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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

(Mark One)
|X| ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
    1934

         For the fiscal year ended:  December 31, 2001

                                       OR

|_| TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
    OF 1934.

         For the transition period from __________ to __________

                              GLOBAL NETWORK, INC.
                 (Name of Small Business Issuer in Its Charter)

       Nevada                     000-27185                88-0367123
--------------------------------------------------------------------------------
(State or Other Jurisdiction     (Commission            (I.R.S. Employer
 of Incorporation or              File Number)           Identification No.)
 Organization)

            575 Madison Avenue, 10th Floor, New York, New York 10022
   ---------------------------------------------------------------------------
     (Address of Principal Executive Offices)               (Zip Code)

                                  212.605.0431
       -------------------------------------------------------------------
              (Registrant's Telephone Number, Including Area Code)

Securities registered under Section 12(b) of the Exchange Act:  Not applicable

Securities registered under Section 12(g) of the Exchange Act:  common stock,
                                                                par value $0.001
                                                                per share

          Check whether the issuer: (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.

          Yes  |X|    No  |_|

          Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no disclosure will
be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporate by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. |_|

          State issuer's revenues for its most recent fiscal year: $201,691

          State the aggregate market value of the voting and non-voting common
equity held by non-affiliates computed by reference to the price at which the
common equity was sold, or the average bid and asked prices of such common
equity, as of a specified date within the past 60 days. (See definition of
affiliate in Rule 12b-2 of the Exchange Act.) The aggregate market value of the
voting and non-voting common equity of Global Network, Inc. held by
non-affiliates was $3,333,373, based on the average bid and asked prices of such
common equity as of April 10, 2002.


                   ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                           DURING THE PAST FIVE YEARS

          Check whether the issuer has filed all documents and reports required
to be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.

          Yes  |_|    No  |_|


<PAGE>

                    APPLICABLE ONLY TO CORPORATE REGISTRANTS

          State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date. As o f April 12, 2002, the
number of shares of common stock, par value $0.001 per share, of Global Network,
Inc. issued and outstanding were 24,754,505.

                       DOCUMENTS INCORPORATED BY REFERENCE

          If the following documents are incorporated by reference, briefly
describe them and identify the part of the Form 10-KSB (e.g., Part I, Part II,
etc.) into which the document is incorporated: (1) any annual report to security
holders; (2) any proxy or information statement; and (3) any prospectus filed
pursuant to Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act").
The listed documents should be clearly described for identification purposes
(e.g., annual report to security holders for fiscal year ended December 24,
1990). None of the foregoing documents are incorporated by reference in this
Form 10-KSB.

          Transitional Small Business Disclosure Format: (check one):

          Yes  |_|    No  X|






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                              GLOBAL NETWORK, INC.

                          Annual Report on Form 10-KSB
                   for the Fiscal Year Ended December 31, 2001

                            IMPORTANT NOTE REGARDING
                           FORWARD LOOKING STATEMENTS

          Some of the statements in our Annual Report are forward-looking
statements within the meaning of the federal securities laws. Generally,
forward-looking statements can be identified by the use of terms like "believe,"
"may," "will," "expect," "anticipate," "plan," "intend", "hope" and similar
words, although this is not a complete list, and we may express some
forward-looking statements differently. Discussions relating to our plan of
operation, our business strategy and our competition, among others, contain such
statements. Actual results may differ materially from those contained in our
forward-looking statements for a variety of reasons, including those that may be
discussed as "Risk Factors" in other filings we submit with the SEC.

          Throughout this report, when we refer to "GNI," "Global Network" or
"the Company," or when we speak of ourselves generally, we are referring
collectively to Global Network, Inc. and any of our subsidiaries unless the
context indicates otherwise or as otherwise noted.

PART I

Item 1.  Description of Business

OUR BUSINESS

          Global Network packages, sells and serves online banner advertising on
newspaper websites to national advertisers and their advertising agencies. We
have created the first and only unique cyberlinked network of online newspaper
web sites to bring national advertisers and leading newspapers together on the
Internet. Our proprietary software system -- the GNI System -- allows national
advertisers and their ad agencies to place ads on multiple newspaper websites at
one time and to target a specific demographic by having the advertisement posted
in the section of the newspaper that they choose. In addition, the GNI System
has real time auditing capabilities that provides advertisers with an accurate
and timely accounting of the number of page views and "click-throughs" for their
ads. The GNI System is also unique in that it allows the advertiser the ability
to change creative copy in real time thereby enabling a multi-market advertising
buy that changes the ad to the creative specifications of the newspapers
involved.

          We believe that the GNI System is the only system that allows the
advertiser to target its market both geographically and demographically on
newspaper websites in one step and that provides auditing services as frequently
as requested by the advertiser. We believe that the ultimate potential market
for the GNI System is 15,000 newspaper websites worldwide. The combination of
our proprietary software, strategic alliances and the size of the database
provides potential earnings for the GNI System in the form of fees, revenue
sharing opportunities, licensing arrangements and subscription agreements.


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BACKGROUND

          The use by national advertisers of newspapers has been somewhat less
than anticipated because of the limited, local audience of newspapers and the
difficulty for advertisers to place advertising in multiple newspapers,
including local newspapers, efficiently. A multiple-market newspaper
advertisement in either print or online media can be difficult for national
advertisers to place because the advertiser (or its agency) must contact each
newspaper separately to obtain, among other things, production specifications,
advertising rates and positioning information, a process frequently involving
several departments within each newspaper.

          Given the time-consuming nature of this process, companies desiring to
advertise nationally online are drawn to national networks that offer local city
guides, such as AOL, Yahoo! and Lycos, as that national advertiser will then
have access to local markets. The GNI System, however, provides national
advertisers with access to online newspapers in a one-step purchase process that
the Company believes is far more effective than the national sites, as supported
by the research described below.

          An independent study published in September 2000 by NFO AD:IMPACT, a
subsidiary of NFO WorldGroup, one of the Interpublic Group of Companies (one of
the largest organizations of advertising agencies and marketing service
companies in the world), found that online newspapers are among the most
recognized and visited websites among local-oriented Internet destinations. The
study found that:

          o    28 percent of visitors to newspaper websites contacted a business
               that advertised on the online newspaper and that 58 percent of
               those visitors made a purchase from those online advertisers.

          o    Across 17 major and local markets, 66 percent of online consumers
               were aware of online newspaper websites while only 34 percent of
               those consumers were aware of local city guide websites that
               compete for the same advertising business. Local city guide
               websites that are competitive with newspaper websites include
               AOL, Yahoo!, Lycos and Ticketmaster CitySearch.

          o    When Yahoo!Local was compared with newspaper websites in 7
               markets, 74 percent of online users were aware of online
               newspaper websites while only 34 percent were aware of
               Yahoo!Local websites. In addition, 28 percent of the survey
               participants reported visiting an online newspaper website within
               the past 30 days while only 4 percent visited a Yahoo!Local
               website.

          As newspapers are increasingly offering content on the Internet, we
believe there exists a significant, and largely untapped, potential market for
national advertisers. The GNI System enables each advertiser to target its
market both demographically and geographically in one step. We intend to
capitalize on this market potential by purchasing unused space on these
newspaper web sites and, using our proprietary software, packaging and reselling
it as online banner advertising to national advertisers. Newspapers can thus
sell inventory (unused space) through the GNI System to national advertisers who
otherwise would not buy advertising in local markets as a result of the
cumbersome nature of placing such advertisements.


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THE GNI SYSTEM

          Advantages of the GNI System

          The key to our business is our software, the GNI System. The GNI
System provides the following benefits to national advertisers and their ad
agencies:

          o    They can reach their demographic on newspaper websites by
               choosing the editorial section, time of day, week or month they
               want their ad to appear.

          o    They reach their targets through a series of linked banner and
               interstitial ads appearing throughout the newspaper website on
               specific content pages, providing the advertiser with a targeting
               capability that is precise, efficient and measurable.

          o    They can target several geographic markets at one time in a
               single step.

          o    They place only one order, and receive only one audit report and
               one invoice for a multi-market advertisement; multi-market
               negotiations are eliminated.

          The GNI System also benefits the newspaper by providing the newspaper
with new advertisers and new revenues and by reducing unused advertising space.

          How the GNI System Works

          When a national advertiser or its agency is interested in purchasing
advertising space on newspaper websites using the GNI System, the advertiser or
agency logs into our website at www.dgonn.com. The advertiser or agency then
submits a request for an estimate by entering the online newspapers (also
referred to as venues) in which it wishes for the advertisement to appear, the
section in which the advertisement will appear and the placement of the
advertisement on the web page (such as the top banner, near the top of the page,
near the middle of the page, and so on), the dates and times during which the
advertisement is to run on each particular newspaper and the total number of
impressions that are to appear during the specified dates.

          The GNI System has a database containing over 800 online newspapers
nationwide. With the information contained in the database, the GNI System is
able to provide an estimate of the cost of the proposed campaign. The GNI System
also checks with the online newspapers to determine the availability of the
requested running times. If the requested running times are available, the
advertiser or agency may then submit a binding order, at which time the GNI
System will purchase the requested advertising space. Each of the online
newspapers then submits an invoice to GNI, which then submits one invoice to the
advertiser that includes the cost of the advertising space purchased on its
behalf as well as a fee for the services provided by GNI. In addition, if the
advertiser or agency requests, GNI can provide auditing services to show on a
real time basis how many impressions and "click throughs" have occurred.

          We believe we have the ability to purchase unused page views from
virtually every newspaper that maintains a web site. Currently, a majority of
these page views go unsold or are sold for less than optimal rates. Though our
primary focus is on newspapers in all of the major domestic markets, our
strategic alliances offer us a revenue source by providing a greater worldwide
market for GNI's Internet Database.


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<PAGE>

          To date, we have not experienced any problems in unavailable
inventory, and the amount of unpurchased advertising space has been widely
available. We believe that this will continue to be the case for the foreseeable
future, although we cannot guarantee that we will always be able to acquire the
requested amount of advertising space.

          We believe that the GNI System is unique in its ability to link to
multiple pages on multiple newspaper web sites, thereby allowing national ad
agencies to purchase targeted advertising on specific sites in major markets.
Using the GNI System, advertisers can target their ads by demographic criteria,
day, date and time of day. This allows the advertisers to match the message with
the medium by tying the sales message to editorial content. It is also our
belief that no other system similar to the GNI System exists today.

          The editorial section options that are currently available on the GNI
System database are very similar to those found in the print version of a
newspaper. The editorial sections most popular with our advertisers are as
follows:

          Financial                Women
          Package Goods            Men
          Entertainment            Sports
          Pharmaceuticals          Gossip
          Political                Food
          Health                   Airlines
          Automotive               Travel
          Technology               CD's
          Television               Books
          Weather                  Parenting
          International buys       Custom buys


          The GNI System also lets national advertisers transact in multiple
markets by purchasing an "Area of Dominant Influence," or "ADI." An ADI is a
pre-selected network of ad inventory that targets geographic zones. For example,
a manufacturer of cold medicine could advertise its products through a "Cold
Weather Buy" that targets regions in which consumers are more susceptible to
winter colds. GNI has developed 50 geographic ADIs and 30 demographic buys. The
geographic ADIs include "Beach Buy," "Canadian Buy" and "West Coast Business
Buy." The demographic buys include "Kids Buy," "Seniors Buy," "Public Opinion
Buy" and "Sports Buy."

          In addition to providing advertisers and agencies with the ability to
access multiple markets in a single session, we also provide auditing
capabilities upon request. The auditing software is able to verify the amount of
traffic a newspaper website receives for ad impression purposes, and also allows
the online newspaper publisher to gauge audience receptivity of specific
editorial content. The software is able to count the total number of views of
banner ads using real time verification technologies, which means that a
newspaper or advertiser may count the number of ad impressions as they happen
rather than wait until responses are bulked or stored.

          Our auditing software is also capable of distinguishing between "raw"
and "actual" results. A "raw" result occurs when a web page is not actually
viewed, which occurs when Internet search

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engines list a web page as a result of a search inquiry by an online user; the
Internet search engines has searched the web page and listed it as possibly
containing content relevant to the search inquiry, but the page is not actually
viewed by the online user. An actual result occurs when an online user views a
web page. By distinguishing between raw and actual results, our auditing
software shows advertisers how many times the page is actually viewed by online
users a much more valuable statistic to advertisers.

          To date, we have been invited to submit proposals by national
advertisers in the following industries: financial services; package goods;
entertainment; pharmaceuticals; political; health care; automotive; technology;
airlines; travel; CD's; books; and parenting.

OUR TEAM

          We employ one full-time employee and various outside consultants. The
individuals bring a variety of publishing, Internet, design, programming,
corporate, and entrepreneurial experience in marketing and/or publishing, as
more fully detailed in Part III, Item 9, below. We intend to continue to
capitalize on each such individual's industry experience and contacts to expand
our business.

          In March 2001, we entered into an agreement with the Newspaper
National Network ("NNN") pursuant to which NNN will sell online newspaper
advertising through our system to the following industries: automobiles;
packaged goods; pharmaceuticals; and technology. NNN, a subsidiary of the
Newspaper Association of America, which is owned by 24 of the largest newspaper
companies in the United States, currently sells national advertising in
approximately 1,500 daily newspapers. NNN will receive a 5% sales commission on
gross revenues attributable to NNN-placed advertising. We believe that this
relationship with NNN will provide us with a significant opportunity to expand
our business and provide new contacts.

          During the third quarter of 2001, we entered into an agreement with
Vertis Inc. ("Vertis"), a leader in integrated advertising and marketing
solutions. We have combined forces with Vertis in an effort to place advertising
for major national and regional retailers onto our on-line newspaper network.
The agreement with Vertis, together with the NNN alliance, gives us access and
strategic relationships with a substantial number of advertising contacts. As a
result of our alliances with Vertis and NNN, we are now the online component to
major print sales organizations.

          The advertising sales responsibility for our company rests on our
major strategic partners including NNN and Vertis which together employ over 300
sales people in the field. These organizations provide us with access to top
level contacts at major national advertisers and ad agencies. It is our plan to
engage other similar organizations.

PATENTS

          The Company has filed U.S. and international patent applications
directed to methods of placing advertisements or other communication on multiple
websites. There can be no assurance that any such patent protection will be
granted or, if granted, will have any commercial value. Management feels
confident that the uniqueness of GNI's software will distinguish it among others
that create revenue opportunities that are more subscription related than
advertising "cpm" based.

CUSTOMERS

          Currently our customers consist of both traditional and on-line
companies and advertising agencies that desire to advertise online. Despite the
slump in all advertising in 2001, we were able to attract new and major national
advertisers, including American Express, Citibank, America West,


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British Airways, Cendant, Diners Club, AT&T, DSTV and VISA. However, as a result
of the September 11, 2001 terrorist attack, all of these campaigns were
truncated. It is our belief that, as the economy recovers, these advertisers
will return and we will continue attract new customers.

MARKETING STRATEGIES

          We plan to grow our business by implementing the following key
strategies:

          Focus on Newspaper Websites

          We believe that there is a potentially large untapped market for
national advertising on newspaper web sites in that newspaper websites provide
national advertisers with a target market that is larger than the local market
of the print newspaper. We intend to focus on this market and become the leading
Internet advertising company dedicated to the newspaper industry. We believe
that our arrangements with NNN and Vertis discussed above will significantly
enhance our customer base for newspaper websites. According to Jupiter Media and
Gardner Associates, by 2007, interactive newspaper advertising is projected to
cover up to 15,000 sites worldwide and generate $8 billion in revenues.

          Target our Marketing to National Advertisers

          We intend to focus our marketing on national advertisers and their ad
agencies. We plan to demonstrate to these advertisers the power of our network
of local newspaper website advertising as a potentially formidable competitor to
magazines and television. Specific industries that we intend to target initially
include automobiles, entertainment, financial, insurance, pharmaceuticals,
politics and packaged goods.

          Continue to Develop and Use our Leading Edge Proprietary Software

          Our software allows our advertisers to target, place and track online
advertising on our network based on a number of demographic, geographic and
other criteria. We have designed our software to allow us to efficiently meet
the needs of our advertisers. We intend to continue to develop our software as
technology and the marketplace expands.

          Continue to emphasize the ability to change copy "in flight"

          In dealing with multiple sites and combining the online and offline
"buy," time is of the essence. Our software is capable of re-tooling the
creative message by the click of a mouse instead of taking an extensive amount
of time which increases the speed and efficiency of how the buy is executed.

          Capitalize on an Experienced Management Team

          We intend to capitalize on our management team's industry contacts and
relationships to attract major national advertisers. Rather than rely on
inexperienced salesmen, we are looking to our management to pursue leading
interactive ad agencies and interactive advertisers. We also intend to use
management contacts to further develop relationships with major newspapers and
newspaper chains.

          Pursue Strategic Relationships with Select Interactive and National
Advertising Agencies

          We have pursued and are continuing to pursue strategic relationships
with a variety of major interactive and national advertising agencies, such as
Interpublic, True North, Saatchi & Saatchi and J.W. Thompson.


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INDUSTRY OVERVIEW AND COMPETITION

          Internet marketing and advertising is an intensely competitive
business. An increasing number of dedicated Internet marketing companies are
competing for online advertising dollars. We also face competition from
traditional marketing and advertising firms. We expect competition from both
sources to increase in the future.

          Our competition for Internet advertising dollars has included major
Internet advertising companies such as DoubleClick, 24/7 Media, Flycast, and
Razorfish, as well as companies such as ValueClick, Media Passages,
Advertising.com and ClickAgents. Of these, 24/7, Flycast, Razorfish, Media
Passages are no longer in existence. Most of these companies relied too heavily
on advertising revenues and did not have the software to attract or sustain
additional revenue streams. We feel that the combination of ad revenues along
with further emphasis on serving banners will help our financial needs.

OUR HISTORY

          Our operations are conducted solely through a wholly-owned subsidiary,
a New York corporation known as Global Network, Inc. (the "New York
Subsidiary"). The parent of the New York Subsidiary is also known as Global
Network, Inc. (the "Parent Company"); the Parent Company is the company that is
filing this Form 10-KSB. The Parent Company was incorporated in Nevada in August
1996 and originally was intended to operate as a wholesale liquidator of
closeouts, factory overruns, seconds and insurance salvage goods. The Parent
Company ceased those operations prior to acquiring the New York Subsidiary. The
New York Subsidiary was incorporated in April 1999.

CONTACT INFORMATION

          Our address is 575 Madison Avenue, New York, New York 10022. Our
telephone number is (212) 605-0431. Our Internet address is www.dgonn.com.
"DGONN" stands for "demographic geographic online newspaper network."

Item 2.  Description of Property

          Our principal office is located at 575 Madison Avenue, New York, NY
10022. This office houses all of our employees and the majority of our
operations including investor relations, management, sales, marketing and
accounting.

Item 3.  Legal Proceedings

          We are not currently a party to any pending lawsuits or similar
administrative proceedings and, to the best of our knowledge, there is presently
no basis for any such suit or proceeding.

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

          Not applicable.


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PART II

Item 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

          Our common stock trades in the over-the-counter market on the OTC
Bulletin Board. We began trading under the symbol "GNNU" on August 15, 1999.
Prior to that date, the stock was traded under the symbol "BRGB" with only
limited and sporadic trading. The following table shows the high and low bid
prices for our common stock for each quarter from March 31, 2000 through
December 31, 2001. Such quotations reflect inter-dealer prices, without retail
mark-up, markdown or commission, and may not represent actual transactions.

          Quarter                                 High         Low
          -------                                 ----         ---
          First Quarter 2000                     $13.25       $0.81
          Second Quarter 2000                    $10.25       $5.38
          Third Quarter 2000                      $9.25       $3.50
          Fourth Quarter 2000                     $3.50       $0.63
          First Quarter 2001                      $0.70       $0.63
          Second Quarter 2001                     $0.70       $0.61
          Third Quarter 2001                      $0.77       $0.60
          Fourth Quarter 2001                     $0.60       $0.41

          As of December 31, 2001, there were approximately 1,100 stockholders
of record of our common stock. On April 12, 2002, the closing bid price for our
common stock was $0.16. We have never paid any cash dividends on our common
stock and do not anticipate paying dividends in the near future. Any payment of
future cash dividends will be determined by our Board of Directors based upon
conditions then existing, including our financial condition, capital
requirements, cash flow, profitability, business outlook and other factors. In
addition, any credit arrangements that we obtain in the future may restrict the
payment of dividends.

RECENT SALES OF UNREGISTERED SECURITIES

          We have made the following sales of unregistered securities within the
last three years:

          August 1999

          While operating under our previous name, Bargain Brokers, Inc., we
acquired Global Network, Inc. (the New York Subsidiary) by issuing 27,732,934
shares of our common stock to the stockholders of Global Network in exchange for
all of its outstanding shares of common stock. The issuance of such securities
was exempt from registration pursuant to Section 4(2) and Regulation D of the
Securities Act of 1933.

          Again, while operating under the name Bargain Brokers, Inc., we sold
100,000 shares of our common stock and warrants to acquire up to an additional
400,000 shares of our common stock at a strike price of $2.00 per share to one
offshore investor for an aggregate sales price of $200,000. The investor
exercised warrants to acquire 100,000 shares in August 1999, which resulted in
additional gross proceeds of $200,000 to the Company. The remaining warrants
have expired. The sale of these


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securities was exempt from registration pursuant to Section 4(2) and Regulation
D of the Securities Act of 1933.

          We issued 25,000 shares of our common stock to our corporate attorneys
for services rendered. The issuance of these securities was exempt from
registration pursuant to Section 4(2) and Regulation D of the Securities Act of
1933.

          December 1999

          We issued 10,000 shares of our common stock to our intellectual
property attorneys for services rendered. The issuance of these securities was
exempt from registration pursuant to Section 4(2) and Regulation D of the
Securities Act of 1933.

          December 1999 Through February 2000

          We granted options to purchase an aggregate of 745,000 shares of our
common stock at strike prices ranging from $0.50 to $0.93 to a limited number of
service providers in consideration for services rendered. The grant of such
options option was exempt from registration pursuant to Section 4(2) and
Regulation D of the Securities Act of 1933.

          February and March 2000

          We sold an aggregate of 1,338,000 shares of our common stock to 30
accredited investors that resulted in gross proceeds of $1,768,250 to the
Company. The sale of these securities was exempt from registration pursuant to
Section 4(2) and Regulation D of the Securities Act of 1933. In connection with
this offering, we also issued 5,000 shares of our common stock to a consultant
for services rendered. The issuance of these securities was exempt from
registration pursuant to Section 4(2) and Regulation D of the Securities Act of
1933.

          September 2000

          We sold an aggregate of 194,750 shares of our common stock to
accredited investors at $2 per share, which provided the Company with gross
proceeds of $389,500. In connection with this offering we issued 14,500 shares
for financial services rendered. The issuance of these securities was exempt
from registration pursuant to Section 4(2) and Regulation D of the Securities
Act of 1933.

          In addition to the offerings noted above, during 2000 the Company
issued a total of 1,000,000 shares of common stock to various vendors and
consultants in exchange for services provided. The aggregate fair value of the
shares of common stock was approximately $1,706,250. The issuance of these
securities was exempt of registration pursuant to Section 4(2) and Regulation D
of the Securities Act of 1933.

          January 2001 through April 2001

          We sold an aggregate of 466,750 shares of our common stock to
accredited investors at $.25 per share, which provided the Company with gross
proceeds of $116,687. We sold an aggregate of 250,000 shares of our common stock
to accredited investors at $.20 per share, which provided the Company with gross
proceeds of $50,000. The sale of these securities was exempt from registration
pursuant to Section 4(2) of the Securities Act of 1933. Additionally, we issued
a total of 340,000 shares of common stock to various vendors and consultants in
exchange for services provided. The aggregate fair value of the shares of common
stock was approximately $446,250.


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          April 2001 through June 2001

          We issued 500,000 shares of our common stock to Westhaven Properties
and 250,000 shares of our common stock to Grenada Properties at $.56 per share
in exchange for services and we recognized a charge of $420,000. The issuance of
these securities was exempt from registration pursuant to Section 4(2) of the
Securities Act of 1933. We sold an aggregate of 50,000 shares of our common
stock to accredited investors as $.22 per share, net of expenses of $1,650,
which provided the Company with net proceeds of $9,350. The sale of these
securities was exempt from registration pursuant to Section 4(2) of the
Securities Act of 1933.

          July 2001 through September 2001

          We sold an aggregate of 3,082,203 shares of our common stock at $.22
per share, net of expenses of $94,838 and finder fee shares of 667,000, which
provided the Company with net proceeds of $587,412. The sale of these securities
was exempt from registration pursuant to Section 4(2) of the Securities Act of
1933.

          October 2001 through December 2001

          We sold an aggregate of 2,577,600 shares of our common stock at $.10
per share, net of expenses of $42,962, which provided the Company with net
proceeds of $214,798. In connection with the 446,750 and 3,032,203 share
offerings referenced above, we issued 20,000 and 614,000 shares of our common
stock, respectively, for services rendered. We cancelled options to purchase
450,000 shares of common stock at a purchase price of $.93 per share and issued
the holders of such options an equal number of shares of our common stock in
exchange for cancellation of such options. The fair market value of the options
exceeded the fair value of the stock thus there were no adjustments recorded in
our 2001 financial statements. We issued 277,778 shares of our common stock in
exchange for public relations services rendered at $.65 per share, and
accordingly recognized a charge of $180,556 in our 2001 financial statements.

RECENT CANCELLATIONS OF CERTAIN SHARES

          In March 2000, our president canceled 1,175,000 shares of our common
stock that he held at the time, reducing the number of shares of our common
stock outstanding. The number of shares outstanding set forth on the cover page
of this report reflects the cancellation of these shares. The cancellation of
these shares in conjunction with the recent private placements discussed above
allowed us to raise additional funds through issuances of equity while
minimizing shareholder dilution.

          During 2001, 850,000 shares in the Company's treasury were retired.

Item 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATION

          Except for historical information, the material contained in this
Management's Discussion and Analysis of Financial Condition and Results of
Operation is forward-looking. This discussion includes, in addition to
historical information, forward-looking statements that involve risks and
uncertainties. The Company's actual results could differ materially from the
results discussed in these forward-looking statements. For the purposes of the
safe harbor protection for forward-looking statements provided by the Private
Securities Litigation Reform Act of 1995, readers are urged to review the list
of certain important factors set forth in Cautionary Statement for Purposes of
the Safe Harbor Provisions of the Private Securities Litigation Reform Act of
1995, which is set forth below after Liquidity and Capital Resources.


                                    12 of 25

<PAGE>

            Summary of Significant Accounting Policies and Estimates

          Our discussion and analysis of our financial condition and results of
operations are based upon our consolidated financial statements, which have been
prepared in accordance with accounting principles generally accepted in the
United States of America. The preparation of these consolidated financial
statements requires us to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues, and expenses, and related disclosures
of contingent assets and liabilities. On an on-going basis, we evaluate our
estimates, including those related to accounts receivable, property and
equipment, intangible assets, stock based compensation and contingencies. We
base our estimates on historical experience and on various assumptions that are
believed to be reasonable under the circumstances, the results of which form the
basis for making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from
these estimated under different assumptions or conditions.

          Note 1 of the notes to the consolidated financial statements included
in this annual report sets forth the principal accounting policies, assumptions
and bases for estimates used in preparing our financial statements as summarized
below:

Revenue recognition:

          Revenue is recognized when earned. For advertising services, revenue
          is earned generally when advertising placed by our customers appears
          on the newspaper web sites.

Computer equipment:

          Computer equipment is stated at cost, net of accumulated depreciation.
          Depreciation of equipment is provided on a straight-line basis over
          the estimated useful lives of the assets of five years.

Software development costs:

          We account for costs incurred in connection with the development of
          software in accordance with Statement of Position 98-1, "Accounting
          for Costs of Computer Software Developed or Obtained for Internal
          Use." Accordingly, all costs incurred in preliminary project stage are
          expensed as incurred, and internal and external costs incurred to
          develop internal use computer software during the application
          development stage are capitalized. Capitalized software development
          costs are amortized on a straight-line basis over an estimated useful
          life of five years.

          We capitalized costs of approximately $422,000 that were incurred in
          connection with the application and development stage of its
          proprietary software during 2000.

Impairment of long-lived assets:

          We have adopted the provisions of Statement of Financial Accounting
          Standards No. 121, "Accounting for the Impairment of Long-Lived Assets
          and for Long-Lived Assets to be Disposed of" ("SFAS 121"). Under SFAS
          121, impairment losses on long-lived assets, such as equipment and
          capitalized software development costs, are recognized when events or
          changes in circumstances indicate that the undiscounted cash flows
          estimated to


                                    13 of 25

<PAGE>

          be generated by such assets are less than their carrying value and,
          accordingly, all or a portion of such carrying value may not be
          recoverable. Impairment losses are then measured by comparing the fair
          value of assets to their carrying amounts.

Net earnings (loss) per common share:

          We present "basic" earnings (loss) per common share and, if
          applicable, we will present "diluted" earnings per common share
          pursuant to the provisions of Statement of Financial Accounting
          Standards No. 128, "Earnings per Share". Generally, basic earnings
          (loss) per common share is calculated by dividing net income or loss
          by the weighted average number of common shares outstanding during
          each period. The calculation of diluted earnings per common share is
          similar to that of basic earnings per common share, except that the
          denominator is increased to include the number of additional common
          shares that would have been outstanding if all potentially dilutive
          common shares, such as those issuable upon the exercise of options and
          warrants, were issued during the period.

          Because we had losses for 2001 and 2000, the assumed effect of
          outstanding options and warrants and the application of the treasury
          stock method would have been anti-dilutive and, therefore, diluted per
          share amounts have not been presented in the accompanying consolidated
          statements of operations.

Stock based compensation:

          In accordance with the provisions of Accounting Principles Board
          Opinion No. 25, "Accounting for Stock Issued to Employees" ("APB 25"),
          the Company will recognize compensation costs as a result of the
          issuance of stock options granted to employees based on the excess, if
          any, of the fair value of the underlying stock at the date of grant or
          award (or at an appropriate subsequent measurement date) over the
          amount the employee must pay to acquire the stock. Therefore, the
          Company will not be required to recognize compensation expense as a
          result of any grants of stock options to employees at an exercise
          price that is equivalent to or greater than fair value. The Company
          will also make pro forma disclosures, as required by Statement of
          Financial Accounting Standards No. 123, "Accounting for Stock-Based
          Compensation" ("SFAS 123"), of net income or loss as if a fair value
          based method of accounting for stock options granted to employees had
          been applied instead if such amounts differ materially from the
          historical amounts.

          In accordance with SFAS 123, we will also recognize the cost of
          shares, options, warrants and other equity instruments issued to
          nonemployees as consideration for services as expense over the periods
          in which the related services are rendered by a charge to compensation
          cost and a corresponding credit to additional paid-in capital.
          Generally, cost will be determined based on the fair value of the
          equity instruments at the date of issuance. The fair value of options,
          warrants and similar equity instruments will be estimated based on the
          Black-Scholes option-pricing model which meets the criteria set forth
          in SFAS 123, and the assumption that all of the options or other
          equity instruments will ultimately vest. The effect of actual
          forfeitures will be recognized as they occur.

Recent accounting pronouncements:

          In August 2001, the Financial Accounting Standards Board issued
          Statement of Financial Accounting Standards No. 144, "Accounting for
          the Impairment or Disposal of Long-


                                    14 of 25

<PAGE>

          Lived Assets" ("SFAS 144"). SFAS 144 addresses financial accounting
          and reporting for the impairment or disposal of long-lived assets.
          Among other things, SFAS 144 provides guidance on the implementation
          of previous pronouncements related to when and how to measure
          impairment losses and how to account for the discontinued operations.
          We do not believe that the adoption of SFAS 144 will have a material
          impact on our consolidated financial position or results of
          operations.

          The Financial Accounting Standards Board and the Accounting Standards
          Executive Committee of the American Institute of Certified Public
          Accountants have issued certain accounting pronouncements as of
          December 31, 2001 that will become effective in subsequent periods;
          however, we do not believe that any of those pronouncements would have
          significantly affected our financial accounting measurements or
          disclosures had they been in effect during 2001 and 2000 or that the
          pronouncements will have a significant affect at the time they become
          effective.

Information as to related party transactions and balances are summarized below.

Advances to officers:

          Advances to officers of $68,841 as of December 31, 2001 were
          noninterest bearing and due on demand.

Other related party transactions and commitments:

          Selling, general and administrative expenses include charges by
          related parties for client entertainment, office and secretarial
          services and other office expenses totaling approximately $221,000 and
          $296,000 for 2001 and 2000, respectively.

RESULTS OF OPERATIONS

          REVENUES. In 2001, the Company's gross revenues from operations were
          $201,691 as compared with $269,111 in 2000. All of these revenues were
          attributable to the sale of online banner advertising on newspaper
          websites. The decrease in revenue is primarily attributable to a
          general downturn in the economy and companies reducing their
          advertising budgets. This fact was enhanced by the terrorist attacks
          of September 11, 2001. In addition, NNN, one of our strategic
          partners, was not fully trained in the use of our system until
          November 2001.

          COST OF REVENUES. Costs incurred by the Company in producing revenues
          in 2001 were $53,918 as compared with $178,557 in 2000. The decreased
          costs were attributable to revenue sharing plans with newspapers
          instead of the outright purchase of impressions.

          GROSS PROFIT. For 2001, the Company had a gross profit of $147,773 as
          compared with $90,554 in 2000. This increase in gross profit is
          attributable to the decrease in our costs of revenues explained above.

          SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. The Company's selling,
          general and administrative expenses decreased by $611,350, from
          $3,232,344 in 2000 to $2,620,994 in 2001. The primary components of
          this decrease were:

               (i) a decrease of $1,298,750 in investment banking services from
               $1,644,375 in 2000 to $345,625 in 2001. Substantially all of the
               investment banking expense


                                    15 of 25

<PAGE>

               resulted from non-cash charges associated with the issuance of
               common stock and options in exchange for services.

               (ii) a decrease in salaries of $185,000 from $326,500 in 2000 to
               $141,500 in 2001 associated with the dismissal of two of our
               officers during the first quarter.

               (iii) selling, general and administrative cost containment
               efforts.

          These decreases were offset by the following increases:

               (i) an increase in compensation to our board of directors of
               $332,812 from $28,125 in 2000 to $360,937 in 2001. This increase
               results primarily from non-cash charges from the issuance of
               shares of common stock during the first quarter to new board
               members.

               (ii) an increase in investor and public relation costs of
               $227,811 from $141,564 in 2000 to $369,375 in 2001. The increase
               in such costs primarily results from non-cash charges from the
               issuance of common stock in exchange for such services.

               (iii) an increase in professional fees of $174,719 from $153,323
               in 2000 to $328,042 in 2001. The majority of these fees were
               non-recurring and were primarily associated with litigation that
               occurred in connection with the dismissal of two of our former
               officers.

               (iv) an increase in bad debt expense of $183,846 from $20,000 in
               2000 to $203,846 in 2001 resulting from the inability to collect
               on overdue payments by customers.

          LOSS FROM OPERATIONS. Loss from operations for 2001 was $2,473,221 as
compared with $3,141,790 in 2000. The decreased loss from operations is
attributable to the increase in gross profit and a reduction in our selling,
general and administrative expenses in 2001 versus 2000.

          NET LOSS. Net loss was $2,481,994 for 2001 as compared with $3,097,910
in 2000.

          In the third quarter of 2000, the Company refocused its efforts from
selling the GNI System directly to working with strategic partners who would be
able to represent GNI more effectively. In March 2001, the Company consummated
its first strategic partnership with NNN. NNN is a sales and marketing
organization headquartered in New York City that is funded by the 47 largest
circulation newspapers in the United States. NNN places approximately $200
million of advertising annually in newspapers in the United States and has
agreed to use the GNI System to place advertising in the automobile, packaged
goods, pharmaceutical, and technology industries on newspaper websites. NNN will
receive a commission of 5% of the gross revenues of all NNN-placed online
newspaper advertising. Under the Vertis agreement, the terms of which are very
similar to the NNN agreement, Vertis will receive a commission of 10% as well as
additional ad categories and licensing agreements.

LIQUIDITY AND CAPITAL RESOURCES

          Our consolidated financial statements have been prepared assuming that
we will continue as a going concern. However, as shown in the accompanying
consolidated financial statements, we are in the development stage and we only
generated revenues of approximately $202,000, $269,000 and $486,000 during 2001,
2000 and the period from inception, respectively. As a result, in part, because
of


                                    16 of 25

<PAGE>

our limited revenues we incurred net losses of approximately $2,482,000,
$3,098,000 and $5,938,000 and negative cash flow from operating activities of
approximately $1,111,000, $1,385,000 and $2,847,000 during 2001, 2000 and the
period from inception, respectively. As a result, we had a cash balance of only
$34,000, a working capital deficiency of $130,000 and an accumulated deficit of
approximately $5,938,000 as of December 31, 2001. We believe that we will
continue to incur net losses and cash flow deficiencies from operating
activities through at least December 31, 2002. These matters raise substantial
doubts as to our ability to continue as a going concern.

          To continue as a going concern we plan to continue to seek
opportunities to increase revenues through strategic alliances in the
advertising industry in addition to those already formed. We are awaiting patent
approval of our proprietary software, and we believe that such software can
provide additional revenues in the form of licensing revenue. We have limited
fixed costs and as such can curtail our cash usage without having a material
impact on our overall operations.

          To enable us to sustain our operations through at least December 31,
2002 and ultimately complete our marketing and development program and achieve
profitability, we plan to seek additional financing for the Company through the
sale of debt and equity securities. During the period from January 1, 2002
through April 2, 2002, we raised $305,000 through the sale of shares of common
stock.

          CASH FLOW FROM OPERATIONS. For 2001, the Company used net cash from
operating activities of $1,111,133, as compared with $1,384,700 in 2000. The
cash usages in both 2001 and 2000 were used primarily to fund our net losses.
The decrease in the net cash used results primarily from our efforts to
better contain costs as described above.

          CASH FLOW FROM INVESTING ACTIVITIES. For 2001, the Company had a net
cash outflow of $4,461 attributable to the purchase of computer equipment.
During the year ended December 31, 2000, we had a net cash outflow of $162,663
attributable to payments for capitalized software development costs and
purchases of computer equipment.

          CASH FLOW FROM FINANCING ACTIVITIES. For 2001, the Company had a net
cash inflow of $694,900 as compared with $1,988,000 in 2000. The decrease
results from greater financing efforts through private placements in 2000 than
in 2001. During the year ended 2000, we raised $2,012,750 through the sale of
1,552,250 shares of common stock as compared with $978,247 through the sale of
7,677,553 shares of common stock in 2001. In addition, during the year ended
December 31, 2001, we purchased 3,390,500 shares of our common stock for our
treasury on the open market at a cost of $265,934. During the year ended
December 31, 2000, we purchased 14,500 shares of our common stock for our
treasury on the open market at a cost of $17,670. The increase in purchases of
shares for our treasury during 2001 results primarily from a settlement
agreement reached with two former officers of the Company as more fully
described in Part III, Item 12.

          STOCKHOLDERS' EQUITY. The Company's stockholders' equity at December
31, 2001 was $262,371, including an accumulated deficit of ($5,937,626). The
Company's stockholders' equity at December 31, 2000 was $1,090,873, including an
accumulated deficit of ($3,455,632). The components of the changes in
stockholders' equity include the following: (i) our net loss during the year
ended December 31, 2001 of $2,481,994; (ii) the issuance of 1,367,778 shares of
our common stock with an aggregate fair value of $1,046,806 in exchange for
services; (iii) the purchase of 3,790,500 shares of our common stock for our
treasury at a cost of $371,561 and (iv) the sale of 7,677,553 shares of our
common stock for net proceeds of $978,247.


                                    17 of 25

<PAGE>

          We will require additional capital during 2002 to continue to
implement our business strategy. Such additional capital may be raised through
public or private financings, as well as through borrowings and other resources.
To the extent that additional capital is raised through the sale of equity or
equity-related securities, the issuance of such securities could result in
dilution to our stockholders. No assurance can be given, however, that we will
have access to the capital markets in the future, or that financing will be
available on acceptable terms to satisfy our cash requirements to implement our
business strategy. If we are unable to access the capital markets or obtain
acceptable financing, the results of operations and financial conditions could
be materially and adversely affected. If adequate funds are not available to us,
we may be required to curtail operations significantly or to obtain funds
through entering into arrangements with collaborative partners or others that
may require us to relinquish rights in its technology. While we have begun to
receive commercial revenues, there can be no assurances that revenue growth will
continue or be able to provide adequate cash to sustain our operations.

     Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the
     Private Securities Litigation Reform Act of 1995

          Certain statements contained in our Annual Report contain
"forward-looking statements" within the meaning of the private Securities
Litigation Reform Act of 1995. These are statements that do not relate strictly
to historical or current facts. Such forward-looking statements involve known
and unknown risks and uncertainties. The Company's actual results could differ
materially from the results discussed in the forward-looking statements. Factors
that could cause or contribute to such differences are discussed below. These
risks and uncertainties include, without limitation:

     o    the rate of market development and acceptance of our technology;

     o    the limited revenues and significant operating losses we have
          generated to date;

     o    the possibility of significant ongoing capital requirements;

     o    the loss of any significant customer;

     o    the ability of the Company to compete successfully with current or
          future competitors;

     o    the ability of the Company to secure additional financing as and when
          necessary;

     o    the ability of the Company to retain the services of its key
          management, and to attract new members of the management team;

     o    the ability of the Company to effect and retain appropriate patent,
          copyright and trademark protection of its products; and

     o    the ability of the Company to achieve adequate levels of revenue to
          recover its investment in capitalized software development costs.

          For the purposes of the safe harbor protection for forward-looking
statements provided by the Private Securities Litigation Reform Act of 1995,
readers are urged to review the list of certain important factors set forth in
"Cautionary Statement for Purposes of the 'Safe Harbor' Provisions of the
Private Securities Litigation Reform Act of 1995".

          We undertake no obligation to release publicly any revisions to the
forward-looking statements or to reflect events or circumstances occurring after
the date of this Form 10-KSB.


                                    18 of 25

<PAGE>

Item 7.  FINANCIAL STATEMENTS

          Our financial statements are attached to this report beginning on page
F-1.

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

          None.

PART III

Item 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

OFFICERS AND DIRECTORS

          Following is certain information about our executive officers and
directors. We have not entered into employment agreements with any of our
executive officers.

          James C. Mason, CEO, President, Treasurer and Director

          Mr. Mason, age 58, has more than 30 years of senior management
experience in both large corporation and entrepreneurial enterprises. Before
co-founding GNI in 1999, he held executive positions with several
entrepreneurial companies in publishing and marketing and acted as consultant to
numerous investment banking and publishing institutions, including Lazard
Freres, Merrill Lynch, Times Mirror, McGraw-Hill, and Hachette Filipachhi. From
1987 to 1991, Mason was Executive Vice President of Sales and Marketing at New
York Daily News and from 1985 to 1987 he was Associate Publisher and a partner
at U.S. News & World Report.

          Dennis Stillwell, Secretary and Director

          Mr. Stillwell, age 55, joined our Board of Directors and was elected
Secretary of the Company in December 2000. Mr. Stillwell has served as President
of IMEX Exchange, an Internet development and consultancy company owned by him,
since 1995.

          David Altschiller, Director

          Mr. Altschiller, age 60, joined our Board of Directors in December
2000. Mr. Altschiller is currently the Chairman of the New York division of
Hill, Holliday, Connors, Cosmopulos, an advertising agency that is a division of
the Interpublic Group of Companies. Mr. Altschiller helped to found the agency
in 1977 under a different name (Hill, Holliday/Altschiler) and has been with the
company since it was founded. Mr. Altschiller has taught advertising at New York
University and the Pratt Institute and has served as a visiting professor to the
master program in advertising at Syracuse University for the past 25 years. At
the present time, Mr. Benjou is director of the New York office of Ad Click.


                                    19 of 25

<PAGE>

          Paul Benjou, Director

          Mr. Benjou, age 53, joined our Board of Directors in December 2000.
For the past three years, Mr. Benjou has held the position of Executive Vice
President of Draft Worldwide, an integrated marketing network, specializing in
direct and promotional marketing and brand building. Prior to that, Mr. Benjou
was President of Group 1, an advertising company owned by him.

          Alex Lucas, Director

          Mr. Lucas, age 61, joined our Board of Directors in December 2000.
Since June 1999, Mr. Lucas has worked as an international financial consultant
and in public relations in Budapest, Hungary. Prior to that, Mr. Lucas served as
Director of Marketing and Corporate Finance for Crane Bank in Kampala, Uganda.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

          Based solely on a review of Forms 3, 4 and 5 and amendments thereto
furnished to us during or relating to the past fiscal year, the following
persons failed to timely file the reports described below.

          Messrs. Altschiller, Benjou, and Lucas, each of whom is a director,
failed to file their respective Form 5s in 2001 as required by Section 16(a) of
the Exchange Act. We expect that these individuals will file Form 5s shortly
following the filing of this report.

Item 10.  EXECUTIVE COMPENSATION

          The following table shows compensation for services rendered to the
Company during the fiscal years ended December 31, 2001, 2000 and 1999,
respectively, by the Chief Executive Officer and each other executive officer of
the Company. Each executive officer serves under the authority of the Board of
Directors. Directors who are also employees of the Company receive no extra
compensation for their service on the Board of Directors of the Company.


                                    20 of 25

<PAGE>

<TABLE>
<CAPTION>
                             SUMMARY COMPENSATION TABLE
                          Annual Compensation                                 Long-Term Compensation
-------------------------------------------------------------------------------------------------------
                                                                            Awards             Payouts
                                                                   ------------------------------------

                                                                                Securities
                                                         Other     Restricted   Underlying
                                                         Annual       Stock      Options/       LTIP       All Other
Name and Principal              Salary      Bonus     Compensation   Award(s)     SARs(1)      Payouts    Compensation
Position               Year       ($)        ($)          ($)          ($)          (#)          ($)          ($)
<S>                    <C>     <C>            <C>         <C>          <C>          <C>          <C>          <C>
James C. Mason,        2001    $141,000       -0-         -0-          -0-          -0-          -0-          -0-
President, CEO,
Treasurer &            2000    $115,500       -0          -0-          -0-          -0-          -0-          -0-
Director
                       1999     $90,000       -0-         -0-          -0-          -0-          -0-          -0-


John F. Grant,*        2001          $0       -0-         -0-          -0-          -0-          -0-          -0-
Executive Vice
President,             2000    $105,500       -0-         -0-          -0-          -0-          -0-          -0-
Treasurer &
Director               1999     $90,000       -0-         -0-          -0-          -0-          -0-          -0-


Arnold R.              2001          $0       -0-         -0-          -0-          -0-          -0-          -0-
Behrman,*
Executive Vice         2000    $105,500       -0-         -0-          -0-          -0-          -0-          -0-
President,
Secretary &            1999     $90,000       -0-         -0-          -0-          -0-          -0-          -0-
Director
--------------------
</TABLE>

--------------------------------------------------------------------------------
*Messrs. Grant and Behrman no longer hold positions as officers or directors of
the Company. Messrs. Grant and Behrman were not reelected to their respective
positions as officers of the Company at the December 1, 2000 meeting of the
Board of Directors and resigned from their positions as directors effective
March 1, 2001.


          None of our officers have been awarded any stock options, stock
appreciation rights or other long term or incentive compensation. We do not have
any written employment agreements with any of our executive officers.

          The members of our board of directors are reimbursed for actual
expense incurred in attending board meetings. In January 2001, Mr. Benjou was
granted an additional 75,000 shares of common stock, and Messrs. Altschiller and
Stillwell were each granted 100,000 shares of common stock in connection with
their respective appointments, as directors. There are no other arrangements for
compensation to directors.

Item 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

          The following table sets forth certain information with respect to
beneficial ownership of our common stock as of April 11, 2002 by (i) each person
known to us to be the beneficial owner of more than five percent of our common
stock, (ii) each of our executive officers and directors, and (iii) all of our
executive officers and directors as a group.

          As of April 12, 2002, there were 24,754,505 shares of common stock
outstanding.


                                    21 of 25

<PAGE>

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------
Name and Address of Beneficial Owner      Number of Shares Beneficially Owned    Percentage of Class
-----------------------------------------------------------------------------------------------------

<S>                                                   <C>                                <C>
Officers and Directors

James C. Mason                                        3,305,000                          13.4%
575 Madison Avenue, 10th Floor
New York, New York 10022

Dennis Stillwell                                      2,000,000                           8.1%
575 Madison Avenue, 10th Floor
New York, New York 10022

David Altschiller                                       100,000                           0.4%
575 Madison Avenue, 10th Floor
New York, New York 10022

Paul Benjou                                             100,000                           0.4%
575 Madison Avenue, 10th Floor
New York, New York 10022

Alex Lucas                                              100,000                           0.4%
575 Madison Avenue, 10th Floor
New York, New York 10022

Officers and directors as a group                     5,605,000                          22.6%

</TABLE>



Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

          Except as set forth below, we are not aware of any transaction during
the last two years, or proposed transactions, to which we were or are to be a
party, with any person, in which any director, executive officer, 5% security
holder, or member of the immediate family of any of the previously named persons
had or is to have a direct or indirect material interest.

          Pursuant to an oral agreement with the Company, during 2001 we paid
fees of approximately $121,000, plus reimbursement for out of pocket expenses,
to IMEX Exchange Inc., a designer and developer of web sites, to assist us in
further developing our web site and creating proprietary software for the
design, distribution, and measurement of interactive advertising. Dennis
Stillwell, the President and CEO of IMEX Exchange Inc., is an officer of GNI and
holds more than 5% of our common stock.

          Pixel Incorporated, one of our suppliers, is owned by Jill Mason, who
is the wife of our President, Jim Mason. Throughout 2000 and to the present,
Pixel has provided us with secretarial services and assistance in connection
with investor relations, including responding to emails and preparing financial
information. During 2000 and 2001, we paid Pixel approximately $77,000 and
$33,000, respectively, plus reimbursement for out of pocket expenses, as
compensation for services.

          JCM Transport, one of our vendors, is owned by the son of our
president. Throughout 2001, JCM Transport has provided us with freight
forwarding services and has received approximately $23,000 as compensation for
such services.


                                    22 of 25

<PAGE>

          On March 1, 2001, we entered into agreements with two of our former
officers, Messrs. John Grant and Arnold Behrman, in conjunction with their
resignation as directors of our company. Pursuant to this agreement, we would
purchase, in monthly installments, an aggregate of 3,270,000 shares of our
common stock, and would redeem, as of March 1, 2001, 400,000 shares of our
common stock in exchange for cancellation of receivables owed by then to us.
Under the terms of the agreements, the former officers were each be entitled to
retain 100,000 shares of our common stock. After we had repurchased or redeemed
350,000 shares from one of the former officers and 500,000 shares from the other
former officer, various disputes arose between us and the former officers
regarding the agreements that led to litigation in federal court and before the
American Arbitration Association. On August 23, 2001, we entered into a global
settlement agreement, including mutual releases of all claims held by the
parties, with each of the former officers pursuant to which we repurchased
2,820,000 shares held by them for an aggregate purchase price of $122,700 and
the former officers surrendered the remaining shares to us. Both former
directors agreed not to compete with the Company for a period of six months from
March 1, 2001, which period has now expired, in the field of designing and
developing software to be used in connection with the packaging, selling or
placing of on-line banner advertising on newspaper websites.


PART IV

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

(a)  Exhibits

     2.1  Agreement and Plan of Reorganization dated as of August 5, 1999 by and
          among Bargain Brokers, Inc., a Nevada corporation, Global Network,
          Inc., a New York Corporation, and the shareholders of Global Network,
          Inc.(1)

     3.1  Articles of Incorporation of Global Network, Inc., as amended(1)

     3.2  Bylaws of Global Network, Inc.(1)

     4.1  Separation and Share Repurchase Agreement, dated as of March 1, 2001,
          between Global Network, Inc. and John F. Grant (2)

     4.2  Separation and Share Repurchase Agreement, dated as of March 1, 2001,
          between Global Network, Inc. and Arnold Behrman (2)

     4.3  Letter Agreement dated April 4, 2001 among Global Network, Inc., John
          F. Grant and Arnold Behrman amending Separation and Share Repurchase
          Agreement, dated as of March 1, 2001, between Global Network, Inc. and
          John F. Grant and Separation and Share Repurchase Agreement, dated as
          of March 1, 2001, between Global Network, Inc. and Arnold Behrman. (2)

     10.1 Agreement between the Newspaper National Network and Global Network
          Inc. dated March 27, 2001. (2)

     21.1 List of Subsidiaries(1)
------------------
(1)  Incorporated by reference to GNI's Registration Statement on Form 10-SB,
     filed with the Securities and Exchange Commission on August 30, 1999.


                                    23 of 25

<PAGE>

(2)  Incorporated by reference to GNI's Registration Statement on Form 10-KSB,
     filed with the Securities and Exchange Commission on December 31, 2000.

(b)  Reports on Form 8-K

          The Company filed reports on Form 8-K on June 13, 2001 and August 28,
2001.


                                    24 of 25

<PAGE>


                                   SIGNATURES

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

Date:  April 15, 2002
                                   GLOBAL NETWORK INC. (Registrant)


                              By:  /s/ James C. Mason
                                   ------------------------------------------
                                   James C. Mason, CEO, President, and Treasurer

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



/s/ James C. Mason                                     April 15, 2002
----------------------------------
James C. Mason, CEO, President,
Treasurer and Director
(Principal Executive, Financial
and Accounting Officer)

/s/ Dennis Stillwell                                   April 15, 2002
----------------------------------
Dennis Stillwell, Secretary and
Director

/s/ Alex Lucas                                         April 15, 2002
----------------------------------
Alex Lucas
Director


                                    25 of 25


<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)




                                    I N D E X


                                                                            PAGE

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS                                    F-2

CONSOLIDATED BALANCE SHEET
     DECEMBER 31, 2001                                                      F-3

CONSOLIDATED STATEMENTS OF OPERATIONS
     YEARS ENDED DECEMBER 31, 2001 AND 2000 AND PERIOD FROM
     APRIL 26, 1999 (DATE OF INCEPTION) THROUGH DECEMBER 31, 2001           F-4

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
     YEARS ENDED DECEMBER 31, 2001 AND 2000 AND PERIOD FROM
     APRIL 26, 1999 (DATE OF INCEPTION) THROUGH DECEMBER 31, 2001          F-5/6

CONSOLIDATED STATEMENTS OF CASH FLOWS
     YEARS ENDED DECEMBER 31, 2001 AND 2000 AND PERIOD FROM
     APRIL 26, 1999 (DATE OF INCEPTION) THROUGH DECEMBER 31, 2001           F-7

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                                F-8/20



                                      * * *


                                       F-1

<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


To the Board of Directors
Global Network, Inc.


We have audited the accompanying consolidated balance sheet of GLOBAL NETWORK,
INC. AND SUBSIDIARY (a development stage company) as of December 31, 2001, and
the related consolidated statements of operations, changes in stockholders'
equity and cash flows for the years ended December 31, 2001 and 2000 and the
period from April 26, 1999 (date of inception) through December 31, 2001. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Global Network, Inc.
and Subsidiary as of December 31, 2001, and their results of operations and cash
flows for the years ended December 31, 2001 and 2000 and the period from April
26, 1999 (date of inception) through December 31, 2001, in conformity with
accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As further discussed in Note
3 to the consolidated financial statements, the Company's operations have
generated recurring losses and it had a working capital deficiency as of
December 31, 2001. Such matters raise substantial doubt about the Company's
ability to continue as a going concern. Management's plans concerning these
matters are also described in Note 3. The accompanying consolidated financial
statements do not include any adjustments that might result from the outcome of
these uncertainties.


                                                 J.H. COHN LLP

Roseland, New Jersey
April 2, 2002


                                      F-2

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                           CONSOLIDATED BALANCE SHEET
                                DECEMBER 31, 2001


                                     ASSETS

Current assets:
   Cash and cash equivalents                                        $     34,251
   Accounts receivable, net of allowance for doubtful accounts            88,224
   Advances to officer                                                    68,841
   Other current assets                                                    4,750
                                                                    ------------
            Total current assets                                         196,066

Computer equipment, net of accumulated depreciation of $35,121           106,254
Capitalized software development costs, net of accumulated
   amortization of $106,029                                              316,085
Other assets                                                              12,523
                                                                    ------------

            Total                                                    $   630,928
                                                                    ============


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Accounts payable and accrued expenses                            $   282,540
   Current portion of notes payable                                      23,348
   Other current liabilities                                             20,564
                                                                    -----------
            Total current liabilities                                   326,452

Notes payable, net of current portion                                    42,105
                                                                    -----------
            Total liabilities                                           368,557
                                                                    -----------

Commitments and contingencies

Stockholders' equity:
   Preferred stock, $.001 par value; 5,000,000 shares authorized;
     none issued                                                           -
   Common stock, $.001 par value; 50,000,000 shares authorized;
     20,833,581 shares issued and outstanding                            20,834
   Additional paid-in capital                                         6,417,767
   Treasury stock - 2,955,000 shares, at cost                          (238,604)
   Deficit accumulated in the development stage                      (5,937,626)
                                                                    -----------
            Total stockholders' equity                                  262,371
                                                                    -----------

            Total                                                   $   630,928
                                                                    ===========


See Notes to Consolidated Financial Statements.


                                      F-3

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                   YEARS ENDED DECEMBER 31, 2001 AND 2000 AND
                 PERIOD FROM APRIL 26, 1999 (DATE OF INCEPTION)
                            THROUGH DECEMBER 31, 2001


<TABLE>
<CAPTION>
                                                     Year             Year
                                                    Ended             Ended             Cumulative
                                                   December          December              from
                                                   31, 2001          31, 2000            Inception
                                                -------------       -----------         -----------

<S>                                             <C>                <C>                <C>
Revenues                                        $   201,691        $   269,111        $   485,802

Cost of revenues                                     53,918            178,557            243,776
                                                -----------        -----------        -----------

Gross profit                                        147,773             90,554            242,026

Selling, general and administrative
  expenses                                        2,620,994          3,232,344          6,214,759
                                                -----------        -----------        -----------

Loss from operations                             (2,473,221)        (3,141,790)        (5,972,733)
                                                -----------        -----------        -----------

Other income (expense):
  Interest income                                     7,182             50,005             57,187
  Interest expense                                  (15,955)            (6,125)           (22,080)
                                                -----------        -----------        -----------
      Totals                                         (8,773)            43,880             35,107
                                                -----------        -----------        -----------

Net loss                                        $(2,481,994)       $(3,097,910)       $(5,937,626)
                                                ===========        ===========        ===========

Basic net loss per common share                 $      (.18)       $      (.28)
                                                ===========        ===========

Basic weighted average common shares
  outstanding                                    13,817,105         11,044,116
                                                ===========        ===========
</TABLE>


See Notes to Consolidated Financial Statements.


                                      F-4

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
      YEARS ENDED DECEMBER 31, 2001 AND 2000 AND PERIOD FROM APRIL 26, 1999
                  (DATE OF INCEPTION) THROUGH DECEMBER 31, 2001


<TABLE>
<CAPTION>

                                                                                                             Deficit
                                                                                                            Accumulated
                                             Common Stock       Stock      Additional    Treasury Stock       in the
                                         ------------------  Subscription    Paid-in    -----------------   Development
                                           Shares    Amount   Receivable     Capital    Shares    Amount       Stage        Total
                                         ---------  -------  ------------  -----------  ------- ---------  ------------  -----------

<S>                                      <C>        <C>        <C>         <C>          <C>     <C>        <C>           <C>
Initial issuance of shares on
  April 26, 1999 (as retroactively
  adjusted to reflect shares
  effectively issued prior to
  reverse acquisition on
  August 5, 1999 and the
  effects of certain
  agreements on September 9, 1999)       9,000,000  $   100    $(100)

Effects of reverse acquisition           1,576,000   10,476      100       $  (45,576)                                   $  (35,000)

Sale of units of shares of common
  stock and warrants through
  private placement                        100,000      100                   199,900                                       200,000

Exercise of warrants                       100,000      100                   199,900                                       200,000

Effects of issuance of common stock
  in exchange for services                  35,000       35                     8,090                                         8,125

Effects of issuance of stock options
  in exchange for services                                                     76,050                                        76,050

Net loss                                                                                                   $  (357,722)    (357,722)
                                        ----------   ------    ------       ---------                      -----------   ----------
Balance, December 31, 1999              10,811,000   10,811       -           438,364                         (357,722)      91,453

Sale of shares of common stock
  through private placements,
  net of expenses of $145,250            1,552,250    1,552                 2,011,198                                     2,012,750

Cancellation of shares of common stock  (1,175,000)  (1,175)                    1,175

Effects of issuance of common stock
  in exchange for services               1,000,000    1,000                 1,705,250                                     1,706,250

Effects of issuance of stock options
  in exchange for services                                                    396,000                                       396,000

Purchase of treasury stock                                                              14,500  $(17,670)                   (17,670)

Net loss                                                                                                    (3,097,910)  (3,097,910)
                                        ----------   ------    ------       ---------   ------  --------   -----------   ----------
Balance, December 31, 2000              12,188,250   12,188       -         4,551,987   14,500   (17,670)   (3,455,632)   1,090,873
</TABLE>



See Notes to Consolidated Financial Statements.


                                      F-5

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
      YEARS ENDED DECEMBER 31, 2001 AND 2000 AND PERIOD FROM APRIL 26, 1999
                  (DATE OF INCEPTION) THROUGH DECEMBER 31, 2001


<TABLE>
<CAPTION>

                                                                                                            Deficit
                                                                                                          Accumulated
                                      Common Stock        Stock      Additional       Treasury Stock         in the
                                  -------------------  Subscription    Paid-in    ---------------------   Development
                                    Shares     Amount   Receivable     Capital      Shares      Amount       Stage         Total
                                  ----------  -------  ------------  -----------  ---------   ----------  ------------  -----------

<S>                               <C>         <C>       <C>          <C>          <C>         <C>         <C>           <C>
Sale of shares of common stock
  through private placements,
  net of expenses
  of $139,451                      7,677,553  $ 7,678                $  970,569                                         $   978,247

Purchases of treasury stock
  for cash                                                                        3,390,500   $(265,934)                   (265,934)

Purchases of treasury stock
  through cancellation of
  advances receivable from
  former officers                                                                   400,000    (105,627)                   (105,627)

Effects of issuance of common
  stock in exchange for services   1,367,778    1,368                 1,045,438                                           1,046,806

Retirement of treasury stock        (850,000)    (850)                 (149,777)   (850,000)    150,627

Effects of issuance of common
  stock in exchange for
  cancellation of stock
  options                            450,000      450                      (450)

Net loss                                                                                                  $(2,481,994)   (2,481,994)
                                  ----------  -------   -------      ----------   ---------   ---------   -----------   -----------

Balance, December 31, 2001        20,833,581  $20,834   $    -       $6,417,767   2,955,000   $(238,604)  $(5,937,626)  $   262,371
                                  ==========  =======   =======      ==========   =========   =========   ===========   ===========
</TABLE>


See Notes to Consolidated Financial Statements.


                                      F-6

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                   YEARS ENDED DECEMBER 31, 2001 AND 2000 AND
                 PERIOD FROM APRIL 26, 1999 (DATE OF INCEPTION)
                            THROUGH DECEMBER 31, 2001

<TABLE>
<CAPTION>
                                                                   Year              Year
                                                                  Ended             Ended            Cumulative
                                                                 December          December             from
                                                                 31, 2001          31, 2000           Inception
                                                              ------------       ------------       ------------
<S>                                                           <C>                <C>                <C>
Operating activities:
   Net loss                                                   $(2,481,994)       $(3,097,910)       $(5,937,626)
   Adjustments to reconcile net loss to net cash
      used in operating activities:
      Provision for doubtful accounts                             203,846             20,000            223,846
      Depreciation                                                 28,275              6,846             35,121
      Amortization of software development costs                   84,823             21,206            106,029
      Costs of services paid through issuance of
         common stock and stock options                         1,046,806          1,778,250          2,909,231
      Changes in operating assets and liabilities:
         Accounts receivable                                     (124,727)          (172,343)          (312,070)
         Advances to officers and former officers                  (4,014)           (84,251)          (174,468)
         Other current assets                                      15,950            (20,700)            (4,750)
         Other assets                                              (4,686)            (7,837)           (12,523)
         Accounts payable and accrued expenses                    124,588            151,475            300,120
         Other current liabilities                                                    20,564             20,564
                                                              -----------        -----------        -----------
            Net cash used in operating activities              (1,111,133)        (1,384,700)        (2,846,526)
                                                              -----------        -----------        -----------

Investing activities:
   Purchases of computer equipment                                 (4,461)           (64,549)           (69,010)
   Payments for capitalized software development
      costs                                                                          (98,114)           (98,114)
                                                              -----------        -----------        -----------
            Net cash used in investing activities                  (4,461)          (162,663)          (167,124)
                                                              -----------        -----------        -----------

Financing activities:
   Payments of notes payable                                      (17,413)            (7,079)           (24,492)
   Proceeds from sale of common stock and
      warrants                                                    978,247          2,012,750          3,190,997
   Proceeds from exercise of warrants                                                                   200,000
   Purchases of treasury stock                                   (265,934)           (17,670)          (283,604)
   Payments of costs in connection with reverse
      acquisition                                                                                       (35,000)
                                                              -----------        -----------        -----------
            Net cash provided by financing activities             694,900          1,988,001          3,047,901
                                                              -----------        -----------        ----------

Net increase (decrease) in cash and cash equivalents             (420,694)           440,638             34,251

Cash and cash equivalents, beginning of period                    454,945             14,307              -
                                                              -----------        -----------        -----------

Cash and cash equivalents, end of period                      $    34,251        $   454,945        $    34,251
                                                              ===========        ===========        ===========

Supplemental disclosure of cash flow data:
   Interest paid                                              $    15,955        $     6,125        $    22,080
                                                              ===========        ===========        ===========
</TABLE>


See Notes to Consolidated Financial Statements.


                                      F-7

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1 - Organization and business:
             Global Network, Inc. ("Global Nevada") was originally incorporated
             in August 1996 in Nevada as Bargain Brokers, Inc. to develop
             operations as a liquidator of closeouts, factory overruns, seconds
             and insurance salvage goods. However, Global Nevada never generated
             any significant revenues or expenses in connection with such
             operations, and it was an inactive "shell company" whose common
             shares were publicly traded at the time of the exchange of shares
             described below.

             Global Network, Inc. ("Global New York") was originally
             incorporated on April 26, 1999 in New York to develop business
             operations comprised of packaging and selling online banner
             advertising on newspaper web sites to national advertisers. It has
             developed a proprietary software system that allows national
             advertisers and their ad agencies to place ads on multiple
             newspaper web sites at one time and to target a specific
             demographic by having the advertisement posted in the section of
             the newspaper that they choose. During the period from its
             inception on April 26, 1999 through December 31, 2001, Global New
             York did not generate any significant revenues and, accordingly, it
             was in the development stage at the time of the exchange of shares
             described below and as of December 31, 2001.

             As of August 5, 1999, Global Nevada had, effectively, 1,576,000
             shares of common stock outstanding, with a par value of $.001 per
             share. As of that date, Global Nevada issued 9,000,000 shares of
             common stock to acquire all of the 9,000,000 shares of common
             stock, which had no par value, of Global New York that were,
             effectively, then outstanding (the "Exchange"). All references to
             numbers of shares and per share amounts in these notes and the
             accompanying consolidated financial statements have been
             retroactively restated, where appropriate, for shares cancelled as
             a result of (i) the issuance of shares upon the exercise of
             warrants on August 10, 1999 and (ii) the September 1999 agreements
             (the "Cancellation Agreements") pursuant to which certain
             stockholders waived their right to receive and/or agreed to the
             cancellation of certain shares which had been held in escrow, as
             further explained in Note 8. As a result of the Exchange, Global
             New York became a wholly-owned subsidiary of Global Nevada, and
             Global Nevada had 10,576,000 shares of common stock outstanding, of
             which 9,000,000 shares, or 85.1%, were owned by the former
             stockholders of Global New York and 1,576,000 shares, or 14.9%,
             were owned by the former stockholders of Global Nevada. However,
             since the former stockholders of Global New York became the owners
             of a majority of the outstanding common shares of Global Nevada
             after the Exchange and Global Nevada had no significant operating
             activities or assets and liabilities prior to the Exchange, the
             Exchange was treated effective as of August 5, 1999 as a "purchase
             business combination" and a "reverse acquisition" for accounting
             purposes in which Global Nevada was the legal acquirer and Global
             New York was the accounting acquirer.


                                      F-8

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1 - Organization and business (concluded):
             As a result, the assets and liabilities of the accounting acquirer,
             Global New York, continued to be recorded at their historical
             carrying values as of August 5, 1999; however, common stock and
             additional paid-in capital were adjusted as of August 5, 1999 to
             reflect the $.001 per share par value of the shares of the legal
             acquirer, Global Nevada, and all references to the number of shares
             of common stock of Global New York as of dates or for periods prior
             to the Exchange have been restated to reflect the ratio of the
             number of common shares of Global Nevada effectively exchanged for
             common shares of Global New York.

             As used herein, the "Company" refers to Global New York prior to
             August 5, 1999 and Global Nevada together with Global New York
             subsequent to that date. As used herein, "2001" refers to the year
             ended December 31, 2001, "2000" refers to the year ended December
             31, 2000 and the "period from inception" refers to the period from
             April 26, 1999 (date of inception) through December 31, 2001.


Note 2 - Summary of accounting policies:
           Use of estimates:
             The preparation of financial statements in conformity with
             accounting principles generally accepted in the United States of
             America requires management to make estimates and assumptions that
             affect certain reported amounts and disclosures. Accordingly,
             actual results could differ from those estimates.

           Principles of consolidation:
             The accompanying consolidated financial statements include the
             accounts of Global Nevada from its acquisition on August 5, 1999
             and Global New York, its wholly-owned subsidiary, from April 26,
             1999, the date of its inception. All significant intercompany
             accounts and transactions have been eliminated in consolidation.

           Cash equivalents:
             The Company considers highly liquid investments with maturities of
             three months or less when acquired to be cash equivalents.

           Revenue recognition:
             Revenue is recognized when earned. For advertising services,
             revenue is earned generally when advertising placed by the Company
             appears on the newspaper web sites.


                                      F-9

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 2 - Summary of significant accounting policies (continued):
            Income taxes:
             The Company accounts for income taxes pursuant to the asset and
             liability method which requires deferred income tax assets and
             liabilities to be computed annually for temporary differences
             between the financial statement and tax bases of assets and
             liabilities that will result in taxable or deductible amounts in
             the future based on enacted tax laws and rates applicable to the
             periods in which the differences are expected to affect taxable
             income. Valuation allowances are established when necessary to
             reduce deferred tax assets to the amount expected to be realized.
             The income tax provision or credit is the tax payable or refundable
             for the period plus or minus the change during the period in the
             deferred tax assets and liabilities.

            Computer equipment:
             Computer equipment is stated at cost, net of accumulated
             depreciation. Depreciation of equipment is provided on a
             straight-line basis over the estimated useful lives of the assets
             of five years.

            Software development costs:
             The Company accounts for costs incurred in connection with the
             development of software in accordance with Statement of Position
             98-1, "Accounting for Costs of Computer Software Developed or
             Obtained for Internal Use." Accordingly, all costs incurred in
             preliminary project stage are expensed as incurred, and internal
             and external costs incurred to develop internal use computer
             software during the application development stage are capitalized.
             Capitalized software development costs are amortized on a
             straight-line basis over an estimated useful life of five years.

             The Company capitalized costs of approximately $422,000 that were
             incurred in connection with the application and development stage
             of its proprietary software during 2000.

            Impairment of long-lived assets:
             The Company has adopted the provisions of Statement of Financial
             Accounting Standards No. 121, "Accounting for the Impairment of
             Long-Lived Assets and for Long-Lived Assets to be Disposed of"
             ("SFAS 121"). Under SFAS 121, impairment losses on long-lived
             assets, such as equipment and capitalized software development
             costs, are recognized when events or changes in circumstances
             indicate that the undiscounted cash flows estimated to be generated
             by such assets are less than their carrying value and, accordingly,
             all or a portion of such carrying value may not be recoverable.
             Impairment losses are then measured by comparing the fair value of
             assets to their carrying amounts.


                                      F-10

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 2 - Summary of significant accounting policies (continued):
            Net earnings (loss) per common share:
             The Company presents "basic" earnings (loss) per common share and,
             if applicable, it will present "diluted" earnings per common share
             pursuant to the provisions of Statement of Financial Accounting
             Standards No. 128, "Earnings per Share". Generally, basic earnings
             (loss) per common share is calculated by dividing net income or
             loss by the weighted average number of common shares outstanding
             during each period. The calculation of diluted earnings per common
             share is similar to that of basic earnings per common share, except
             that the denominator is increased to include the number of
             additional common shares that would have been outstanding if all
             potentially dilutive common shares, such as those issuable upon the
             exercise of stock options and warrants, were issued during the
             period.

             Since the Company had losses in 2001 and 2000, the assumed effects
             of the exercise of outstanding stock options and warrants and the
             application of the treasury stock method were anti-dilutive and,
             therefore, diluted per share amounts have not been presented in the
             accompanying consolidated statements of operations.

            Stock based compensation:
             In accordance with the provisions of Accounting Principles Board
             Opinion No. 25, "Accounting for Stock Issued to Employees" ("APB
             25"), the Company will recognize compensation costs as a result of
             the issuance of stock options granted to employees based on the
             excess, if any, of the fair value of the underlying stock at the
             date of grant or award (or at an appropriate subsequent measurement
             date) over the amount the employee must pay to acquire the stock.
             Therefore, the Company will not be required to recognize
             compensation expense as a result of any grants of stock options to
             employees at an exercise price that is equivalent to or greater
             than fair value. The Company will also make pro forma disclosures,
             as required by Statement of Financial Accounting Standards No. 123,
             "Accounting for Stock-Based Compensation" ("SFAS 123"), of net
             income or loss as if a fair value based method of accounting for
             stock options granted to employees had been applied instead if such
             amounts differ materially from the historical amounts.

             In accordance with SFAS 123, the Company will also recognize the
             cost of shares, options, warrants and other equity instruments
             issued to nonemployees as consideration for services as expense
             over the periods in which the related services are rendered by a
             charge to compensation cost and a corresponding credit to
             additional paid-in capital. Generally, cost will be determined
             based on the fair value of the equity instruments at the date of
             issuance. The fair value of options, warrants and similar equity
             instruments will be estimated based on the Black-Scholes
             option-pricing model, which meets the criteria set forth in SFAS
             123, and the assumption that all of the options or other equity
             instruments will ultimately vest. The effect of actual forfeitures
             will be recognized as they occur.


                                      F-11

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 2 - Summary of significant accounting policies (concluded):
            Recent pronouncements:
             In August 2001, the Financial Accounting Standards Board issued
             Statement of Financial Accounting Standards No. 144, "Accounting
             for the Impairment or Disposal of Long-Lived Assets" ("SFAS 144").
             SFAS 144 addresses financial accounting and reporting for the
             impairment or disposal of long-lived assets. Among other things,
             SFAS 144 provides guidance on the implementation of previous
             pronouncements related to when and how to measure impairment losses
             and how to account for discontinued operations. Management does not
             believe that the adoption of SFAS 144 will have a material impact
             on the Company's consolidated financial position or results of
             operations.

             The Financial Accounting Standards Board and the Accounting
             Standards Executive Committee of the American Institute of
             Certified Public Accountants had issued certain other accounting
             pronouncements as of December 31, 2001 that will become effective
             in subsequent periods; however, management of the Company does not
             believe that any of those pronouncements would have significantly
             affected the Company's financial accounting measurements or
             disclosures had they been in effect during 2001 and 2000, and it
             does not believe that any of those pronouncements will have any
             significant impact on the Company's consolidated financial
             statements at the time they become effective.


Note 3 - Basis of presentation:
             The accompanying consolidated financial statements have been
             prepared assuming that the Company will continue as a going
             concern. The Company is in the development stage and it only
             generated revenues of approximately $202,000, $269,000 and $486,000
             during 2001, 2000 and the period from inception, respectively. As a
             result, in part, of its limited revenues, the Company incurred net
             losses of $2,482,000, $3,098,000 and $5,938,000 and negative cash
             flows from operating activities of $1,111,000 and $1,385,000 and
             $2,847,000 during 2001, 2000 and the period from inception,
             respectively. As a result, the Company had a cash balance of only
             $34,000, a working capital deficiency of $130,000 and an
             accumulated deficit of approximately $5,938,000 as of December 31,
             2001. In addition, management believes that the Company will
             continue to incur net losses and cash flow deficiencies from
             operating activities through at least December 31, 2002. These
             matters raise substantial doubt about the Company's ability to
             continue as a going concern.


                                      F-12

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 3 - Basis of presentation (concluded):

             To enable the Company to continue as a going concern through at
             least the year ending December 31, 2002, management plans to
             continue to seek opportunities to increase revenues through
             strategic alliances in the advertising industry, in addition to
             those already formed, and the licensing of the Company's
             proprietary software if and when its application for a patent for
             such software is approved. During the period from January 1, 2002
             through April 2, 2002, the Company raised $305,000 through the sale
             of shares of both common and preferred stock, and management
             intends to continue to seek additional equity and/or debt financing
             for the Company. Since the Company has limited fixed costs,
             management will have the ability to curtail the Company's cash
             usage without causing a material impact on its overall operations
             during 2002. As a result, management believes, but cannot assure,
             that the Company will have sufficient resources and will be able to
             continue to operate through at least December 31, 2002.

             The accompanying consolidated financial statements do not include
             any adjustments related to the recoverability and classification of
             assets or the amounts and classification of liabilities that might
             be necessary should the Company be unable to continue its
             operations as a going concern.


Note 4 - Advances to officers and former officers:
             Advances to officers and former officers made by the Company during
             the period from inception, including advances to officers of
             $68,841 outstanding as of December 31, 2001, were noninterest
             bearing and due on demand. Information as to the fair value of
             these financial instruments as of December 31, 2001 and 2000 has
             not been presented because management of the Company does not
             believe that there is any practical method that can be used to
             determine such fair value.


                                      F-13

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 5 - Income taxes:
             As of December 31, 2001, the Company had net operating loss
             carryforwards of approximately $5,720,000 available to reduce
             future Federal taxable income which, if not used, will expire at
             various dates through 2021. The Company had no other material
             temporary differences as of that date. Due to the uncertainties
             related to, among other things, the changes in the ownership of the
             Company, which could subject those loss carryforwards to
             substantial annual limitations, and the extent and timing of its
             future taxable income, the Company offset the deferred tax assets
             attributable to the potential benefits of approximately $1,945,000
             from the utilization of those net operating loss carryforwards by
             an equivalent valuation allowance as of December 31, 2001.

             The Company had also offset the potential benefits of $1,120,000
             and $93,000 from net operating loss carryforwards by equivalent
             valuation allowances as of December 31, 2000 and 1999,
             respectively. As a result of the increases in the valuation
             allowance of $805,000, $1,047,000 and $1,945,000 during 2001, 2000
             and the period from inception, respectively, there are no credits
             for income taxes reflected in the accompanying consolidated
             statements of operations to offset pre-tax losses.

             Prior to the Exchange on August 5, 1999, Global New York, with the
             consent of its stockholders, had elected to be treated as an "S"
             Corporation under the Internal Revenue Code. Accordingly, during
             the period from April 26, 1999 (date of inception) through August
             5, 1999, Global New York's losses were allocated to its
             stockholders for inclusion in their personal income tax returns and
             it was not required to record any provision or credit for Federal
             income taxes. However, Global New York's pre-tax loss for that
             period was not material and, accordingly, the aforementioned
             elections did not materially change the effective tax rate for the
             period from inception.


Note 6 - Notes payable:
             Notes payable consists of various equipment financing obligations
             payable in monthly installments through July 2005 with interest at
             variable rates (the effective rates ranged from 19.5% to 36.7% at
             December 31, 2001. The notes are secured by substantially all of
             the Company's computer equipment.

             Required principal payments for the notes in each of the years
             subsequent to December 31, 2001 are as follows:


                                      F-14

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 6 - Notes payable (concluded):

          Year Ending
          December 31,                                             Amount

                2002                                              $23,348
                2003                                               22,649
                2004                                               12,437
                2005                                                7,019
                                                                ---------

                            Total                                 $65,453
                                                                =========


Note 7 - Commitments and contingencies:
            Concentrations of credit risk:
             Financial instruments that potentially subject the Company to
             concentrations of credit risk consist primarily of cash and cash
             equivalents and accounts receivable. The Company maintains its cash
             in bank deposit accounts which, at times, may exceed Federally
             insured limits. The Company reduces its exposure to credit risk by
             maintaining its cash deposits with major financial institutions and
             monitoring their credit ratings.

             The Company extends credit to its customers. It does not require
             any collateral. Because the Company had only generated a limited
             amount of revenues through December 31, 2001, each customer
             generated a significant percentage of its total revenues in 2001
             and 2000 and a few customers accounted for substantially all of its
             accounts receivable balance as of December 31, 2001. To limit
             credit risk, the Company closely monitors the extension of credit
             while maintaining appropriate allowances for potential credit
             losses. Accordingly, management does not believe that the Company
             was exposed to significant credit risk at December 31, 2001.


Note 8 - Stockholders' equity:
            Preferred stock authorized:
             The Company's Articles of Incorporation authorize the issuance of
             up to 5,000,000 shares of preferred stock with a par value of $.001
             per share. The preferred stock may be issued in one or more series,
             with terms and preferences to be determined by the Company's Board
             of Directors. No shares of preferred stock had been issued as of
             December 31, 2001 (see Note 11).


                                      F-15

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 8 - Stockholders' equity (continued):
            Issuances and cancellations of common stock and warrants:
             The Company's Articles of Incorporation also authorize the issuance
             of 50,000,000 shares of common stock with a par value of $.001 per
             share.

             On April 26, 1999, a total of 27,732,934 shares of common stock
             were issued, effectively, to the founders of Global New York for
             nominal consideration.

             On August 5, 1999: (i) 4,000,000 shares of common stock were
             initially issued to the owners of Global Nevada as a result of the
             Exchange and the reverse acquisition by Global New York, (ii)
             21,732,934 shares of common stock owned by the founders of Global
             New York were placed in escrow and became subject to cancellation
             pursuant to an agreement that was initially due to expire on August
             5, 2002, as further explained below, and (iii) the Company sold
             100,000 shares of common stock and warrants ("Warrants") to
             purchase 400,000 shares of common stock, exercisable at $2.00 per
             share through February 5, 2000, pursuant to a private offering of
             units for which it received total consideration of $200,000 of $.50
             per share.

             Of the 21,732,934 escrowed shares of common stock owned by the
             founders of Global New York that were subject to cancellation,
             12,000,000 shares and 9,732,934 shares were designated as "Earnout
             Shares" and "Penalty Shares," respectively. The Earnout Shares were
             to be released to the stockholders if the Company had income before
             income taxes of not less than $1,000,000 during any four
             consecutive quarters prior to the expiration of the escrow
             agreement or upon the release of Penalty Shares. The Penalty Shares
             were to be released in specified amounts if the Warrants were not
             exercised by specified dates.

             On August 10, 1999, the Company received $200,000 upon the exercise
             of Warrants for the purchase of 100,000 shares of common stock at
             $2.00 per share. As a result of the exercise of those Warrants, a
             total of 2,433,234 Penalty Shares held in escrow became subject to
             cancellation, and 29,499,700 shares of common stock remained
             outstanding, including 19,299,700 shares held in escrow. In
             addition, Warrants remained outstanding for the purchase of 300,000
             shares of common stock.


                                      F-16

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 8 - Stockholders' equity (continued):
            Issuances and cancellations of common stock and warrants
            (continued):
             As a result of the September 1999 Cancellation Agreements, (i)
             2,424,000 shares of the Company's common stock held by certain of
             the stockholders of Global Nevada became subject to cancellation;
             (ii) 10,000,000 Earnout Shares and 6,299,700 Penalty Shares that
             were held in escrow became subject to cancellation; and (iii) the
             remaining 2,000,000 Earnout Shares and 1,000,000 Penalty Shares
             that were held in escrow became subject to release to the founders
             of Global New York that waived their rights to and agreed to the
             cancellation of the 10,000,000 Earnout Shares and the 6,299,700
             Penalty Shares. As a result, the Company had, effectively,
             10,776,000 shares of common stock outstanding as of September 30,
             1999 comprised of 1,576,000 shares that were effectively issued to
             the former stockholders of Global Nevada, 9,000,000 shares that
             were effectively issued to the founders of Global New York and
             200,000 shares that had been issued as a result of the private
             placement and the exercise of Warrants.

             During 1999, the Company issued a total of 35,000 shares of common
             stock in exchange for services with an aggregate fair value of
             $8,125, all of which had a fair value of $.23 per share.

             During February and March 2000, the Company received proceeds of
             $1,666,250, net of payments for related costs and expenses of
             $102,500, from the sale and issuance of 1,343,000 shares of common
             stock that were made through a private placement intended to be
             exempt from registration under the Securities Act of 1933 (the
             "Act"). The total included 1,338,000 shares sold at $1.33 per share
             and 5,000 shares issued for financial services related to the
             private placement. In connection with the private placement, one of
             the founders of the Company agreed to return 1,175,000 shares of
             common stock to the Company, and the Company agreed to cancel those
             shares.

             During September 2000, the Company received proceeds of $389,500,
             net of payments for related costs and expenses of $43,000, from the
             sale and issuance of 209,250 shares of common stock through private
             placements intended to be exempt from registration under the Act.
             The total included 194,750 shares sold at $2.00 per share and
             14,500 shares issued for financial services related to the private
             placement.

             During 2000, the Company issued a total of 1,000,000 shares of
             common stock in exchange for services which had an aggregate fair
             value of $1,706,250, of which 700,000 shares had a fair value of
             $1.13 per share and 300,000 shares had a fair value of $3.06 per
             share.

                                      F-17


<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 8 - Stockholders' equity (continued):
            Issuances and cancellations of common stock and warrants
            (concluded):
             During 2001, the Company received proceeds of $978,247, net of
             expenses of $139,451 paid in cash, from the sale and issuance of
             7,677,553 shares of common stock through private placements
             intended to be exempt from registration under the Act. The total
             included 466,750 shares sold at $.25 per share, 250,000 shares sold
             at $.20 per share, 3,082,203 shares sold at $.22 per share,
             2,577,600 shares sold at $.10 per share and 1,301,000 shares issued
             for financial services related to the private placements.

             During 2001, the Company issued a total of 1,367,778 shares of
             common stock which had an aggregate fair value of $1,046,806 in
             exchange for services. The total included 340,000 shares issued
             with a fair value of $1.3125 per share, 750,000 shares issued with
             a fair value of $.56 per share and 277,778 shares issued with a
             fair value of $.65 per share.

             The issuances of shares for services were noncash transactions that
             are not reflected in the accompanying consolidated statements of
             cash flows.

            Treasury stock:
             During 2000, the Board of Directors authorized the repurchase by
             the Company of up to 100,000 shares of its outstanding common
             stock, and the Company repurchased 14,500 shares at a cost of
             $17,670 or an average of $1.22 per share.

             During 2001, the Company repurchased a total of 3,790,500 shares of
             its outstanding common stock for the treasury at an aggregate cost
             of $371,561 as follows:

             o  On March 1, 2001, the Company entered into agreements with two
                of its former officers in conjunction with their resignation as
                directors of the Company. As of December 31, 2000, these former
                officers held a total of 3,870,000 shares of the Company's
                common stock. Pursuant to the agreements, the Company
                effectively repurchased a total of 400,000 shares of common
                stock from the former officers during 2001 in exchange for the
                cancellation of receivables of $105,627 (effectively, $.26 per
                share) that arose from noninterest bearing advances made to them
                prior to December 31, 2000 (see Note 4). The repurchases of
                those shares in exchange for the cancellation of receivables
                were noncash transactions that are not reflected in the
                accompanying 2001 consolidated statement of cash flows. The
                agreements also required the Company to repurchase an additional
                total of 3,270,000 shares of common stock from the former
                officers at the rate of 300,000 shares per month and a purchase
                price of $.10 per share.


                                      F-18

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 8 - Stockholders' equity (continued):
            Treasury stock (concluded):

             However, management of the Company believed that the former
             officers breached their respective obligations under the agreements
             and, after repurchasing 450,000 shares for $45,000 or $.10 per
             share, the Company stopped such repurchases and filed a Demand for
             Arbitration with the American Arbitration Association during 2001.
             Pursuant to settlement agreements with the former stockholders, the
             Company repurchased the remaining 2,820,000 shares subject to the
             original repurchase agreements for $122,700 or $.044 per share.

             o  During 2001, the Board of Directors authorized the repurchase by
                the Company of up to 200,000 additional shares of its
                outstanding common stock, and the Company repurchased 120,500
                shares at a cost of $98,234 or an average of $.82 per share. As
                of December 31, 2001, the Company had repurchased a total of
                135,000 shares pursuant to the authorizations by the Board of
                Directors.

             o  During 2001, the Company retired 850,000 shares of common stock
                held in its treasury.

            Stock options:
             During 1999, the Company issued options to purchase 195,000 shares
             of common stock in exchange for consulting services. All of the
             options remained outstanding at December 31, 2000 and are
             exercisable at $.50 per share at any time prior to their expiration
             on December 31, 2002. The options had an approximate aggregate fair
             value of $76,050, all of which was charged to selling, general and
             administrative expenses during 1999.

             During 2000, the Company issued options to purchase 100,000 shares
             of common stock in exchange for consulting services. All of those
             options remained outstanding at December 31, 2001 and are
             exercisable at $.93 per share at any time prior to their expiration
             on February 28, 2003. The options had an approximate fair value of
             $72,000, which was charged to selling, general and administrative
             expenses during 2000.

             During 2001, the Company issued options to purchase 450,000 shares
             of common stock that were originally exercisable at $.93 per share
             and were due to expire on February 28, 2003. The options were
             issued in exchange for consulting services provided in connection
             with the development of the Company's proprietary software and,
             accordingly, the fair value of those options of $324,000 was
             capitalized. Subsequently, the Company agreed to issue 450,000
             shares of its common stock in exchange for the cancellation of the
             options. The fair value of the common stock issued to the holders
             was less than the original fair value of the options granted and,
             accordingly, the accompanying consolidated financial statements do
             not reflect any adjustments of the amounts originally recorded as a
             result of the exchange.


                                      F-19

<PAGE>

                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 8 - Stockholders' equity (concluded):
            Stock options (concluded):

             The fair value of the options was determined in 2001 and 2000 using
             a Black-Scholes option-pricing model in accordance with SFAS 123
             based on the following assumptions:

                 Expected years of option life                           1.5
                 Risk free interest rate                                 6%
                 Dividend yield                                          0%
                 Volatility                                            113%

             The options outstanding as of December 31, 2001 were exercisable
             and had a weighted average remaining contractual life of 1.05 years
             and a weighted average exercise price of $.65 per share.

             As a result of the issuances of shares and options to purchase
             shares described above, the Company charged a total of $1,046,806,
             $1,778,250 and $2,728,675 to selling, general and administrative
             expenses during 2001, 2000 and the period from inception,
             respectively, and $324,000 to capitalized software costs in 2000
             and increased common stock and additional paid-in capital by
             equivalent aggregate amounts, based on the fair value of the shares
             and options issued for services. The issuances of shares and
             options for services are noncash transactions that are not
             reflected in the accompanying consolidated statements of cash
             flows.


Note 9 - Other related party transactions and commitments:
             Selling, general and administrative expenses include charges by
             related parties for client entertainment, office and secretarial
             services and other office expenses totaling approximately $221,000,
             $296,000 and $591,000 for 2001, 2000 and the period from inception,
             respectively.


                                      F-20

<PAGE>


                       GLOBAL NETWORK, INC. AND SUBSIDIARY
                          (A Development Stage Company)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 10- Other noncash transactions:

             As of December 31, 2000, accounts payable and accrued expenses
             included approximately $18,000 attributable to purchases of
             equipment. During 2001, the Company entered into an agreement
             whereby it will pay for such purchases in installments through
             March 2004 (see Note 6). Accordingly, the remaining liability has
             been reclassified and included in notes payable as of December 31,
             2001. This noncash transaction is not reflected in the accompanying
             2001 consolidated statement of cash flows.


Note 11- Subsequent events:

             During the period from January 1, 2002 through April 2, 2002, the
             Company received gross proceeds of $305,000 through the sale of
             30,000 shares of common stock at $.10 per share and 3,341,176
             shares of common stock that will be converted into 3,341,176 shares
             of preferred stock upon the proper filing of the certificate of
             designation with respect to the preferred stock at prices ranging
             from $.085 to $.10 per share pursuant to private placements
             intended to be exempt from registration under the Act. Holders of
             the preferred shares will be entitled to receive dividends at the
             annual rate of 8% and will have voting rights equivalent to those
             of a holder of common stock. In addition, the Company issued
             637,000 shares of common stock for services in connection with
             private placements.

             During the period from January 1, 2002 to March 31, 2002, the
             Company issued a total of 3,150,000 shares of common stock as
             compensation for the services of its executive officers and
             consultants. The shares had an approximate fair value of $630,000
             as of the date of issuance which will be charged to expense during
             the first quarter of 2002.

                                      * * *


                                      F-21