Edgar Filing: Idea Sports Entertainment Group, Inc.

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-KSB

ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2004

COMMISSION FILE NUMBER 0-23100

IDEA SPORTS ENTERTAINMENT GROUP, INC.
(Exact name of small business issuer in its charter)

DELAWARE 22-2649848
(State or Other Jurisdiction (IRS Employer
of Incorporation or Organization) Identification No.)

800 WEST MAIN
LAKE CITY, SOUTH CAROLINA 29560
(Address of principal executive offices) (Zip Code)

ISSUER'S TELEPHONE NUMBER (843) 374-4332

SECURITIES REGISTERED UNDER SECTION 12(b) OF THE EXCHANGE ACT: NONE

SECURITIES REGISTERED UNDER SECTION 12(g) OF THE EXCHANGE ACT:

COMMON STOCK, $.0001 PAR VALUE
(TITLE OF EACH CLASS)

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

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

State issuer's revenues for its most recent fiscal year. $ 0

As of March 2, 2005, the registrant had outstanding 84,632,412 shares of its
common stock, par value of $.0001, its only class of voting securities. The
aggregate market value of the shares of common stock of the registrant held by
non-affiliates on March 2, 2005, was $8,586,000 based on the closing price on
the OTC Bulletin Board on that date. (See Item 5).

DOCUMENTS INCORPORATED BY REFERENCE

No documents are incorporated by reference into this Report except those
Exhibits so incorporated as set forth in the Exhibit index.

Transitional Small Business Disclosure Format (Check one): Yes [ ]; No [X].

IDEA SPORTS ENTERTAINMENT GROUP, INC.

TABLE OF CONTENTS

FORM 10-KSB

Part I

Page
PART I
Item 1 Description of Business 3
Item 2 Description of Property 5
Item 3 Legal Proceedings 5
Item 4 Submission of Matters to a Vote of Security Holders 5

PART II
Item 5 Market for Common Equity and Related Stockholder Matters 6
Item 6 Management's Discussion and Analysis or Plan of Operation 8
Item 7 Financial Statements 13
Item 8 Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 35
Item 8A Controls and Procedures 36
Item 8B Other Information 37

PART III
Item 9 Directors and Executive Officers of the Registrant 38
Item 10 Executive Compensation 40
Item 11 Security Ownership of Certain Beneficial Owners and
Management and Related Stockholder Matters 43
Item 12 Certain Relationships and Related Transactions 45
Item 13 Exhibits 48
Item 14 Principal Accountant Fees and Services 48

From time to time, the Company may publish forward-looking statements relative
to such matters as anticipated financial results, business prospects,
technological developments and similar matters. The Private Securities
Litigation Reform Act of 1995 provides a safe harbor for forward-looking
statements. The following discussion and analysis should be read in conjunction
with the report on the Consolidated Financial Statements and the accompanying
Notes to Consolidated Financial Statements appearing later in this report. All
statements other than statements of historical fact included in this Annual
Report on Form 10-KSB are, or may be deemed to be, forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Exchange Act of 1934, as amended. Important factors that
could cause actual results to differ materially from those discussed in such
forward-looking statements include, but are not limited to, the following: the
Company's current liquidity needs, as described in its periodic reports; changes
in the economy; inability of the Company to raise additional capital; the

Company's involvement in potential litigation; volatility of the Company's stock
price; the variability and timing of business opportunities; changes in
accounting policies and practices; the effect of organizational changes within
the Company; adverse state and federal regulation and legislation; and the
occurrence of extraordinary or catastrophic events and terrorist acts. These
factors and others involve certain risks and uncertainties that could cause
actual results or events to differ materially from management's views and
expectations. Inclusion of any information or statement in this report does not
necessarily imply that such information or statement is material. The Company
does not undertake any obligation to release publicly revised or updated
forward-looking information, and such information included in this report is
based on information currently available and may not be reliable after this
date.

PART I

ITEM 1. DESCRIPTION OF BUSINESS

BUSINESS DEVELOPMENT

Idea Sports Entertainment Group, Inc. (together with its subsidiaries,
hereinafter referred to as the "Company", "Idea Sports", "We" or "Us"), is a
holding company with three wholly owned subsidiaries, Maxx Motorsports, Inc.
("Maxx"), Idea Management Group, Inc. ("IMGI") and Strategic Gaming Consultants,
LLC, ("Gaming").

Maxx, through its wholly owned subsidiary, Team Racing Auto Circuit, LLC, a
Delaware limited liability company ("TRAC"), planned to develop, own, operate
and sanction an automotive racing league designed to provide content for
television and tracks while expanding the existing base of racing fans. The
Company was in the development stage since its inception on May 15, 2001, and
did not establish sources of revenue sufficient to fund the development of
business and pay operating expenses, resulting in a net loss of $15,054,021 from
inception through December 31, 2003. Accordingly, on August 26, 2003, the Board
of Directors of the Company unanimously approved a plan to immediately
discontinue its racing operation. Since August 26, 2003 and until September 9,
2004, the Company has been attempting to find a suitable acquisition candidate.

On September 9, 2004, the Company acquired all of the issued and outstanding
common stock of IMGI in exchange for warrants to acquire 15,000,000 shares of
the Company's common stock at an exercise price of $.10 per share. In addition,
in the event IMGI generates $2,000,000 in gross revenue within 36 months of
closing, the sellers of IMGI would receive additional warrants to acquire
15,000,000 shares of the Company's common stock at an exercise price of $.10.
IMGI is a South Carolina corporation organized on July 28, 2004. IMGI had no
prior operations. Accordingly, this transaction was valued at $1,200, which was
the amount the sellers of IMGI paid for IMGI's common stock.

On October 15, 2004, the Company acquired two television programs entitled
"America's Top Drivers" and "Women's Racing League" in exchange for warrants to
acquire 1,750,000 shares of the Company's common stock at an exercise price of
$.10 per share. The transaction was valued at $65,458 using the Black-Scholes
option pricing model.

On October 27, 2004, the Company acquired all of the issued and outstanding
memberships of Gaming in exchange for warrants to acquire 750,000 shares of the
Company's common stock at an exercise price of $.10 per share. In addition, in
the event Gaming generates $2,000,000 in gross revenue within 36 months of
closing, the sellers of Gaming would receive additional warrants to acquire
750,000 shares of the Company's common stock at an exercise price of $.10.
Gaming is a Nevada limited liability corporation organized on September 7, 2004.
Gaming had no prior operations and has no assets. Accordingly, the transaction
was recorded with no value.

Idea Sports Entertainment Group, Inc., a Delaware corporation, was originally
incorporated on July 25, 1985 as Horizon Capital Corp. It was known as
Reconversion Technologies, Inc. ("Reconversion") until May 1, 2000, at which
time the name was changed to Logisoft Corp. On May 15, 2001, the Company changed
its name from Logisoft Corp. to Team Sports Entertainment, Inc. and on November
8, 2004, the Company changed its name from Team Sports to Idea Sports
Entertainment Group, Inc.

On May 15, 2001, the Company acquired all of the common stock of Maxx
Motorsports, Inc. and its wholly owned subsidiary, TRAC, in a tax-free stock
exchange for 7,750,000 shares of the Company's common stock. In addition, as a
part of this agreement, the Company issued 3,300,000 shares of its common stock
in exchange for the cancellation of $825,000 of Maxx's liabilities. The
liabilities consisted of $450,000 for cash advances and loans made to Maxx and
$375,000 for consulting fees incurred. In addition, the Company completed the
sale of its wholly owned subsidiaries, LCP and eStore, to a group of its
shareholders in exchange for 12,000,000 shares of the Company's common stock,
which were cancelled.

BUSINESS OF THE COMPANY

The Company is a concept development company that internally creates projects in
the fields of professional sports, motor sports, motion pictures, animated
films, publishing, television, radio, licensed merchandise, direct-to-retail
videos and international entertainment for distribution into the global
marketplace.

Through various exclusive partnerships and wholly-owned subsidiaries, the
Company develops unique content through its internal creative team and then
partners with individuals and corporations already established in the respective
field or industry for which the project was created which increases the
viability that the project will be successful and profitable. The Company's
business model involves negotiating a revenue share agreement with its
individual and corporate partners to minimize the up front development costs
associated with each project that has been created which minimizes the risk
associated with developing a profitable business unit for the Company.

Gaming has had no prior operations. Gaming was formed to provide consultation
and related services to include the setup, management and security for all types
of casino operations.

TRAC planned to develop, own, operate and sanction an automotive racing league
designed to provide content for television and tracks while expanding the
existing base of racing fans. The Company, which has been in the development
stage since its inception, May 15, 2001, did not establish sources of revenue
sufficient to fund the development of business and pay operating expenses,
resulting in a net loss of $15,054,021 from inception through December 31, 2003.
Accordingly, on August 26, 2003, the Board of Directors of the Company
unanimously approved a plan to immediately discontinue its racing operation. The
operations of TRAC are included in discontinued operations.

EMPLOYEES

At December 31, 2004 and 2003, the Company had one full-time employee and two
part-time employees, respectively.

ITEM 2. DESCRIPTION OF PROPERTY

The Company currently leases its office space in Lake City, South Carolina from
a company which is 50% owned by and controlled by the president and Chief
Executive Officer of the Company at a rate of $1,500 per month. The current
agreement expires December 31, 2005.

ITEM 3. LEGAL PROCEEDINGS

On February 18, 2004, four Georgia shareholders filed suit in the Superior Court
of Fulton County against the Company's former CEO, William G. Miller of
Alpharetta, Georgia. The suit alleges breach of contract, wrongful conversion of
company monies, mismanagement, breach of fiduciary duty and fraud on the part of
the defendants while serving the Company in 2001 and 2002. The suit contends
Idea Sport's shareholders suffered market losses in excess of $50 million. Also
named in the action was Jon Pritchett, who was president of the Company while
Miller was CEO.

On May 3, 2004, Miller, Pritchett and three other individuals filed several
derivative and individual claims against the Company, its Directors and certain
of its shareholders in the Court of Chancery of the State of Delaware in and for
New Castle County, C.A. No. 413-N. The Company filed a counterclaim against
Miller and Pritchett on November 24, 2004.

On March 15, 2005, all parties to the litigation agreed to dismiss with
prejudice all claims and counterclaims. The final settlement is subject to court
approval, which management expects to be granted.

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

No matters were submitted to a vote of security holders during the fourth
quarter of 2004.

PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Our $0.0001 par value per share common stock is traded in the over-the-counter
market and is quoted on the NASD Over-The Counter Bulletin Board ("OTCBB") under
the symbol "ISPO.OB." Prior to November 8, 2004, the Company was quoted on the
OTCBB under the symbol "TSPT.OB," prior to May 18, 2001, the Company was quoted
on the OTCBB under the symbol "LGST" and prior to May 1, 2000, was quoted on the
OTCBB under the symbol "RTTK." The following tables set forth the quarterly high
and low daily bids for our common stock as reported by the OTCBB for the two
years ended December 31, 2004. The bids reflect inter-dealer prices without
adjustments for retail mark-ups, mark-downs or commissions and may not represent
actual transactions.

High Low
---- ---
2004:
Fourth quarter $.31 $.03
Third quarter $.13 $.01
Second quarter $.02 $.01
First quarter $.03 $.01

2003:
Fourth quarter $.05 $.01
Third quarter $.23 $.01
Second quarter $.71 $.15
First quarter $.49 $.20

The OTCBB is a quotation service sponsored by the National Association of
Securities Dealers ("NASD") that displays real-time quotes and volume
information in over-the-counter ("OTC") equity securities. The OTCBB does not
impose listing standards or requirements, does not provide automatic trade
executions and does not maintain relationships with quoted issuers. A company
traded on the OTCBB may face loss of market makers and lack of readily available
bid and ask prices for its stock and may experience a greater spread between the
bids and ask price of its stock and a general loss of liquidity with its stock.
In addition, certain investors have policies against purchasing or holding OTC
securities. Both trading volume and the market value of our securities have
been, and will continue to be, materially affected by the trading on the OTCBB.

HOLDERS

At March 2, 2005, there were 431 holders of record of the Company's common
stock, an undetermined number of which represent more than one individual
participant in securities positions with the Company.

DIVIDENDS

The Company has never paid cash dividends on its common stock and intends to
utilize current and future resources to implement its new plan of operations.
Therefore, it is not anticipated that cash dividends will be paid on the
Company's common stock in the foreseeable future.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

The following table summarizes certain information as of December 31, 2004, with
respect to compensation plans (including individual compensation arrangements)
under which common stock of the Company is authorized for issuance:

NUMBER OF SECURITIES TO BE
ISSUED UPON EXERCISE OF WEIGHTED AVERAGE EXERCISE NUMBER OF SECURITIES
OUTSTANDING OPTIONS, PRICE OF OUTSTANDING REMAINING AVAILABLE FOR
PLAN CATEGORY WARRANTS AND RIGHTS OPTIONS, WARRANTS AND RIGHTS FUTURE ISSUANCE
------------- ------------------- ---------------------------- ---------------

Equity compensation plans approved
by security holders* 3,000,000 $ 1.00 1,500,000
Equity compensation plans not
approved by security holders # 12,200,000 -- --
------------ ---------- -----------

Total 15,200,000 $ 1.00 1,500,000
============ ========== ===========

* All options are granted under the Company's 2000 Stock Option Plan ("Plan"),
which authorizes the grant of options to purchase an aggregate of 3,000,000
shares and was approved by stockholders in April 2001.

# In 2001, the Board of Directors approved the increase of authorized shares
available under the Plan to 7,500,000 shares. This increase in authorized shares
will be submitted to a vote of the stockholders at the next annual meeting. On
April 2, 2003, the Board of Directors approved the issuance of options to
acquire 8,800,000 common shares pursuant to the Plan. The necessary increase in
shares will be submitted to a vote of stockholders at the next annual meeting.
As a result of discontinuing the planned racing operation, 4,300,000 of the
options were forfeited since they were contingent upon the 2004 and 2005 race
seasons starting.

As a result of the settlement of the Miller litigation, options to acquire
12,900,000 shares were cancelled, leaving a balance outstanding of 1,500,000.

The material features of the Plan, the data for which is summarized under the
equity compensation plans approved by security holders in the table above, and
its warrant arrangements are summarized in Note 5 to the consolidated financial
statements that appear in Item 7.

RECENT SALES OF UNREGISTERED SECURITIES

On October 12, 2004, the Company issued 20,000,000 shares of its common stock in
exchange for $200,000 in accrued interest owed by the Company. The shares were
issued pursuant to an exemption from registration under Section 4(2) promulgated
under the Securities Act of 1933, as amended.

On October 12, 2004, the Company issued 850,000 shares of its common stock in
exchange for $22,000 in accounts payable due to a related party. The shares were
issued pursuant to an exemption from registration under Section 4(2) promulgated
under the Securities Act of 1933, as amended.

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

The Company, which has been in the development stage for its planned racing
operation since its inception, May 15, 2001, did not establish sources of
revenue sufficient to fund the development of business and pay operating
expenses, resulting in a net loss of $15,054,021 from inception through December
31, 2003. On August 26, 2003, the Board of Directors of the Company unanimously
approved a plan to immediately discontinue its racing operation. Since August
26, 2003 and until September 9, 2004, the Company has been attempting to find a
suitable acquisition candidate. On September 9, 2004, with the acquisition of
IMGI, the Company completed one development stage, which had been included in
discontinued operations, and commenced a new development stage operation.

IMGI commenced operations on September 9, 2004, and has not generated any
revenue to date.

GOING CONCERN FACTORS--LIQUIDITY

The Company has not established sources of revenues sufficient to fund the
development of business, projected operating expenses and commitments for fiscal
year 2005. The Company, which has been in the development stage since its
inception, May 15, 2001, has accumulated a net loss of $15,054,021 through
December 31, 2003. The Company has ceased its plans to begin a racing league and
all operations have been discontinued. This discontinued operation had a loss of
$671,289 during the year ended December 31, 2004.

Since August 26, 2003, the Company attempted to locate and negotiate with a
business entity for the merger of that target business into the Company. As
discussed above, the Company has acquired new development stage businesses
commencing on September 9, 2004. Since September 9, 2004, the Company has
incurred losses in the amount of $344,616. A group of the note holders have
agreed to advance funds on a limited basis to allow the Company to develop a
business capable of generating revenues sufficient to fund projected operating
expenses and commitments. However, there can be no assurance that the group of
note holders will be able to continue to provide sufficient funding to develop
the Company's current business plan.

In addition, current liabilities of the Company exceed its assets by
approximately $4,200,000, and its convertible promissory notes payable
obligations are in default. These conditions raise substantial doubt about the
Company's ability to continue as a going concern. The consolidated financial
statements do not include any adjustments that may result from the outcome of
these uncertainties.

DISCONTINUED OPERATIONS

The Company, which has been in the development stage since its inception, May
15, 2001, did not establish sources of revenue sufficient to fund the
development of business and pay operating expenses, resulting in a net loss of
$15,054,021 from inception through December 31, 2003. As a result of the
continuing losses, on August 26, 2003, the Board of Directors of the Company
unanimously approved a plan to immediately discontinue its racing operation.
This discontinued operation had a loss of $671,289 during the year ended
December 31, 2004. While the Company does not expect any additional liability,
the following agreements were in place when the Company discontinued its racing
operation:

RACING CAR DESIGN AND CONSTRUCTION AGREEMENT
On October 22, 2001, TRAC entered into a Racing Car Design and Construction
Agreement with Riley & Scott Race Car Engineering ("Riley & Scott"). The
agreement required payments aggregating approximately $12,500,000 to include
design, tooling, prototype construction and aero tooling and production of 100
racing cars, plus the cost of engines. The agreement was modified to extend the
payment schedule due to delaying the first racing season and eventually
terminated. At December 31, 2003, the Company had paid $4,060,781 on the
agreement.

The agreement terms included that upon temporary cessation or early termination
of the agreement, Riley & Scott shall have all rights and title to all tangible
and intangible inventory then in its possession. When the agreement was
terminated in August 2003, Riley & Scott had possession of all inventory.
Management does not believe the Company has any remaining liability to Riley &
Scott.

TEAM SALES BROKERAGE AGREEMENT
In June 2002, TRAC engaged Moag & Company to be the exclusive broker of all team
sales for a one-year term, and in June 2003, TRAC and Moag & Company amended and
restated their agreement to extend the term of the agreement through April 16,
2004. Management is of the opinion that this agreement was terminated without
future liability when racing operations were discontinued.

BROADCASTING AGREEMENT
In April 2003, the Company entered into an agreement with ESPN, Inc. and ESPN
Productions, Inc. (together, "ESPN"), pursuant to which ESPN was to provide for
the live broadcasting of at least 13 two-hour League events and produce these
television events for the 2004 and 2005 racing seasons (the "ESPN Agreement").

Under the contract, the Company would have been required to make the following
minimum payments:

2003 $ 375,000
2004 10,285,000
2005 10,640,000
----------------
Total minimum contract payments $ 21,300,000
================

Management is of the opinion that this agreement was terminated without future
liability to the Company when racing operations were discontinued.

LETTER OF CREDIT FOR OFFICE LEASE
A letter of credit was purchased to guarantee the Company's performance of
payment to a third party on their vacated office lease. Restricted cash in the
amount of $100,000 was collateral on the letter of credit. The Company applied
the restricted cash to pay an accrued lease settlement obligation in 2004.

LOCAL OPERATOR AGREEMENT WITH FORMER CHIEF EXECUTIVE OFFICER
On August 25, 2001, the Company entered into an agreement in principle with its
former Chief Executive Officer under which the former Chief Executive Officer
would become the local operator of a market. The agreement stated that the cost
would be $100,000 plus the cost of the nine racing cars and three haulers to
obtain the operating rights for the team, which was substantially less than
amounts anticipated to be paid by other local operators. Under the agreement,
the $100,000 was to be kept in an escrow account. The funds are not currently
escrowed and the $100,000 is included in amounts payable to related parties on
the consolidated balance sheet. Under the Miller litigation settlement
agreement, described in Item 3, the former CEO would retain the rights as the
local operator of a market and waive any right to the $100,000 deposit.

NEW ACCOUNTING STANDARDS

In December 2004, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 153, "Exchanges of Non-monetary Assets," (SFAS 153) an amendment of APB
Opinion No. 29, "Accounting for Non-monetary Transactions" (APB 29). The
amendments made by SFAS 153 are based on the principle that exchanges of
non-monetary assets should be measured based on the fair value of the assets
exchanged. Further, the amendments eliminate the narrow exception for
non-monetary exchanges of similar productive assets and replace it with a
broader exception for exchanges of non-monetary assets that do not have
commercial substance. Previously, APB 29 required that the accounting for an
exchange of a productive asset for a similar productive asset or an equivalent
interest in the same or similar productive asset should be based on the recorded
amount of the asset relinquished. APB 29 provided an exception to its basic
measurement principle (fair value) for exchanges of similar productive assets.
The FASB believed that exception required that some non-monetary exchanges,
although commercially substantive, be recorded on a carryover basis. By focusing
the exception on exchanges that lack commercial substance, the FASB believes
SFAS 153 produces financial reporting that more faithfully represents the
economics of the transactions. SFAS 153 is effective for non-monetary asset
exchanges occurring in fiscal periods beginning after June 15, 2005. Earlier
application is permitted for non-monetary asset exchanges occurring in fiscal
periods beginning after the date of issuance. The provisions of SFAS 153 shall
be applied prospectively. The Company has evaluated the impact of the adoption
of SFAS 153, and does not believe the impact will be significant to the
Company's overall results of operations or financial position.

In December 2004, the FASB issued SFAS 123 (revised 2004), "Share-Based
Payment" (SFAS 123(R)). Among other things, SFAS 123(R) requires expensing the
fair value of stock options, previously optional accounting. For transition,
upon adoption on January 1, 2006, SFAS 123(R) would require expensing any
unvested options and will also require us to change the classification of
certain tax benefits from option deductions to financing rather than operating
cash flows. As of December 31, 2003, the Company did not have any unvested
options which would require adjustment upon adoption of SFAS 123(R). Adoption
should have the same impact as the pro forma disclosure included under stock
option plans in note 1 to the consolidated financial statements.

CRITICAL ACCOUNTING POLICIES

The SEC issued Financial Reporting Release No. 60, "Cautionary Advice Regarding
Disclosure about Critical Accounting Policies" ("FRR 60"), suggesting companies
provide additional disclosure and commentary on their most critical accounting
policies. In FRR 60, the SEC defined the most critical accounting policies as
the ones that are most important to the portrayal of a company's financial
condition and operating results, and require management to make its most
difficult and subjective judgments, often as a result of the need to make
estimates of matters that are inherently uncertain. Based on this definition and
based on the Company's current status as a development stage company, Idea

Sports' most critical accounting policies include the valuation of intangibles,
which affects their amortization and impairment calculations and stock-based
compensation. The methods, estimates and judgments Idea Sports uses in applying
these most critical accounting policies have a significant impact on the results
it reports in its consolidated financial statements.

INTANGIBLE ASSET VALUATION - The determination of the fair value of certain
acquired assets and liabilities is subjective in nature and often involves the
use of significant estimates and assumptions. Determining the fair values and
useful lives of intangible assets especially requires the exercise of judgment.
Idea Sports may use its common stock to acquire assets and will probably use the
Black-Scholes valuation method to determine a valuation for the stock used in an
acquisition. The Black-Scholes valuation method calculates a volatility factor
for the stock price and extrapolates a valuation using these criteria. This
valuation method has generally proven effective for companies with established
markets for their common stock; however, due to the lack of an established
trading market for Idea Sports, a development stage company, in the opinion of
management, this may result in an unduly high valuation for the stock.

STOCK BASED COMPENSATION - Idea Sports records stock-based compensation to
outside consultants at fair value in general and administrative expense.
Historically, Idea Sports does not record expense relating to stock options
granted to employees with an exercise price greater than or equal to market
price at the time of grant. Idea Sports reports pro-forma net loss and loss per
share in accordance with the requirements of SFAS 123 and SFAS 148. This
disclosure shows net loss and loss per share as if Idea Sports had accounted for
its employee stock options under the fair value method of those statements.
Pro-forma information is calculated using the Black-Scholes pricing method on
the date of grant. This option valuation model requires input of highly
subjective assumptions. Because Idea Sports' employee stock options have
characteristics significantly different from those of traded options, and
because changes in the subjective input assumptions can materially affect the
fair value estimate, in management's opinion, the existing model does not
necessarily provide a reliable single measure of fair value of its employee
stock options. Idea Sports did not have any stock-based compensation during
2004; however, the Company did have option compensation in 2003 and expects to
have option compensation in the future.

OTHER - The Company expects revenue recognition and other financial estimates to
become critical as business develops in the future.

OFF-BALANCE SHEET ARRANGEMENTS

The Company does not have any material off-balance sheet arrangements.

ITEM 7. FINANCIAL STATEMENTS

The Consolidated Financial Statements of Idea Sports Entertainment Group, Inc.
and Subsidiaries (a development stage company) together with the reports thereon
of Creason & Associates, P.L.L.C. dated April 7, 2005, for the year ended
December 31, 2004, and Guest & Company, P.C. dated March 22, 2004, for the year
ended December 31, 2003, is set forth as follows:

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Page

Report of Independent Registered Public Accounting Firm:
Creason & Associates, P.L.L.C. 14
Independent Auditor's Report:
Guest & Company, P.C. 15
Consolidated Balance Sheet 16
Consolidated Statements of Operations 17
Consolidated Statements of Stockholders' Deficit 18
Consolidated Statements of Cash Flows 19-20
Notes to Consolidated Financial Statements 21-34

CREASON & ASSOCIATES, P.L.L.C.
7170 S. Braden Ave., Suite 100
Tulsa, OK 74136-6333
Phone: 918-481-5355 Fax: 918-481-5771

Report of Independent Registered Public Accounting Firm

Board of Directors and Stockholders
Idea Sports Entertainment Group, Inc. and Subsidiaries:

We have audited the accompanying consolidated balance sheet of Idea Sports
Entertainment Group, Inc. and Subsidiaries (a development stage company) as of
December 31, 2004, and the related consolidated statements of operations,
stockholders' deficit and cash flows for the year ended December 31, 2004, and
the period from inception (September 9, 2004) through December 31, 2004. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. The Company
is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audit included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal control
over financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated financial statement
presentation. We believe that our audit provides 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 Idea Sports
Entertainment Group, Inc. and Subsidiaries (a development stage company) at
December 31, 2004, and the results of their operations and their cash flows for
the year ended December 31, 2004, and the period from inception (September 9,
2004) through December 31, 2004, in conformity with accounting principles
generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that Idea Sports Entertainment Group, Inc. and Subsidiaries (a development stage
company) will continue as a going concern. As discussed in Note 1 to the
consolidated financial statements, Idea Sports Entertainment Group, Inc. and
Subsidiaries have acquired new non-operating businesses and have ceased its
plans to begin a racing league for which all operations have been discontinued.
In addition, current liabilities of Idea Sports Entertainment Group, Inc. and
Subsidiaries exceed its assets by approximately $4,200,000, and its convertible
promissory notes payable obligations are in default. These conditions raise
substantial doubt about Idea Sports Entertainment Group, Inc. and Subsidiaries'
ability to continue as a going concern. Management's plans regarding these
matters are also described in Note 1. The consolidated financial statements do
not include any adjustments that may result from the outcome of these
uncertainties.

/s/ Creason & Associates, P.L.L.C.

Tulsa, Oklahoma
April 7, 2005

GUEST & COMPANY, P.C.
7170 S. Braden Ave., Suite 100
Tulsa, OK 74136-6333
Phone: 918-481-5355 Fax: 918-481-5771

Independent Auditor's Report

Board of Directors and Stockholders
Team Sports Entertainment, Inc. and Subsidiary:

We have audited the accompanying consolidated balance sheet of Team Sports
Entertainment, Inc. and Subsidiary (a development stage company) as of December
31, 2003 and the related consolidated statements of operations, stockholders'
deficit and cash flows for the year ended December 31, 2003, and the period from
May 15, 2001 (inception) through December 31, 2003. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the consolidated financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall consolidated financial statement presentation. We
believe that our audit provides 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 Team Sports
Entertainment, Inc. and Subsidiary (a development stage company) at December 31,
2003 and the results of their operations and their cash flows for the year ended
December 31, 2003, and the period from May 15, 2001 (inception) through December
31, 2003, in conformity with accounting principles generally accepted in the
United States of America.

The accompanying consolidated financial statements have been prepared assuming
that Team Sports Entertainment, Inc. and Subsidiary (a development stage
company) will continue as a going concern. As discussed in Note 1 to the
consolidated financial statements, Team Sports Entertainment, Inc. and
Subsidiary have ceased its plans to begin a racing league and all operations
have been discontinued. In addition, current liabilities of Team Sports
Entertainment, Inc. and Subsidiary exceed its assets by approximately
$3,400,000, and its convertible promissory notes payable obligations are in
default. These conditions raise substantial doubt about Team Sports
Entertainment, Inc. and Subsidiary's ability to continue as a going concern.
Management's plans regarding these matters are also described in Note 1. The
consolidated financial statements do not include any adjustments that may result
from the outcome of these uncertainties.

/s/ Guest & Company, P.C.

March 22, 2004
Tulsa, Oklahoma

IDEA SPORTS ENTERTAINMENT GROUP, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED BALANCE SHEET
DECEMBER 31, 2004

ASSETS

CURRENT ASSETS
Cash and cash equivalents $ 2,691
-------------
Total current assets 2,691
-------------
Computer equipment 1,863
Television programs 65,458
-------------
Total assets $ 70,012
=============

LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Accounts payable $ 252,059
Amounts payable to related parties 366,392
Accrued expenses 19,768
Accrued interest payable 355,717
Convertible promissory notes 3,271,675
-------------
Total liabilities 4,265,611
-------------

Commitments and contingencies

STOCKHOLDERS' DEFICIT
Preferred stock: $2.75 par value; authorized 2,000,000 shares;
no shares issued and outstanding --
Common stock: $.0001 par value; authorized 500,000,000 shares;
issued 84,751,212 shares and outstanding 84,632,412 shares 8,463
Additional paid-in capital 16,094,533
Common stock warrants 66,658
Accumulated deficit (20,365,253)
-------------
Total stockholders' deficit (4,195,599)
-------------
Total liabilities and stockholders' deficit $ 70,012
=============

See accompanying notes to consolidated financial statements.

IDEA SPORTS ENTERTAINMENT GROUP, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 2004 AND 2003 AND DEVELOPMENT STAGE
FROM INCEPTION (SEPTEMBER 9, 2004), THROUGH DECEMBER 31, 2004

FROM INCEPTION
YEARS ENDED (9/9/2004)
DECEMBER 31, THROUGH
----------------------------- DECEMBER 31,
2004 2003 2004
------------- ------------- -------------

CONTINUING OPERATIONS
Selling, general and administrative expenses $ 247,361 $ -- $ 247,361
Interest expense 97,255 -- 97,255
------------- ------------- -------------
LOSS FROM CONTINUING OPERATIONS (344,616) -- (344,616)
------------- ------------- -------------

DISCONTINUED OPERATIONS
Loss from discontinued operations (671,289) (9,069,804) --
Income tax benefit -- -- --
------------ ------------ ------------
LOSS FROM DISCONTINUED OPERATIONS (671,289) (9,069,804) --
------------- ------------- -------------
NET LOSS $ (1,015,905) $ (9,069,804) $ (344,616)
============= ============= =============

NET LOSS PER SHARE, BASIC AND DILUTED
Continuing operations $ -- $ -- $ (0.00)
Discontinued operations (0.01) (0.14) --
------------- ------------- -------------
NET LOSS PER SHARE, BASIC AND DILUTED $ (0.01) $ (0.14) $ (0.00)
============= ============= =============

WEIGHTED AVERAGE SHARES OUTSTANDING,
BASIC AND DILUTED 68,339,789 63,594,559 78,543,474
============= ============= =============

See accompanying notes to consolidated financial statements.

IDEA SPORTS ENTERTAINMENT GROUP, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
YEARS ENDED DECEMBER 31, 2004 AND 2003

Common Stock Additional Common
---------------------------- Paid-in Stock
Shares Par Value Capital Warrants
------------- ------------- ------------- -------------

Balance at December 31, 2002 63,476,312 $ 6,348 $ 15,798,123 $ --
Issuance of common stock for
loan origination fees 306,100 30 76,495 --
Net loss -- -- -- --
------------- ------------- ------------- -------------
Balance at December 31, 2003 63,782,412 6,378 15,874,618 --
------------- ------------- ------------- -------------
Discontinued operations -- -- -- --
Issuance of common stock warrants for:
Acquisition of IMGI and Gaming -- -- -- 1,200
Acquisition of television programs -- -- -- 65,458
Issuance of common stock for:
Amount due related party 850,000 85 21,915 --
Accrued interest 20,000,000 2,000 198,000 --
Net loss -- -- -- --
------------- ------------- ------------- -------------
Balance at December 31, 2004 84,632,412 $ 8,463 $ 16,094,533 $ 66,658
============= ============= ============= =============
(CONTINUED)

(Deficit)
Accumulated
During the
Accumulated Development
Deficit Stage Total
------------- ------------- -------------
Balance at December 31, 2002 $ (4,295,327) $ (5,984,217) $ 5,524,927
Issuance of common stock for
loan origination fees -- -- 76,525
Net loss -- (9,069,804) (9,069,804)
------------- ------------- -------------
Balance at December 31, 2003 (4,295,327) (15,054,021) (3,468,352)
------------- ------------- -------------
Discontinued operations (15,054,021) 15,054,021 --
Issuance of common stock warrants for:
Acquisition of IMGI and Gaming -- -- 1,200
Acquisition of television programs -- -- 65,458
Issuance of common stock for:
Amount due related party -- -- 22,000
Accrued interest -- -- 200,000
Net loss (671,289) (344,616) (1,015,905)
------------- ------------- -------------
Balance at December 31, 2004 $(20,020,637) $ (344,616) $ (4,195,599)
============= ============= =============

See accompanying notes to consolidated financial statements.

IDEA SPORTS ENTERTAINMENT GROUP, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 2004 AND 2003 AND DEVELOPMENT STAGE
FROM INCEPTION (SEPTEMBER 9, 2004), THROUGH DECEMBER 31, 2004

FROM INCEPTION
YEARS ENDED (9/9/2004)
DECEMBER 31, THROUGH
--------------------------- DECEMBER 31,
2004 2003 2004
------------ ------------ ------------

CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(1,015,905) $(9,069,804) $ (344,616)
Loss from discontinued operations (671,289) (9,069,804) --
------------ ------------ ------------
Loss from continuing operations (344,616) -- (344,616)
Adjustment to reconcile net loss to net cash used
in operating activities:
Prepaid expenses 35,662 -- --
Accounts payable 19,575 -- (17,723)
Accrued expenses 366,404 -- 98,516
------------ ------------ ------------
Net cash from continuing operations 77,025 -- (263,823)
------------ ------------ ------------
Net cash used in discontinued operations (428,264) (1,326,887) --
------------ ------------ ------------
Net cash used in operations (351,239) (1,326,887) (263,823)
------------ ------------ ------------

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of computer equipment (1,863) -- (1,863)
------------ ------------ ------------
Net cash used in continuing operations (1,863) -- (1,863)
------------ ------------ ------------
Net cash used in discontinued operations -- (150,000) --
------------ ------------ ------------
Net cash used in investing activities (1,863) (150,000) (1,863)
------------ ------------ ------------

CASH FLOWS FROM FINANCING ACTIVITIES
Loan proceeds 236,425 -- 236,425
Advances from related parties 29,500 -- 29,500
Cash received in acquisition of IMGI 1,200 -- 1,200
------------ ------------ ------------
Net cash from continuing operations 267,125 -- 267,125
------------ ------------ ------------
Net cash from discontinued operations -- 915,250 --
------------ ------------ ------------
Net cash provided by financing activities 267,125 915,250 267,125
------------ ------------ ------------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (85,977) (561,637) 1,439
CASH AND CASH EQUIVALENTS, beginning of period 88,668 650,305 1,252
------------ ------------ ------------
CASH AND CASH EQUIVALENTS, end of period $ 2,691 $ 88,668 $ 2,691
============ ============ ============

See accompanying notes to consolidated financial statements.

IDEA SPORTS ENTERTAINMENT GROUP, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUED
YEARS ENDED DECEMBER 31, 2004 AND 2003 AND DEVELOPMENT STAGE
FROM INCEPTION (SEPTEMBER 9, 2004), THROUGH DECEMBER 31, 2004

FROM INCEPTION
YEARS ENDED (9/9/2004)
DECEMBER 31, THROUGH
-------------------- DECEMBER 31,
2004 2003 2004
--------- --------- ---------

SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest and income taxes:
Interest $ -- $ 75,830 $ --
Income taxes -- -- --

NON-CASH INVESTING AND FINANCING ACTIVITIES:
Issuance of common stock for:
Loan origination fees $ -- $ 76,525 $ --
Accrured interest 200,000 -- 200,000
Amount due related party 22,000 -- 22,000
Issuance of common stock warrants for:
Acquisition of IMGI and Gaming 1,200 -- 1,200
Acquisition of television programs 65,458 -- 65,458

See accompanying notes to consolidated financial statements.

IDEA SPORTS ENTERTAINMENT GROUP, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
-----------------------------------------------------------

PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION
The consolidated financial statements include the accounts of Idea
Sports Entertainment Group, Inc. ("Idea Sports") and it's wholly owned
subsidiaries, Idea Management Group, Inc. ("IMGI"), Strategic Gaming
Consultants, LLC ("Gaming") and Maxx Motorsports, Inc. (Maxx) and its
wholly owned subsidiary, Team Racing Auto Circuit, LLC (TRAC),
collectively referred to as "the Company" or "the Companies". All
significant inter-company balances and transactions have been
eliminated in consolidation. IMGI and Gaming represent the continuing
operations of the Company and the current development stage
operations.

Maxx, through its wholly owned subsidiary, TRAC, planned to develop,
own, operate and sanction an automotive racing league (the League)
designed to provide content for television and tracks while expanding
the existing base of racing fans. Accordingly, the operations of the
Companies are presented as those of a development stage enterprise,
from its inception (May 15, 2001) as prescribed by Statement of
Financial Accounting Standards (SFAS) No. 7, "Accounting and Reporting
by Development Stage Enterprises." The Company follows the AICPA SOP
98-5, "Reporting on the Costs of Start-Up Activities" in accounting
for its start-up activities. On August 26, 2003, the Board of
Directors of the Company unanimously approved a plan to immediately
discontinue its racing operation. Accordingly, all prior operations
from this business activity are classified as discontinued operations
in the accompanying consolidated financial statements.

Idea Sports acquired IMGI and Gaming, both of which are non-operating
development stage enterprises within the meaning of SFAS No. 7.
Accordingly, the costs associated with the new development stage
activities have a new inception date of September 9, 2004, and all
prior development stage costs associated with the discontinued
automotive racing league have been transferred to accumulated deficit.

ORGANIZATION AND NATURE OF BUSINESS
Idea Sports, a Delaware corporation, is a holding company with three
wholly owned subsidiaries.

On September 9, 2004, the Company acquired all of the issued and
outstanding common stock of IMGI, a South Carolina corporation, in
exchange for warrants to acquire 15,000,000 shares of the Company's
common stock at an exercise price of $.10 per share. In addition, in
the event IMGI generates $2,000,000 in gross revenue within 36 months
of closing, the sellers of IMGI would receive additional warrants to
acquire 15,000,000 shares of the Company's common stock at an exercise
price of $.10. IMGI had no prior operations. Accordingly, this
transaction was valued at $1,200, which was the amount the sellers of
IMGI paid for IMGI's common stock.

On October 15, 2004, the Company acquired two television programs
entitled "America's Top Drivers" and "Women's Racing League" in
exchange for warrants to acquire 1,750,000 shares of the Company's
common stock at an exercise price of $.10 per share. The transaction
was valued at $65,458 using the Black-Scholes option pricing model.

On October 27, 2004, the Company acquired all of the issued and
outstanding memberships of Gaming, a Nevada limited liability company,
in exchange for warrants to acquire 750,000 shares of the Company's
common stock at an exercise price of $.10 per share. In addition, in
the event Gaming generates $2,000,000 in gross revenue within 36
months of closing, the sellers of Gaming would receive additional
warrants to acquire 750,000 shares of the Company's common stock at an
exercise price of $.10. Gaming had no prior operations and has no
assets. Accordingly, the transaction was recorded with no value.

Maxx, a South Carolina corporation, through its wholly owned
subsidiary, TRAC, planned to develop, own, operate, and sanction an
automotive racing league designed to provide content for television
and tracks while expanding the existing base of racing fans. This
operation was discontinued on August 26, 2003.

On November 8, 2004, the Company changed its name from Team Sports
Entertainment, Inc. ("Team Sports") to Idea Sports Entertainment
Group, Inc. On May 15, 2001, Team Sports changed its name from
Logisoft Corporation to Team Sports Entertainment, Inc. and acquired
all of the common stock of Maxx in a tax-free stock exchange for
7,750,000 shares of Team Sports common stock. In addition, as a part
of this agreement, Team Sports issued 3,300,000 shares of its common
stock in exchange for $450,000 of Maxx's liabilities and consulting
fees to third parties in the amount of $375,000 that were instrumental
to the transaction. Also on this date, Team Sports completed the sale
of its wholly owned subsidiaries, LCP and eStorefronts, who created
global and localized Internet solutions for both traditional and pure
e-business companies, to a group of its shareholders in exchange for
12,000,000 shares of Team Sports common stock, which were canceled.

GOING CONCERN
The Company has not established sources of revenues sufficient to fund
the development of business, projected operating expenses and
commitments for fiscal year 2005. The Company, which has been in the
development stage since its inception, May 15, 2001, has accumulated a
net loss of $15,054,021 through December 31, 2003. The Company has
ceased its plans to begin a racing league and all operations have been
discontinued. This discontinued operation had a loss of $671,289 during
the year ended December 31, 2004.

Since August 26, 2003, the Company attempted to locate and negotiate
with a business entity for the merger of that target business into the
Company. As discussed above, the Company has acquired new development
stage businesses commencing on September 9, 2004. Since September 9,
2004, the Company has incurred losses in the amount of $344,616. A
group of the note holders have agreed to advance funds on a limited
basis to allow the Company to develop a business capable of generating
revenues sufficient to fund projected operating expenses and
commitments. However, there can be no assurance that the group of note
holders will be able to continue to provide sufficient funding to
develop the Company's current business plan.

In addition, current liabilities of the Company exceed its assets by
approximately $4,200,000, and its convertible promissory notes payable
obligations are in default. These conditions raise substantial doubt
about the Company's ability to continue as a going concern. The
consolidated financial statements do not include any adjustments that
may result from the outcome of these uncertainties.

CASH AND CASH EQUIVALENTS
The Companies consider all cash on hand, cash in banks and all highly
liquid debt instruments purchased with a maturity of three months or
less to be cash and cash equivalents.

GOODWILL
SFAS No. 142, "Goodwill and Other Intangible Assets" has been applied
to the Maxx transaction. Accordingly, goodwill is not amortized but
reviewed for impairment at least annually or more frequently if
impairment indicators arise. On August 26, 2003, the Board of
Directors of the Company approved a plan to immediately discontinue
its racing operation. Accordingly, the net goodwill balance of
$2,810,627 was considered fully impaired and the adjustment was
included in loss from discontinued operations during the year ended
December 31, 2003.

REVENUE RECOGNITION
Revenue from product sales is recognized when the related goods are
shipped and all significant obligations have been satisfied. Revenue
from services is recognized when the services are performed. No
revenue has been recognized.

STOCK OPTION PLANS
Idea Sports applies the intrinsic value-based method of accounting
prescribed by Accounting Principles Board Opinion No. 25 (APB No. 25),
"Accounting for Stock Issued to Employees," and related
interpretations, in accounting for its stock option plan. As such,
compensation expense would be recorded on the date of grant only if
the current market price of the underlying stock exceeded the exercise
price.

SFAS No. 123, "Accounting for Stock Based Compensation" (SFAS No.
123), requires the Company to disclose pro forma information regarding
option grants made to its employees. SFAS No. 123 specifies certain
valuation techniques that produce estimated compensation charges that
are included in the pro forma results below. These amounts have not
been reflected in the Company's consolidated statements of operations,
because APB No. 25 specifies that no compensation charge arises when
the price of the employees' stock options equal the market value of
the underlying stock at the grant date, as in the case of options
granted to Idea Sports employees, board of directors, advisory
committee members, and consultants.

SFAS No. 123 pro forma numbers are as follows for the years ended
December 31, 2004 and 2003 and from inception (September 9, 2004)
through December 31, 2004:

FROM
INCEPTION
(9/9/04)
THROUGH
2004 2003 12/31/04
-------------- ----------- ------------

Net loss, as reported $ 1,015,905 $9,069,804 $ 344,616
Add: Total stock-based employee
compensation expense determined
under fair value based method for all
awards, net of related tax effects -- 611,452 --
-------------- ----------- ------------
Pro forma net loss $ 1,015,905 $9,681,256 $ 344,616
============== =========== ============

Pro forma basic and diluted net loss per share $ .01 $ .15 $ .01
============== =========== ============
Basic and diluted total net loss per share as
reported $ .01 $ .14 $ .01
============== =========== ============

Under SFAS No. 123, the fair value of each option grant is estimated
on the date of grant using the Black-Scholes option pricing model.
During the year ended December 31, 2003, the following weighted
average assumptions were used: risk-free interest rate of 4.67% based
on the date of issuance, no expected dividends, a volatility factor of
128% to 180% and an expected life of the options of 1 to 2 years.
Using these assumptions, the total value of stock options and rights
to receive stock granted in 2003 was $2,003,303. Options to acquire
8,800,000 shares of common stock were granted in 2003. These options
included grants for 4,300,000 shares which were contingent upon the
start of the 2004 and 2005 race seasons. Since the Company
discontinued operations and there will be no race seasons, these
options have been treated as forfeited and not included in the above
disclosure.

The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options that have no vesting
restrictions and are fully transferable. In addition, option valuation
models require the input of highly subjective assumptions including
the expected stock price volatility. Because Idea Sports employee
stock options have characteristics significantly different from those
of traded options, and because changes in the subjective input
assumptions can materially affect the fair value estimate, in
management's opinion the existing models do not necessarily provide a
reliable single measure of the fair value of Idea Sports' options.

DEFERRED INCOME TAXES
Deferred income taxes are provided for temporary differences between
financial and tax reporting in accordance with the liability method
under the provisions of SFAS No. 109, "Accounting for Income Taxes." A
valuation allowance is recorded to reduce the carrying amounts of
deferred tax assets unless management believes it is more likely than
not that such assets will be realized.

EARNINGS (LOSS) PER COMMON SHARE
Earnings (loss) per common share are calculated under the provisions
of SFAS No. 128, "Earnings per Share," which established new standards
for computing and presenting earnings per share. SFAS No. 128 requires
Idea Sports to report both basic earnings per share, which is based on
the weighted-average number of common shares outstanding, and diluted
earnings per share, which is based on the weighted-average number of
common shares outstanding plus all potential dilutive shares
outstanding. At December 31, 2004 and 2003, all exercisable common
stock equivalents were antidilutive and are not included in the
earnings (loss) per share calculations. Accordingly, basic and diluted
earnings per share are the same for all periods presented.

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

RECENT ACCOUNTING PRONOUNCEMENTS
The following is a summary of recent authoritative pronouncements that
affect accounting, reporting, and disclosure of financial information
by the Company.

In December 2004, the Financial Accounting Standards Board ("FASB")
issued SFAS No. 153, "Exchanges of Non-monetary Assets," (SFAS 153) an
amendment of APB Opinion No. 29, "Accounting for Non-monetary
Transactions" (APB 29). The amendments made by SFAS 153 are based on
the principle that exchanges of non-monetary assets should be measured
based on the fair value of the assets exchanged. Further, the
amendments eliminate the narrow exception for non-monetary exchanges
of similar productive assets and replace it with a broader exception
for exchanges of non-monetary assets that do not have commercial
substance. Previously, APB 29 required that the accounting for an
exchange of a productive asset for a similar productive asset or an
equivalent interest in the same or similar productive asset should be
based on the recorded amount of the asset relinquished. APB 29
provided an exception to its basic measurement principle (fair value)
for exchanges of similar productive assets. The FASB believed that
exception required that some non-monetary exchanges, although
commercially substantive, be recorded on a carryover basis. By
focusing the exception on exchanges that lack commercial substance,
the FASB believes SFAS 153 produces financial reporting that more
faithfully represents the economics of the transactions. SFAS 153 is
effective for non-monetary asset exchanges occurring in fiscal periods
beginning after June 15, 2005. Earlier application is permitted for
non-monetary asset exchanges occurring in fiscal periods beginning
after the date of issuance. The provisions of SFAS 153 shall be
applied prospectively. The Company has evaluated the impact of the
adoption of SFAS 153, and does not believe the impact will be
significant to the Company's overall results of operations or
financial position.

In December 2004, the FASB issued SFAS 123 (revised 2004),
"Share-Based Payment" (SFAS 123(R)). Among other things, SFAS 123(R)
requires expensing the fair value of stock options, previously
optional accounting. For transition, upon adoption on January 1, 2006,
SFAS 123(R) would require expensing any unvested options and will also
require us to change the classification of certain tax benefits from
option deductions to financing rather than operating cash flows. As of
December 31, 2003, the Company did not have any unvested options which
would require adjustment upon adoption of SFAS 123(R). Adoption should
have the same impact as the pro forma disclosure included under stock
option plans above.

Other accounting standards that have been issued or proposed by the
FASB or other standards-setting bodies that do not require adoption
until a future date are not expected to have a material impact on the
consolidated financial statements upon adoption.

FAIR VALUE DETERMINATION
Financial instruments consist of cash, marketable securities,
promissory notes receivable, accounts payable, accrued expenses and
short-term borrowings. The carrying amount of these financial
instruments approximates fair value due to their short-term nature or
the current rates at which the Company could borrow funds with similar
remaining maturities.

FILM AND TELEVISION COSTS
The Company defers film and television production costs, including
direct costs, production overhead, development costs and interest. The
Company does not defer costs of exploitation, which principally
comprise costs of film and television program marketing and
distribution. The Company amortizes deferred film and television
production costs, as well as associated participation and residual
costs, on an individual production basis using the ration of the
current period's gross revenues to estimated total remaining gross
revenues from all sources and such costs are stated at the lower of
amortized cost or fair value. The Company defers the costs of acquired
broadcast material and amortizes these costs when the associated
programs are broadcast and such costs are stated at the lower of
amortized cost or net realizable value. The Company has not yet
commenced amortizing its film costs.

ADVERTISING COSTS
Idea Sports expenses advertising costs as incurred. Idea Sports
recorded advertising costs of $20,925 for the year ended December 31,
2003 and none during the year ended December 31, 2004.

COMPENSATED ABSENCES
Idea Sports accounts for compensated absences in accordance with SFAS
No. 43, "Accounting for Compensated Absences."

RECLASSIFICATIONS
Certain prior year amounts have been reclassified to conform with
current year presentation.

NOTE 2. ACQUISITIONS
------------

On September 9, 2004, the Company acquired all of the issued and outstanding
common stock of IMGI, a South Carolina corporation, in exchange for warrants to
acquire 15,000,000 shares of the Company's common stock at an exercise price of
$.10 per share. In addition, in the event IMGI generates $2,000,000 in gross
revenue within 36 months of closing, the sellers of IMGI would receive
additional warrants to acquire 15,000,000 shares of the Company's common stock
at an exercise price of $.10. IMGI had no prior operations. Accordingly, this
transaction was valued at $1,200, which was the amount the sellers of IMGI paid
for IMGI's common stock.

On October 27, 2004, the Company acquired all of the issued and outstanding
memberships of Gaming, a Nevada limited liability company, in exchange for
warrants to acquire 750,000 shares of the Company's common stock at an exercise
price of $.10 per share. In addition, in the event Gaming generates $2,000,000
in gross revenue within 36 months of closing, the sellers of Gaming would
receive additional warrants to acquire 750,000 shares of the Company's common
stock at an exercise price of $.10. Gaming had no prior operations and has no
assets. Accordingly, the transaction was recorded with no value.

NOTE 3. DISCONTINUED OPERATIONS
-----------------------

The Company realized losses from its discontinued operations of $671,289 and
$9,069,804 in 2004 and 2003, respectively. The loss in 2003 includes an asset
impairment of $7,029,808 which includes goodwill of $2,810,627 and $4,219,181 in
payments associated with the race cars. The remainder of the loss in both
periods is primarily the interest expense and selling, general and
administrative costs associated with attempting to implement the business plan.

NOTE 4. CONVERTIBLE PROMISSORY NOTES
----------------------------

In April 2003, holders of convertible promissory notes with a principal balance
of $1,645,000 agreed to extend the maturity date of their respective notes from
August 31, 2003 to March 1, 2004. In addition, certain holders of the notes
increased the principal amount of their notes by an aggregate amount of
$765,250. A 10% loan origination fee was paid on the increased principal
balances through the issuance of 306,100 shares of the Company's common stock to
the holders of the notes at $.25 per share. The origination fee of $76,525 was
being amortized over the extended term of the convertible promissory notes.

Notes in the aggregate principal amount of $625,000 bear interest at 8% per
annum, require quarterly interest payments, and matured August 31, 2003. The
remaining notes, in the aggregate principal amount of $2,410,250, bear interest
at 8% per annum, require quarterly interest payments, and mature March 1, 2004.
Each note is convertible into common stock of the Company at the rate of $.20
per share. The common stock issuable upon conversion of the convertible notes
payable is restricted and may only be sold in compliance with Rule 144 of the
Securities Act of 1933, as amended.

To induce certain note holders to loan additional funds to the Company, the
Company issued 20,000,000 shares of its common stock in exchange for $200,000 in
accrued interest owed these note holders. The Company received additional loans
from note holders in the amount of $236,425 after the acquisition of IMGI. At
December 31, 2004, the Company owed accrued interest on the notes of $355,717
and did not make the quarterly interest payments due on September 1, 2003 and
December 1, 2003, or any of the four quarterly interest payments due during
2004. All notes are in default at December 31, 2004 and the default rate of
interest is 12% since the default occurred.

NOTE 5. INCOME TAXES
------------

Idea Sports has not recorded a deferred tax benefit or expense for the years
ended December 31, 2004 and 2003, as all net deferred benefits have a full
valuation allowance.

Actual income tax expense applicable to earnings before discontinued operations
and income taxes is reconciled with the "normally expected" federal income tax
as follows:

2004 2003
------------- -------------

"Normally expected" income tax benefit $ 345,400 $ 3,083,700
Increase (decrease) in taxes resulting from:
State income taxes net of federal income
tax benefit 33,500 299,300
Nondeductible meals and entertainment (1,500) (1,200)
Valuation allowance (377,400) (3,381,800)
------------- -------------

Actual income tax expense $ -- $ --
============= =============

The net deferred taxes at December 31, 2004, are comprised of the following:

Net operating loss carryforward $ 15,550,400
Start-up cost carryforward 128,500
Capital loss carryforward 13,800
-------------
15,692,700
Valuation allowance (15,692,700)
-------------

Net deferred tax asset $ --
=============

Idea Sports has available unused net operating loss carryforwards and
capitalized start-up costs of $42,034,000 which will expire in various periods
from 2007 to 2024, some of which may be limited as to the amount available on an
annual basis.

NOTE 6. COMMON STOCK OPTIONS AND WARRANTS
---------------------------------

In April 2000, Idea Sports adopted its 2000 Stock Option Plan (the Plan) and the
Company's Board of Directors approved the same. Idea Sports shareholders
approved the Plan in April 2001. The Plan was established to advance the
interests of Idea Sports and its stockholders by attracting, retaining and
motivating key personnel. The Board of Directors, or a committee that it
appoints, is authorized to grant options to purchase the common stock of Idea
Sports, not to exceed an aggregate of 3,000,000 shares. The Board of Directors,
or a committee that it appoints, is also authorized to establish the exercise
price and vesting terms of individual grants under the Plan. In 2001, the Board
of Directors approved a proposal to increase the number of authorized shares
available under the Plan not to exceed an aggregate of 7,500,000 shares. In
April 2003, the Board of Directors approved a proposal to increase the number of
shares available under the Plan to 15,200,000 shares. Neither proposal has been
approved by the shareholders.

Options granted under the Plan may be either "incentive stock options" intended
to qualify as such under the Internal Revenue Code, or "non-qualified stock
options." Idea Sports expects that most options granted pursuant to the Plan
will be subject to vesting over a three or four-year period, such as 25%
increments on each annual grant date anniversary, during which the optionee must
continue to be an employee of Idea Sports. The Board or the committee, if
applicable, may choose to impose different vesting requirements or none at all.
Options outstanding under the Plan have a maximum term of up to ten (10) years.

The Plan also provides that all options that are not vested will become vested
upon a change in control, unless the options are either assumed or substituted
with equivalent options. In addition, unvested options become vested, after a
change in control, if an optionee is subject to involuntary termination other
than for cause during that optionee's remaining vesting period after a change in
control. The Plan further provides that all options will be forfeited 90 days
after employment terminates.

In May 2001, Idea Sports granted common stock options under the Plan to three
employees as part of their employment contracts for a total of 1,000,000 shares
of its common stock at an exercise price of $1.00 per share, which was above the
market price at the time. Accordingly, no additional compensation expense was
recorded, pursuant to APB No. 25. The options vested 83,333 shares on September
30, 2001, 333,332 shares on December 31, 2001, 333,334 shares on June 30, 2002
and the remaining 250,001 shares on June 30, 2003. Options representing 500,000
shares were forfeited due to termination of the employee in fiscal 2002.

In December 2001, Idea Sports granted common stock options to its seven Advisory
Board members for a total of 1,750,000 shares of its common stock at an exercise
price of $1.00 per share, which was above the market price at the time. These
options have a 5-year life and were exercisable immediately. In addition, Idea
Sports granted common stock options to its eight Board members for a total of
4,000,000 shares of its common stock, also exercisable at $1.00 per share, with
a 10-year life and are exercisable immediately. These 5,750,000 options were all
granted under the Plan.

A summary of stock option activity under the Plan during the years ended
December 31, 2004 and 2003 is as follows (forfeitures in 2004 are a result of
the settlement of the litigation with Miller, which did not occur until March
2005).

2004 2003
----------------------- -----------------------
WEIGHTED WEIGHTED
AVERAGE AVERAGE
EXERCISE EXERCISE
SHARES PRICE SHARES PRICE
------------ --------- ------------ --------

Outstanding, beginning of year 10,900,000 $ .89 6,400,000 $ .99

Granted -- -- 8,800,000 .58
Exercised -- -- -- --
Forfeited (9,400,000) .87 (4,300,000) .42
------------ ------------

Outstanding, end of year 1,500,000 $ 1.00 10,900,000 $ .89
============ ============
Options exercisable at year end 1,500,000 $ 1.00 10,900,000 $ .89
Shares available for grant -- -- -- --

As of December 31, 2004 and 2003, options to acquire 12,200,000 shares, have
been approved by the Board of Directors but have not been approved by the
Shareholders.

Idea Sports applies APB No. 25 and related interpretations in accounting for the
stock option plan.

On September 9, 2004, the Company issued 15,000,000 warrants to acquire its
common stock at $.10, which expire on August 31, 2007, to acquire IMGI. See note
2.

On October 15, 2004, the Company issued 1,750,000 warrants to acquire its common
stock at $.10, which expire on November 15, 2007, to acquire two television
programs. See note 2.

On November 15, 2004, the Company issued 750,000 warrants to acquire its common
stock at $.10, which expire on November 15, 2007, to acquire Gaming. See note 2.

On April 2, 2003, the Board of Directors granted options to certain employees
and directors to acquire 8,800,000 shares of the Company's common stock at
prices ranging from $.42 to $1.00 per share. The options were scheduled to vest
as follows: 4,500,000 on April 2, 2003; 2,210,000 on the day the 2004 racing
season commences and 2,090,000 on the day the 2005 racing season commences. The
following assumptions were used: risk-free interest rate of 4.67%, no expected
dividends, a volatility factor of 127.59% and an expected life of the options of
1 to 2 years. These options included grants for 4,300,000 shares which were
contingent upon the start of the 2004 and 2005 race seasons. Since the Company
discontinued operations and there will be no race seasons, these options have
been treated as forfeited.

As a part of its issue of 28,977,000 shares of its common stock on May 15, 2001
for $7,244,250 in cash, Idea Sports also issued warrants to purchase 14,488,500
shares of its common stock at a purchase price of $1.00 per share. These
warrants expire three (3) years from the effective date of the Securities and
Exchange Commission registration of the 28,977,000 shares of common stock. The
Company has not completed a registration of the common stock; accordingly, the
effective date has not yet started. As a part of the Miller litigation
settlement, warrants to acquire 13,738,500 shares of our common stock were
terminated, leaving a balance of 750,000 outstanding.

NOTE 7. COMMON STOCK
------------

COMMON STOCK - The Company is authorized to issue up to 500,000,000 shares of
common stock with a par value of $.0001. At December 31, 2004, 84,751,212 shares
were issued and 84,632,412 shares were outstanding.

In 2001, Idea Sports sold, pursuant to agreements, 28,977,000 shares of its
common stock for $7,244,250. The agreements required Idea Sports to prepare and
file with the SEC, within 75 days of the acquisition of Maxx (May 15, 2001), a
registration statement covering these securities for an offering to be made on a
continuous basis pursuant to Rule 415 of the U.S. Securities and Exchange Act.
As a result of delays in obtaining certain information from outside parties that
was necessary to complete the registration, the registration statement was filed
after the end of the 75 day period. In accordance with the terms of the
agreements, Idea Sports was required to issue an additional 2,897,700 common
shares effective May 15, 2001. These 31,874,700 shares were "restricted
securities" and may be sold only in compliance with Rule 144 of the Securities
and Exchange Act. The Company withdrew its registration statement during 2003.

PREFERRED STOCK--The Company is authorized to issue up to 2,000,000 shares of
Series A non-voting, cumulative preferred stock with a par value of $2.75. At
December 31, 2004, no preferred stock was issued or outstanding.

A 6% cumulative dividend would be payable quarterly to stockholders of record on
the last day of the month prior to the dividend date. The Series A preferred
stock has a liquidation preference over Idea Sports common stock as well as any
other classes of stock established by Idea Sports.

NOTE 8. RELATED PARTY TRANSACTIONS
--------------------------

In 2004 and 2003, the Companies had various transactions with related parties,
primarily its board members and officers. The following is a summary of those
transactions:

2004 2003
--------- ---------
Payable to current and former officers and board members $304,556 $269,056
Consulting expenses 107,500 132,500
Directors' fees -- 70,500
Legal fees owed to a shareholder and creditor 83,836 64,571

In addition, see note 4 for convertible promissory notes.

2004 TRANSACTIONS
-----------------

On September 9, 2004, the Company issued 15,000,000 warrants to acquire its
common stock at $.10 per share to acquire IMGI. The Company's current CEO, its
former Chairman of the Board of Directors and a former Advisory Director each
received 5,000,000 warrants.

Administrative expenses include payments to Godley Morris Group LLC, a company
50% owned and managed by the CEO, of $40,000 for office expense reimbursement;
consulting fees to the Company's former Chairman of the Board of Directors in
the amount of $45,000; and consulting fees and payroll to the Company's former
Advisory Director in the amount of $37,500. In addition, the Company paid Godley
Morris Group LLC $9,000 for office rent. Idea Sports has a rent commitment to
Godley Morris Group LLC in the amount of $1,500 per month, which expires on
December 31, 2005.

A related party received 850,000 shares of the Company's common stock in
exchange for $22,000 which the Company owed him.

2003 AND PRIOR TRANSACTIONS
---------------------------

The options discussed below were forfeited as a result of the settlement of the
litigation with Miller.

Idea Sports had an employment agreement with its former CEO. This agreement
combined a base pay amount of $50,000 per month, with $200,000 paid for
consulting services from September 1, 2001 through December 31, 2001 and
$300,000 paid for services from January 1, 2002 through June 30, 2002. In
addition, the Companies obtained restricted certificates of deposit in the
amount of $480,000 to be paid if the CEO was employed at July 1, 2002 for
compensation through April 30, 2003. This entire amount was paid to the former
CEO prior to the termination of his employment on August 8, 2002. The former CEO
also received stock options to purchase 3,000,000 shares of Idea Sports common
stock, of which 2,500,000 shares vested upon execution of the agreement and the
remaining 500,000 shares vested when the former CEO was accepted to the Board of
Directors in 2002. The stock option to acquire 2,500,000 shares is not granted
under the 2000 stock option plan described in Note 7 to these consolidated
financial statements.

On August 25, 2001, Idea Sports entered into an agreement in principle with its
former CEO under which the CEO would become the local operator of a market. The
agreement stated that the cost would be $100,000, plus the cost of the nine
racing cars and three haulers to obtain the operating rights for the team, which
was substantially less than amounts anticipated to be paid by other local
operators. The $100,000 was not escrowed, as required by the agreement, and is
included in the amounts payable to related parties on the consolidated balance
sheet.

In 2001, Idea Sports granted common stock options to the Chairman of the Board
of Directors for a total of 1,000,000 shares of its common stock at an exercise
price of $.375 per share, which was above the market price at the time (based
upon common stock sales for cash near the same date). These options were
exercisable immediately and have a 5-year life. These stock options were not
granted under the 2000 Stock Option Plan.

NOTE 9. CONTINGENCIES
-------------

Under the contract, the Company would have been required to make the following
minimum payments:

2003 $ 375,000
2004 10,285,000
2005 10,640,000
--------------
Total minimum contract payments $ 21,300,000
==============

Management is of the opinion that this agreement was terminated without future
liability to the Company when racing operations were discontinued.

LOCAL OPERATOR AGREEMENT WITH FORMER CHIEF EXECUTIVE OFFICER
On August 25, 2001, the Company entered into an agreement in principle with its
former Chief Executive Officer under which the former Chief Executive Officer
would become the local operator of a market. The agreement stated that the cost
would be $100,000 plus the cost of the nine racing cars and three haulers to
obtain the operating rights for the team, which was substantially less than
amounts anticipated to be paid by other local operators. Under the agreement,
the $100,000 was to be kept in an escrow account. The funds are not currently
escrowed and the $100,000 is included in amounts payable to related parties on
the consolidated balance sheet. Under the Miller litigation settlement
agreement, described in note 10, the former CEO would retain the rights as the
local operator of a market and waive any right to the $100,000 deposit.

NOTE 10. LEGAL MATTERS
-------------

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

MARCH 22, 2005 CHANGE

On March 22, 2005, the Company dismissed its former principal accountant, Guest
& Company, P.C., ("Guest") Certified Public Accountants, of Tulsa, Oklahoma and
engaged Creason & Associates, P.L.L.C., ("Creason") Certified Public
Accountants, of Tulsa, Oklahoma, as its principal accountants. The decision to
change accountants was approved by the Board of Directors of the Company and was
required due to the purchase of Guest by Creason.

During the fiscal year ended December 31, 2003 and the subsequent interim
periods, there were no disagreements with the former accountant on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure, which disagreements, if not resolved to the satisfaction of
the former accountant would have caused him to make reference in connection with
his report to the subject matter of the disagreement, and Guest & Company, P.C.
has not advised the Company of any reportable events as defined in paragraph (A)
through (D) of Regulation S-K Item 304(a)(1)(v).

Guest's audit report for the fiscal year ended December 31, 2003, and note 1 to
the corresponding financial statements, contained a modification regarding the
Company's ability to continue as a going concern due to the Company not having
commenced operations and its total liabilities and commitments exceeded current
assets available to fund operations and such audit report stated these factors
raised "substantial doubt" about the Company's ability to continue as a going
concern. The audited financial statements of the Company for the fiscal year
ended December 31, 2003, did not include any adjustments in respect of the going
concern modification. Other than the going concern modification, the audit
report of Guest on the financial statements of the Company for the fiscal year
ended December 31, 2003, and any subsequent interim period, did not contain an
adverse opinion or disclaimer of opinion, nor were they qualified or modified as
to uncertainty, audit scope, or accounting principles.

During the year ended December 31, 2003, and through March 22, 2005, the Company
did not consult with Creason regarding any of the matters or events set forth in
Item 304(a)(2)(i) and (ii) of Regulation S-K.

NOVEMBER 18, 2003 CHANGE

On November 18, 2003, the Company dismissed its former principal accountant,
Elliott Davis, LLC ("Davis"), Certified Public Accountants, of Columbia, South
Carolina and engaged Guest & Company, P.C., Certified Public Accountants, of
Tulsa, Oklahoma, as its principal accountants. The decision to change
accountants was approved by the Board of Directors of the Company on November
18, 2003.

During the fiscal year ended December 31, 2002 and the subsequent interim
periods until November 18, 2003, there were no disagreements with the former
accountant on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which disagreements, if
not resolved to the satisfaction of the former accountant would have caused him
to make reference in connection with his report to the subject matter of the
disagreement, and Davis did not advised the Company of any reportable events as
defined in paragraph (A) through (D) of Regulation S-K Item 304(a)(1)(v).

Davis' audit report for the fiscal year ended December 31, 2002, and note 1 to
the corresponding financial statements, contained a modification regarding the
Company's ability to continue as a going concern due to the Company not having
commenced operations and its total liabilities and commitments exceeded current
assets available to fund operations and such audit report stated these factors
raised "substantial doubt" about the Company's ability to continue as a going
concern. The audited financial statements of the Company for the fiscal year
ended December 31, 2002, did not include any adjustments in respect of the going
concern modification. Other than the going concern modification, the audit
report of Davis on the financial statements of the Company for the fiscal year
ended December 31, 2002, and any subsequent interim period, did not contain an
adverse opinion or disclaimer of opinion, nor were they qualified or modified as
to uncertainty, audit scope, or accounting principles.

During the year ended December 31, 2002, and through November 18, 2003, the
Company did not consult with Guest regarding any of the matters or events set
forth in Item 304(a)(2)(i) and (ii) of Regulation S-K.

ITEM 8A. CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are
designed to ensure that information required to be disclosed in the reports that
are filed or submitted under the Exchange Act is recorded, processed, summarized
and reported, within the time periods specified in the Securities and Exchange
Commission's rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed in the reports that are filed under the Exchange Act is
accumulated and communicated to management, including the principal executive
officer, as appropriate to allow timely decisions regarding required disclosure.
Under the supervision of and with the participation of management, including the
principal executive officer, the Company has evaluated the effectiveness of the
design and operation of its disclosure controls and procedures as of December
31, 2004, and, based on its evaluation, our principal executive officer has
concluded that these controls and procedures are effective. The Company
discontinued its racing operations in August 2003 and subsequently retained a
third-party consultant to assist in determining required disclosures.

(b) Changes in Internal Controls

There have been no significant changes in internal controls or in other factors
that could significantly affect these controls subsequent to the date of the
evaluation described above, including any corrective actions with regard to
significant deficiencies and material weaknesses.

ITEM 8B. OTHER INFORMATION

Pursuant to General Instruction B of Form 8-K, any reports previously or in the
future submitted under Item 2.02 (Results of Operations and Financial Condition)
are not deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 and the Company is not subject to the liabilities of that
section, unless the Company specifically states that the information is to be
considered "filed" under the Exchange Act or incorporates it by reference into a
filing under the Securities Act or Exchange Act. If a report on Form 8-K
contains disclosures under Item 2.02, whether or not the report contains
disclosures regarding other items, all exhibits to such report relating to Item
2.02 will be deemed furnished, and not filed, unless the registrant specifies,
under Item 9.01 (Financial Statements and Exhibits), which exhibits, or portions
of exhibits, are intended to be deemed filed rather than furnished pursuant to
this instruction. The Company is not incorporating, and will not incorporate, by
reference these reports into a filing under the Securities Act of 1933, as
amended, or the Exchange Act of 1934, as amended.

PART III

ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

EXECUTIVE OFFICERS AND DIRECTORS

The following section sets forth the names, ages and current positions with the
Company held by the Directors, Executive Officers and Significant Employees;
together with the year such positions were assumed. There is no immediate family
relationship between or among any of the Directors, Executive Officers or
Significant Employees, and the Company is not aware of any arrangement or
understanding between any Director or Executive Officer and any other person
pursuant to which he was elected to his current position. Each Executive Officer
will serve until he or she resigns or is removed or otherwise disqualified to
serve, or until his or her successor is elected and qualified.

Each Director will serve until he or she resigns or is removed or otherwise
disqualified to serve or until his or her successor is elected. The Company
currently has one Director. The Board of Directors does not expect to appoint
additional Directors until a potential acquisition is identified.

DATE FIRST
NAME AGE POSITION ELECTED/APPOINTED
---- --- -------- -----------------

William C. Morris 57 President and August 2004
CEO

Terry Washburn 51 Director and May 2001
Chairman of
Audit Committee

WILLIAM C. MORRIS, 57, became President, Chief Executive Officer and a Director
in August 2004. Chief Executive Officer, managing partner and 50% owner of
Godley Morris Group, LLC ("GMG") since its formation in January 1996. GMG is a
holding company with a diverse group of investments, including an investment in
the Company. Mr. Morris graduated from Charleston Southern University with a
Bachelor of Science Degree in 1970 and has completed graduate studies at the
University of Florida and the University of South Carolina.

TERRY WASHBURN, 51, Director since May 2001, Chief Executive Officer from April
2001 to August 2001. Dr. Washburn is the President of Eurovest, Inc., a private
venture capital firm, which specializes in private placement of capital as well
as providing consulting services in strategic planning, business development and
organizational management. He is also the Chief Executive Officer of USN
Corporation, formerly Premier Concepts, Inc., a company specializing in
marketing and retailing of high-end faux jewelry. Dr. Washburn is also Chief
Executive Officer of SGD Holdings, Ltd., a wholesale jewelry operation. Dr.
Washburn earned a Bachelor of Business Administration from the University of
Oklahoma, a Master of Divinity from the Southwestern Baptist Theological
Seminary in Ft. Worth, Texas and a Doctor of Ministry from the Fuller
Theological Seminary in Pasadena, California. Dr. Washburn also serves on the
Board of Directors of SGD Holdings, Ltd. and USN Corporation.

AUDIT COMMITTEE

The Board of Directors has determined that Terry Washburn meets the requirements
of a financial expert and serves as Chairman of the Audit Committee. Mr.
Washburn is independent as specified in Item 7 (d)(3)(iv) of Schedule 14A under
the Exchange Act.

The small business issuer has a separately designated standing audit committee
established in accordance with Section 3 (a)(58)(A) of the Exchange Act, which
is currently made up of Mr. Washburn.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the
Company's executive officers, directors and persons who own more than ten
percent of the Company's common stock to file initial reports of ownership and
changes in ownership with the SEC. Additionally, SEC regulations require that
the Company identify any individuals for whom one of the referenced reports was
not filed on a timely basis during the most recent fiscal year or prior fiscal
years. To the Company's knowledge, based solely on a review of reports furnished
to it, William C. Morris did not file his Form 3 when he became a Director and
Mr. Morris and Terry Washburn did not timely file their required Form 5 for
fiscal 2004.

CODE OF ETHICS

The Company had intended to adopt a code of ethics to apply to its principal
executive officer, principal financial officer, principal accounting officer and
controller, or persons performing similar functions; however, the Company
discontinued its race operations in August 2003 and has determined it should
wait until it made an acquisition before adopting a code of ethics. The Company
completed its first acquisition in September 2004, and expects to include the
adoption of a code of ethics on its agenda during 2005.

ITEM 10. EXECUTIVE COMPENSATION

The Compensation Committee of the Board of Directors deliberates executive
compensation matters to the extent they are not delegated to the Chief Executive
Officer.

SUMMARY COMPENSATION TABLE

The following table shows the compensation of the Company's Chief Executive
Officer and each executive officer whose total cash compensation exceeded
$100,000 for the three years ended December 31, 2004.

ANNUAL COMPENSATION

OTHER ANNUAL
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION
--------------------------- ---- ------ ----- ------------

William C. Morris (CEO since 2004 $ 45,000 $ - $ 49,000
August 2004) (1) 2003 N/A N/A N/A
2002 N/A N/A N/A

Terry Hanson (CEO from 2004 $ 24,000 - -
September 2003 until August 2003 $ 127,500 - -
2004) COO and President from 2002 $ 100,000 - -
August 2002 until August 2004)

Charles Bradshaw (CEO from 2004 N/A N/A N/A
August 2002 through August 2003 $ - - -
2003) 2002 $ - - -

William G. Miller (CEO from 2004 N/A N/A N/A
September 1, 2001 through 2003 N/A N/A N/A
July 25, 2002) 2002 $ 780,000 (2) - -

(1) Godley Morris Group, LLC ("GMG"), of which Mr. Morris is 50% owner, Chief
Executive Officer and managing partner, was paid $15,000 for reimbursement of
office expenses and $9,000 for office rent. In addition, $25,000 for additional
office expense reimbursement is included in accounts payable at December 31,
2004.

(2) Prior to his termination, Mr. Miller was prepaid $480,000 for services to be
rendered from July 1, 2002 through April 30, 2003. The Company believes that,
because Mr. Miller was terminated for cause on July 25, 2002, he was not
entitled to substantially all of such amount. See "Item 12. Certain
Relationships and Related Transactions - Transactions with William G. Miller."

LONG TERM COMPENSATION AWARDS

NUMBER OF
SHARES UNDERLYING
NAME YEAR OPTIONS
---- ---- -------

William C. Morris 2004 -
2003 N/A
2002 N/A

Terry Hanson 2004 -
2003 1,000,000 (1)
2002 -

Charles Bradshaw 2004 N/A
2003 1,000,000 (1)
2002 -

William G. Miller 2004 N/A
2003 N/A
2002 -

(1) Options were granted outside the 2000 Stock Option Plan. The option grants
of 3,000,000 shares each included 1,000,000 shares which vested when granted and
2,000,000 shares which were subject to commencement of the 2004 and 2005 racing
season. Accordingly, 2,000,000 shares of each option will not vest and has been
treated as forfeited. These options were forfeited as a part of the Miller
litigation settlement.

OPTION/SAR GRANTS IN LAST FISCAL YEAR

During the year ended December 31, 2004, the Company did not have any option/SAR
grants.

The Company does not have a long term incentive plan.

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES

Number of
Securities Value of
Underlying Unexercised
Unexercised In-the Money
Shares Options/SARs Options/SARs
Acquired at FY-End (#) at FY-End ($)
On Value Exercisable/ Exercisable/
Name Exercise (#) Realized ($) Unexercisable Unexercisable
---- ------------ ------------ ------------- -------------

William C. Morris - $ - 5,000,000 $ 800,000
Terry Hanson - $ - - $ -
Charles Bradshaw - $ - - $ -
William G. Miller - $ - - $ -

DIRECTOR COMPENSATION

Directors do not currently receive compensation for the meetings they attend. It
is anticipated that Directors will receive some form of compensation when the
Company becomes better funded.

EMPLOYMENT AGREEMENTS

See the discussion in "Item 12. Certain Relationships and Related Transactions"
regarding the employment agreement between the Company and William G. Miller.

REPRICING OPTIONS

The Company did not adjust or amend the exercise price of stock options or SAR's
previously awarded during the year ended December 31, 2004.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

The following table indicates all persons who, as of March 2, 2005, the most
recent practicable date, are known by the Company to own beneficially more than
5% of any class of the Company's outstanding voting securities. As of March 2,
2005, there were 84,632,412 shares of the Company's common stock outstanding.
Except as otherwise indicated below, to the best of the Company's knowledge,
each person named in the table has sole voting and investment power with respect
to the securities beneficially owned by them as set forth opposite their name.
The amount and nature of the beneficial owner listed below is after giving
effect to the settlement of the Miller litigation.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

NAME AND ADDRESS OF AMOUNT AND NATURE OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNER % OF CLASS
-------------- ---------------- ---------------- ----------

Common Robert Wussler 5,846,000 (1) 6.52%
C/O Ted Turner Pictures
133 Luckie NW
Atlanta, GA 30303

Common ME Durschlag 7,401,000 (2) 8.21%
5403 Mc Chesney Drive
Charlotte, NC 28269

(1) Includes warrant for 5,000,000 shares.

(2) Includes warrant for 5,000,000 shares and options for 500,000 shares.

SECURITY OWNERSHIP OF MANAGEMENT

The following table indicates the beneficial ownership of the Company's voting
securities of all Directors of the Company and all Executive Officers who are
not Directors of the Company, and all officers and directors as a group, as of
March 2, 2005, the most recent practicable date. As of March 2, 2005, there were
84,632,412 shares of the Company's common stock outstanding. Except as otherwise
indicated below, to the best of the Company's knowledge, each person named in
the table has sole voting and investment power with respect to the securities
beneficially owned by them as set forth opposite their name. All options are
currently exercisable, unless otherwise indicated.

NAME AND ADDRESS OF AMOUNT AND NATURE OF
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNER % OF CLASS
-------------- ----------------- ---------------- ----------

Common William C. Morris 8,833,181 (1) 9.85%

Common Terry Washburn -- --

Common All officers and directors as 8,833,181 9.85%
a Group (2 persons)

(1) Includes warrant to acquire 5,000,000 shares and 3,592,556 shares owned by
Godley Morris Group, LLC of which Mr. Morris is 50% owner, Chief Executive
Officer and managing partner.

EQUITY COMPENSATION PLAN INFORMATION

This table provides certain information as of December 31, 2004, with respect to
our equity compensation plan (options outstanding have been reduced by those
options which were forfeited as a result of the settlement of the Miller
litigation):

NUMBER OF
SECURITIES
AWARDED PLUS
NUMBER OF
SECURITIES
TO BE ISSUED NUMBER OF
UPON EXERCISE SECURITIES
NUMBER OF OF OPTIONS, TO BE ISSUED NUMBER OF
SECURITIES WARRANTS OR UPON EXERCISE SECURITIES
AUTHORIZED RIGHTS OF OUTSTANDING REMAINING
FOR ISSUANCE GRANTED OPTIONS, AVAILABLE
UNDER THE DURING LAST WARRANTS OR FOR FUTURE
NAME OF PLAN PLAN FISCAL YEAR RIGHTS ISSUANCE
------------ ------------ ----------- -----------

Logisoft Corp. 2000
Stock Option Plan 3,000,000 -- 1,500,000 1,500,000

Amendments to Logisoft
Corp. 2000 Stock Option
Plan (1) 12,200,000 -- -- --
------------ ------------ ----------- -----------
15,200,000 -- 1,500,000 1,500,000
============ ============ =========== ===========

(1) The Board of Directors has approved the increase from 3,000,000 shares to
7,500,000 shares authorized for issuance by the Plan. Shareholder approval is
required to authorize the increase to 7,500,000 shares. The Board of Directors
approved the issuance of options for 8,800,000 shares, which were subject to
Shareholder approval, and would require an additional increase of 7,700,000
shares. As a result of discontinuing operations, options for 4,300,000 shares
were forfeited since they were contingent upon the race season starting in 2004
and 2005.

The amendments to the Logisoft Corp. 2000 Stock Option Plan have not been
approved by the shareholders.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

2004 TRANSACTIONS
-----------------
On September 9, 2004, the Company issued 15,000,000 warrants to acquire its
common stock at $.10 per share to acquire IMGI. The Company's current CEO, its
former Chairman of the Board of Directors and a former Advisory Director each
received 5,000,000 warrants.

Administrative expenses include payments to Godley Morris Group LLC, an
affiliate of the CEO, of $40,000 for office expense reimbursement; consulting
fees to the Company's former Chairman of the Board of Directors in the amount of
$45,000; and consulting fees and payroll to the Company's former Advisory
Director in the amount of $37,500. In addition, the Company paid Godley Morris
Group LLC $9,000 for office rent. Idea Sports has a rent commitment to Godley
Morris Group LLC in the amount of $1,500 per month, which expires on December
31, 2005.

A related party received 850,000 shares of the Company's common stock in
exchange for $22,000 which the Company owed him.

2003 AND PRIOR TRANSACTIONS
---------------------------
TRANSACTIONS WITH WILLIAM G. MILLER

EMPLOYMENT AGREEMENT - William G. Miller became an employee of the Company on
September 4, 2001. On October 10, 2001, Mr. Miller was appointed by the Board of
Directors as the Chief Executive Officer and a director of the Company.
Effective January 1, 2002 (the "Effective Date"), the Company entered into an
Employment Agreement (the "Miller Employment Agreement") with Mr. Miller, which
set forth the terms of his employment as Chief Executive Officer.

The Miller Employment Agreement provided that Mr. Miller would be employed for a
period of 16 months from the Effective Date, unless earlier terminated. Mr.
Miller was entitled to receive compensation as follows:

(a) Base salary of $50,000 per month (the "Base Salary");

(b) An option to purchase 2,500,000 shares of the Company's common stock, which
vested immediately at an exercise price of $0.35 per share (the "CEO Option");

(c) An option to purchase 500,000 shares of the Company's common stock, as a
result of his being appointed to the Board of Directors, at an exercise price of
$1.00 per share and which vested immediately (the "Director Option");

(d) The right to participate in the Company's various employee benefit plans, to
be reimbursed for typical business expenses, and to receive various standard
benefits; and

(e) In the event that TRAC began its first race with a minimum of eight racing
teams by July 1, 2003 (the "Bonus Event") and Mr. Miller was employed by the
Company for a period of 12 months as its Chief Executive Officer, then

(i) A cash bonus in the amount of $1,000,000 (the "Cash Bonus"), and

(ii) an option to purchase 1,000,000 shares of the Company's common
stock that would vest upon the occurrence of the Bonus Event (the
"Bonus Option").

In the event that Mr. Miller had exercised his right to terminate his employment
or he was terminated without cause, he would be entitled to act as an
independent consultant to the Company and to receive $50,000 per month as
payment for those services until April 30, 2003.

The Miller Employment Agreement prohibits Mr. Miller, during the term of his
employment and for the two-year period following termination of his employment,
without the prior consent of the Board of Directors, from (i) soliciting
customers or clients of the Company for the purpose of providing services to
them, or (ii) soliciting employees or independent contractors of the Company for
employment or services. Mr. Miller also is prohibited from competing with the
Company, without the prior written consent of the Board of Directors, during the
term of his employment and for the two-year period following his termination.

The Company terminated Mr. Miller's employment effective July 25, 2002 (the
"Termination Date"). In accordance with the terms of the Miller Employment
Agreement, Mr. Miller already had received advance payment of his Base Salary
through April 30, 2003. Because Mr. Miller was not employed for a period of 12
months as the Chief Executive Officer and because the Bonus Event did not occur,
management believes that the Bonus Option and the Cash Bonus did not vest.
Moreover, the Company contends that Mr. Miller's employment was terminated for
cause and that, as a result, the CEO Option and Director Option are terminated
and the Base Salary was not earned after the Termination Date.

Mr. Miller has disputed the Company's contention that he was terminated for
cause. On March 15, 2005, all parties to the litigation agreed to dismiss with
prejudice all claims and counterclaims. The final settlement is subject to court
approval, which management expects to be granted.

ATLANTA TEAM OPERATING RIGHTS - With the knowledge and approval of the Board of
Directors, the Company entered into a nonbinding Agreement in Principle with Mr.
Miller ("AIP No. 1") pursuant to which it agreed to negotiate with Mr. Miller to
finalize definitive agreements for Mr. Miller to obtain operating rights to the
Atlanta TRAC team (the Atlanta Team") for a purchase price of $10,000,000. AIP
No. 1 was dated June 19, 2001 and was accepted and agreed to by Mr. Miller on
August 8, 2001. Subsequently, the Company began negotiations with Mr. Miller to
employ him as the Chief Executive Officer. With the knowledge and approval of
the Board of Directors, the Company reduced the Atlanta Team purchase price in
connection with Mr. Miller's overall employment package with the Company. A
definitive agreement was not executed by April 30, 2003, and therefore, AIP No.
1 expired in accordance with its terms.

A second Agreement in Principle ("AIP No. 2") on the same subject, dated August
25, 2001 was executed apparently on or about December 11, 2001, by Mr. Miller
and Jon Pritchett, purportedly acting on behalf of the Company as its Chief
Operating Officer. The agreement stated that the cost would be $100,000, plus
the cost of the nine racing cars and three haulers to obtain the operating
rights for the team, which was substantially less than amounts anticipated to be
paid by other local operators. The Company contends that AIP No. 2 differs from
AIP No. 1 in material respects that were not approved by the Board of Directors,
that its execution was not authorized by the Company, and that it is void. Mr.
Miller maintains that AIP No. 2 is an enforceable obligation of the Company. On
March 15, 2005, all parties to the litigation agreed to dismiss with prejudice
all claims and counterclaims. The final settlement is subject to court approval,
which management expects to be granted.

PAYMENTS TO ROBERT WUSSLER

In May 2001, the Company and Robert J. Wussler, the Chairman of the Board until
February 5, 2004, entered into an agreement pursuant to which Mr. Wussler agreed
to assist the Company in obtaining a national television contract and to join
the Board of Directors. The Company agreed to pay Mr. Wussler certain fees and
to grant certain options to purchase shares of common stock. The Company and Mr.
Wussler have agreed to terminate this agreement in exchange for a grant on April
2, 2003 of options to purchase 2,250,000 shares (immediately exercisable) at an
exercise price of $1.00 per share. Mr. Wussler received $70,833.39 under the
agreement prior to its termination and was paid an additional $20,000 after
termination of the agreement. Mr. Wussler is not entitled to any further
payments under this Agreement.

Options to acquire 3,750,000 shares of the Company's common stock were forfeited
as a result of the settlement of the Miller litigation.

CALE YARBOROUGH CONSULTING AGREEMENT

Mr. Yarborough, a Director until he resigned in September 2003, also served as
TRAC's national spokesman. For his duties as national spokesman, Mr. Yarborough
received $150,000 annually.

An option to acquire 500,000 shares of the Company's common stock was forfeited
as a result of the settlement of the Miller litigation.

ITEM 13. EXHIBITS

See Exhibit Index on Page 50.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Audit Fees - The aggregate fees billed as of March 31, 2005 for professional
services rendered by the Company's current accountant was $6,500 for the audit
of the Company's annual financial statements for the fiscal year ended December
31, 2004. The Company's prior accountant billed $27,922 for the audit of fiscal
2003 and review of Forms 10-QSB for the last quarter of fiscal 2003 and for
fiscal 2004. The Company's prior accountant billed $45,865 during fiscal 2003
for the prior year audit and review of the applicable Forms 10-QSB for fiscal
2003.

Audit-Related Fees - None.

Tax Fees - None for 2004 or 2003.

All Other Fees - Other than the services described above, no other fees were
billed for services rendered by the principal accountant during fiscal 2004 or
fiscal 2003.

Audit Committee Policies and Procedures - Not applicable.

If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees -
Not applicable.

SIGNATURES

In accordance with the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

IDEA SPORTS ENTERTAINMENT GROUP, INC.

April 11, 2005 /s/ William C. Morris
----------------------------------------------
William C. Morris, President and CEO
(equivalent of Chief Financial Officer)

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.

April 11, 2005 /s/ William C. Morris
----------------------------------------------
William C. Morris, Director, President and CEO

April 11, 2005 /s/ Terry Washburn
----------------------------------------------
Terry Washburn, Director

EXHIBITS HAVE BEEN OMITTED FROM THIS COPY. COPIES OF EXHIBITS MAY BE OBTAINED
FROM IDEA SPORTS ENTERTAINMENT GROUP, INC. (THE "COMPANY") UPON REQUEST AND
PAYMENT OF THE COMPANY'S COSTS IN FURNISHING SUCH COPIES. COPIES MAY ALSO BE
OBTAINED FROM THE SECURITIES AND EXCHANGE COMMISSION FOR A SLIGHT CHARGE. (The
foregoing is not applicable to the original(s) hereof.)

EXHIBIT INDEX
Securities and
Exchange
Commission Page
Exhibit No. Type of Exhibit Number

2 Plan of acquisition, reorganization, arrangement, N/A
liquidation, or succession

3(i) Articles of incorporation N/A

3(ii) By-laws N/A

4 Instruments defining the rights of holders,
incl. Indentures N/A

9 Voting trust agreement N/A

10 Material contracts N/A

11 Statement re: computation of per share earnings Item 7

16 Letter on change in certifying accountant N/A

18 Letter on change in accounting principles N/A

21 Subsidiaries of the Registrant Item 1

22 Published report regarding matters submitted to vote N/A

23 Consent of experts and counsel N/A

24 Power of Attorney N/A

31 Certification pursuant to 18 U.S.C. Section 1350
Section 302 of the Sarbanes-Oxley Act of 2002 51

32 Certification pursuant to 18 U.S.C. Section 1350
Section 906 of the Sarbanes-Oxley Act of 2002 52