SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

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

                   For the fiscal year ended December 31, 2001

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

                        Commission file number: 333-87293



                              SENSE HOLDINGS, INC.
                          -----------------------------
                 (Name of Small Business Issuer in Its Charter)

           FLORIDA                                         82-0326560
           -------                                         ----------
(State or Other Jurisdiction of                          (I.R.S. Employer
 Incorporation or Organization)                         Identification No.)

             4503 NW 103rd Avenue, Suite 200, SUNRISE, FLORIDA 33351
             -------------------------------------------------------
               (Address of Principal Executive Offices)(Zip Code)

                                 (954) 726-1422
                                 --------------
                (Issuer's Telephone Number, Including Area Code)



Securities registered under Section 12(b)of the Securities Exchange Act of 1934:

        None

Securities registered under Section 12(g)of the Securities Exchange Act of 1934:

        None

Check whether the registrant: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 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 disclosure  of delinquent  filers in response to Item 405 of Regulation
S-B is not contained in this form, and no disclosure  will be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference  in Part III of this Form 10-KSB or any  amendment to
this Form 10-KSB. [X]

State registrant's revenues for the year ended December 31, 2001: $69,569.

State the aggregate market value of the voting stock held by non-affiliates of
the registrant computed by reference to the closing bid price of its Common
Stock as reported by the OTC Bulletin Board on March 26, 2001 ($.96):
$14,922,486.

The number of shares outstanding of the registrant's Common Stock, par value
$.10 per share (the Common Stock), as of March 26, 2002, was 15,544,257.

Transitional Small Business Disclosure Format (check one) Yes   No X

Documents Incorporated By Reference:        None.
<PAGE>
                                     PART 1

This Annual Report Form 10-KSB contains  forward-looking  statements  within the
meaning of Section 27A of the  Securities  Act of 1933, as amended,  and Section
21E of the Securities  Exchange Act of 1934, as amended.  All statements,  other
than  statements of historical  facts,  included in or incorporated by reference
into this Form 10-KSB, are forward-looking statements. In addition, when used in
this  document  the words  anticipate,  estimate,  intends,  project and similar
expressions  are  intended  to  identify   forward-looking   statements.   These
forward-looking  statements  are  subject to certain  risks,  uncertainties  and
assumptions.  Should one or more of these risks or uncertainties materialize, or
should  underlying   assumptions  prove  incorrect,   actual  results  may  vary
materially from those anticipated,  estimated or projected. Although the Company
believes that the  expectations we include in such forward-  looking  statements
are reasonable,  we cannot assure you that these  expectations  will prove to be
correct.

ITEM 1. DESCRIPTION OF BUSINESS

     Sense Holdings,  Inc. ("Sense Holdings",  "Sense", "we", "us", "our"), is a
Florida corporation. We design, develop,  manufacture and sell products that use
biometric technology to verify a person's identity.  Unique physical traits such
as  fingerprints,  retina  lines,  voice  waves  and palm  prints  are  known as
biometric  traits,  and  their  use to verify a  person's  identity  is known as
biometric  identification.  In addition,  Sense  Holdings,  Inc., has integrated
smartcard technology into its biometric applications. Applications, such as time
and attendance and access control are written around the biometric and smartcard
technology.

     Our  time  and  attendance  systems,  which  are  marketed  under  the name
CheckPrint(R)  T/A, are human resource systems that permit an employees time and
attendance at work to be tracked using our fingerprint  identification  hardware
and software  suite.  The  technology  operates as a stand alone unit or a fully
networkable unit that generates reports and can  automatically  port all payroll
information to a payroll service.

     Our access control systems, which are marketed under the name CheckPrint(R)
A/C, are security  systems that permit  access to locked  buildings,  offices or
other secured areas only to those whose  identities  can be verified,  using our
fingerprint  identification software. Our modest  revenue-generation to date is,
in  substantial  part,  a result of a lack of  capital  necessary  to  acquire a
product  inventory and commence  aggressive  marketing  programs.  While we have
funded our growth to date through the sale of our debt and equity securities, we
require operating revenues or alternative  financing in order to fully implement
our business plan and achieve profitability.

     Sense  Holdings,   Inc.,  is  also  a  research  and  development   company
specializing  in biometric  security  and  explosive  detection.  We continue to
develop our  biometric  line of  products to meet the needs of today's  security
market. Our subsidiary, Micro Sensor Technologies,  Inc., is exclusively engaged
in the acquisition and development of explosive detection technology.

     Our fiscal year end is December  31. Our  executive  offices are located at
4503 NW 103rd Avenue, Sunrise,  Florida 33351, and our telephone number is:(954)
726-1422.

<PAGE>

Industry

     The use of unique physical traits to verify a person's  identity,  is known
as biometric  identification.  Biometric identification includes fingerprinting,
hand  geometry,  iris  scanning,  signature  verification  and  voice  analysis.
Biometric technology has been used for decades in government and law enforcement
applications.   But,  until  recently,  these  systems  were  too  expensive  to
manufacture to make retail  marketing  realistic.  With the introduction of more
powerful  computers and the development of more advanced software  applications,
biometric identification techniques can be adapted for commercial purposes on an
economically feasible basis. In addition,  there is currently a higher awareness
of biometrics as it relates to security applications.

     There are many alternatives in the biometric industry that include, but are
not limited to, fingerprint recognition,  facial recognition,  voice recognition
and palm  recognition.  Many  providers  have  used  the  different  methods  in
different  applications.  To date,  applications  include  time and  attendance,
access  control,  crowd  scanning  and computer  access.  The industry is in its
infancy  regarding  applications  however  the  technology  regarding  biometric
detection is a rapidly  maturing  science.  Presently,  there are many companies
entering the  biometric  detection  and  application  industry  while many other
companies  have failed at trying to create a marketable  product.  There are few
companies  that have been in the industry for multiple years and continue to use
their experience to market biometric detection devices and applications.

     We  believe  that  fingerprint  identification  is far  more  effective  in
authenticating  employees' actual attendance at work than traditional time clock
verification.  By authenticating a person's identity,  biometric  identification
can  substantially  reduce  incidents of employee  fraud  inherent in the use of
other forms of employee  identification  and  attendance  verification,  such as
punch clocks.  We also believe that fingerprint  verification is less intrusive,
more widely  accepted  and more cost  effective  than other  available  forms of
biometric  identification.  Also,  the use of biometrics  for access  control is
becoming widely accepted in the marketplace.  This is especially true for access
to sensitive workspaces like an airport tarmac.

     Many factors,  including recent world events, have created increased demand
for new biometric applications to secure access, not only to physical areas, but
also sensitive data. Among the applications that are being developed are the use
of biometrics to validate the identities of individuals at security  checkpoints
before boarding a plane,  entering a building,  crossing a boarder,  accessing a
computer and many other applications.

Products and Systems

BIOCLOCK(TM)

     Our  biometric  systems  are  designed  and built  around  our  proprietary
hardware platform known as BioClock(TM),  a stand-alone  platform, or completely
networkable  system,  that replaces a traditional  wall mounted or free-standing
swipe or punch  card  time  clock.  Identity  verification  is  accomplished  by
comparing an individual's  scanned and digitized  fingerprint to the fingerprint
profile  stored in a computer  database.  The user's  fingerprint  is scanned by
means of a silicon-based reader with sensors that capture the fingerprint image.
The image is then  converted  into data that is stored in the system's  computer
database, and saved as a reference for comparison to the fingerprint offered for
identification.

     BioClock(TM)  replaces  traditional  identification  devices such as: swipe
cards; punch cards; PIN numbers; or, passwords that can be stolen or voluntarily
provided by the owner to another person. Alternatively, BioClock(TM) can be used
in conjunction with traditional  identification  devices for added security.  We
have  made  our  systems  modular  so the  user can  choose  which  parts of the
technology  they wish to use. In  addition,  we have  designed our systems to be
compatible  with many existing  technologies so that they can be integrated into
an existing system.  As a result, we believe  BioClock(TM)  reduces incidents of
fraud associated with traditional identification systems that do not effectively
preclude  individuals from using another person's means of identification  while
keeping integration hurdles and costs down.

     We have also  developed two integrated  hardware and software  applications
that incorporate BioClock(TM) in turn-key total solution systems.


<PAGE>

CHECKPRINT(R) T/A

     Our  time  and  attendance  systems,  which  are  marketed  under  the name
CheckPrint(R) T/A:

o use fingerprint verification to authenticate the identity of employees when
  they arrive at and leave work;

o gather data, including the time each employee attends work and what areas
  where accessed by an employee;

o perform payroll functions and other record keeping calculations using the data
  that is gathered;

o provide electronic export capability to over 150 third-party payroll services
  to facilitate the use of automated payroll checks;

o generate logs and reports, including over 20 standard reports; and

o perform other functions including employee scheduling, job cost analysis, edit
  time punches, electronic calculations and related record keeping.

     Our standard  CheckPrint(R)  T/A system includes a 100 person user base. We
are currently developing data base management capabilities for larger numbers of
employee,  while maintaining system accuracy. These developments include the use
of a PIN number in conjunction  with  biometrics,  that make the number of users
only  limited by the data  storage  capacity  of the  system ,  without  adverse
effects on accuracy.

CHECKPRINT(R) A/C

Our access control systems, which are marketed under the name CheckPrint(R) A/C,
are security  systems that permit access to locked  buildings,  offices or other
secured  areas  only to  those  whose  identities  can be  verified,  using  our
proprietary fingerprint  identification software. Our CheckPrint(R) A/C systems,
which can be used with or without  smartcard  technology,  can be programmed for
different levels of security,  permitting access only to recognized  individuals
who have the  requisite  level of security  clearance.  Our  current  version of
CheckPrint(R) A/C system  incorporates access control capability for single door
access. We are developing software application infrastructure that will enable a
single  CheckPrint(R)  A/C system to control  access to multiple  locations.  We
market  CheckPrint(R) A/C at a higher price than  CheckPrint(R)  T/A, to reflect
the increased level of technology and  functionality  provided by  CheckPrint(R)
A/C .


<PAGE>

We have also developed and are marketing:

o CheckPrint(R) SDK, a software development kit for biometrics that enables
purchasers and licensees to create custom applications for our software and
hardware. The SDK was developed to work in conjunction with Sense Holdings,
Inc.'s hardware and aids developers in the creation of robust biometric
fingerprint applications. The SDK is separated into 3 categories - imaging,
algorithm, and database. Once an application is developed and successfully
deployed by a purchaser or licensee the end result will be increased sales of
Sense Holdings, Inc.'s hardware.

o CheckPrint(R) DTU, provides users with the ability to secure a computer
terminal, and files and folders via, fingerprint identification. The hardware is
a stand-alone peripheral that can be connected to a port on an existing computer
to permit fingerprint identification.

o CheckPrint(R) SDTU, provides users the ability to secure a computer terminal
with fingerprint biometric and a smart card. The hardware is a stand-alone
peripheral that can be connected to a port on an existing computer to permit
fingerprint identification. There are many applications that can be written
around the secure data storage capability of a smart card that is unlocked by a
fingerprint biometric signature. For example, in a university setting
information such as meal plan credits can be stored on the smart card and
deducted as used by the biometrically identified user.

Product Development, Manufacturing and Assembly

CheckPrint(R)  T/A is  configured as a standalone  unit  comprised of a TFT Flat
Panel  display,  internal  computer,  keypad,  and silicon  fingerprint  reader.
CheckPrint(R) T/A automatically  authenticates  the employee's  identity,  track
totals hours, and calculates the correct pay rates.  Sense offers  CheckPrint(R)
T/A models to support any size employee base.

We  design,  develop,  manufacture,  and sell  the  CheckPrint(R)  T/A  security
solution.  Sense has developed Time and Attendance,  Access Control and security
system  software  applications,  as well as a complete  hardware system solution
based on a  Pentium  PC  processor  backbone.  Our  products  work in a  network
environment and we can connect to any existing network infrastructure,  or Sense
can set the network up. Data is transmitted  through TCP/IP  protocol and we can
link unlimited  CheckPrint(R) T/A units together in any environment or facility.
Sense also can remotely  communicate with other  CheckPrint(R) T/A units using a
modem and transmitting over the standard  telephone lines. The CheckPrint(R) T/A
system is an unsupervised  security and clock-in station  replacing the standard
wall mounted time clock or swipe system. An employee or another  authorized user
uses his or her fingerprint to replace a password, PIN or swipe card.

CheckPrint(R)  T/A  system  and  CheckPrint(R)  A/C  system  are driven  by  our
proprietary software.

The  software  components  for our  biometric  identification  systems have been
developed,  in most part, by our employees.  The source code for the software is
our proprietary  property.  This software enables our systems to gather,  filter
and sort data,  generate  reports from the data and compute payroll  information
for export to third party payroll services.

Most of the hardware components for our biometric systems are off-the shelf, and
we are not dependent on any one vendor for these  components.  However,  certain
hardware  components  have been  designed by our in-house  engineering  staff or
designed to our specifications as works for hire by independent contractors.

We have  entered into an agreement  with Test Systems  Engineering,  under which
Test Systems  Engineering  has designed,  engineered  and configure  some of our
hardware  components for CheckPrint(R)  T/A and CheckPrint(R) A/C systems.  They
are a valuable  outsource for many engineering tasks and have a state of the art
design and manufacturing facility. All product testing and assembly is performed
by ourselves  in order to maintain  quality  control.  Our  agreement  with Test
Systems  Engineering  terminates on December 31, 2005, and may be  automatically
renewed  for  consecutive  one-year  terms.  For  its  services,   Test  Systems
Engineering  receives  a fee  payable  at the rate of $75 per  hour.  We are not
dependent on Test Systems Engineering for its services.


<PAGE>

Our biometric systems currently incorporate a silicon-based  fingerprint scanner
with sensors to capture a user's fingerprint. Related software then compares the
user's  fingerprint  to the  digitized  reference  sample stored in the system's
database, and verifies the user's identity. The silicon-based technology is used
in conjunction with our own software that interfaces between the silicon product
and our biometric systems.  We currently  purchase the silicon-based  technology
from an independent  supplier.  We believe that this supplier is able to provide
us with our foreseeable requirements for these components.  We are not dependent
on the supplier for our sensor needs.

We have entered into an  agreement  with  Integrated  Design,  Inc.  under which
Integrated  Design  developed  a software  program to enable  the  payroll  data
produced by  CheckPrint(R)  T/A to be  exported to over 150 third party  payroll
services such as ADP and Paychex.  We have licensed the software from Integrated
Design and are  required  to pay license  fees on a per user basis.  This fee is
incorporated into the cost of our overall product.  Integrated Design was paid a
$10,000 software development fee to customize their software to our application.
The software  development  agreement is for a term of five years, with five year
renewal  terms,  but may be canceled by either party on 90 days written  notice.
The agreement  also provides us access to the software and allows us to continue
to use Integrated Design's software in the event of such company's  dissolution,
bankruptcy  or  similar  events.   If  our  agreement  with  Integrated   Design
terminates, we will incur time and expense to develop alternative software links
for data export.  Delays in the successful  development of alternative  software
links could adversely affect us.

Acquisition of Micro Sensor Technologies, Inc.

On May 31,  2001,  we acquired  all of the  outstanding  shares of Micro  Sensor
Technologies,  Inc. , a Florida corporation.  The shares were acquired from UTEK
Corporation a Delaware corporation and UT-Battelle LLC, a Tennessee corporation,
the  shareholders  of Micro Sensor,  in a  stock-for-stock  exchange,  for total
consideration   of  2,000,000   shares  of  our  common  stock.   Following  the
acquisition,  Micro Sensor became our wholly-owned subsidiary, and we indirectly
acquired the rights and obligations of Micro Sensor under various  agreements to
which it is a party,  including a Patent License Agreement with UT-Battelle LLC,
a Consulting  Agreement with Dr. Thomas Thundat and a Work for Others  Agreement
with UT-Battelle LLC.

Under the Patent License  Agreement,  Micro Sensor became the exclusive licensee
of UT-Battelle with respect to certain patented  technology owned by UT-Battelle
relating to the use, sale or offer for sale of  technology  which assists in the
detection of unexploded ordnance including bombs, grenades, shells, rockets, and
other explosive devices either placed as mines or fallen as projectiles  whether
buried  or  camouflaged.  The  exclusive  license  does  not  include  explosive
detection for security applications,  including airport security. However, Micro
Sensor  has been  granted a  non-exclusive  license  to use the  technology  for
security-related applications.  UT-Battelle acquired the licensed rights under a
contract  with the United  States  Department  of Energy,  pursuant to which the
technology  was  developed at the Oak Ridge  National  Laboratory  in Oak Ridge,
Tennessee.

Under the License  Agreement,  Micro Sensor is obligated to pay  UT-Battelle  an
amount  equal  to 2.5% of net  sales  of  products  incorporating  the  licensed
technology,  subject to minimum annual royalties  ranging from $5,000 during the
first year of the license  term to $25,000 for the seventh  year of the term and
thereafter.  If the technology is  sublicensed  to third  parties,  a sublicense
royalty fee equal to 50% of the  sublicenses  received  by Micro  Sensor must be
paid to UT-Battelle.  The term of the license agreement expires upon termination
of the  last-to-expire  of the  proprietary  rights granted under the agreement,
subject  to  earlier  termination  in the  event  of an  uncured  breach  of the
agreement  by  either  party.  No  products  have  yet been  developed  from the
technology,  and we do not know if the acquired  technology can be  successfully
incorporated  into  commercially  feasible products or whether any such products
can be successfully marketed.

Under a  Consulting  Agreement,  Dr.  Thomas G.  Thundat  has  agreed to review,
evaluate and make  recommendations  to Micro Sensor regarding the application of
manufacturing and testing of the explosive detection  technology,  and will also
provide   recommendations   to  Micro  Sensor   regarding  the  application  and
integration of the new technology to products, and recommendations regarding the
need for future research and development. Dr. Thundat was integrally involved in
the development of the technology at the Oak Ridge National Laboratory.  The one
consulting  agreement  commenced on June 1, 2001. The agreement requires Thundat
to provide  100 hours of  consulting  time to Micro  Sensor at a rate of $200 an
hour totaling $20,000,  which amount was paid by Micro Sensor at the time of our
acquisition.


<PAGE>

Micro Sensor has also entered into a Work for Others Agreement with UT-Battelle,
LLC. The  objective  of this  agreement  is to  demonstrate  the efficacy of the
technology being licensed for the purpose of detecting  explosive  devices.  The
duration of the Work for Others  Agreement  is 12 months.  UT-Battelle,  LLC has
estimated  that the cost for the work to be performed  under this agreement will
be $100,000, and this amount was paid from Micro Sensor funds at the time of our
acquisition.

Oak Ridge National  Laboratory  continues to work toward a  commercially  viable
Micro  Sensor  to be  incorporated  into our  product  line of  sensors.  We are
engineering systems and hardware to incorporate the sensor, as envisioned,  into
handheld explosive detection devices.

Research and Development

>From the  inception of our current  activities  in July 1998  through  December
2001,  we  have  spent  approximately   $600,000  on  research  and  development
activities.

Sales and Marketing

Many of our goods and services are based on custom  orders that require  pricing
on a case by case  basis.  However,  to the  extent  individual  pricing  is not
necessary,   we market  CheckPrint(R)  T/A systems for base prices  ranging from
$4,995 to $7,995,  depending on the number of  employees  who will be tracked on
the system.  We also offer software  updates and on-site  service  contracts for
additional  fees.  We also sell  other  goods and  services,  such as a desk top
finger sensor,  a desk top finger sensor with a smart card reader built into the
desk top unit,  software  developer's  kits and database  management  tools,  at
suggested retail prices.

Initially,  we intend to market CheckPrint(R) T/A to manufacturers and retailers
with at  least  15  employees.  We plan to  sell  CheckPrint(R)  T/A and  future
products  through an in-house sales force as well as OEMs and independent  sales
representatives.  We will  engage  in  direct  marketing  programs,  trade  show
participation,  and  local,  regional  and  national  advertising  campaigns  to
generate  sales.  Moreover,  we have offered  consulting and design  services to
specialized  biometric  deployment  projects.  By offering our  expertise in the
design and  deployment  of  biometric  systems we gain  additional  revenues and
create another marketing avenue.

Our independent  Sales  Representatives  currently serve markets  throughout the
United States and South America.  We intend to engage sales  representatives  to
cover additional  territories over the next 12 months.  Initially,  we intend to
seek penetration of the retail  merchandise,  home and business  security,  food
processing   facilities,   textile  manufacturing  and  trucking  and  transport
distribution  markets  through  the  services  of these  representatives.  Sales
representatives  are generally  compensated by a commission based upon the sales
prices of systems sold by them.

We intend to license  our time and  attendance  software  to  third-party  OEMs,
integrators  and  software  developers,  for  incorporation  in their  products.
License fees and royalty fees will be  negotiated  on a case by case basis,  and
take into  consideration  various factors  including  competitive  pricing,  the
nature of the installation, the number of users to be tracked, and the extent of
enhancements,  modifications and customization required by the customer.  Basic,
extended and enhanced  maintenance  services will also be made  available for an
annual fee.

Intellectual Property

Patents.  We currently  have on file with the United States Patent and Trademark
Office,  a utility patent that was converted from a provisional  patent covering
the proprietary  use of our technology and the proprietary  hardware used in our
application.  The goods  and  services  are  clearly  marked as patent  pending.
Several other products and methods are being identified as potential  patentable
subject  matter and once the analysis is complete  applications  will be sought.
All of the engineers  and programs are working  diligently  toward  hardware and
software  solutions  and  it is  believed  that  many  of the  solutions  may be
patentable.  Sense  Holdings,  Inc.,  has retained  patent counsel to review the
projects  and  advise  where  patentable  subject  matter  exists and to prepare
applications  for the same.  All of our  employees  are under an  obligation  to
assign inventive material to Sense Holdings, Inc. There is no guarantee that our
patent application will mature into a registration for patent.


<PAGE>

Trademarks. We enjoy several common law rights to our trademarks. The common law
rights  protect the use of marks used to identify our goods and  services  since
the time of their first use in commerce. In addition, we have filed applications
with the United States Patent and Trademark  Office seeking  registration of our
logo and the mark BioClock(TM).  We have a registration for the flagship product
Checkprint(R).  Several other marks are being  identified as strong  product and
service identifiers and trademark search and applications are underway. There is
no guarantee that our trademark  applications  will mature into  registration of
trademarks.

Copyrights.  We enjoy several common law rights to our  proprietary  copyrights.
The common law rights protect the actual  programming code, the look and feel of
its display screens and material contained in our user manuals since the time of
the copyrightable  works creation.  In addition,  we have an application on file
with the United States  Copyright  Office covering our proprietary  source code,
the look and feel of our display screens and user manuals. There is no guarantee
that our application will mature into a registration for copyright.

Whether or not we obtain formal  protection for our products and/or systems,  we
intend to vigorously  protect our ownership rights.  However,  protection of our
rights will not prevent others from developing  similar  technology on their own
or developing  other products that may be used for purposes  similar to ours. If
these  events  occur,  others  may become our  competitors,  which  could have a
material  adverse  effect on our  business,  financial  condition and results of
operations.

Competition

We face competition from companies engaged in the time and attendance  industry,
as well as in the security and access  control  industry.  Competition  may come
from companies using biometric fingerprint technology, as well as from companies
using other biometric identification methods. Competitors also include companies
marketing  traditional forms of employee  verification and attendance  products,
including  time  clocks,  ID  badges,  passwords  and PIN  numbers.  Some of our
competitors may have longer operating  histories and greater financial and other
resources than we have. Our ability to compete  successfully will depend on many
factors,  including our ability to adapt to changing  technologies  and meet the
needs of the marketplace on a price competitive and timely basis.

Competition  in time  and  attendance  services  exists  from  various  software
developers  and  product  manufacturers,  the  largest  of  which is  Kronos,  a
publicly-traded company (NASDAQ National Market System: KRON) providing software
applications  based on a swipe card  identifier.  Other  competitors in time and
attendance application development include Simplex,  Smartime Software, Time and
Tech.com and Unitime Systems.  Principal  competition in fingerprint  biometrics
include Identix,  Secugen and Veridicom.  Other biometric  technology  providers
include  Recognition Systems (hand geometry),  Iridian(iris  identification) and
Visionics  (facial  recognition).  Many of our competitors  have a substantially
longer operating history than we do and have substantially greater financial and
other  resources  than we do. While we believe that our ability to offer a total
package  of time and  attendance  and access  control  software  and  innovative
hardware  gives us a  competitive  marketing  advantage,  unless  we are able to
penetrate  the  marketplace  and gain  name  recognition  for our  products  and
technology, we may be unable to compete effectively.

We believe that we can effectively compete in our industry because:

o biometric identification is more reliable than traditional employment
  verification methods;

o fingerprint identification is less costly and more recognized than other
  currently available forms of biometric identification;

o our systems provide a total solution, turnkey approach to our customers; and

o our systems are networkable and can be remotely accessed by a system
  administrator to get valuable real time information regarding the customer's
  work force and security at the workplace;

o our systems offer an enterprise solution in that the systems are complete
  scalable for large numbers of employees and multiple access points and
  numerous locations;

o our systems are modular and offer a variety of identification methods that can
  be added to the basic system;

o our systems are software driven and the software is customable to a customer's
  particular needs; and,

o biometric identification does not use ID badges, passwords, PIN numbers or
  other devices that have historically been misused by employees to the
  detriment of employers.


<PAGE>

We have not deployed  technology in the explosive detection arena as the product
is still under development.

Our inability to compete  successfully  could have a material  adverse effect on
our business, financial condition and results of operations.

Employees

We currently employ twelve people, all of whom are full-time  employees,  in the
following  capacities:  three executive officers,  one corporate counsel, one in
house sales, five programmers,  one research and development  engineer,  and one
warehouse  and  assemble  employee.  Our  employees  are  not  represented  by a
collective  bargaining  unit. We believe that  relations  with our employees are
good.

Corporate History

We were  organized  in Idaho,  under the name Century  Silver  Mines,  Inc.,  on
February 5, 1968. Originally, we developed mining properties, but by 1998 we had
ceased those operations.

Sense Technologies, Inc. was organized under the laws of the State of Florida on
July 13,  1998.  Sense  Technologies  was formed for the  purpose of engaging in
developing and marketing  biometric  devices for use in employee  identification
and security-related products.

In January 1999, we acquired all of the outstanding shares of Sense Technologies
for a purchase price consisting of 4,026,700 of our shares, issued to the former
shareholders of Sense Technologies. We operated Sense Technologies,  Inc. as our
wholly-owned  subsidiary.  At the time of the acquisition,  Century Silver Mines
had  no  operations  and  Sense  Technologies  was  developing  its  proprietary
biometric security systems.  Immediately  following the acquisition,  the former
shareholders of Sense  Technologies  owned  approximately 93% of our outstanding
shares.

At the time of the acquisition,  the principal owners of Sense Technologies were
Dore Scott Perler and Andrew  Goldrich.  Dore Perler was its  president,  Andrew
Goldrich was its secretary and treasurer,  and Messrs.  Perler and Goldrich were
the  members  of its board of  directors.  At the time of the  acquisition,  the
officers and directors of Century  Silver Mines were John Branz,  Kirk Scott and
Barbara Scott, the mother of Kirk Scott.  There were 288,300  outstanding shares
of Century Silver Mines owned by approximately 750 holders, none of whom, to our
knowledge,  owned  in  excess  of 5% of  the  outstanding  shares.  However,  we
understand that Kirk Scott,  Barbara Scott and James Scott, her  brother-in-law,
owned an aggregate of  approximately  29% of the  outstanding  shares of Century
Silver Mines at the time of the acquisition.

In January  1999,  we reduced the shares of our stock that were  outstanding  by
combining each 7.74 shares that were outstanding, into one share. All numbers of
shares in this report reflect the January 1999 share combination.  In June 1999,
we changed our corporate  domicile from Idaho to Florida and, in connection with
the domicile change, we changed our name to Sense Holdings, Inc. In May 2000, we
increased  the number of shares of common  stock we are  authorized  to issue to
20,000,000,  and in Janaury 2002, we again increased our authorized common stock
to 40,000,000 shares.

In May of 2001 we acquired all of the issued and  outstanding  capital  stock of
Micro Sensor  Technology  Incorporated,  a Florida  corporation  specializing in
explosive  detection  technology.  Micro Sensor Technology is now a wholly-owned
suhsidiary of Sense Holdings.

In  January  2002,  in an  effort  to unify  our  corporate  identity  we ceased
operating under the name Sense  Technologies,  Inc., and began operating only as
Sense Holdings, Inc.


<PAGE>

ITEM 2. DESCRIPTION OF PROPERTIES

In February  2002 we terminated  our lease in Tamarac,  Florida (with no further
financial  obligation   thereunder)  and  relocated  our  corporate  offices  to
approximately 7,000 square feet of office space in Sunrise,  Florida.  The lease
is with an  unaffiliated  party.  Our monthly  lease  payment is $4,664 over the
lease term.  The lease expires in March 2005 and provides that we may not assign
or sublet the premises  without the  landlord's  prior  written  consent.  These
facilities  are  suitable  and  adequate  for our  current  needs  and allow for
anticipated  expansion  during  the term of the  lease.  We  currently  maintain
commercial  general liability and property insurance coverage with policy limits
of $1,000,000 and $125,000,  respectively.  We may increase this coverage to the
extent business growth dictates.

ITEM 3. LEGAL PROCEEDINGS

We are  not a  party  to any  material  legal  proceeding,  nor  are  any of our
officers, directors or affiliates a party adverse to us in any legal proceeding.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS

On November  28,  2001,  holders of a majority of our  outstanding  common stock
consented to the  following  actions,  in writing,  in lieu of holding an annual
meeting of our shareholders:

o Dore Scott Perler, Andrew Goldrich,  Shawn Tartaglia and Julie Slater, each of
  whom served  as members  of our  board of  directors  prior to the date of the
  written consent, were re-elected to serve as members of our board of directors
  until the next annual meeting of shareholders  and until their  successors are
  duly elected and qualified;

o our 2001 Equity compensation plan was approved and adopted; and

o the engagement  of  Feldman Sherb & Co., P.A., as our independent auditors was
  confirmed and ratified.

Each of the  foregoing  board  nominees  received,  and  each  of the  foregoing
corporate  actions  was  approved  by,  6,024,311  shares of our  common  stock,
representing  approximately  50.8% of our issued and outstanding common stock as
of November 28, 2001 the record date for  determining  the number of outstanding
shares. We did not solicit proxies in connection with the written consent of our
shareholders,  and  the  board  of  directors,  as  previously  reported  to the
Securities and Exchange Commission, was re-elected in its entirety.


                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

Our shares of common stock are currently traded on the Over-the-Counter Bulletin
Board under the symbol SEHO (previously CTSMD).  Prior to February 28, 2000, our
shares were listed on the National  Quotation  Bureau's  Pink  Sheets.  There is
currently a limited  trading market for our shares and we do not know whether an
active market will develop.  The reported high and low bid prices for the common
stock are shown below for the period from January 1, 2000  through  December 31,
2001. The  quotations  reflect  inter-dealer  prices,  without  retail  mark-up,
mark-down or commission, and may not represent actual transactions.



Period                                    High                     Low
------                                    ----                     ---

First Quarter ended 3/31/00              $2.00                     $1.00
Second Quarter ended 6/30/00             $1.62                     $1.00
Third Quarter ended 9/30/00              $1.31                     $0.87
Fourth Quarter ended 12/31/00            $1.25                     $0.44

First Quarter ended 3/31/01              $0.51                     $0.96
Second Quarter ended 6/30/01             $0.71                     $0.36
Third Quarter ended 9/30/01              $0.85                     $0.33
Fourth Quarter ended 12/31/01            $1.35                     $0.63



<PAGE>

As of  December  31,  2001,  there were  11,861,136  shares of our common  stock
outstanding.  Our common stock is owned of record by approximately  800 holders.
We have never paid cash dividends on our common stock.  We intend to keep future
earnings,  if any,  to finance  the  expansion  of our  business,  and we do not
anticipate that any cash dividends will be paid in the foreseeable  future.  Our
future payment of dividends will depend on our earnings,  capital  requirements,
expansion plans, financial condition and other relevant factors.

The Securities and Exchange  Commission has adopted  regulations which generally
define a penny stock to be any equity  security  that has a market price of less
than  $5.00 per  share,  subject  to  certain  exceptions.  Depending  on market
fluctuations,  our common stock could be considered to be a penny stock. A penny
stock is subject to rules that impose additional sales practice  requirements on
broker/dealers  who sell  these  securities  to persons  other than  established
customers and accredited investors. For transactions covered by these rules, the
broker-dealer must make a special suitability  determination for the purchase of
these securities. In addition he must receive the purchaser's written consent to
the  transaction  prior to the purchase.  He must also provide  certain  written
disclosures to the purchaser.  Consequently,  the penny stock rules may restrict
the ability of broker/dealers to sell our securities,  and may negatively affect
the ability of holders of shares of our common stock to resell them.

Other stockholder matters

Common Stock

During 2001, the Company issued 886,500 of its common shares to consultants  and
employees for services  rendered.  The shares were valued at prices ranging from
$.39 to $.75.  For the year  ended  December  31,  2001,  the  Company  recorded
compensation  expense  of  $300,420  and  professional  fees  of  $119,421.  The
consultants and advisors (a) had a preexisting  business  relationship  with the
Company,  (b) had access to financial  statements and other relevant information
concerning the Company, (c) had such knowledge in business and financial matters
that they were able to  understand  the risks and merits of an investment in the
Company, and were, therefore, sophisticated investors at the time of acquisition
and (d) the  shares  that  were  issued  contained  a legend  restricting  their
transferability  absent  registration  under the Act or the  availability  of an
applicable exemption therefrom. Accordingly, these transactions were exempt from
the  registration  requirements  of the Act by reason of Section 4(2) of the Act
and the rules and regulations thereunder.

On March 28, 2001, the Company raised  $755,000  through a private  placement of
604,000  units  ($1.25  per  unit),  each unit  consisting  of two shares of the
Company's  common stock and one common stock  purchase  warrant  exercisable  at
$1.50  per  share.  The  Company  incurred  costs in  relation  to this  private
placement of $168,650 and netted  proceeds of $586,350.  The Company also issued
56,000  shares of its common  stock for legal  services  rendered in relation to
this offering.  Additionally,  the Company issued to a consultant  that provided
services in relation to securing the proceeds of this  offering,  627,500 common
stock warrants  exercisable at $0.50 per share.  All costs  associated with this
offering are recorded net against the gross proceeds. The units were issued to a
total of seven persons whom the Company had  reasonable  grounds to believe were
accredited  investors.  Each of the  investors  (a) had access to  business  and
financial  information  concerning  the  Company,  (b)  represented  that it was
acquiring  the  securities  for  investment  purposes  only  and not with a view
towards  distribution or resale except in compliance with applicable  securities
laws and (c) had such knowledge and experience in business and financial matters
that he or she was able to evaluate the risks and merits of an investment in the
Company.  Therefore each investor was also  sophisticated  within the meaning of
Federal securities laws. In connection with this transaction, the Company issued
warrants to purchase  627,500  shares of common stock,  as  compensation  to the
placement agent, and 56,000 shares of common stock as compensation to counsel to
the placement  agent. In addition,  the  certificates  evidencing the shares and
warrants that were issued contained a legend  restricting their  transferability
absent registration under the Act or the availability of an applicable exemption
therefrom.  The issuance of these  securities  was exempt from the  registration
requirements  of the  Act by  reason  of  Section  4(2)  and/or  the  rules  and
regulations thereunder including Rule 506 of Regulation D.


<PAGE>

On May 31,  2001,  the Company  issued  2,000,000  shares of its common stock in
exchange for 100% of the outstanding  stock of Micro Sensor  Technologies,  Inc.
("Micro Sensor").  The Company valued the shares exchanged at $0.38 per share or
$760,000. The shareholders,  each of which the Company had reasonable grounds to
believe was an  accredited  investor,  (a) had access to business and  financial
information  concerning the Company,  (b) represented  that it was acquiring the
securities for investment purposes only and not with a view towards distribution
or resale except in compliance with applicable  securities laws and (c) had such
knowledge and  experience in business and financial  matters that it was able to
evaluate the risks and merits of an  investment in the Company.  Therefore  each
investor was also  sophisticated  within the meaning of Federal securities laws.
In addition, the certificates evidencing the shares that were issued contained a
legend restricting their  transferability  absent  registration under the Act or
the  availability of an applicable  exemption  therefrom.  The issuance of these
securities was exempt from the registration requirements of the Act by reason of
Section 4(2) and/or the rules and regulations  thereunder  including Rule 506 of
Regulation D.

In June 2001,  the Company  purchased  3,000 shares of its common stock at $0.53
per share or $1,588. Such shares were subsequently retired.

In connection  with a loan payable dated August 15, 2000,  the Company agreed to
issue 100,000 shares of the Company's  restricted  common stock to the holder of
the loan at the end of the loan,  which was due on August 15,  2001.  The common
shares to be issued  were  valued on the loan date at the fair  market  value of
$1.12 per share for an aggregate of  $112,500.  Accordingly,  as of December 31,
2000, the Company accrued  $42,188 in interest  expense in connection with these
shares to be issued.  In May 2001,  the Company issued these shares and recorded
additional interest expense of $70,312 related to these shares.

On August 31, 2001, we issued an aggregate of $1,055,000 principal amount of our
10% promissory  notes and an aggregate of 1,055,000  shares of our common stock,
for an aggregate purchase price of $1,055,000.  These securities were sold to 22
persons,  each of whom we had  reasonable  grounds to believe was an  accredited
investor.  Each of the  investors  (a) had  access  to  business  and  financial
information  concerning us, (b) was afforded the opportunity to ask questions of
our management  concerning  our  operations  and the terms of the offering,  (c)
represented  that it was acquiring the securities  for investment  purposes only
and not with a view towards  distribution  or resale except in  compliance  with
applicable securities laws and (d) had such knowledge and experience in business
and  financial  matters  that it was able to evaluate the risks and merits of an
investment.  Therefore,  each investor was also sophisticated within the meaning
of Federal  securities laws. In connection with this  transaction,  we issued an
additional  105,500  shares of common  stock as  compensation  to the  placement
agent. In addition, the notes and certificates evidencing all of the shares that
were  issued  contained  a  legend  restricting  their  transferability   absent
registration  under  the  Act or the  availability  of an  applicable  exemption
therefrom.  The issuance of these  securities  was exempt from the  registration
requirements  of the  Act by  reason  of  Section  4(2)  and/or  the  rules  and
regulations thereunder including Rule 506 of Regulation D.



<PAGE>

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The following  discussion and analysis  should be read in  conjunction  with the
financial statements of the Company and the notes thereto appearing elsewhere.

Results of Operations - Year Ended December 31, 2000 as compared to December 31,
2001

Sales decreased by 24% from $91,591 in 2000 to $69,569 in 2001. This decrease is
attributable to $50,000 of sales derived from biometric  consulting  services in
2000.

Cost of goods sold as a percentage of sales increased from 11% in 2000 to 31% in
2001.  This  increase  is  attributable  to the low  costs  associated  with the
consulting services performed in 2000.

Depreciation and amortization increased 2265 % from $2,759 in 2000 to $65,262 in
2001. This increase is attributable to amortization of license acquired with the
acquisition of MSTI technology.

General  and  administrative  cost  increased  45%  from  $790,198  in  2000  to
$1,148,707.  This  increase is  attributable  to  increased  personnel to offset
outsource work expense and the necessary expansion associated therewith.

Research and  Development  costs increased 240% from 135,231 in 2000 to $460,253
in 2001. This increase is  attributable to additional  personnel in research and
development and the planned expansion of product line.

Interest  Expense  increased 825% from $41,824 in 2000 to $387,235 in 2001. This
increase  is  attributable  to interest  on notes  payable  from the August 2001
financing of $1,055,000 principal amount of our 10% promissory notes.

Liquidity, Capital Resources and Plan of Operations

We have financed our growth and cash requirements through equity investments and
debt and equity  financing.  We do not currently have any credit facilities from
financial institutions or private lenders. We do not currently have any material
commitments for capital expenditures.

Cash used in operations for the year ended  December 31, 2001 was  approximately
$988,000  attributable  primarily  to the net loss of  approximately  $2,014,000
offset by  non-cash  compensation  of  $468,000  and  amortization  of  deferred
financing cost $284,000.  Cash provided by financing  activities during the year
was approximately  $1,325,000 from proceeds of short-term loans of $1,055,000 in
notes  payable  and  the  sale  of  common  stock.   Total  cash   increased  by
approximately $440,000 during the period.

Since our  inception,  we have been engaged in research  development  activities
relating to our first generation of biometric  security  products.  We commenced
delivery of these products in the third quarter of 1999 and have been generating
revenues since the fourth quarter of 1999. We have completed  development of our
second generation  product,  and have recognized  revenue on its sales since the
year ended  December 31, 2000. We have also  recognized  revenue for  consulting
fees since the third quarter of 2000. We will continue to make  enhancements  to
our second  generation  product so that it will support a larger  database,  and
enable us to market CheckPrint T/A to larger  companies,  resulting in a greater
profit  margin to us. We will  continue to develop  other  products and services
relating to biometrics,  security,  data management,  explosive  detection,  and
consulting services.

Based upon purchase  orders we have received,  anticipated  future product sales
and cash on hand, we believe that we will have the need for  additional  capital
investment and are actively  pursuing  additional  outside capital  investments,
that will be necessary to meet our cash flow needs over the next twelve  months.
Additionally, in order to remain competitive in the marketplace, we must develop
new  products  and enhance our  existing  products.  Should  revenues  not reach
projected  levels or should unforseen events arise, we may be required to secure
additional funds to meet our operating needs sooner than anticipated. Subsequent
to December 31, 2001, we sold 70 units of stock consisting of 50,000 shares each
of common  stock for  proceeds  of  $2,625,625.  Additional  funding  may not be
available to us on acceptable terms.

<PAGE>

Factors  That  Could  Cause  Our  Results  to  Differ  From Our  Forward-Looking
Statements

This Report  contains  forward-looking  statements.  Forward-looking  statements
express our  expectations  or predictions of future events or results.  They are
not  guarantees  and are  subject to many risks and  uncertainties.  There are a
number of factors - many beyond our control - they could cause actual  events or
results   to  be   significantly   different   from  those   described   in  the
forward-looking  statement. Any or all of our forward-looking statements in this
report or in any other public statements we make may turn out to be wrong.

Forward-looking statements might include one or more of the following:

o       projections of future revenue;
o       anticipated purchase orders and/or product delivery dates;
o       descriptions of plans or objectives of management for future operations,
        products or services;
o       forecasts of future economic performance; and
o       descriptions or assumptions underlying or relating to any of the above
        items.

Forward-looking statements can be identified by the fact that they do not relate
strictly to historical or current  facts.  They use words such as  "anticipate",
"estimate", "expect", "project", "intend", "plan", "believe" or words of similar
meaning. They may also use words such as "well", "would",  "should",  "could" or
"may".

Factors that may cause our actual results to differ materially from those
described in forward-looking statements include the risks such as:

o        our early stage of development makes evaluating us difficult;
o        we have experienced historical losses and an accumulated deficit and we
         may not become profitable;
o        we will require additional capital or alternative financing and funding
         may not be available to us on acceptable terms;
o        our competitors are financially stronger than we are and we may be
         unable to compete effectively or become a competitive force in our
         industry;
o        we are dependent upon third-party software, our access to which may be
         cancelled on 90 days' notice;
o        biometric security devices may not be accepted in the marketplace or
         may be replaced by alternative technologies;
o        we may be unable to develop applications for the technology we acquired
         from Micro Sensor Technology Inc., and we are obligated to pay
         royalties to the technology owner even if we do not develop commercial
         applications for the technology;
o        we may be unable to protect our proprietary rights;
o        our stock is thinly traded and in the absence of an active trading
         market, investors may have difficulty reselling their shares;
o        as an emerging technology company, the market price for our common
         stock is subject to wide fluctuations; and
o        the other risks identified from time-to-time in our various filings
         with the United States Securities and Exchange Commission, including
         our registration statement on Form S-8 File No. 333-81306.

ITEM 7. FINANCIAL STATEMENTS

See Index to Financial Statements for the financial statements included in this
Form 10-KSB.


<PAGE>

                                    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 includes the names, positions held and ages of our executive
officers and directors.

NAME                    AGE                                    POSITION
----                    ---                                    --------

Dore Scott Perler       41                          Chief Executive Officer,
                                                    President and Director

Andrew Goldrich         41                          Vice President and Director

Shawn Tartaglia         32                          Chief Technical Officer and
                                                    Director

Julie Slater            42                          Director

Dore Scott Perler has served as our Chief Executive  Officer and President and a
member of our Board of Directors,  since July 1998.  From May 1993 to July 1998,
Mr. Perler was a founder,  Director,  and Vice  President of Sales  covering the
Southeast United States and Latin America, for Latinrep,  Inc., a manufacturer's
representative  organization.  He assisted in the formation of Latin Channels, a
trade show for Latin American distributors.

Andrew  Goldrich has served as our Vice  President  and a member of our Board of
Directors,  since July 1998.  From January 1984 to July 1998,  Mr.  Goldrich was
Vice  President  of  Sales  and  Finance  for  Sassy  Knitting  Mills,  Inc.,  a
privately-held  garment manufacturer.  He was a founder of Sassy Knitting Mills,
where he  implemented  a national  sales force and was  responsible  for overall
financial and marketing activities.

Shawn  Tartaglia has served as our Chief  Technical  Officer and a member of our
Board of  Directors,  since  July 1998.  From  November  1997 to July 1998,  Mr.
Tartaglia  was  Manager  of  Information   Systems  for   CompScript,   Inc.,  a
privately-held  pharmaceutical provider. From February 1993 to November 1997, he
was  employed  by  Solopak  Pharmaceuticals,   a  privately-held  pharmaceutical
supplier, as its Systems and Telecommunications Manager.

Julie Slater has served on our Board of Directors  since January 1999. From 1984
and  continuing  until the  present,  Ms.  Slater is Vice  President of All Eyes
Optical, a privately-held optometry and retail eye wear provider.


<PAGE>

We have also engaged  several  consultants who we believe are significant to our
business. They are:

Doug Kilarski is our Operations Director,  Business Operations. Mr. Kilarski has
served as a consultant to us, through Test Systems Engineering, since July 1998.
Since 1994 he has been Vice President, Analyst for Aspen Business Development, a
privately-held business development organization.

Alex  Schlinkmann  is  our  Operations   Director,   Hardware   Engineering  and
Manufacturing. Mr. Schlinkmann has been a consultant to us, through Test Systems
Engineering,  since  July  1998.  Since  1991 he has been  President  and Design
Engineer for Test Systems Engineering.

Jamie Schlinkmann is our Operations  Director,  Hardware Design. Mr. Schlinkmann
is the brother of Alex  Schlinkmann,  and has been a consultant to us since July
1998. Since 1991 he has been Vice President and Design Engineer for Test Systems
Engineering.

Board  Committees:  We do not as yet have an audit  committee or a  compensation
committee.  However,  as and when we elect independent  directors,  we expect to
organize these committees.

All  directors  serve for one year and until  their  successors  are elected and
qualify.  Directors  do not  receive  compensation  for  serving  as  directors.
Officers  are  elected  by the Board and their  terms of office  are,  except as
otherwise stated in employment contracts, at the discretion of the Board.

Employment Agreements. In March 1999, we entered into employment agreements with
each of Dore Scott Perler,  Andrew Goldrich and Shawn Tartaglia.  The agreements
have been extended on each year by addendum and have no new terms and conditions
other than level of compensation.  Each agreement provides for employment at our
discretion,  and may be terminated at any time, for any reason not prohibited by
law. The  agreements  require  each  employee to devote all of his work time and
attention to our business,  and contain  confidentiality  provisions prohibiting
the employee from  divulging  information  concerning  our business to any third
party. Each employee is entitled to participate in our stock option plan, and in
all other benefit programs established by the board of directors for the benefit
of our employees.  We pay Messrs.  Perler and Goldrich annual salaries,  for the
year 2001,  at the rate of $93,000  per year,  and Mr.  Tartaglia,  for the year
2001, at the rate of $83,000 per year.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

We are not subject to Section 16(a) of the Securities Exchange Act of 1934, and,
therefore,  our directors and executive officers,  and persons who own more than
ten percent of our common stock are not required to file with the Securities and
Exchange  Commission  reports  disclosing their initial ownership and changes in
their ownership of our common stock.


<PAGE>

ITEM 10. EXECUTIVE COMPENSATION

Summary Compensation Table

The following table sets forth information relating to all compensation awarded
to, earned by or paid by us during each fiscal year since our inception to: (a)
our President and Chief Executive Officer; and (b) each of our executive
officers who earned more than $100,000 during the fiscal year ended December 31,
2001:
<TABLE>
<CAPTION>
                                    Fiscal                             Other Annual                     LTIP     All Other
Name and Principal Position          Year        Salary       Bonus    Compensation     Options/ (#)    Payouts  Compensation
---------------------------          ----        -------      -----    ------------     ------------    -------  ------------

<S>                                  <C>        <C>            <C>     <C>              <C>             <C>      <C>
Dore Scott Perler, CEO               2001       $93,000         _           _             650,000            _         _
                                     2000       $67,000         _           _                 _              _         _
                                     1999       $53,400         -           -                 -              -     $2,329(1)
</TABLE>
(1) Other annual compensation consists of automobile and gas allowance ($1,429)
and health insurance premiums ($900).

Option Grants in Last Fiscal Year

The following table sets forth information concerning our grant of options to
purchase shares of our common stock during the fiscal year ended December 31,
2001 to (a) our President and Chief Executive Officer; and (b) each of our
executive officers who earned more than $100,000 during the fiscal year ended
December 31, 2001.
<TABLE>
<CAPTION>
                                                 Percent of
                                Number of      Total Options/
                               Securities       SARs Granted
                               Underlying       To Employees        Exercise Or
                               Options/SARs      In Fiscal           Base Price
      Name                     Granted (#)          Year               ($/Sh)           Expiration Date

<S>                              <C>               <C>                 <C>                   <C>
Dore Scott Perler, CEO           250,000           12.19%              $ 0.50                5/21/04
                                 250,000           12.19%              $ 0.43                8/13/04
                                 150,000           07.32%              $ 0.69               12/26/06
</TABLE>
Incentive and Non-Qualified Stock Option Plan

1999 Plan:  On July 19,  1999,  the board of  directors  adopted  our 1999 stock
option plan. We have reserved 1,500,000 shares of common stock for issuance upon
exercise of options  granted from time to time under the 1999 stock option plan.
The 1999 stock  option plan is intended to assist us in securing  and  retaining
key employees,  directors and consultants by allowing them to participate in our
ownership and growth through the grant of incentive and non-qualified options.

Under the stock  option plan we may grant  incentive  stock  options only to key
employees and employee directors,  or we may grant non-qualified  options to our
employees,  officers,  directors and consultants.  The 1999 stock option plan is
currently administered by our board of directors.

Subject to the provisions of the stock option plan, the board will determine who
shall  receive  options,  the  number  of shares  of  common  stock  that may be
purchased  under the  options,  the time and manner of  exercise  of options and
exercise prices. The term of options granted under the stock option plan may not
exceed  ten years or five  years for an  incentive  stock  option  granted to an
optionee  owning  more than 10% of our  voting  stock.  The  exercise  price for
incentive stock options will be equal to or greater than 100% of the fair market
value of the  shares  of the  common  stock at the time  granted.  However,  the
incentive  stock  options  granted  to a 10%  holder  of our  voting  stock  are
exercisable at a price equal to or greater than 110% of the fair market value of
the common stock on the date of the grant. The exercise price for  non-qualified
options will be set by the board, in its  discretion,  but in no event shall the
exercise price be less than 75% of the fair market value of the shares of common
stock on the date of grant.  The exercise  price may be payable in cash or, with
the approval of the board, by delivery of shares or by a combination of cash and
shares. Shares of common stock received upon exercise of options will be subject
to restrictions on sale or transfer. As of December 31, 1999 we have not granted
any options under the 1999 stock option plan.

<PAGE>

2001 Plan: On November 28, 2001, the board of directors  adopted our 2001 equity
compensation  plan, and on November 28, the 2001 plan was ratified by holders of
a majority of our outstanding common stock. We have reserved 2,000,000 shares of
common stock for issuance as stock grants and upon  exercise of options  granted
from time to time  under the 2001  equity  compensation  plan.  The 2001 plan is
intended to assist us in securing and  retaining  key  employees,  directors and
consultants  by allowing them to participate in our ownership and growth through
the grant of  incentive  and  non-qualified  options,  as well as  direct  stock
grants.

Under the 2001 plan we may grant  incentive  stock options only to key employees
and  employee  directors.  We may grant  non-qualified  options and issue direct
stock awards to our employees,  officers,  directors and  consultants.  The 2001
equity compensation plan is currently administered by our board of directors.

Subject to the  provisions of the 2001 plan,  the board will determine who shall
receive  options  or grants,  the  number of shares of common  stock that may be
purchased  under the  options,  the time and manner of  exercise  of options and
exercise prices. The term of options granted under the stock option plan may not
exceed  ten years or five  years for an  incentive  stock  option  granted to an
optionee  owning  more than 10% of our  voting  stock.  The  exercise  price for
incentive stock options will be equal to or greater than 100% of the fair market
value of the  shares  of the  common  stock at the time  granted.  However,  the
incentive  stock  options  granted  to a 10%  holder  of our  voting  stock  are
exercisable at a price equal to or greater than 110% of the fair market value of
the common stock on the date of the grant. The exercise price for  non-qualified
options will be set by the board, in its  discretion,  but in no event shall the
exercise  price be less  than the par value for our  common  stock The  exercise
price may be payable in cash or, with the approval of the board,  by delivery of
shares or by a  combination  of cash and  shares.  The board may also direct the
issuance  of shares of our common  stock as awards  under the 2001 plan.  Absent
registration  under the Securities Act of 1933, as amended,  or the availability
of an applicable exemption  therefrom,  shares of common stock received as stock
grants and upon exercise of options will be subject to  restrictions  on sale or
transfer.  As of December 31, 2001, we have granted options to purchase  565,500
shares and awarded 0 shares under the 2001 plan.  No options under the 2001 Plan
have yet been exercised.


<PAGE>

Option Exercises and Holdings

The following table contains information with respect to the exercise of options
to purchase  shares of common  stock  during the fiscal year ended  December 31,
2001 to (a) our  President  and  Chief  Executive  Officer;  and (b) each of our
executive  officers who earned more than  $100,000  during the fiscal year ended
December 31, 2001.

Aggregated  Option/SAR  Exercises  in  Last  Fiscal  Year  and  Fiscal  Year-End
Option/SAR Values
<TABLE>
<CAPTION>
                                                                            Number of
                                                                           Securities            Value of
                                                                           Underlying           Unexercised
                             Shares                                        Unexercised         In-The-Money
                            Acquired                                      Options/SARs         Options/SARs
                               On                         Value           At FY-End (#)        At FY-End ($)
                            Exercise                    Realized          Exercisable/         Exercisable/
      Name                     (#)                         ($)            Unexercisable        Unexercisable
      ----                -------------               -------------       -------------        -------------

<S>                            <C>                          <C>                 <C>                 <C>
Dore Scott Perler, CEO         -                            -                   -                   -
</TABLE>
Long-Term Incentive Plans Awards in Last Fiscal Year
<TABLE>
<CAPTION>

                                     Number          Performance
                                    of Shares         or Other            Estimated Future Payouts Under
                                    Units or        Period Until             Non-Stock Price-Based Plans
                                                                          ---------------------------------
                                  Other Rights       Maturation             Threshold   Target   Maximum
      Name                            (#)             or Payout                ($or #)  ($or #)    ($ or #)
      ----                    --------------------    ---------           ---------------------------------
<S>                                     <C>               <C>                    <C>        <C>   <C>
Dore Scott Perler, CEO                  -                 -                      -          -      -
</TABLE>
Limitation on Liability and Indemnification Matters

As  authorized  by  the  Florida  Business  Corporation  Law,  our  Articles  of
Incorporation  provide that none of our directors shall be personally  liable to
us or our  shareholders  for monetary  damages for breach of fiduciary duty as a
director, except liability for:

o any breach of the director's duty of loyalty to our company or its
  shareholders;
o acts or omissions not in good faith or which involve intentional misconduct or
  a knowing violation of law;
o unlawful payments of dividends or unlawful stock redemptions or repurchases;
  and
o any transaction from which the director derived an improper personal benefit.

This provision  limits our rights and the rights of our  shareholders to recover
monetary  damages  against a director for breach of the  fiduciary  duty of care
except in the  situations  described  above.  This  provision does not limit our
rights or the rights of any shareholder to seek injunctive  relief or rescission
if a director  breaches his duty of care.  These  provisions  will not alter the
liability of directors under federal securities laws.

Our Articles of Incorporation further provide for the indemnification of any and
all persons who serve as our director, officer, employee or agent to the fullest
extent permitted under Florida law.

Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to our directors, officers and controlling persons pursuant to the
foregoing provisions, or otherwise, we have been advised that in the opinion of
the SEC, this indemnification is against public policy as expressed in the
securities laws, and is, therefore unenforceable.


<PAGE>

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT

The following  table sets forth, as of March 31, 2001,  information  known to us
relating to the  beneficial  ownership of shares of common stock by: each person
who is the beneficial owner of more than five percent of the outstanding  shares
of common  stock;  each  director;  each  executive  officer;  and all executive
officers and directors as a group.

Unless  otherwise  indicated,  the address of each beneficial owner in the table
set forth below is care of Sense  Holdings,  Inc.,  4503 NW 103rd Avenue,  Suite
200, Sunrise, Florida 33351.

We believe that all persons  named in the table have sole voting and  investment
power with respect to all shares of common stock beneficially owned by them.

Under  securities  laws, a person is  considered to be the  beneficial  owner of
securities  he owns and that can be acquired by him within 60 days from the date
of  this  prospectus  upon  the  exercise  of  options,  warrants,   convertible
securities or other understandings. We determine a beneficial owner's percentage
ownership by assuming that options,  warrants or convertible securities that are
held by him,  but not those held by any other  person and which are  exercisable
within 60 days of the date of this prospectus, have been exercise or converted.

Except as other wise  required  by  Securities  and  Exchange  commission  rules
relating to beneficial ownership, the table does not give effect to the issuance
of up to:

o  2,485,500 shares of common stock issuable upon exercise of options that have
             been granted;
o  5,548,790 shares of common stock issuable upon exercise of outstanding
             purchase warrants; and/or
o  1,401,661 shares of common stock issuable upon conversion of outstanding
             convertible promissory notes.

Name and Address of             Amount and Nature of                  Percentage
   Beneficial Owner             Beneficial Ownership                   of Class

Dore S. Perler                     1,344,723 shares(1)                   13.1%
9400 S.W. 49th Place
Cooper City, FL 33328

Andrew Goldrich                    1,244,519 shares(1)                   12.5%
21653 Marigot Drive
Boca Raton, FL 33428

Shawn Tartaglia                      193,585 shares (2)                   4.8%
6888 Ashburn Road
Lake Worth, FL 33467

Julie Slater                          38,703 shares                         *
402 N.W. 118th Terrace
Coral Springs, FL 33071

Officers and Directors             2,861,530 shares (3)                  28.4%
as a group (4 persons)

Utek Corporation                   1,850,000 shares                      11.9%
202 South Wheeler Street
Plant City, FL 33566

* Less than 1%.

(1)  Includes 800,000 shares issuable upon exercise of currently exercisable
     options.
(2)  Includes 575,000 shares issuable upon exercise of currently exercisable
     options
(3)  Includes 2,175,000 shares issuable upon exercise of currently exercisable
     options.


<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

In October 2001, Andrew Goldrich transferred 40,000 shares of common stock owned
by him to his father Richard Goldrich.

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

A. EXHIBITS:

Exhibit No.                         Description of Document

      2.1    Agreement and Plan of Merger between Century Silver Mines, Inc. and
             Sense Holdings, Inc.(1)
   3.1(a)    Articles of Incorporation of Sense Holdings, Inc.(1)3.1
      (b)    Articles of Merger of Century Silver Mines, Inc. into Sense
             Holdings, Inc. (FL)(1)
   3.1(c)    Articles of Merger of Century Silver Mines, Inc. into Sense
             Holdings, Inc. (ID)(1)
      3.2    Bylaws (1)
     10.1    1999 Stock Option Plan (1)
     10.2    Employment Agreement between the Company and Dore Scott Perler (1)
     10.3    Employment Agreement between the Company and Andrew Goldrich (1)
     10.4    Employment Agreement between the Company and Shawn Tartaglia (1)
     10.5    Technology License Agreement, as amended, with SAC Technologies,
             Inc.(1)
     10.6    Lease for Tamarac Office    (1)
     10.11   Manufacturing and Non-Compete Agreement with Test Systems
             Engineering (1)
     10.12   Sales Agreement with Integrated Design, Inc.(1)
     10.13   Agreement and Plan of Acquisition dated May 31, 2001 with Micro
             Sensor Technologies, Inc. (2)
     10.14   Patent License Agreement dated March 26, 2001, between
             Micro Sensor Technologies, Inc. and UT-Battelle, LLC (2)
     10.15   Consulting Agreement dated June 1, 2001, between Micro Sensor
             Technologies, Inc. and Dr. Thomas Thundat (2)
     10.16   Work for Others Agreement dated June 4, 2001, between UT-Battelle,
             LLC and Micro Sensor Technologies, Inc. (2)
     10.17   Form of Promissory Note, as amended (4)
     10.18   Lease for Sunrise Office. (4)
     10.19   2001 Equity Compensation Plan (3)
-------------------------
(1)     Incorporated by reference to exhibits with the corresponding number
        filed with our registration statement on Form SB-2 (File No. 333-87293).
(2)     Incorporated by reference to exhibits with the corresponding number
        filed with our registration statement on Form SB-2 (File No.333-62874).
(3)     Incorporated by reference to exhibits with the corresponding number
        filed with our registration statement on Form S-8 (File No.333-81306).
(4)     Filed herewith.

B.      Reports ON Form 8-K:
        No reports on Form 8-K were filed during the last quarter of the period.

<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS






    Independent Auditors' Report                                            F-2

    Consolidated Balance Sheet                                              F-3

    Consolidated Statements of Operations                                   F-4

    Consolidated Statements of Stockholders' Equity (Deficit)               F-5

    Consolidated Statements of Cash Flows                                   F-6

    Notes to Consolidated Financial Statements                      F-7 to F-18






















                                       F-1
<PAGE>
                          INDEPENDENT AUDITORS' REPORT



To the Board of Directors
Sense Holdings, Inc. and Subsidiaries
Tamarac, Florida

     We have  audited  the  accompanying  consolidated  balance  sheet  of Sense
Holdings,  Inc.  and  Subsidiaries  as of  December  31,  2001,  and the related
consolidated statements of operations,  stockholders' equity (deficit), and cash
flows  for the years  ended  December  31,  2001 and  2000.  These  consolidated
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is  to  express  an  opinion  on  these  consolidated  financial
statements based on our audits.

     We conducted our audits in accordance  with  auditing  standards  generally
accepted in the United States of America.  Those standards  require that we plan
and  perform  the  audit  to  obtain  reasonable  assurance  about  whether  the
consolidated  financial statements are free of material  misstatement.  An audit
includes  examining  on  a  test  basis,  evidence  supporting  the  amount  and
disclosures in the  consolidated  financial  statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

     In our opinion,  the consolidated  financial  statements  referred to above
present fairly, in all material respects, the consolidated financial position of
Sense Holdings,  Inc. and  Subsidiaries as of December 31, 2001, and the results
of their  operations  and their cash flows for the years ended December 31, 2001
and 2000, in conformity with  accounting  principles  generally  accepted in the
United States of America.




                                               /s/ Feldman Sherb & Co., P.C.
                                                   Certified Public Accountants

New York, New York
March 15, 2002







                                       F-2
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

                                DECEMBER 31, 2001




                                     ASSETS
CURRENT ASSETS:
     Cash                                                         $     440,914
     Accounts receivable (Net of allowance for
       doubtful accounts of $20,000)                                     48,868
     Inventories                                                        119,171
     Advances - shareholders                                             76,222
     Prepaid expenses                                                   101,972
                                                                  --------------

     TOTAL CURRENT ASSETS                                               787,147

PROPERTY AND EQUIPMENT, net                                               5,519

DEFERRED FINANCING COSTS, net                                           568,844

LICENSE AGREEMENTS, net                                                 473,442
                                                                  --------------

     TOTAL ASSETS                                                 $   1,834,952
                                                                  ==============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
     Accounts payable and accrued expenses                        $     261,072
     Accrued interest                                                    35,167
     Notes payable                                                    1,055,000
                                                                  --------------

     TOTAL CURRENT LIABILITIES                                        1,351,239
                                                                  --------------

STOCKHOLDERS' EQUITY:
     Common stock, $.10 par value, 20,000,000 shares
       authorized; 11,918,136 shares issued and outstanding           1,191,813
     Additional paid-in capital                                       3,037,181
     Accumulated deficit                                             (3,745,281)
                                                                  --------------

     TOTAL STOCKHOLDERS' EQUITY                                         483,713
                                                                  --------------

     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                   $   1,834,952
                                                                  ==============






                   See notes to consolidated financial statements
                                       F-3
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS



                                                 Years Ended December 31,
                                        ----------------------------------------
                                               2001                  2000
                                        -----------------     ------------------


Sales                                   $         69,569      $          91,591

Cost of goods sold                                21,798                 10,446
                                        -----------------     ------------------

Gross profit                                      47,771                 81,145
                                        -----------------     ------------------

OPERATING EXPENSES:
   General and administrative                  1,148,707                790,198
   Research and development                      460,253                135,231
   Depreciation and amortization                  65,262                  2,759
                                        -----------------     ------------------
                                               1,674,222                928,188
                                        -----------------     ------------------

Loss from operations                          (1,626,451)              (847,043)

OTHER EXPENSES:
   Interest expense, net                        (387,235)               (41,824)
                                        -----------------     ------------------

Net loss                                $     (2,013,686)     $        (888,867)
                                        =================     ==================

Net loss per common share - basic
   and diluted                          $          (0.21)     $           (0.14)
                                        =================     ==================

Weighted average number of shares
   outstanding - basic and diluted             9,786,559              6,309,832
                                        =================     ==================












               See notes to consolidated financial statements
                                       F-4
<PAGE>
<TABLE>
<CAPTION>
                                               SENSE HOLDINGS, INC. AND SUBSIDIARIES

                                       CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)



                                                                    Common Stock
                                                           ------------------------   Additional                       Total
                                                             Number of                 Paid-in      Accumulated     Stockholders'
                                                              Shares      Amount       Capital        Deficit      Equity (Deficit)
                                                           ----------- ------------  ------------   ------------  -----------------

<S>               <C> <C>                                  <C>         <C>           <C>            <C>           <C>
Balance, December 31, 1999                                  6,072,142  $   607,214   $   550,619    $  (842,728)  $        315,105

Issuance of common stock
   for services                                               438,494       43,849       374,491              -            418,340

Net loss                                                            -            -             -       (888,867)          (888,867)
                                                           ----------- ------------    ----------   ------------   -----------------

Balance, December 31, 2000                                  6,510,636      651,063       925,110     (1,731,595)          (155,422)

Issuance of common stock for services                         886,500       88,650       331,191              -            419,841

Sale of common stock                                        1,208,000      120,800       465,550              -            586,350

Issuance of common stock in connection with stock offering     56,000        5,600        (5,600)             -                  -


Shares issued for acquisition                               2,000,000      200,000       560,000              -            760,000

Repurchase of common stock                                     (3,000)        (300)       (1,288)             -             (1,588)

Issuance of common stock in connection with short term loan   100,000       10,000       102,500              -            112,500

Issuance of shares for services in connection
  with notes payable                                          105,000       10,500        49,035              -             59,535

Issuance of shares for notes payable                        1,055,000      105,500       492,685              -            598,185

Options and warrants granted for services                           -            -        47,998              -             47,998

Beneficial conversion of notes payable                              -            -        70,000              -             70,000

Net loss                                                            -            -             -     (2,013,686)        (2,013,686)

                                                           ----------- ------------  ------------  -------------  -----------------
Balance December 31, 2001                                  11,918,136  $ 1,191,813   $ 3,037,181   $ (3,745,281)  $        483,713
                                                           =========== ============  ============  =============  =================


                                           See notes to consolidated financial statements
                                                                F-5
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                                         Years Ended December 31,
                                                                         -------------------------
                                                                            2001          2000
                                                                         -----------   -----------

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                      <C>            <C>
    Net loss                                                            $(2,013,686)  $  (888,867)
                                                                         -----------   -----------
    Adjustments to reconcile net loss to net cash used in operations:
          Depreciation and amortization                                      65,262         2,759
          Common stock issued for professional services                     419,841       418,340
          Interest expense  from issuance of common stock                    70,312             -
          Amortization of deferred financing costs                          284,421             -
          Common stock options and warrants granted for services             47,998             -

    Changes in assets and liabilities:
       Accounts receivable                                                   12,231        (1,304)
       Inventories                                                           (2,182)     (106,644)
       Prepaid expenses                                                      55,828             -
       Other current assets                                                  15,177       (12,585)
       Accounts payable and accrued expenses                                 21,484       216,122
       Accrued interest                                                      35,167             -
                                                                         -----------   -----------
          Total adjustments                                               1,025,539       516,688
                                                                         -----------   -----------

NET CASH USED IN OPERATING ACTIVITIES                                      (988,147)     (372,179)
                                                                         -----------   -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Cash from acquisition                                                   104,028             -
                                                                         -----------   -----------
NET CASH FLOWS PROVIDED BY INVESTING ACTIVITIES                             104,028             -
                                                                         -----------   -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Receipts from (repayment of) bank overdraft                              (4,162)        4,162
    Repayments of (proceeds from) short-term loans                         (150,000)      150,000
    Financing costs paid                                                   (125,545)            -
    Advances to shareholders                                                (35,022)      (36,300)
    Repurchase of common stock                                               (1,588)            -
    Proceeds from notes payable                                           1,055,000             -
    Proceeds from the sale of common stock                                  586,350             -
                                                                         -----------   -----------
NET CASH FLOWS PROVIDED BY FINANCING ACTIVITIES                           1,325,033       117,862
                                                                         -----------   -----------

NET (DECREASE) INCREASE IN CASH                                             440,914      (254,317)

CASH - beginning of year                                                          -       254,317
                                                                         -----------   -----------

CASH - end of year                                                      $   440,914   $         -
                                                                         ===========   ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid for:
    Interest                                                            $         -   $         -
                                                                         ===========   ===========
    Taxes                                                               $         -   $         -
                                                                         ===========   ===========

NONCASH INVESTING AND FINANCING ACTIVITIES:
    Common stock issued in connection with acquisition,
      net of cash acquired                                              $   655,972   $         -
                                                                         ===========   ===========
    Common stock issued in connection with note payable and debt        $   770,220   $         -
                                                                         ===========   ===========
    Deferred financing costs recorded for beneficial conversion         $    70,000   $         -
                                                                         ===========   ===========




                 See notes to consolidated financial statements
                                       F-6
</TABLE>
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                     YEARS ENDED DECEMBER 31, 2001 AND 2000


NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

Sense  Technologies,  Inc.  ("Sense")  was  formed on July 13,  1998 to  design,
develop, manufacture and sell biometric security identification systems.

On January 19, 1999, Sense was acquired by Century Silver Mines,  Inc.  ("CSM"),
an Idaho  corporation,  for 4,026,700 shares of CSM stock (the "Exchange").  The
Exchange was  completed  pursuant to the  Agreement  and Plan of  Reorganization
between  Sense  and CSM.  The  Exchange  has  been  accounted  for as a  reverse
acquisition  under the purchase method for business  combinations.  Accordingly,
the combination of the two companies is recorded as a recapitalization of Sense,
pursuant to which Sense is treated as the  continuing  entity.  In August  1999,
pursuant  to the  approval  of the Board of  Directors  of CSM,  the name of the
company changed to Sense Holdings, Inc. (the "Company").

On May 31, 2001,  the Company  acquired 100% of the  outstanding  stock of Micro
Sensor  Technologies,  Inc. ("Micro Sensor") in exchange for 2,000,000 shares of
the Company's common stock.

Principles of consolidation

The consolidated  financial  statements  include the accounts of the Company and
its wholly-owned subsidiaries. All material inter-company transactions have been
eliminated.

Cash and Cash Equivalents

The Company considers all highly liquid  investments  purchased with an original
maturity of three months or less to be cash equivalents.

Inventories

Inventories are stated at the lower of average cost or market.

Property and Equipment

Property  and  equipment  are  stated  at cost.  Depreciation  on  property  and
equipment is calculated using the straight-line method over the estimated useful
lives of the assets. Expenditures for major renewals and betterments that extend
the useful lives of property and equipment  are  capitalized.  Expenditures  for
maintenance and repairs are charged to expense as incurred.

Fair Value of Financial Instruments

The  carrying  amounts  reported  in the  balance  sheet for cash,  receivables,
accounts payable and accrued expenses  approximate their fair market value based
on the short-term maturity of these instruments.




                                       F-7
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000


Revenue Recognition

The  Company  recognizes  revenues  as units of its  product  are shipped to its
customers.

Use of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.

Impairment of long-lived assets

The Company  evaluates the  recoverability  and carrying value of its long-lived
assets at each  balance  sheet date,  based on guidance  issued in SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed  of." Among  other  factors  considered  in such  evaluation  is the
historical  and projected  operating  performance  of business  operations,  the
operating environment and business strategy,  competitive information and market
trends.  As of December 31, 2001, the Company believes that its long-lived asset
have not been impaired.

Income Taxes

Under the asset and liability method of FASB Statement 109,  deferred tax assets
and liabilities are recognized for the future tax  consequences  attributable to
differences  between the financial statement carrying amounts of existing assets
and  liabilities,  and their  respective  tax bases and  operating  loss and tax
credit  carryforwards.  Deferred tax assets and  liabilities  are measured using
enacted  tax rates  expected  to apply to  taxable  income in the years in which
those temporary  differences  are expected to be recovered or settled.  Deferred
tax assets are reduced by a valuation  allowance,  when in the Company's opinion
it is likely  that some  portion  or the entire  deferred  tax asset will not be
realized.

Comprehensive Income

The Company has adopted  Statement of  Financial  Accounting  Standards  No. 130
("SFAS 130) "Reporting Comprehensive Income".  Comprehensive income is comprised
of net loss and all changes to the statements of  stockholders'  equity,  except
those due to  investments  by  stockholders,  changes  in  paid-in  capital  and
distribution to  stockholders.  For the period ended December 31, 2000 and 2001,
the Company had deemed comprehensive income to be negligible.

Research and Development

Research and development  costs are expensed as incurred.  These costs primarily
consist of fees paid for the development of the Company's software.




                                       F-8
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000


Licensing Agreements

Licensing  agreements  are  stated  at  cost,  less  accumulated   amortization.
Amortization is computed using the  straight-line  method over an estimated life
of ten years based upon  management's  expectations  relating to the life of the
technology  and current  competitive  market  conditions.  The estimated life is
reevaluated  each year based upon changes in these  factors.  For the year ended
December 31, 2001, amortization of license agreements amounted to $62,530.

Stock Based Compensation

The Company uses SFAS No. 123, "Accounting for Stock-Based  Compensation," which
permits  entities to recognize as expense over the vesting period the fair value
of all stock-based awards on the date of grant. Alternatively, SFAS No. 123 also
allows  entities to continue  to apply the  provision  of APB Opinion No. 25 and
provide pro forma net income and pro forma  earnings per share  disclosures  for
employee stock option grants as if the  fair-value-based  method defined in SFAS
No. 123 has been  applied.  The  Company  has  elected to  continue to apply the
provisions of APB Opinion No. 25 and provide the pro forma disclosure provisions
of SFAS No. 123.

Concentration Of Credit Risk

Financial  instruments  that  potentially  subject  the  Company to  significant
concentrations  of credit risk consist  primarily of cash and cash  equivalents.
The  Company's  investment  policy  is to  invest  in low  risk,  highly  liquid
investments. The Company has not experienced any losses in such account and does
not believe it is exposed to any significant credit risk in its cash investment.

The Company  maintains  its cash balances at financial  institutions  located in
Florida. These balances are insured by the Federal Deposit Insurance Corporation
up to $100,000.  At December 31, 2001, the Company's cash balances  exceeded the
insured limits by $360,000.  The Company has not  experienced any losses in such
accounts and believes it is not exposed to any  significant  credit risk on cash
on deposit.

Loss Per Common Share

Basic loss per common share is based upon the weighted  average number of common
shares  outstanding  during the year.  Diluted  earnings (loss) per common share
include the effects of potential  dilution that would occur if securities  (such
as  warrants)  or other  contracts  (such as options) to issue common stock were
exercised or converted into common stock.  Such instruments that are convertible
into common stock are  excluded  from the  computation  in periods in which they
have  an  anti-dilutive   effect.   Potential  common  shares  included  in  the
computation are not presented in the consolidated financial statements, as their
effect  would be  anti-dilutive.  As of  December  31,  2001,  the  Company  had
3,317,000  stock options and warrants that may  potentially  dilute earnings per
share.






                                       F-9
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000


Recent Accounting Pronouncements

In June 2001, the FASB issued SFAS No. 141,  "Business  Combinations."  SFAS No.
141 applies prospectively to all business combinations  initiated after June 30,
2001 and to all business  combinations  accounted for using the purchase  method
for which the date of  acquisition  is July 1, 2001,  or later.  This  statement
requires  all  business  combinations  to be  accounted  for using the  purchase
method. Under previously existing accounting rules,  business  combinations were
accounted for using one of two methods, the  pooling-of-interests  method or the
purchase  method.  The  adoption  of  SFAS  No.  141 is not  expected  to have a
significant impact on the Company's consolidated financial statements.

In June 2001,  the FASB  issued  SFAS No. 142,  "Goodwill  and Other  Intangible
Assets." SFAS No. 142 addresses financial  accounting and reporting for acquired
goodwill  and other  intangible  assets.  Under SFAS No. 142,  goodwill and some
intangible  assets  will  no  longer  be  amortized,  but  rather  reviewed  for
impairment on a periodic basis. The provisions of this statement are required to
be applied  starting with fiscal years  beginning  after December 15, 2001. This
statement  is required to be applied at the  beginning of the  Company's  fiscal
year and to be applied to all goodwill and other intangible assets recognized in
its  financial  statements  at that date.  Impairment  losses for  goodwill  and
certain  intangible  assets  that arise due to the initial  application  of this
statement are to be reported as resulting from a change in accounting principle.
Goodwill  and  intangible  assets  acquired  after June 30, 2001 will be subject
immediately to the provision of this statement.  The adoption of SFAS No. 142 is
not expected to have a material impact on the Company's  consolidated  financial
statements.

In August 2001, the FASB issued SFAS No. 143,  "Accounting for Asset  Retirement
Obligations."  The  standard  requires  entities  to record  the fair value of a
liability  for an  asset  retirement  obligation  in the  period  in which it is
incurred.  When the liability is initially  recorded,  the entity  capitalizes a
cost by increasing the carrying  amount of the related  long-lived  asset.  Over
time,  the  liability  is  accreted to its present  value each  period,  and the
capitalized cost is depreciated over the useful life of the related asset.  Upon
settlement of the  liability,  an entity either  settles the  obligation for its
recorded  amount or  incurs a gain or loss  upon  settlement.  The  standard  is
effective for fiscal years  beginning  after June 15, 2002. The adoption of SFAS
No. 143 is not expected to have a material impact on the Company's  consolidated
financial statements.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets." SFAS No. 144 replaces SFAS No. 121,  "Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of." SFAS No. 144 requires  that  long-lived  assets be measured at the lower of
carrying amount or fair value less cost to sell,  whether reported in continuing
operations or in discontinued  operations.  Therefore,  discontinued  operations
will no longer be  measured  at net  realizable  value or  include  amounts  for
operating  losses that have not yet  occurred.  SFAS No. 144 also  broadens  the
reporting of discontinued operations to include all components of an entity with
operations that can be  distinguished  from the rest of the entity and that will
be  eliminated  from  the  ongoing  operations  of  the  entity  in  a  disposal
transaction.  The  provisions  of SFAS  No.  144  are  effective  for  financial
statements  issued for fiscal years  beginning  after  December  15,  2001.  The
adoption  of SFAS No.  144 is not  expected  to have a  material  impact  on the
Company's consolidated financial statements.



                                      F-10
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000

NOTE 2 - INVENTORIES

At December 31, 2001 inventories consist of:

         Raw materials                                       $       7,750
         Finished goods                                            111,421
                                                             --------------
                                                             $     119,171
                                                             ==============

NOTE 3 - RELATED PARTY TRANSACTIONS

During 2001, certain shareholders  received funds from the Company. The advances
are  non-interest  bearing and are  payable on demand.  At  December  31,  2001,
advances to the shareholders amounted to $76,222.

NOTE 4 - PROPERTY and EQUIPMENT

At December 31, 2001, property and equipment consisted of the following:

              Computer equipment                           $          13,795
              Less: Accumulated depreciation                           8,276
                                                           ------------------
                                                           $           5,519
                                                           ==================

For the year ended December 31, 2001 and 2000,  depreciation expense amounted to
$2,732 and $2,259, respectively.

NOTE 5 - ACQUISITION

On May 31, 2001,  the Company  acquired 100% of the  outstanding  stock of Micro
Sensor  Technologies,  Inc. ("Micro Sensor") in exchange for 2,000,000 shares of
the Company's common stock. The Company accounted for this acquisition using the
purchase method of accounting and,  accordingly,  the operating results of Micro
Sensor have been included in the  Company's  consolidated  financial  statements
since the date of acquisition.  The Company valued the shares exchanged at $0.38
per share or  $760,000.  The  purchase  price  exceeded the fair value of assets
acquired by $535,972.  The excess has been  allocated to as a license  agreement
and is being  amortized  on a  straight-line  basis over five  years.  Pro forma
financial information related to the acquisition has not been presented,  as the
results are immaterial.

NOTE 6- NOTES PAYABLE

On August 31, 2001, the Company issued notes payable in the amount of $1,055,000
in  connection  with a private  placement.  The notes bear  interest  at 10% per
annum. In November 2001, the note agreements were amended.  The maturity date of
the  notes  was  extended  from an  original  maturity  date of March 1, 2002 to
September 1, 2002.  Additionally,  each note payable is convertible  into common
stock at a  conversion  price of $.75 per  share or an  aggregate  of  1,406,661
shares of common stock.  For the year ended December 31, 2001,  $35,167 has been
charged to interest expense.  The beneficial  conversion  feature present in the
issuance  of the notes  payable as  determined  on the date of  issuance  of the
Company's  common stock  totaled  $70,000 and  recorded as interest  expense and
additional paid-in capital. As of December 31, 2001, no conversion had occurred

                                      F-11
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000

NOTE 7 - COMMITMENTS

Operating Lease

The Company  leases office space under  operating  leases  commencing  September
1999.  On January 25, 2002 the Company  entered into a new lease  agreement  and
relocated  to a new  office  space.  The  lease  commenced  on March 1, 2002 and
terminates on February 28, 2005.

At December 31, 2001, minimum rental commitments are as follow:

                     2002                       $          33,976
                     2003                                  37,860
                     2004                                  37,860
                     2005                                   6,310
                                                ------------------

                                                $         116,006
                                                ==================

License Agreements

On March 26, 2001, the Company's subsidiary,  Micro Sensor entered into a patent
license agreement with a technology  company.  Under the terms of the agreement,
Micro Sensor has been granted the right and license to use,  sell,  manufacture,
or  distribute  the products in the field of use as described in the  agreement.
The agreement  expires upon the  expiration  of the  proprietary  rights.  Micro
Sensor is required to pay royalty fees in the amount of $5,000 commencing on the
third  anniversary of the agreement,  March 2004. For each succeeding  year, the
amount will escalate by $5,000 per year.  Commencing  in the seventh  year,  the
annual fee will be fixed at $25,000.

On August 27, 2001, the Company entered into a license agreement with a software
development  company.  Under the terms of the agreement,  the Company,  has been
granted a  non-exclusive,  non-transferable  right to  incorporate,  use,  copy,
reproduce, market, sell, and distribute the software company's technology in its
identification  systems.  The  agreement  expires on August 31,  2004 and may be
renewed for an  additional  year.  The Company  paid an initial  transfer fee of
$25,000  and is  required  to pay  an  annual  maintenance  fee of  $15,300.  In
addition, the Company is required to pay royalty fees in the amounts between $10
and $25 per system  sold,  depending  on the  quarterly  volume.  The  agreement
requires a minimum  royalty fee in the first  quarter of 2002 to be $5,000.  For
each succeeding quarter of 2002, the amount will escalate by $5,000.  Commencing
in 2003, the minimum quarterly fee will be fixed at $25,000.

Employment Agreement

The  Company has entered  into an  employment  agreement  with a  consultant  to
provide legal services for an indefinite period commencing on November 26, 2001.
In the event of sale of the Company,  the consultant will be entitled to receive
the cash equivalent of one year's pay as a severance package.  In addition to an
annual  salary of $60,000 in cash,  the  Company is  required  to pay $60,000 in
shares per year.  The shares  will be granted on the last  business  day of each
month for an amount of shares equal to $5,000 on the day the shares are issued

                                      F-12
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000

NOTE 7 - COMMITMENTS (Continued)

Employment Agreement (Continued)

A maximum of 10,000  shares and a minimum of 2,500  shares  will be  transferred
each month  regardless of stock price or other  compensation.  In addition,  the
agreement  entitles the consultant to receive  options to purchase 20,000 shares
of common stock of the Company for each of the next three years of employment at
10% less than fair market value on the date of the  agreement.  If the agreement
is terminated  at any time other than the  anniversary  date,  any stock options
which would have accrued  during the  termination  year will be offered on a pro
rata basis at the time of termination.

NOTE 8 - INCOME TAXES

The Company  accounts for income taxes under  Statement of Financial  Accounting
Standards No. 109,  "Accounting for Income Taxes" ("SFAS No. 109"). SFAS No. 109
requires the  recognition  of deferred tax assets and  liabilities  for both the
expected impact of differences between the financial statements and tax basis of
assets and  liabilities,  and for the expected  future tax benefit to be derived
from tax loss and tax credit  carryforwards.  SFAS No. 109 additionally requires
the  establishment  of a  valuation  allowance  to  reflect  the  likelihood  of
realization of deferred tax assets.

The provision  (benefit)  for income taxes differs from the amounts  computed by
applying the statutory federal income tax rate to income (loss) before provision
for income taxes, the reconciliation is as follows:
<TABLE>
<CAPTION>

                                                                         Year Ended            Year Ended December
                                                                     December 31, 2001              31, 2000
                                                                     -------------------      ----------------------
<S>                                                                  <C>                      <C>
         Taxes benefit computed at statutory rate                    $         (785,000)      $            (356,000)

         Permanent differences                                                  258,000                     167,000
         Income tax benefit not utilized                                        527,000                     189,000
                                                                     -------------------      ----------------------

         Net income tax benefit                                      $                -       $                   -
                                                                     ===================      ======================
</TABLE>
The Company has a net  operating  loss  carryforward  for tax purposes  totaling
approximately $2,400,000 at December 31, 2001 expiring through the year 2021.

Listed below are the tax effects of the items  related to the  Company's net tax
asset:

                                                             December 31, 2001
                                                            -------------------
         Tax benefit of net operating loss carryforward     $          938,000
         Valuation Allowance                                          (938,000)
                                                            -------------------
         Net deferred tax asset recorded                    $                -
                                                            ===================


                                      F-13
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000


NOTE 9 - STOCKHOLDERS' EQUITY

Common Stock

In May 2000,  the Company  issued  334,000 shares of its common stock to various
consultants,  in consideration for services rendered to the Company. Such shares
were valued at an  aggregate  of $303,606 or $0.91 per share.  Such amounts were
recorded as compensation.

On May 31, 2000, the Company amended its articles of  incorporation  to increase
the  number of common  shares  it is  authorized  to issue  from  10,000,000  to
20,000,000.

On September 8, 2000,  the Company  issued 104,494 shares of its common stock to
various consultants, in consideration for services rendered to the Company. Such
shares were valued at $114,734 or $1.01 per share. Such amounts were recorded as
compensation.

During 2001, the Company issued 886,500 of its common shares to consultants  and
employees for services  rendered.  The shares were valued at prices ranging from
$.39 to $.75.  For the year  ended  December  31,  2001,  the  Company  recorded
compensation expense of $300,420 and professional fees of $119,421.

On March 28, 2001, the Company raised  $755,000  through a private  placement of
604,000  units  ($1.25  per  unit),  each unit  consisting  of two shares of the
Company's  common stock and one common stock  purchase  warrant  exercisable  at
$1.50  per  share.  The  Company  incurred  costs in  relation  to this  private
placement of $168,650 and netted  proceeds of $586,350.  The Company also issued
56,000  shares of its common  stock for legal  services  rendered in relation to
this offering.  Additionally,  the Company issued to a consultant  that provided
services in relation to securing the proceeds of this  offering,  627,500 common
stock warrants  exercisable at $0.50 per share.  All costs  associated with this
offering are recorded net against the gross proceeds.

On May 31,  2001,  the Company  issued  2,000,000  shares of its common stock in
exchange for 100% of the outstanding  stock of Micro Sensor  Technologies,  Inc.
("Micro Sensor").  The Company valued the shares exchanged at $0.38 per share or
$760,000.

In connection  with a loan payable dated August 15, 2000,  the Company agreed to
issue 100,000 shares of the Company's  restricted  common stock to the holder of
the loan at the end of the loan,  which was due on August 15,  2001.  The common
shares to be issued  were  valued on the loan date at the fair  market  value of
$1.12 per share for an aggregate of  $112,500.  Accordingly,  as of December 31,
2000, the Company accrued  $42,188 in interest  expense in connection with these
shares to be issued.  In May 2001,  the Company issued these shares and recorded
additional interest expense of $70,312 related to these shares.

In June 2001,  the Company  purchased  3,000 shares of its common stock at $0.53
per share or $1,588. Such shares were subsequently retired.





                                      F-14
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000


NOTE 9 - STOCKHOLDERS' EQUITY (Continued)

Common Stock (Continued)

On August 31,  2001,  in  connection  with a note  payable,  the Company  issued
1,055,000  shares of common  stock.  The stock was issued  having a fair  market
value on the date that the funds were received of $598,185.  The amount has been
recorded as deferred  financing costs, which is being amortized over the life of
the notes.  For the year ended  December 31, 2001,  $199,395 has been charged to
interest expense.

Additionally,  in  connection  with  the  offering,  the  Company  issued  to an
investment  banker for services provided in relation to securing the proceeds of
this offering,  105,000 shares of its common stock.  These shares were valued at
fair market  value of $.57 per share or $59,535.  The Company has  recorded  the
amount as deferred  financing  costs and is amortizing such amount over the life
of the notes. For the year ended December 31, 2001,  $19,845 has been charged to
interest expense.

Common Stock Option and Warrants

1999 Stock Option Plan

On July 19, 1999, the board of directors adopted the Company's 1999 Stock Option
Plan (the "1999  Plan").  The Company has  reserved  1,500,000  shares of common
stock for issuance upon exercise of options  granted from time to time under the
1999 stock  option  plan.  The 1999 stock  option plan is intended to assist the
Company in securing and retaining key  employees,  directors and  consultants by
allowing them to participate  in the Company's  ownership and growth through the
grant of incentive and non-qualified  options.  Under the stock option plan, the
Company may grant  incentive  stock  options only to key  employees and employee
directors,  or  the  Company  may  grant  non-qualified  options  to  employees,
officers,  directors and consultants. The Company's board of directors currently
administers  the 1999 stock option plan.  Subject to the  provisions of the 1999
stock option plan,  the board will  determine  who shall  receive  options,  the
number of shares of common  stock that may be purchased  under the options,  the
time and manner of  exercise  of options and  exercise  prices.  The term of the
options  granted under the 1999 stock option plan may not exceed ten years (five
years for an incentive  stock option granted to an optionee owning more than 10%
of our voting  stock).  The exercise  price for incentive  stock options will be
equal to or  greater  than 100% of the fair  market  value of the  shares of the
common stock at the time granted.  However,  the incentive stock options granted
to a 10% holder of the Company's  voting stock are  exercisable at a price equal
to or greater than 110% of the fair market value of the common stock at the date
of the grant.  The exercise price for  non-qualified  options will be set by the
board, in its discretion,  but in no event shall the exercise price be less than
75% of the fair market value of the shares of common stock on the date of grant.
The exercise price may be payable in cash or, with the approval of the board, by
delivery of shares or a combination  of cash and shares.  Shares of common stock
received  upon  exercise of options will be subject to  restrictions  on sale or
transfer.  During 2001,  the Company  granted  1,485,000  options under the 1999
stock option plan, as discussed below.





                                      F-15
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000


NOTE 9 - STOCKHOLDERS' EQUITY (Continued)

2001 Equity Compensation Plan

On November 26, 2001,  the board of directors  adopted the Company's 2001 Equity
Compensation Plan (the "2001 Plan").  The Company has reserved  2,000,000 shares
of the  Company's  common  stock.  The  purpose  of the 2001 Plan is to  provide
designated employees, certain key advisors who perform services for the Company,
and  non-employee  board  members  with the  opportunity  to  receive  grants of
incentive stock options,  nonqualified  stock options and restricted  stock. The
Company  believes that the Plan will  encourage the  participants  to contribute
materially  to the  growth of the  Company,  thereby  benefiting  the  Company's
shareholders.  The Plan is administered by the Company's board of directors or a
committee appointed by the board.

Subject to the  provisions  of the stock option plan,  the board of directors or
its  appointed  committee  shall  have  the  sole  authority  to  determine  the
individuals to whom grants shall be made, the type, size and terms of the grants
to be made to each individual. In addition, the board or its appointed committee
will  determine the time when the grants will be made and the duration of grants
including exercise or restrictions and criteria for exercisability.

The term of the  options  granted  under the 2001 Plan may not  exceed ten years
(five years for an  incentive  stock option  granted to an optionee  owning more
than 10% of our voting stock).  The exercise  price for incentive  stock options
may be equal to, or  greater  than the fair  market  value of the  shares of the
common stock at the time granted.  However,  the incentive stock options granted
to a 10% holder of the Company's  voting stock are  exercisable at a price equal
to or greater than 110% of the fair market value of the common stock at the date
of the grant.  In the case of an option  granted that  qualifies as  performance
based  compensation,  the  exercise  price may not be less than 100% of the fair
market value of the Company's stock on the date of grant. The exercise price for
non-qualified options granted to non-employee directors, shall equal 100% of the
fair  market  value of the  Company's  common  stock at the date of  grant.  The
exercise  price may be payable in cash or, with the  approval  of the board,  by
delivery of shares or a combination  of cash and shares.  Shares of common stock
received  upon  exercise of options will be subject to  restrictions  on sale or
transfer. As of December 31, 2001, the Company has granted 550,500 options under
the 2001 stock option plan, as discussed below.

During 2001, the Company granted options to purchase  1,385,000 shares of common
stock to certain employees of the Company under the 1999 Plan and 537,500 shares
under the 2001 Plan.  The options are  exercisable  at per share prices  ranging
from $.39 to $.50 per share and $.63 to $.69 per share, respectively,  which was
the fair market value of the common stock at the grant date.

During 2001, the Company  granted  options to purchase  100,000 shares of common
stock to  consultants of the Company under the 1999 Plan and 13,000 shares under
the 2001 Plan. The options are exercisable at a price of $.39 per share and $.63
per share, respectively,  which was the fair market value of the common stock at
the grant date.  Consulting  expense in the amount of $22,348 has been  recorded
for the year ended December 31, 2001 relating to these options.




                                      F-16
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000



NOTE 9 - STOCKHOLDERS' EQUITY (Continued)

Common Stock Option and Warrants (Continued)

The Company applies APB No. 25,  "Accounting for Stock Issued to Employees," and
related  interpretations  in accounting  for its stock  options.  As a result no
compensation  expense  has been  recognized  for  employee  and  director  stock
options. Had the Company determined compensation cost based on the fair value at
the  grant  date for its stock  options  under  SFAS No.  123,  "Accounting  for
Stock-Based  Compensation,"  the  Company's net loss would have been reported as
follows:

                                       Years Ended December 31,
                                       2001                 2000
                                  -----------------  ----------------

    Net Income (loss):
     As reported                  $     (2,013,686)  $      (888,867)
     Pro forma                    $     (2,464,796)  $      (888,867)

    Diluted income (loss) per common share:
        As reported               $          (.21)   $          (.14)
        Pro forma                 $          (.25)   $          (.14)

On March 28, 2001, the Company  granted  654,000 common stock purchase  warrants
through a private placement. The warrants are exercisable at prices ranging from
$.50 to $1.50 per share.  In addition,  the Company issued to a consultant  that
provided services in relation to securing the proceeds of this offering, 627,500
common stock purchase warrants exercisable at $0.50 per share which was the fair
market value of the common stock at that date.  Consulting expense in the amount
of $25,650 has been recorded for the year ended December 31, 2001

The Company  utilizes the  Black-Scholes  option-pricing  model to calculate the
fair value of each  individual  issuance of options and warrants.  The per-share
weighted  average fair value of stock options and warrants  granted  during 2001
was $0.20 on the date of grant  using the  Black-Scholes  pricing  model and the
following assumptions:

     Expected dividend yield                      0%
     Risk-free interest rate                 4.5% - 5%
     Annualized volatility                    54%-105%
     Expected life, in years                      2-5

Stock option  activity for the year ended  December  31, 2001 is  summarized  as
follows:

                                           Number of     Weighted average
                                            shares        exercise price
                                          -----------    ----------------
Outstanding at December 31, 2000                   -     $             -
Granted                                    2,035,500                0.51
Exercised                                          -                   -
Canceled                                           -                   -
                                          -----------    ----------------

Outstanding at December 31, 2001           2,035,500     $          0.51
                                          ===========    ================






                                      F-17
<PAGE>
                      SENSE HOLDINGS, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                     YEARS ENDED DECEMBER 31, 2001 AND 2000



NOTE 9 - STOCKHOLDERS' EQUITY (Continued)

Common Stock Option and Warrants (Continued)

Stock  warrant  activity for the year ended  December 31, 2001 is  summarized as
follows:

                                         Number of      Weighted average
                                           shares        exercise price
                                         ---------      ----------------
Outstanding at December 31, 2000                 -      $             -
Granted                                  1,281,500                 0.98
Exercised                                        -                    -
Canceled                                         -                    -
                                         ---------      ----------------
Outstanding at December 31, 2001         1,281,500      $          0.98
                                         =========      ================

The  following  table  summarizes  the  Company's  stock  options  and  warrants
outstanding at December 31, 2001:

                      Options and warrants outstanding and exercisable
                     --------------------------------------------------
                                         Weighted     Weighted
                                         average       average
          Range of                      remaining     exercise
        exercise price     Number          life         price
        --------------   ---------      ---------     ---------

        $   0.39-0.50    2,112,500          3.00        $ 0.47
        $   0.63-0.69      600,500          2.25        $ 0.67
        $        1.50      604,000          4.75        $ 1.50
                         ---------

                         3,317,000


NOTE 10 - SUBSEQUENT EVENTS

On January 14, 2002 the Company  granted  8,192 shares of the  Company's  common
stock to a consultant in consideration  for services  rendered during the months
of November and December 2001.

On January 30, 2002, the shareholders of the Company approved an increase in the
number of authorized shares to 40,000,000.

On February 15, 2002 the Company  granted 5,376 shares of the  Company's  common
stock to a consultant in consideration for services rendered during the month of
January 2002.

On March 1, 2002, the Company raised  $2,625,625  through a private placement of
70 units  ($37,500  per  unit),  each unit  consisting  of 50,000  shares of the
Company's common stock and 50,000 common stock warrants exercisable at $1.25 per
share with an expiration date of five years from the date of closing.







                                      F-18
<PAGE>
                                   SIGNATURES

In accordance  with Section 13 or 15(d) of the Securities  Exchange Act of 1934,
the  registrant  has  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized, in Sunrise, Florida on April 1, 2002.

                              SENSE HOLDINGS, INC.

                            By: /s/ Dore Scott Perler
                                Dore Scott Perler
                                  Chairman, Chief Executive Officer
                                  and Principal Financial and Accounting Officer



In accordance  with the  Securities  Exchange Act of 1934,  this report has been
signed by the following  persons on behalf of the  registrant in the  capacities
and on the dates indicated.


SIGNATURE                       TITLE                                 DATE
---------                       -----                                 ----

/s/ Dore Scott Perler     Chief Executive Officer,                March 26, 2002
---------------------     President and Director
Dore Scott Perler         (Principal Executive Officer
                          and Principal Accounting Officer)


/s/ Andrew Goldrich       Vice President and Director             March 26, 2002
---------------------
Andrew Goldrich


/s/ Shawn Tartaglia       Chief Technical Officer                 March 26, 2002
---------------------     and Director
Shawn Tartaglia


/s/ Julie Slater          Director                                March 26, 2002
---------------------
Julie Slater