consultant shall deliver a minimum of 100,000
       emails, with the proper disclosures and disclaimers, promoting the
       Company to industry specific investors per month on behalf of the
       Company.

       1.03   Direct Client Promotion. Consultant shall contact and promote to
       its own clients with the proper disclosures and disclaimers.

       1.04   Investor Relations. Should someone express an interest to invest
       in the Company, Consultant shall forward the Company's brochures and
       other literature given to Consultant from the Company. Consultant must
       again make the proper disclosures and disclaimers.

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       1.05   Affiliate Promotions. Consultant shall contact its affiliates and
       expose the Company to others at no additional costs, who may benefit the
       Company by offering its services or purchasing the Company's stock.

       1.06   Research Report. Consultant shall create a research report on the
       Company and disseminate to 1,000 NASD Broker / Dealer firms within the
       first 30 days of this Agreement.

       1.07   Radio Show. Company will be profiled on Consultant's nationwide
       radio show.  A representative of the Company will be interviewed on a
       rotating basis with Consultant's client companies.


2.00   Terms & Fees

       2.01   Term. Six (6) months.

       2.02   Fees. (6) 200,000 common shares, restricted under Rule 144 of the
       Company upon execution of this Agreement.

       2.03   Payment Schedule. The fees payable pursuant to section 2.02 shall
       follow the following payment schedule :

              1st Month: 25,000 common shares, restricted under Rule 144 (upon
              contract execution)
              2nd Month: 25,000 common shares, restricted under Rule 144
              3rd Month: 25,000 common shares, restricted under Rule 144
              4th Month: 25,000 common shares, restricted under Rule 144
              5th Month: 50,000 common shares, restricted under Rule 144
              6th Month: 50,000 common shares, restricted under Rule 144

       2.04   No Registration Rights. Both parties hereto agree and understand
       that the underlying shares contained in this Agreement have not and will
       not be registered under any effective Registration Statement under the
       Securities Act of 1933, as amended or the Securities Laws of any state of
       the United States. Furthermore, each share certificate issued under this
       Agreement shall bear an appropriate restrictive legend.


3.00   Termination

     Either party may terminate this agreement for any reason after giving
notice pursuant to section 4.00. Once notice is given, this Agreement will be
considered terminated at the end of 30 days.

<PAGE>

4.00   Notice

     All notices must be in writing and sent via facsimile or Registered mail to
the following addresses:

       Company    Online Innovation, Inc.
                  1118 Homer Street, Suite 218
                  British Columbia Vancouver,
                  V6B 6L5, Canada
                  Fax No.: 604-669-7507


       Consultant   Action Stocks, Inc.
                  990 Highland Drive, Suite 106
                  Solana Beach, CA 92075
                  Fax No.:_____________


5.00   Miscellaneous

       5.01   Further Assurance. Each of the parties shall hereafter execute all
       documents and do all acts reasonably necessary to effect the provisions
       of this Agreement.

       5.02   Successors. The provisions of this Agreement shall be deemed to
       obligate, extend to and inure to the benefit of the successors, assigns,
       transferees, grantees, and indemnities of each of the parties to this
       Agreement.

       5.03   Independent Counsel. Each of the parties to this Agreement
       acknowledges and agrees that it has been represented by independent
       counsel of its own choice throughout all negotiations which preceded the
       execution of this Agreement and the transactions referred to in this
       Agreement, and each has executed this Agreement with the consent and upon
       the advice of said independent counsel. Each party represents that he or
       it fully understands the provisions of this Agreement, has consulted with
       counsel concerning its terms and executes this Agreement of its own free
       choice without reference to any representations, promises or expectations
       not set forth herein.

       5.04   Integration. This Agreement, after full execution, acknowledgment
       and delivery, memorializes and constitutes the entire agreement and
       understanding between the parties and supersedes and replaces all prior
       negotiations and agreements of the parties, whether written or unwritten.

<PAGE>

       5.05   Attorneys Fees. In the event of a dispute between the parties
       concerning the enforcement or interpretation of this Agreement, the
       prevailing party in such dispute, whether by legal proceedings or
       otherwise, shall be reimbursed immediately for the reasonably incurred
       attorneys' fees and other costs and expenses by the other parties to the
       dispute.

       5.06   Context. Wherever the context so requires: the singular number
       shall include the plural; the plural shall include the singular.

       5.07   Captions. The captions by which the sections and subsections of
       this Agreement are identified are for convenience only, and shall have no
       effect whatsoever upon its interpretation.

       5.08   Severance. If any provision of this Agreement is held to be
       illegal or invalid by a court of competent jurisdiction, such provision
       shall be deemed to be severed and deleted; and neither such provision,
       nor its severance and deletion, shall affect the validity of the
       remaining provisions.

       5.09   Counterparts. This Agreement may be executed in any number of
       counterparts.

       5.10  Expenses Associated With This Agreement. Each of the parties hereto
       agrees to bear its own costs, attorney's fees and related expenses
       associated to fulfill it's obligations under the terms of this Agreement.

       5.11  Arbitration. Any dispute or claim arising to or in any way related
       to this Agreement shall be settled by arbitration in San Diego,
       California. All arbitration shall be conducted in accordance with the
       rules and regulations of the American Arbitration Association ("AAA").
       AAA shall designate a panel of three arbitrators from an approved list of
       arbitrators following both parties' review and deletion of those
       arbitrators on the approved list having a conflict of interest with
       either party. Each party shall pay its own expenses associated with such
       arbitration (except as set forth in Section 5.05 Above). A demand for
       arbitration shall be made within a reasonable time after the claim,
       dispute or other matter has arisen and in no event shall such demand be
       made after the date when institution of legal or equitable proceedings
       based on such claim, dispute or other matter in question would be barred
       by the applicable statutes of limitations. The decision of the
       arbitrators shall be rendered within Sixty (60) days of submission of any
       claim or dispute, shall be in writing and mailed to all the parties
       included in the arbitration. The decision of the arbitrator shall be
       binding upon the parties and judgement in accordance with that decision
       may be entered in any court having jurisdiction thereof.

<PAGE>

       5.12  Assignment. Either party shall have no right to assign this
       Agreement or any obligations created hereby unless both parties expressly
       approve the assignment in writing.

       5.13  Authority to Bind. A responsible officer of the Company has read
       and understands the contents of this Agreement and is empowered and duly
       authorized on behalf of the Company to execute it.

       5.14  Non-Circumvention.  Either party shall not pursue any financial
       relationship for it's own direct benefit or indirectly for the benefit of
       related parties with any entity introduced by Consultant or the Company
       from the date of initial contact of the parties and lasting for a period
       of two (2) years after the termination of this Agreement without the
       written consent of the introducing party.


     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
set forth above.

FOR THE COMPANY:

By:_  /s/ Chad Lee               (Chad Lee President/CEO)
   ------------------------------




FOR ACTION STOCKS, INC.:

By:__/s/ Brent Fouch             (Brent Fouch, President)
   ------------------------------

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