Edgar Filing: NETWORK INSTALLATION CORP

FILE NO.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
NETWORK INSTALLATION CORPORATION

(Name of small business issuer in its charter)

Nevada 7389 88-0390360
------- ---------- ----------
(State or jurisdiction (Primary Standard Industrial I.R.S. Employer
of incorporation or Classification Code Number) Identification
Organization No.

18 Technology Drive, Suite 140A, Irvine, CA 92618
Telephone: (949)753-7551
(Address and telephone number of principal executive offices)

18 Technology Drive, Suite 140A, Irvine, CA 92618
Telephone: (949)753-7551
(Address of principal place of business or intended principal place of business)

Michael Cummings
Chief Executive Officer
18 Technology Drive
Suite 140A
Irvine, CA 92618
(949) 753-7551
(Name, address and telephone number of agent for service)

COPY TO:

Amy M. Trombly
80 Dorcar Road
Newton, MA 02459
(617) 243-0850

Approximate date of proposed sale to the public: As soon as practicable after
this Registration Statement becomes effective.

If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule 434, check
the following box. [ ]

If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 check the following box. [X]

CALCUATION OF REGISTRATION FEE

Title of each Dollar Proposed maximum Proposed maximum Amount
Class of securities. Amount to be offering price aggregate offering of registration
To be registered registered per unit price fee

Common Stock,
001 Par Value 1,625,000 3.51 5,703,750 $461.43

(1) Pursuant to Rule 416(a) of the Securities Act of 1933, as amended (the
"Act"), this registration statement shall be deemed to cover additional
securities that may be offered or issued to prevent dilution resulting from
stock splits, stock dividends or similar transactions.

(2) The price of $3.20 per share, which was the average of the high and low
prices of the Registrant's Common Stock, as reported on the Over-The-Counter
Bulletin Board on January 15, 2004 is set forth solely for purposes of
calculating the registration fee pursuant to Rule 457(c) of the Securities Act
of 1933, as amended.

For the purpose of determining the number of shares subject to registration with
the Securities and Exchange Commission, we have assumed that we will issue not
more than 900,000 shares pursuant to the exercise of our put right under the
Investment Agreement, although the number of shares that we will actually issue
pursuant to that put right may be more than or less than 900,000, depending on
the trading price of our common stock. We currently have no intent to exercise
the put right in a manner that would result in our issuance of more than 900,000
shares, but if we were to exercise the put right in that manner, we would be
required to file a subsequent registration statement with the Securities and
Exchange Commission and for that registration statement to be deemed effective
prior to the issuance of any such additional shares.

The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.

The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is declared effective. This prospectus is not
an offer to sell these securities, and we are not soliciting offers to buy these
securities, in any state where the offer or sale is not permitted.

PROSPECTUS
NETWORK INSTALLATION CORPORATION
OFFERING UP TO 1,625,000 COMMON SHARES

This prospectus relates to the resale of up to 1,625,000 shares of our common
stock by current stockholders and by C.C.R.I. who may acquire our common stock
pursuant to the exercise of warrants and by Preston Capital Partners, LLC, which
will become a stockholder pursuant to a "put right" under an Investment
Agreement, also referred to as an Equity Line of Credit, that we have entered
into with Preston Capital. A "put right" permits us to require Preston Capital
to buy shares pursuant to the terms of the Investment Agreement. That Investment
Agreement permits us to "put" up to $2.5 million in shares of our common stock
to Preston Capital. We are not selling any securities in this offering and
therefore will not receive any proceeds from this offering. We will, however,
receive proceeds from the sale of securities pursuant to our exercise of the put
right and possible future exercise of the warrants held by C.C.R. I. All costs
associated with this registration will be borne by us.

The selling shareholders consist of:

Dutchess Advisors, Ltd. 200,000 shares
Dutchess Private Equities Fund, LP 200,000 shares
Michael Cummings 100,000 shares
Marketbyte, LLC 125,000 shares
Preston Capital Partners, LLC 900,000 shares
C.C.R.I Corp. 100,000 shares

The shares of common stock are being offered for sale by the selling
stockholders at prices established on the Over-the-Counter Bulletin Board or in
negotiated transactions during the term of this offering. Our common stock is
quoted on the Over-the-Counter Bulletin Board under the symbol NWIS.OB. On
January 13, 2004, the last reported sale price of our common stock was $3.60 per
share.

Preston Capital and Park Capital Securities, LLC are "underwriters" within the
meaning of the Securities Act of 1933, as amended, in connection with the resale
of our common stock under the Investment Agreement. Preston Capital will pay us
95% of the average of the four lowest closing bid prices of the common stock
during the five consecutive trading day period immediately following the date of
our notice to them of our election to put shares pursuant to the Equity Line of
Credit. The shares held by Dutchess Advisors, Ltd, Dutchess Private Equities
Fund, L.P., Michael Cummings, and Marketbyte, LLC were issued by us in prior
private placements. With the exception of Preston Capital and Park Capital
Securities, no other underwriter or person has been engaged to facilitate the
sale of shares of our common stock in this offering.

This investment involves a high degree of risk. You should purchase securities
only if you can afford a complete loss.

SEE "RISK FACTORS" BEGINNING ON PAGE 10.

You should rely only on the information provided in this prospectus or any
supplement to this prospectus and information incorporated by reference. We have
not authorized anyone else to provide you with different information. Neither
the delivery of this prospectus nor any distribution of the shares of common
stock pursuant to this prospectus shall, under any circumstances, create any
implication that there has been no change in our affairs since the date of this
prospectus.

Neither the Securities and Exchange Commission nor any state securities
regulator has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. It is a criminal offense to make any
representation to the contrary.

Subject to Completion, the date of this prospectus is January 21, 2004.

TABLE OF CONTENTS

PROSPECTUS SUMMARY 5
RISK FACTORS 10
USE OF PROCEEDS 14
DETERMINATION OF OFFERING PRICE 15
DILUTION 15
SELLING SECURITY HOLDERS 16
PLAN OF DISTRIBUTION 17
LEGAL PROCEEDINGS 19
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS 20
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 21
DESCRIPTION OF SECURITIES 22
INTEREST OF NAMED EXPERTS AND COUNSEL 22
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR SECURITIES
ACT LIABILITIES 23
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS 25
DESCRIPTION OF BUSINESS 25
MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATION 30
DESCRIPTION OF PROPERTY 37
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 37
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS 39
EXECUTIVE COMPENSATION 40
FINANCIAL STATEMENTS 41
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE 49

PROSPECTUS SUMMARY

The following information is a summary, of the prospectus and it does not
contain all of the information you should consider before making an investment
decision. You should read the entire prospectus carefully, including the
financial statements and the notes relating to the financial statements.

OUR COMPANY

We are a project engineering company that designs and installs specialty
communication systems for data, voice, video and telecom. We determine our
clients' requirements by doing a need analysis and site audit. Then we implement
our design and specification of the specialty communication system, which may
include Wireless Fidelity, or Wi-Fi, with the deployment of a fixed Wireless
Local Area Network, or WLAN. We believe we can integrate superior solutions
across a vast majority of communication requirements because we have experts in
each aspect of communication services from the design, project management, and
installation of our products through the maintaining of our products.

We have a two-pronged approached to our business model. One is the continued
focus on our core competency of project management services which entails
inventory management, maintaining project timelines, auditing completed work and
quality assurance of projects in wired networking infrastructure, design,
installation and support of communications solutions. Second, is to leverage
that expertise in our pursuit of the infrastructure build-out of Wi-Fi and WLAN.
With our experience and expertise in the wired networking infrastructure
industry, we can design, manage, install and service our wireless customers with
the same processes, personnel and management. Many of our competitors are new to
deploying wireless infrastructure and have never installed any type of
infrastructure. We believe we can leverage our expertise to compete in this new
technology.

HOW TO CONTACT US

Our executive offices are located at 18 Technology Drive, Suite 140A, Irvine, CA
92618. Our phone number is (949) 753-7551.

SALES BY OUR SELLING STOCKHOLDERS

This prospectus relates to the resale of up to 1,625,000 shares of our common
stock by four stockholders, C.C.R.I who may acquire shares of our common stock
by exercising warrants and Preston Capital, who will become a stockholder
pursuant our Investment Agreement.

The table below sets forth the shares that we are registering pursuant to the
Registration Statement to which this prospectus is a part:

Stockholder Number of Shares(1)
- -------------------------------------------- ------------------

Total common stock being registered 1,625,000 shares

(1) For the purpose of determining the number of shares subject to registration
with the Securities and Exchange Commission, we have assumed that we will
issue not more than 900,000 shares pursuant to the exercise of our put
right under the Investment Agreement, although the number of shares that we
will actually issue pursuant to that put right may be more than or less
than 900,000, depending on the trading price of our common stock. We
currently have no intent to exercise the put right in a manner that would
result in our issuance of more than 900,000 shares, but if we were to
exercise the put right in that manner, we would be required to file a
subsequent registration statement with the Securities and Exchange
Commission and for that registration statement to be deemed effective prior
to the issuance of any such additional shares.

C.C.R.I. holds two warrants to purchase our common stock. Warrant 101 allows
C.C.R.I. to purchase up to a total of 50,000 shares of our common stock at an
exercise price equal to $5.00 per share. Warrant 102 allows C.C.R.I. to purchase
up to a total of 50,000 shares of our common stock at an exercise price equal to
$7.50 per share. The Warrants expire five years after the date of their issuance
on September 29, 2008.

The Offering

Common stock offered 1,625,000 shares

Use of proceeds We will not receive any proceeds
from the sale by the selling stockholders of
our common stock. We will receive proceeds
from our Investment Agreement with Preston
Capital and the exercise of warrants. The
proceeds from our exercise of the put right
pursuant to the Investment Agreement will be
used for working capital and general
corporate expenses, expansion of our internal
operations and potential acquisition costs.
See "Use of Proceeds."

Symbol for our common stock Our common stock trades on the
OTCBB Market under the symbol
"NWIS.OB"

THE INVESTMENT AGREEMENT

The Investment Agreement we have with Preston Capital allows us to "put" to
Preston Capital at least $10,000, but no more than $100,000. The purchase price
for our common stock identified in the Put Notice shall be equal to 95% of the
average of four lowest posted bid prices of our common stock during the five
days after we deliver the put notice to Preston Capital. We can initiate a new
put after we close on the prior put.

Preston Capital will only purchase shares when we meet the following conditions:

- a registration statement has been declared effective and remains effective
for the resale of the common stock subject to the Equity Line;

- our common stock has not been suspended from trading for a period of five
consecutive trading days and we have not have been notified of any pending
or threatened proceeding or other action to delist or suspend our common
stock;

- we have complied with our obligations under the Investment Agreement and
the Registration Rights Agreement;

- no injunction has been issued and remain in force, or action commenced by a
governmental authority which has not been stayed or abandoned, prohibiting
the purchase or the issuance of our common stock;

- the registration statement does not contain any untrue statement of a
material fact or omit to state any material fact required to be stated or
necessary to make the statements not misleading or which would require
public disclosure or an update supplement to the prospectus; and

- We have not filed a petition in bankruptcy, either voluntarily or
involuntarily, and there shall not have commenced any proceedings under any
bankruptcy or insolvency laws.

The Investment Agreement will terminate when any of the following events occur:

- Preston Capital has purchased an aggregate of $2,500,000 of our common
stock;

- 36 months after the SEC declares this registration statement effective;

- we file or otherwise enter an order for relief in bankruptcy;

- trading of our common stock is suspended for a period of 5 consecutive
trading days;

- our common stock ceases to be registered under the 1934 Act.

Dilution

You should be aware that there is an inverse relationship between our stock
price and the number of shares to be issued under the Investment Agreement to
Preston Capital. That is, as our stock price declines, we would be required to
issue a greater number of shares under the Investment Agreement for a given
advance. This inverse relationship is demonstrated by the table below, which
shows the number of shares to be issued under the Investment Agreement at a
price of $3.20 per share per share and 25%, 50% and 75% discounts to that price.

Offering price: $3.20 75% 50% 25% -
PURCHASE PRICE:(1) $0.80 $1.60 $2.40 $3.20
NO. OF SHARES:(2) 3,600,000 1,800,000 1,200,000 900,000
TOTAL OUTSTANDING:(3) 16,216,330 14,416,330 13,816,330 13,516,330
PERCENT OUTSTANDING:(4) 22.2% 12.5% 8.7% 6.7%

(1) Represents market price.

(2) Represents the number of shares of common stock to be issued at the prices
set forth in the table to generate $2.88 million in gross proceeds.

(3) Represents the total number of shares of common stock outstanding after the
issuance of the shares, assuming no issuance of any other shares of common
stock.

(4) Represents the shares of common stock to be issued as a percentage of the
total number shares of common stock outstanding (assuming no exercise or
conversion of any options, warrants or other convertible securities).

OUR CAPITAL STRUCTURE AND SHARES ELIGIBLE FOR FUTURE SALE

Shares of common stock outstanding as of September 30, 2003 12,616,330(1)

Shares of common stock potentially issuable upon
exercise of the put right to Preston Capital 900,000

Shares of common stock potentially issuable to
C.C.R.I. upon exercise of the warrants 100,000
------------

Total 13,616,330

____________________
(1) Assumes no exercise of:
- A warrant to purchase 618,000 shares of our common stock that is
exercisable at a price equal to the closing bid price of our common stock
on August 29, 2003 which was $2.95. The warrant expires on May 16, 2008.

- $403,000 of convertible debentures. The convertible debentures carry an
interest rate of 6% per annum. A portion of the convertible debentures are
due in April and another portion are due in September 2008. The face amount
of the convertible debenture may be converted, in whole or in part, at any
time. The holder is entitled to convert the face amount of the convertible
debenture plus accrued interest at the lesser of (i) 75% of the lowest
closing bid price during the 15 trading days prior to the conversion date
or (ii) 100% of the average of the closing bid prices for the 20 trading
days immediately preceding the closing date of the debenture transaction.
The convertible debentures are convertible into shares of our common stock.

- A convertible promissory note valued at $75,000 that is due on April 1,
2004, carrying an interest rate of 10% per annum. The holder of the
promissory note is entitled to convert the conversion amount into shares of
common stock, at any time, at a conversion price for each share of common
stock equal $7.00 per share of common stock.

RISK FACTORS

An investment in our common stock involves a high degree of risk. You should
carefully consider the following risk factors, other information included in
this prospectus and information in our periodic reports filed with the SEC. If
any of the following risks actually occur, our business, financial condition or
results of operations could be materially and adversely affected, and you may
lose some or all of your investment.

RISKS ABOUT OUR BUSINESS

OUR INDEPENDENT ACCOUNTANTS HAVE ISSUED A GOING CONCERN OPINION.

Our audited financial statements for the fiscal year ended December 31, 2002,
reflect a net loss of $109,006. Our unaudited financial statements for the nine
month period ended September 30, 2003 reflect a net loss of $2,817,494. These
conditions raised substantial doubt about our ability to continue as a going
concern. if we do not acquire sufficient additional funding or alternative
sources of capital to meet our working capital, we may have to substantially
curtail our operations and business plan.

WE HAVE GENERATED SIGNIFICANT LOSSES AND EXPECT TO GENERATE OPERATING LOSSES FOR
THE FORESEEABLE FUTURE, THEREFORE WE MAY NOT BECOME PROFITABLE.

We have sustained substantial operating losses in the past. Our net losses for
the fiscal year ended December 31, 2002, were $3,349,572. Through September 30,
2003 we have generated an accumulated deficit of($4,573,302). We expect
operation losses to continue for the foreseeable future. When this registration
statement is declared effective by the SEC, we will be able to access an Equity
Line of $2.5 million, which we believe will be sufficient to support our
business and operations for at least the next 12 months. However, if this
registration statement is not declared effective, or we can not draw on the
Equity Line for other reasons, we could continue operating for the next twelve
months but would have to significantly curtail operations. As a result, we may
not become profitable, or if we become profitable, we may not remain profitable.

WE HAVE SUBSTANTIAL INDEBTEDNESS WHICH MAY AFFECT OUR ABILITY TO MAINTAIN OR
GROW OUR OPERATIONS.

We currently have $2,718,871 in current long term liabilities. As a result of
our level of debt and the terms of our debt instruments:

- our vulnerability to adverse general economic conditions is heightened; -
we will be required to dedicate a substantial portion of our cash flow from
operations to repayment of debt, limiting the availability of cash for
other purposes;

- we are and will continue to be limited by financial and other restrictive
covenants in our ability to borrow additional funds, consummate asset
sales, enter into transactions with affiliates or conduct mergers and
acquisitions; - our flexibility in planning for, or reacting to, changes in
its business and industry will be limited; and

- our ability to obtain additional financing in the future for working
capital, capital expenditures, acquisitions, general corporate purposes or
other purposes may be impaired.

Our ability to pay principal and interest on our indebtedness and to satisfy our
other debt obligations will partly depend upon our future operating performance,
which will be affected by prevailing economic conditions and financial, business
and other factors, some of which are beyond our control. If we are unable to
service our indebtedness, we will be forced to take actions such as reducing or
delaying capital expenditures, selling assets, restructuring or refinancing our
indebtedness, or seeking additional equity capital. We may not be able to affect
any of these remedies on satisfactory terms, or at all.

OUR OPERATING RESULTS WILL FLUCTUATE SIGNIFICANTLY FOR THE FORESEEABLE FUTURE,
WHICH MAY AFFECT OUR STOCK PRICE.

Our quarterly results of operations have varied in the past and are likely to
continue to vary significantly from quarter to quarter. Our operating expenses
are based on expected future revenues and are relatively fixed in the short
term. If our revenues are lower than expected, our results of operations could
be adversely affected. Additionally, we are unable to forecast our future
revenues with certainty because our business plan contemplates the acquisition
of new enterprises. Many factors can cause our financial results to fluctuate,
some of which are outside of our control. Quarter-to-quarter comparisons of our
operating results may not be meaningful and you should not rely upon them as an
indication of our future performance. In addition, during certain future periods
our operating results likely will fall below the expectations of public market
analysts and investors. In this event, the market price of our common stock
likely would decline.

WE NEED ADDITIONAL CAPITAL TO GROW OUR BUSINESS AND WE MAY NOT BE ABLE TO FIND
SUCH CAPITAL ON ACCEPTABLE TERMS.

Our business plan contemplates the acquisition of new enterprises and the
proceeds from our existing financing arrangements may not be sufficient to fully
implement our business plan. Additionally, we may not be able to generate
sufficient revenues from our existing operations to fund our capital
requirements. Accordingly, we may require additional funds to enable us to
operate profitably. Such financing may not be available on terms acceptable to
us. We currently have no bank borrowings or credit facilities, and we may not be
able to arrange any such debt financing. Additionally, we may not be able to
successfully consummate additional offerings of stock or other securities in
order to meet our future capital requirements. If we cannot raise additional
capital through issuing stock or bank borrowings, we may not be able to grow our
business.

OUR BUSINESS STRATEGY INCLUDES IDENTIFYING NEW BUSINESSES TO ACQUIRE, AND IF WE
CAN NOT INTEGRATE ACQUISITIONS INTO OUR COMPANY SUCCESSFULLY, WE MAY NOT BECOME
PROFITABLE.

Our success partially depends upon our ability to identify and acquire
undervalued businesses. Although we believe that there are companies available
for potential acquisition that are undervalued and might offer attractive
business opportunities, we may not be able to make any acquisitions, and if we
do make acquisitions, they may not be profitable.

WE DEPEND ON OUR KEY PERSONNEL AND IF THOSE PERSONNEL LEAVE THE COMPANY, OUR
BUSINESS MAY BE HARMED.

At this time, we are almost totally dependent upon Michael Cummings as our only
operating officer and on the directors of Network Installation Corporation, our
only business asset that is producing significant revenues. While we have an
employment agreement with Mr. Cummings, it does not obligate him to remain as
our Chief Executive Officer. We do not maintain insurance on the lives of our
officers, directors or key employees. The loss of their services would have a
material adverse effect on our business. We elect our directors each year and
while we expect to reelect our directors currently on the Board, our directors
are not obligated to continue in their positions.

SOME OF OUR POTENTIAL FUTURE GROWTH DEPENDS ON INCREASING CUSTOMER ACCEPTANCE OF
WIRELESS NETWORKS, AND TO THE EXTENT THAT SUCH ACCEPTANCE FAILS TO INCREASE, WE
MAY NOT GROW OUR BUSINESS.

While the majority of our revenues are currently derived from the installation
of cable systems, we believe that improving wireless technology will eventually
make wireless systems an acceptable alternative to many of our potential
customers. We have begun to enter the wireless marketplace and believe this
technology could lead to future growth for our company. The wireless industry
has historically experienced a dramatic rate of growth both in the United States
and internationally. If the rate of growth should slow down and end users
continue to reduce their capital investments in wireless infrastructure or fail
to expand their networks, we may not be able to expand our business.

RISKS ABOUT OUR STOCK AND THIS OFFERING

CERTAIN INSIDERS HAVE ENOUGH SHARES TO EXERCISE CONTROL OVER MATTERS SUBJECT TO
INVESTOR VOTE WHICH COULD ADVERSELY AFFECT OUR STOCK PRICE.

As of September 30, 2003, officers and directors controlled eighty-five percent
of our common stock and therefore control the election of directors and all
other matters subject to stockholder votes. This concentration of ownership may
also have the effect of delaying or preventing a change of control, even if this
change of control would benefit certain shareholders. These shareholders may
make decisions that may not be in the best interest of minority stockholders. As
a result, this concentration of ownership could have an adverse effect on the
market price of our common stock.

OUR STOCK PRICE IS VOLATILE AND YOU MAY NOT BE ABLE TO SELL YOUR SHARES AT A
PRICE HIGHER THAN WHAT YOU PAID.

The market for our common stock is highly volatile. The trading price of our
common stock could be subject to wide fluctuations in response to, among other
things, quarterly variations in operating and financial results, announcements
of technological innovations or new products by our competitors or us, changes
in prices of our products and services or our competitors' products and
services, changes in product mix, changes in our revenue and revenue growth
rates.

WE MUST COMPLY WITH PENNY STOCK REGULATIONS WHICH COULD EFFECT THE LIQUIDITY AND
PRICE OF OUR STOCK.

The SEC has adopted rules that regulate broker-dealer practices in connection
with transactions in "penny stocks." Penny stocks generally are equity
securities with a price of less than $5.00, other than securities registered on
certain national securities exchanges or quoted on NASDAQ, provided that current
price and volume information with respect to transactions in such securities is
provided by the exchange or system. Prior to a transaction in a penny stock, a
broker-dealer is required to:

- Deliver a standardized risk disclosure document prepared by the SEC;

- Provides the customer with current bid and offers quotations for the penny
stock;

- Explain the compensation of the broker-dealer and its salesperson in the
transaction;

- Provide monthly account statements showing the market value of each penny
stock held in the customer's account;

- Make a special written determination that the penny stock is a suitable
investment for the purchaser and receives the purchaser's; and

- Provide a written agreement to the transaction.

These requirements may have the effect of reducing the level of trading activity
in the secondary market for our stock. Because our shares are subject to the
penny stock rules, you may find it more difficult to sell your shares.

EXISTING STOCKHOLDERS MAY EXPERIENCE SIGNIFICANT DILUTION FROM THE SALE OF
SECURITIES PURSUANT TO OUR INVESTMENT AGREEMENT WITH PRESTON CAPITAL.

The sale of shares pursuant to our Investment Agreement with Preston Capital may
have a dilutive impact on our stockholders. As a result, our net income per
share could decrease in future periods, and the market price of our common stock
could decline. In addition, the lower our stock price at the time we exercise
our put option, the more shares we will have to issue to Preston Capital to draw
down on the full equity line with Preston Capital. If our stock price decreases,
then our existing stockholders would experience greater dilution.

PRESTON CAPITAL WILL PAY LESS THAN THE THEN-PREVAILING MARKET PRICE OF OUR
COMMON STOCK.

Our common stock to be issued under our agreement with Preston Capital will be
purchased at a 5% discount to the average of the four lowest closing bid prices
for the five days immediately following our notice to Preston Capital of our
election to exercise our put right. Preston Capital has a financial incentive to
sell our common stock immediately upon receiving the shares to realize the
profit between the discounted price and the market price. If Preston Capital
sells our shares, the price of our stock could decrease. If our stock price
decreases, Preston Capital may have a further incentive to sell the shares of
our common stock that it holds. The discounted sales under our agreement with
Preston Capital could cause the price of our common stock to decline.

RISKS ABOUT OUR INDUSTRY

OUR INDUSTRY HAS RAPIDLY CHANGING TECHNOLOGY AND, IF WE DO NOT STAY CURRENT, WE
MAY LOSE CUSTOMERS AND OUR BUSINESS WILL BE HARMED.

The network installation industry and related technology business involve a
broad range of rapidly changing technologies. Our technologies may not remain
competitive over time, and others may develop technologies that are superior to
ours which may render our products non-competitive. Our business may depend on
trade secrets, know-how, continuing innovations and licensing opportunities to
develop and maintain our competitive position. Others may independently develop
equivalent proprietary information or otherwise gain access to or disclose our
information. Our confidentiality agreements on which we rely may not provide
meaningful protection of any trade secrets on which we may depend for success,
or provide adequate remedies in the event of unauthorized use or disclosure of
confidential information or prevent our trade secrets from otherwise becoming
known to or independently discovered by our competitors.

USE OF PROCEEDS

625,000 shares of common stock covered by this prospectus are to be sold by four
selling shareholders who will receive all of the proceeds from such sales. We
will not receive any proceeds from the sale of the 625,000 shares. However, we
will receive proceeds from the sale of our common shares pursuant to our
Investment Agreement with Preston Capital. Additionally, we may receive proceeds
from the sale of our common shares to C.C.R.I. if C.C.R.I. exercises warrants
that it currently holds. However, we do not believe C.C.R.I. will exercise the
warrants in the near future because the exercise prices of $5.00 and $7.50 are
higher than the current trading price of our stock.

The proceeds from our exercise of the put right pursuant to the Investment
Agreement will be used for working capital and general corporate expenses,
expansion of our internal operations and potential acquisition costs, although
we do not currently have any agreements or arrangements for pending
acquisitions.

For illustrative purposes, we have set forth below our intended use of proceeds
for the range of net proceeds indicated below to be received under the
Investment Agreement. The Gross Proceeds represent the total dollar amount that
Preston Capital is obligated to purchase. The table assumes estimated offering
expenses of $25,000.

Proceeds Proceeds
If 100% Sold If 50% Sold
------------- ------------
Gross Proceeds $2,500,000 $1,250,000
Estimated Expenses of the Offering $ 25,000 $ 25,000
------------- ------------
Net Proceeds $2,475,000 $1,225,000
============= ===========

Priority Proceeds
------------- ------------

Working capital and general corporate expenses 1st $1,000,000 $500,000
Expansion of internal operations 2nd $ 500,000 $250,000
Potential acquisition costs 3rd $ 975,000 $475,000
------------- ------------
$2,475,000 $1,225,000
============= ===========

Proceeds of the offering which are not immediately required for the purposes
described above will be invested in United States government securities,
short-term certificates of deposit, money market funds and other high-grade,
short-term interest-bearing investments.

DETERMINATION OF OFFERING PRICE

The selling stockholders may sell shares in any manner at the current market
price or through negotiated transactions with any person at any price.

DILUTION

Our net tangible book value as of June 30, 2003 was ($219,386), or ($ .027) per
share of common stock. Net tangible book value is determined by dividing our
tangible book value (total tangible assets less total liabilities) by the number
of outstanding shares of our common stock. Since this offering is being made
solely by the selling stockholders and none of the proceeds will be paid to us,
our net tangible book value will be unaffected by this offering. Our net
tangible book value, however, will be impacted by the common stock to be issued
to Preston Capital. The amount of dilution will depend on the offering price and
number of shares to be issued. The following example shows the dilution to new
investors at an offering price of $3.20 per share.

If we assume that we were to issue 900,000 shares of common stock to Preston
Capital at an assumed offering price of $3.20 per share, less $25,000 of
offering expenses, our net tangible book value as of June 30, 2003 would have
been $2,635,614, or $.23 per share. This represents an immediate increase in net
tangible book value to existing shareholders of $0.257 per share and an
immediate dilution to new shareholders of $2.97 per share.

Assumed public offering price per share $3.20
Net tangible book value per share before this offering ($.027)
Net tangible book value after this offering $2,635,614
Net tangible book value per share after this offering $.23
Dilution of net tangible book value per share to new investors $2.97

Increase in net tangible book value per share to existing shareholders $.257

Offering price: $3.20 75% 50% 25% -
PURCHASE PRICE:(1) $0.80 $1.60 $2.40 $3.20
NO. OF SHARES:(2) 3,600,000 1,800,000 1,200,000 900,000
TOTAL OUTSTANDING:(3) . 16,216,330 14,416,330 13,816,330 13,516,330
PERCENT OUTSTANDING:(4) 22.2% 12.5% 8.7% 6.7%

(1) Represents market price.

(2) Represents the number of shares of common stock to be issued at the prices
set forth in the table to generate $2.88 million in gross proceeds.

(3) Represents the total number of shares of common stock outstanding after the
issuance of the shares, assuming no issuance of any other shares of common
stock.

SELLING SECURITY HOLDERS

Based upon information available to us as of November 24, 2003, the following
table sets forth the name of the selling stockholders, the number of shares
owned, the number of shares registered by this prospectus and the number and
percent of outstanding shares that the selling stockholders will own after the
sale of the registered shares, assuming all of the shares are sold. The
information provided in the table and discussions below has been obtained from
the selling stockholders. The selling stockholders may have sold, transferred or
otherwise disposed of, or may sell, transfer or otherwise dispose of, at any
time or from time to time since the date on which they provided the information
regarding the shares beneficially owned, all or a portion of the shares of
common stock beneficially owned in transactions exempt from the registration
requirements of the Securities Act of 1933. As used in this prospectus, "selling
stockholder" includes donees, pledgees, transferees or other
successors-in-interest selling shares received from the named selling
stockholder as a gift, pledge, distribution or other non-sale related transfer.
However, this registration statement does not cover sales by donees, pledges,
transferees or other successors-in-interest of Preston Capital.

Beneficial ownership is determined in accordance with Rule 13d-3(d) promulgated
by the Commission under the Securities Exchange Act of 1934. Unless otherwise
noted, each person or group identified possesses sole voting and investment
power with respect to the shares, subject to community property laws where
applicable.

Ownership Before Offering Shares Being Offered Ownership After Offering(1)
------------------------- -------------------- ------------------------

Dutchess Advisors, Ltd.(3) 3,049,033 200,000 2,649,033
Dutchess Private Equities
Fund, LP(3) 3,049,033 200,000 2,649,033
Michael Cummings(4) 8,042,650 100,000 7,942,650
Marketbyte, LLC (5) 250,000 125,000 125,000
Preston Capital
Partners, LLC(6) 250,000 900,000(8) 250,000
C.C.R.I. Corp.(7) 25,000 100,000 25,000

(1) The numbers assume that the selling stockholders have sold all of the
shares offered hereby prior to completion of this Offering.
(2) Based on 12,616,330 shares outstanding as of September 30, 2003.
(3) Two of our directors, Michael Novielli and Douglas Leighton, are the
Managing Members of Dutchess Capital Management, which is the General
Partner of Dutchess Private Equities. Our director, Theodore Smith, is the
Executive Vice President of Dutchess Advisors, LLC.
(4) The 8,042,650 shares includes a five year option to purchase an additional
618,000 shares of our common stock at a price equal to the closing bid
price of our common stock on August 29, 2003 which was $2.95.
(5) The Managing Member of Marketbyte, LLC is Larry Isen.
(6) The Managing Member of Preston Capital Partners, LLC is John Wykoff.
(7) The President of C.C.R.I. Corp. is Malcolm McGuire.
(8) Represents shares we may issue as a result of exercising our right to put
shares to Preston Capital pursuant to an Equity Line of Credit. Since we
are not obligated to use the Equity Line of Credit and the amount of shares
that we may issue pursuant to the Equity Line is partly based on the future
market price of our common stock, we can not predict with accuracy the
actual number of shares we may issue to Preston Capital.

PLAN OF DISTRIBUTION

The selling stockholders will act independently of us in making decisions with
respect to the timing, manner and size of each sale. The selling stockholders
may sell the shares from time to time:

- in transactions on the Over-the-Counter Bulletin Board or on any national
securities exchange or U.S. inter-dealer system of a registered national
securities association on which our common stock may be listed or quoted at
the time of sale; or
- in private transactions and transactions otherwise than on these exchanges
or systems or in the over-the-counter market;
- at prices related to such prevailing market prices, or
- in negotiated transactions, or
- in a combination of such methods of sale; or
- any other method permitted by law.

The selling stockholders may effect such transactions by offering and selling
the shares directly to or through securities broker-dealers, and such
broker-dealers may receive compensation in the form of discounts, concessions or
commissions from the selling stockholders and/or the purchasers of the shares
for whom such broker-dealers may act as agent or to whom the selling
stockholders may sell as principal, or both, which compensation as to a
particular broker-dealer might be in excess of customary commissions.

Preston Capital and Park Capital Securities, LLC and any broker-dealers who act
in connection with the sale of its shares will be deemed to be "underwriters"
within the meaning of the Securities Act, and any discounts, concessions or
commissions received by them and profit on any resale of the shares as principal
will be deemed to be underwriting discounts, concessions and commissions under
the Securities Act.

On or prior to the effectiveness of the registration statement to which this
prospectus is a part, we will advise the selling stockholders that they and any
securities broker-dealers or others who may be deemed to be statutory
underwriters will be governed by the prospectus delivery requirements under the
Securities Act. Under applicable rules and regulations under the Securities
Exchange Act, any person engaged in a distribution of any of the shares may not
simultaneously engage in market activities with respect to the common stock for
the applicable period under Regulation M prior to the commencement of such
distribution. In addition and without limiting the foregoing, the selling
security owners will be governed by the applicable provisions of the Securities
and Exchange Act, and the rules and regulations thereunder, including without
limitation Rules 10b-5 and Regulation M, which provisions may limit the timing
of purchases and sales of any of the shares by the selling stockholders. All of
the foregoing may affect the marketability of our securities.

On or prior to the effectiveness of the registration statement to which this
prospectus is a part, we will advise the selling stockholders that the
anti-manipulation rules under the Securities Exchange Act may apply to sales of
shares in the market and to the activities of the selling security owners and
any of their affiliates. We have informed the selling stockholders that they may
not:

- engage in any stabilization activity in connection with any of the shares;
- bid for or purchase any of the shares or any rights to acquire the shares,
- attempt to induce any person to purchase any of the shares or rights to
acquire the shares other than as permitted under the Securities Exchange
Act; or
- effect any sale or distribution of the shares until after the prospectus
shall have been appropriately amended or supplemented, if required, to
describe the terms of the sale or distribution.

We have informed the selling stockholders that they must effect all sales of
shares in broker's transactions, through broker-dealers acting as agents, in
transactions directly with market makers, or in privately negotiated
transactions where no broker or other third party, other than the purchaser, is
involved.

The selling stockholders may indemnify any broker-dealer that participates in
transactions involving the sale of the shares against certain liabilities,
including liabilities arising under the Securities Act. Any commissions paid or
any discounts or concessions allowed to any broker-dealers, and any profits
received on the resale of shares, may be deemed to be underwriting discounts and
commissions under the Securities Act if the broker-dealers purchase shares as
principal.

In the absence of the registration statement to which this prospectus is a part,
certain of the selling stockholders would be able to sell their shares only
pursuant to the limitations of Rule 144 promulgated under the Securities Act.

We expect to incur approximately $20,000 in expenses related to this
registration statement. Our expenses consist mainly of accounting and legal
fees.

We engaged Park Capital Securities, LLC as our placement agent with respect to
the securities to be issued under the Equity Line of Credit. To our knowledge
Park Capital Securities, LLC has no affiliation or business relationship with
Preston Capital. Park Capital will be our exclusive placement agent in
connection with the Investment Agreement. We agreed to pay the Park Capital 1%
of the gross proceeds from each put with an aggregate maximum of $7,500 over the
term of our agreement. The Placement Agent agreement terminates when our
Investment Agreement with Preston Capital terminates pursuant to the terms of
that Investment Agreement.

LEGAL PROCEEDINGS

In the year ended December 31, 2002, a suit was brought against us in the
Superior Court of the State of California, County of San Francisco, by
Martin Mast an individual alleging that we made false written and oral
representations to induce the plaintiff to invest in our company and that such
investment occurred despite the plaintiff's request that the funds be held in
a brokerage account maintained by a related entity. A co-defendant Aslam Shaw
an individual in the case also filed a cross-complaint in the action
alleging theories of recovery against us and several other defendants and
alleging fraud, breach of contract, misrepresentation, conversion and
securities fraud against us. On November 21, 2003, we reached a settlement with
the plaintiffs for $160,000. We are making payments in installments through
April 2004. To date $45,000 has been paid. We had accrued $300,000 in the
accompanying financial statements against any possible outcome.

On April 25, 2003 the Superior Court of the State of California, County
of Orange, entered a judgment in the amount of $46,120 against us in favor
of Insulectro Corp. a vendor of our former subsidiary, North Texas Circuit
Board, or NTCB. We believe that we were never issued proper service of process
for the complaint. In addition, on August 20, 2002 we sold NTCB to BC
Electronics Inc. Pursuant to terms of the share purchase agreement, BC
Electronics assumes all liabilities of NTCB. We plan to vigorously
oppose the action and request that the judgment be vacated for lack of personal
service. Although we are the guarantor on the loan, NTCB is the principal
debtor and (i) we will bring action against NTCB to seek relief or (ii)
because partial payment was made by NTCB, it could affect the legal status
of the guarantee, which we believe may absolve us of liability.

On April 29, 2003, Arman Moheban an individual brought a suit against us
in the Superior Court of the State of California, County of Los Angeles,
alleging breach of contract pursuant to a settlement agreement dated
November 20, 2002. The suit alleges that we are delinquent in our
repayment of a $20,000 promissory note, of which $5,000 has been repaid to date.
We plan to vigorously oppose the claim.

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

The names and ages of all of our directors and executive officers, along with
their respective positions, term of office and period such position(s) was held,
is as follows:

Name Age Position Held
----- --- --------------

Michael Cummings 39 Chief Executive Officer, Director

Michael A. Novielli 39 Chairman of the Board of Directors

Douglas H. Leighton 35 Director

Theodore Smith 27 Director

BIOGRAPHIES OF OFFICERS AND DIRECTORS

Set forth below is a brief description of the background of our officers and
directors based on information provided by them to us.

MICHAEL CUMMINGS has served as our Chief Executive Officer and director since
May 2003. He previously founded and served as President of Network Installation
Corp. from 1997 to 2003. During the period from 1999-2001, Mr. Cummings
purchased a controlling interest in Tri-City Datatel, Inc., a designer and
installer of networking systems. Mr. Cummings sold his interest in 2001. In
1983, Mr. Cummings attended Goldenwest College for Business Law.

MICHAEL A. NOVIELLI has served as our director since April, 2003. Mr. Novielli
is a Managing Partner of Dutchess Capital Management, LLC and Dutchess Advisors,
LLC. A co-founder of Dutchess in 1996, Mr. Novielli advises the senior
management of issuers in which Dutchess Private Equities Fund LP has invested,
in areas of business development, legal, accounting and regulatory compliance.
Prior to co-founding Dutchess, Mr. Novielli was a partner at Scharff, Witchel &
Company, a 40 year-old, full service investor relations firm, where he consulted
with publicly-traded companies on areas of finance and business development.
Prior to joining Scharff, Mr. Novielli was Vice-President of Institutional
Sales-Private Placements at Merit Capital Associates, an independent NASD
registered broker-dealer. Before joining Merit, Mr. Novielli began his
investment career at PaineWebber, where he served for approximately three years
as a registered representative servicing high net worth individuals and
institutional clientele. Mr. Novielli has held series 7, 63 and 65 licenses and
received his B.S. in Business from the University of South Florida in 1987.

DOUGLAS LEIGHTON has served as our director since April, 2003. Mr. Leighton is a
Managing Partner of Dutchess Capital Management, LLC and Dutchess Advisors, LLC.
A co-founder of Dutchess in 1996, Mr. Leighton oversees trading and portfolio
risk management of investments made on behalf of Dutchess Private Equities Fund
LP. Prior to co-founding Dutchess, Mr. Leighton was founder and president of
Boston-based Beacon Capital from 1990-1996, which engaged in money management.
Mr. Leighton has held series 7, 63 and 65 licenses as well as registered
investment advisor status and holds a BS/BA in Economics & Finance from the
University of Hartford.

THEODORE SMITH has served as our director since April, 2003. Mr. Smith serves as
Executive Vice President of Dutchess Advisors LLC, whom he joined in 1998 and is
a liaison between Dutchess Capital Management, LLC on behalf of Dutchess Private
Equities Fund, LP and senior management of companies in the Fund's portfolio.
Prior to joining Dutchess in 1998, Mr. Smith was a principal at Geneva Atlantic
Capital, LLC where he focused on assisting corporate clients with SEC compliance
matters, business plan preparation and presentation and capital markets
financing. Mr. Smith received his BS in Finance and Marketing from Boston
College. Mr. Smith has also served as a director of several public as well as
private companies.

Our board currently has four directors. If a vote resulted in a tie, the
directors intend to reopen the discussion and vote again until a majority vote
is achieved. However, the Board has never used this procedure as all matters are
discussed and resolved prior to voting so that a majority vote has always been
achieved to date.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, to our knowledge, certain information concerning
the beneficial ownership of our common stock as of December 7, 2003 by each
stockholder known by us to be (i) the beneficial owner of more than 5% of the
outstanding shares of common stock, (ii) each current director, (iii) each of
the executive officers named in the Summary Compensation Table who were serving
as executive officers at the end of the 2002 fiscal year and (iv) all of our
directors and current executive officers as a group:

Amount and
Nature of
Name and Address of Beneficial Percentage
Beneficial Owner(1) Ownership of Class(2)

Michael Novielli 3,087,033 (3) 24.5%

Douglas Leighton 3,087,033 (3) 24.5%

Theodore Smith 54,600 (3) *

Michael Cummings 8,042,650 (4) 60.8%

Dutchess Private Equities
Funds, L.P. 3,049,033 (3) 24.2%
312 Stuart St., 3rd Floor
Boston, MA 02116

Dutchess Advisors, Ltd. 3,049,033 (3) 24.2%
312 Stuart St., 3rd Floor
Boston, MA 02116

All directors and current
executive officers as a
group (4 persons) 11,221,983 84.8%

* Less than 1% of outstanding shares of common stock.

(1) The address of all individual directors and executive officers is c/o
Network Installation Corporation, 18 Technology Drive, Suite 140A, Irvine,
CA 92618.

(2) The number of shares of common stock issued and outstanding on September
30, 2003 was 12,616,330 shares. The calculation of percentage ownership for
each listed beneficial owner is based upon the number of shares of common
stock issued and outstanding on September 30, 2003, plus shares of common
stock subject to options held by such person on September 30,2003 and
exercisable within 60 days thereafter. The persons and entities named in
the table have sole voting and investment power with respect to all shares
shown as beneficially owned by them, except as noted below.

(3) Two of our directors, Michael Novielli and Douglas Leighton, are the
principals of Dutchess Advisors. Messrs. Novielli and Leighton are also the
principals of Dutchess Capital Management LLC, which is the general partner
to Dutchess Private Equities Fund. Our director, Theodore Smith, is the
Executive Vice President of Dutchess Advisors, LLC. Dutchess Advisors owns
700,000 shares of our common stock. Dutchess Private Equities Fund owns
2,349,333 shares of our common stock. Messrs. Novielli and Leighton each
individually own 37,500 shares of our common stock. Messrs. Novielli and
Leighton share voting and dispositive power over the shares of our common
stock held by Dutchess Advisors and Dutchess Private Equities Fund.

(4) Includes a five year option to purchase 618,000 shares of our common stock
at a price equal to the closing bid price of our common stock on August 29,
2003 which was $2.95.

DESCRIPTION OF SECURITIES

COMMON STOCK

Our Articles of Incorporation authorize us to issue 100,000,000 shares of common
stock, par value $.001 per share. As of September 30, 2003, 12,616,330 common
shares were issued and outstanding.

VOTING RIGHTS. Each share of our common stock entitles the holder thereof to one
vote, either in person or by proxy, at meetings of stockholders. Our Board of
Directors is elected annually at each annual meeting of the stockholders.
Stockholders are not permitted to vote their shares cumulatively. Accordingly,
the holders of more than 50% of the voting power can elect all of our directors.

DIVIDEND POLICY. All shares of common stock are entitled to participate ratably
in dividends when, as and if declared by our Board of Directors out of the funds
legally available therefore. Any such dividends may be paid in cash, property or
additional shares of common stock. We have not paid any dividends since
inception and presently anticipate that all earnings, if any, will be retained
for development of our business. We expect that no dividends on the shares of
common stock will be declared in the foreseeable future. Any future dividends
will be subject to the discretion of our Board of Directors and will depend
upon, among other things, our future earnings, operating and financial
condition, capital requirements, general business conditions and other pertinent
facts. We may never pay dividends on our common stock.

MISCELLANEOUS RIGHTS AND PROVISIONS. Holders of common stock have no preemptive
or other subscriptions rights, conversions rights, redemption or sinking fund
provisions. In the event of the liquidation or dissolution, whether voluntary or
involuntary, of Network Installation, each share of common stock is entitled to
share ratably in any assets available for distribution to holders of the equity
of Network Installation after satisfaction of all liabilities.

TRANSFER AGENT

Our transfer agent for our common stock is:

Pacific Stock Transfer
500 East Warm Springs
Suite 240
Las Vegas, NV 89119
Telephone: (702) 361-3033

INTEREST OF NAMED EXPERTS AND COUNSEL

No expert or counsel within the meaning of those terms under Item 504 of
Regulation S-B will receive a direct or indirect interest in the small business
issuer or was a promoter, underwriter, voting trustee, director, officer, or
employee of Network Installation. Nor does any such expert have any contingent
based agreement with us or any other interest in or connection to us.

DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES

INDEMNIFICATION OF DIRECTORS AND OFFICERS

Article VIII of our By-laws provides: Except as hereinafter stated otherwise,
the Corporation shall indemnify all of its officers and directors, past, present
and future, against any and all expenses incurred by them, and each of them
including but not limited to legal fees, judgments and penalties which may be
incurred, rendered or levied in any legal action brought against any or all of
them for or on account of any act or omission alleged to have been committed
while acting within the scope of their duties as officers or directors of this
Corporation.

Article VIII of our Articles of Incorporation states that: The Corporation
shall, to the fullest extent permitted by the General Corporation Law of the
State of Nevada, as the same may be amended and supplemented, indemnify any and
all persons whom it shall have power to indemnify under said Law from and
against any and all of the expenses, liabilities, or other matters referred to
in or covered by said Law, and the indemnification provided for herein shall not
be deemed exclusive of any other rights to which those indemnified may be
entitled under any Bylaw, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall continue as to a
person who has ceased to be a director, officer, employee, or agent and shall
inure to the benefit of the heirs, executors, and administrators of such a
person.

Under the foregoing provisions of our Certificate of Incorporation and By-Laws,
each person who is or was a director or officer shall be indemnified by us to
the full extent permitted or authorized by the General Corporation Law of
Nevada. Under such law, to the extent that such person is successful on the
merits of defense of a suit or proceeding brought against such person by reason
of the fact that such person is a director or officer of Network Installation,
such person shall be indemnified against expenses, including attorneys' fees,
reasonably incurred in connection with such action. If unsuccessful in defense
of a third-party civil suit or a criminal suit or if such a suit is settled,
such a person shall be indemnified under such law against both (1) expenses
(including attorneys' fees) and (2) judgments, fines and amounts paid in
settlement if such person acted in good faith and in a manner such person
reasonably believed to be in, or not opposed to, our best interests, and with
respect to any criminal action, had no reasonable cause to believe such person's
conduct was unlawful.

If unsuccessful in defense of a suit brought by or under the right of Network
Installation, or if such suit is settled, such a person shall be indemnified
under such law only against expenses (including attorneys' fees) incurred in the
defense or settlement of such suit if such person acted in good faith and in a
manner such person reasonably believed to be in, or not opposed to, our best
interests, except that if such a person is adjudicated to be liable in such suit
for negligence or misconduct in the performance of such person's duty to us,
such person cannot be made whole even for expenses unless the court determines
that such person is fairly and reasonably entitled to be indemnified for such
expenses.

As soon as may be practicable, we expect to cover our officers and directors by
officers' and directors' liability insurance in an amount to be determined by
the Board of Directors which will include reimbursement for costs and fees. We
expect to enter into Indemnification Agreements with each of our executive
officers and directors which will provide for reimbursement for all direct and
indirect costs of any type or nature whatsoever (including attorneys' fees and
related disbursements) actually and reasonably incurred in connection with
either the investigation, defense or appeal of a Proceeding, as defined,
including amounts paid in settlement by or on behalf of an Indemnitee.

We entered into a Consulting Agreement with Dutchess Advisors on April 1, 2003.
Two of our directors, Michael Novielli and Douglas Leighton, are principals of
Dutchess Advisors. This Agreement provides that we will indemnify Dutchess
Advisors for all actions, causes of action, suits, claims, losses, costs,
penalties, fees, liabilities and damages, and expenses in connection therewith,
including reasonable attorneys' fees and disbursements, incurred by Dutchess
Advisors as a result of (i) any misrepresentation or breach of any
representation or warranty made by us in the Agreement or any other certificate,
instrument or document, (ii) any breach of any covenant, agreement or obligation
contained in this Agreement or any other certificate, instrument or document,
(iii) any cause of action, suit or claim brought or made against Dutchess
Advisors by a third party and arising out of the execution, delivery,
performance or enforcement of this Agreement or any other certificate,
instrument or document, except insofar as any such misrepresentation, breach or
any untrue statement, alleged untrue statement, omission or alleged omission is
made in reliance upon and in conformity with written information furnished to
Dutchess Advisors by us.

On April 8, 2003, we entered into a Subscription Agreement with Dutchess Private
Equities Fund which provides that we shall defend, protect, indemnify and hold
harmless Dutchess Private Equities Fund from and against any and all actions,
causes of action, suits, claims, losses, costs, penalties, fees, liabilities and
damages, and expenses in connection therewith, and including reasonable
attorneys' fees and disbursements incurred by Dutchess Private Equities Fund as
a result of (i) any misrepresentation or breach of any representation or
warranty made by us (ii) any breach of any covenant, agreement or obligation
(iii) any cause of action, suit or claim brought or made against Dutchess
Private Equities Fund by a third party and arising out of the execution,
delivery, performance or enforcement of the document contemplated in the
Agreement, (iv) any transaction financed or to be financed with the proceeds of
the issuance of the Debentures or (v) the status of Dutchess Private Equities
Fund as our investor, except insofar as any untrue statement or omission is made
in reliance upon and in conformity with written information furnished to the
Registrant by Dutchess Private Equities Fund. If Dutchess Private Equities Fund,
other than by reason of its gross negligence or willful misconduct, becomes
involved in any capacity in any action, proceeding or investigation brought by
any shareholder in connection with transactions contemplated by transactions
between us and Dutchess Private Equities Fund, we will reimburse Dutchess
Private Equities Fund for its reasonable legal and other expenses.

COMMISSION POSITION ON INDEMNIFICATION OF OFFICERS AND DIRECTORS FOR LIABILITIES
ARISING UNDER THE SECURITIES ACT OF 1933

We have been advised that in the opinion of the Securities and Exchange
Commission, insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to our directors, officers
and controlling persons pursuant to the foregoing provisions, such
indemnification is against public policy as expressed in the Act and is
therefore unenforceable. In the event a claim for indemnification against such
liabilities (other than our payment of expenses incurred or paid by our
director, officer or controlling person in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, we will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements that involve risks and
uncertainties. We generally use words such as "believe," "may," "could," "will,"
"intend," "expect," "anticipate," "plan," and similar expressions to identify
forward-looking statements. You should not place undue reliance on these
forward-looking statements. Our actual results could differ materially from
those anticipated in the forward-looking statements for many reasons, including
the risks described in our "Risk Factor" section and elsewhere in this report.
Although we believe the expectations reflected in the forward-looking statements
are reasonable, they relate only to events as of the date on which the
statements are made, and our future results, levels of activity, performance or
achievements may not meet these expectations. Moreover, neither we nor any other
person assumes responsibility for the accuracy and completeness of the
forward-looking statements. We do not intend to update any of the
forward-looking statements after the date of this document to conform these
statements to actual results or to changes in our expectations, except as
required by law.

DESCRIPTION OF BUSINESS

HISTORY

We incorporated in the State of Nevada as Color Strategies on March 24, 1998. On
October 1, 1999, we created a wholly-owned subsidiary named Infinite Technology
Holding, Inc. On December 23, 1999, we changed our name to Infinite Technology
Corporation. On May 4, 2000, we changed our name from Infinite Technology
Corporation to Network Installation Corporation. On the same date, we changed
the name of our wholly-owner subsidiary to Network Installation Holdings, Inc.

In May of 2000, we acquired Mardock, Inc., a designer, manufacturer and
distributor of apparel and promotional products. In August 2000, we acquired a
majority interest in North Texas Circuit Board Co., or NTCB through the
acquisition of 67% of the common stock of Primavera Corporation, the parent
company of NTCB, in exchange for 195,000 shares of our common stock, valued at
$325,000, plus a contribution of $1,250,000 in cash to NTCB as additional
working capital. NTCB manufactures high quality printed circuit boards. In
September 2000, we acquired 80% of the outstanding stock of OpiTV.com. OpiTV.com
was an I-commerce technology company in the development stage with a business
plan to market and distribute a TV device. In November 2000, we acquired an
additional 13% of Primavera Corporation. This increase in equity brought our
indirect ownership of NTCB from 67% to 80%.

In late 2000, management determined that our capital and management resources
were spread too thin to properly address the capital needs and the management
needs of our three subsidiaries. As a result, in July of 2001, we sold all of
our common stock ownership in Mardock, Inc. and OpiTV.com.

In July 2001, we acquired the remaining 20% of Primavera's common stock. On
August 20, 2002, we sold NTCB to a third party in exchange for cancellation of
debt of approximately $2,255,860 and retention by us of a 10% interest in the
after tax profit of NTCB to us for a period of five years subsequent to the
consummation of the transaction. On December 27, 2002, we disposed of 100% of
Flexxtech Holdings, Inc. Flexxtech Holdings was the parent corporation of
Primavera Corporation. After the sale of NTCB, Flexxtech Holdings had no
significant assets and was disposed of to Western Cottonwood Corp., an
affiliate, for nominal consideration of $10.

On October 1, 2002, we signed to acquire 80% of the outstanding common shares of
W3M, Inc., dba Paradigm Cabling Systems, a privately held California
corporation, in a stock for stock exchange. Paradigm is a full service computer
cabling, networking and telecommunications integrator contractor. As part of the
transaction, we agreed to use our best efforts to arrange for an infusion of
$250,000 in additional capital, either as debt or equity or some combination of
both, to Paradigm, in order to increase its working capital. However, we were
unable to arrange infusion of the capital per the agreement.

On April 8, 2003, we and Paradigm agreed that the transaction is void ab initio,
that is, at its inception, with the effect that Paradigm remains the owner of
all of its assets and the shares of our preferred stock are restored to the
status of authorized shares. The Purchase Agreement and all related documents
and all documents delivered in connection therewith were thereby terminated ab
initio and are of no force or effect whatsoever. In connection with funds
invested as working capital into Paradigm during the period from October 1, 2002
until April 1, 2003, we issued to Ashford Capital LLC and e-fund Capital/Barrett
Evans, 5 year convertible debentures in the amount of $65,000 and $75,000
respectively. Ashford and eFund made investments directly into Paradigm under
the assumption that a merger between Paradigm and us would be consummated. As
part of the rescission negotiations, we agreed to issue the debentures to
Ashford and eFund. Michael Cummings, President of Paradigm also resigned as a
Director of our Board of Directors.

On April 9, 2003, we executed a Restructuring Agreement. The Agreement was
executed to restructure our balance sheet in order to more easily attract an
operating business to merge with or acquire. Pursuant to the Restructuring
Agreement, Western Cottonwood Corporation, a related party through a major
shareholder, agreed to forgive its notes receivable and interest receivable from
us as of December 31, 2002. The receivable totaling $1,984,850 was booked in
consideration for cash we received from Western Cottonwood. The receivable
totaling $1,984,850, was forgiven in exchange for shares of our common stock
totaling 4.9% of the total outstanding shares immediately following our first
merger or acquisition transaction. The principal shareholder of Western
Cottonwood Corporation and Atlantis Partners, Inc. is John Freeland, formerly
our largest investor. Mr. Freeland was also formerly an affiliate through his
beneficial ownership of 23% of our total outstanding shares through Western
Cottonwood. Mr. Freeland is no longer an affiliate. To our knowledge, his
current beneficial ownership represents 3.9% of our current total outstanding
shares. Pursuant to the agreement, (i) Western Cottonwood and Atlantis Partners
shall maintain a combined ownership percentage of a non-dilutive 4.9% and Greg
Mardock, our former president, shall maintain a combined ownership percentage of
a non-dilutive 2% through our first merger or acquisition transaction and (ii)
Mr. Mardock resigned as President and Director(iii) three nominees of Dutchess
Private Equities Fund, LP were appointed directors.

In April 2003, we executed a Letter of Intent to merge with Irvine, CA- based
Network Installation Corporation. Network Installation is a designer and
installer of data, voice, and video networks. The transaction closed in May,
2003. The total consideration and method of payment are $50,000 in cash and
7,382,000 shares of our common stock. In addition, we issued a five year option
to purchase an additional 618,000 shares of our common stock to Mr. Cummings if
our total revenue exceeds $450,000 for the period beginning on June 1, 2003 and
ending August 31, 2003. The option is exercisable at a price equal to the
closing bid price of our common stock on August 31, 2003.

Network Installation was established in July 1997 as a California corporation as
a low voltage-cabling contractor and in 1999 changed its focus to provide
products, project management, design and installation within the networking and
communications sector.

OVERVIEW

We are a project engineering company that designs and installs specialty
communication systems for data, voice, video and telecom. We determine our
clients' requirements by doing a need analysis and site audit. Then we implement
our design and specification of the specialty communication system, which may
include Wireless Fidelity, or Wi-Fi, with the deployment of a fixed Wireless
Local Area Network, or WLAN. We believe we can integrate superior solutions
across a vast majority of communication requirements because we have experts in
each aspect of communication services from the design, project management, the
installation of our products through the maintaining of our products. We earn
revenue for services rendered which include; (i) the installation of data,
voice, video and telecom networks; (ii) the sale of networking products that are
installed and (iii) consulting services in the assessment of existing networks.

We have a two-pronged approached to our business model. One is the continued
focus on our core competency of project management service which entails
inventory management, maintaining project timelines, auditing completed work and
quality assurance of projects in wired networking infrastructure, design,
installation and support of communications solutions. Second, is to leverage
that expertise in our pursuit of the infrastructure build-out of Wi-Fi and WLAN.
With our experience and expertise in the wired networking infrastructure
industry, we can design, manage, install and service our wireless customers with
the same processes, personnel and management. Many of our competitors are new to
deploying wireless infrastructure and have never installed any type of
infrastructure. We believe we can leverage our expertise to compete in this new
technology.

INDUSTRY OVERVIEW (SPECIALTY COMMUNICATION SYSTEMS)

A structured cabling system is a set of cabling and connectivity products that
integrates the voice, data, video, and various management systems of a building,
such as safety alarms, security access and energy systems. These systems
typically consist of an open architecture, standardized media and layout,
standard connection interfaces, adherence to national and international
standards, and total system design and installation. Other than the structured
cabling system, voice, data, video, and building management systems have nothing
in common except similar transmission characteristics, such as analog or digital
data signals, and delivery methods such as conduit, cable tray, or raceway, that
support and protect the cabling investment.

Modern Ethernet networking equipment is designed around the concept that each
device in a building's network has a dedicated media connection to a central
"hub". In a standard hub the LAN bandwidth is shared among all the station. With
dedicated hubs, also called switched technology, a given cable is allocated for
use by a single device.

This was not always the case. The original design of network systems assumed a
common, shared medium: coaxial cable. Structured cabling systems, while having
drawbacks with regards to absolute transmission performance, show considerable
cost savings to the owner by reducing the costs of moves, changes and additions.
These benefits far outweigh the cost of implementation, making structured
cabling the optimum choice for building wiring.

The industry had been dominated by thousands of proprietors with former
employment experience in telecommunications and electrical contracting. With the
boom in technological advances over the past fifteen years, the convergence of
data medium; text, voice, and video has placed a premium in obtaining such
information, faster, cheaper and now wireless. This paradigm shift in the
functionality of data transmission now mandates a more detailed insight into
computer science, project management and a thorough understanding of a potential
customer's total communications needs.

INDUSTRY OVERVIEW (WI-FI)

We believe, in the past two years, Wireless Fidelity, also known as Wi-Fi, has
emerged as the dominant standard for wireless local areas networks, or WLANS
worldwide. A Wi-Fi network can cover an area of typically 100-500 feet with
Internet access hundreds of times faster than a modem connection. We believe
that, unlike other wireless technologies such as CDMA and GSM, Wi-Fi enjoys 100%
global acceptance and that it has become a single networking standard for all
developers, equipment manufacturers, service providers and users.

Hundreds of equipment manufacturers are now flooding the market with millions of
Wi-Fi cards and access points. The single Wi-Fi standard ensures these devices
all interoperate with each other, so, for example, an access point made by
Netgear will communicate with a network card from Linksys.

Hundreds of new companies have begun setting up Wi-Fi access points called "hot
spots" in cafes, hotels, airports, book stores and other public spaces. These
hot spot operators install Wi-Fi access points and either sell high speed
wireless Internet access for a fee or offer it to the public for free.

Hot Spot Operators include Wayport, STSN, Surf and Sip, StayOnline, Pronto,
NetNearU, Deep Blue, Fatport, Air Portal, Ikano, Picopoint, TheCloud and Azure.
In the last year, major wireless carriers have thrown their hat in the ring,
including T-Mobile, which is building hot spots in Starbucks cafes, Borders book
stores, Kinko's stores and airline clubs, AT&T Wireless, British Telecom,
Swisscom, Telecom Italia and Sprint PCS.

Forces outside the industry are also rapidly arming users with Wi-Fi radios.
Consumers also buying Wi-Fi-compatible hardware in their laptops and PDAs for
use in the office or home.

We believe Wi-Fi is over 100 times faster than a standard modem connection.
Wi-Fi is also significantly faster than the wireless services provided by
cellular carriers which typically deliver throughput between 40k and 60k. The
actual speed experienced by hot spot users is determined by the hot spot's
connection to the Internet, which can range from low-end DSL (384k) to one or
more T1s (1.5Mb and up), but this still promises much faster speed than any
other available technology.

We are seeking to exploit the rapid build up of wireless networks by focusing
our marketing efforts on its currently installed base of universities, K-12,
municipalities and Fortune 1000 companies.

OUR BUSINESS

A company's communication network is critical in achieving the timely flow of
information. Typically, a company's network expands beyond its existing
headquarters to remote offices and remote users. The number of networking
applications continues to grow and the demand for high-speed connectivity to
move data back and forth is increasing dramatically. Until recently, a company's
only alternative in obtaining high-speed connectivity was to contact the
telephone company and have a high-speed landline service installed so that
connectivity could be achieved between its locations. The issue today is that
these high-speed landlines take too much time to install, are not available in
all locations, do not solve remote application usage and are costly to use on a
monthly basis.

We seek to exploit the growing demand in high-speed connectivity by providing
complete network solutions including best of breed wireless products,
engineering services for which our technicians design the applications required
for the network build out, structured cabling and deployment. We offer the
ability to integrate superior solutions across the vast majority of
communication requirements.

There are multiple products associated with the deployment of a wireless
solution including microwave equipment, free space optical equipment and
specialty components. There are also important services such as site design,
product integration, structured cabling, network security, training and
technical support. The integration of all these products and services is
critical in achieving the desired results for the customer. The specific
products used and services offered vary depending on the connection speed
required and distances between points. We provide specialty communication
systems, Wi-Fi deployment and WLANs to corporations, municipalities and
educational institutions.

We define wireless deployment as the internal and external design and
installation of a wireless solution to support connectivity between two or more
points without the utilization of landline infrastructure. End users turn to us
to design and integrate a wireless solution, as there are many components from
various technology providers. Wireless solutions can offer a user:
- High-speed connectivity;
- Immediate installation;
- Network ownership; and
- Low costs.

We also provide network security, train end users and provide on-going technical
support to insure a successful installation.

In January 2004, we opened a Sales and Service location in Las Vegas, Nevada to
expand our business beyond California and reach new customers in that region.

SUPPLIERS

While we are predominately a service company, we purchase and resell products
such as networking routers, cable, software and video equipment that are
involved in our project installations. We purchase our products from various
distributors. Should any of these distributors cease operations, our business
would not be adversely affected because these products are readily available
from multiple distributors locally, regionally or nationally.

We have agreements with Vivato and Motorola Inc. that give us what we believe to
be the finest suite of products in the installation of wireless solutions.
Through our Motorola agreement and the use of one of its flagship wireless
products "The Canopy," we have the ability to install point to point service
directly for Wireless Internet Service Providers or proprietors of WLANs or
expanded 'Hot Zones' up to 4 kilometers through our Vivato agreement. Vivato is
a San Francisco-based network infrastructure company and manufacturer of the
industry's first Wi-Fi switches for enterprises and service providers. Adhering
to the IEEE 802.11 standard, Vivato's patent-pending PacketSteering(TM)
technology changes the old rules of Wi-Fi deployment. Vivato Wi-Fi switches
deliver unprecedented range and capacity, with enterprise-class security.

SALES AND MARKETING

Our employees market and sell our services through a direct team of five sales
and project management professionals. We are proactive and able to visit
personally with our clients from time to time. We do not employ an outside sales
force.

We also use several methods of mass marketing to advertise our products and
services including direct mailings, and the distribution of brochures which
describe our services. Additionally, we maintain a web site that describes our
services. We believe that these methods of marketing are a key factor in the
securing of new business.

CUSTOMERS

We currently provide our products and services to the markets in K-12 education,
universities, municipalities and Fortune 1000 companies. Some of our current
customers include the University of California - Los Angeles, University of
Southern California, Wells Fargo and Safeway. The University of California - Los
Angeles currently represents approximately 30% of our annual revenue. No other
customer represents more than 10% of our annual revenue.

COMPETITION

The network cabling market is very fragmented and highly competitive. In the
markets where we operate, we experience intense competition from other
independent providers of network solutions. Our competitors include regional,
privately-held companies including Sunglo Communications, Pacific Coast Cabling,
and Netversant. We are aware of only one publicly-traded competitor, WPCS
International Inc. There is no one dominant competitor. We believe that success
in the industry is based on maintenance of product quality, competitive pricing,
delivery efficiency, customer service and satisfaction levels, maintenance of
satisfactory dealer relationships, and the ability to anticipate technological
changes and changes in customer preferences. We believe our competitive
advantage lies in our ability to provide superior customer service while
offering a more diverse line of hard product offering than our competitors.

EMPLOYEES

As of October 3, 2003, we employed 25 full time employees, four are executives,
five are in sales and marketing, fifteen are project managers and technicians
and one is in administration. We believe our relations with all of our employees
are good.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATION

OVERVIEW

We are a project engineering company that focuses on the implementation
requirements of specialty communication systems, Wireless Fidelity, or Wi-Fi,
deployment and fixed Wireless Local Area Networks, or WLANs. We offer the
ability to integrate superior solutions across a vast majority of communication
requirements.

We have a two-pronged approached to our business model. One is the continued
focus on our core competency of project management in wired networking
infrastructure, design, installation and support of communications solutions.
Second, is to leverage that expertise in our pursuit of the infrastructure to
build-out of Wi-Fi and WLANs.

CRITICAL ACCOUNTING POLICIES

We have identified the policies below as critical to our business operations and
the understanding of our results of operations. The impact and any associated
risks related to these policies on our business operations are discussed
throughout this section where such policies affect our reported and expected
financial results. For a detailed discussion on the application of these and
other accounting policies, see in the Notes to the financial statements of
Network Installations for the year ended December 31, 2002 included with 8-K/A
filed on September 2, 2003. Note that our preparation of our Consolidated
Financial Statements requires us to make estimates and assumptions that affect
the reported amounts of assets and liabilities, disclosure of contingent assets
and liabilities at the date of our financial statements, and the reported
amounts of revenue and expenses during the reporting period. There can be no
assurance that actual results will not differ from those estimates.

Our accounting policies that are the most important to the portrayal of our
financial condition and results, and which require the highest degree of
management judgment relate to revenue recognition, the provision for
uncollectible accounts receivable, property & equipment, advertising and
Issuance of shares for service.

Our revenue recognition policies are in compliance with all applicable
accounting regulations, including American Institute of Certified Public
Accountants (AICPA) Statement of Position (SOP) 81-1, Accounting for Performance
of Construction-Type and Certain Production-Type Contracts. Revenues from
installations, cabling and networking contacts are recognized when the contracts
are completed. The completed-contract method is used because the contracts are
short-term in duration or the Company is unable to make reasonably dependable
estimates of the costs of the contracts.

Our revenue recognition policy for sale of network products is in compliance
with Staff accounting bulletin (SAB) 101. Revenue from the sale of network
products is recognized when a formal arrangement exists, the price is fixed or
determinable, the delivery is completed and collectibility is reasonably
assured.

We estimate the likelihood of customer payment based principally on a customer's
credit history and our general credit experience. To the extent our estimates
differ materially from actual results, the timing and amount of revenues
recognized or bad debt expense recorded may be materially misstated during a
reporting period.

Property and equipment is carried at cost. Depreciation of property and
equipment is provided using the declining balance method over the estimated
useful lives of the assets at five to seven years. Expenditures for maintenance
and repairs are charged to expense as incurred.

We expense advertising costs as incurred.

We account for the issuance of equity instruments to acquire goods and services
based on the fair value of the goods and services or the fair value of the
equity instrument at the time of issuance, whichever is more reliably
measurable.

GOING CONCERN OPINION

Our audited financial statements for the fiscal year ended December 31, 2002,
reflect a net loss of $109,806. Our unaudited financial statements for the nine
month period ended September 30, 2003 reflect a net loss of $2,817,494. Although
these conditions raised substantial doubt about our ability to continue as a
going concern if we do not acquire sufficient additional funding or alternative
sources of capital to meet our working capital needs, we believe we could
continue operating for the next twelve months without additional capital but
would have to curtail our operations and plans for expansion. Our plan to
continue operations in relation to our going concern opinion is to complete the
registration process with the SEC so we can access the Equity Line of Credit
provided by Preston Capital. We believe proceeds from this offering should
enable us to return to profitability.

THREE MONTHS AND NINE MONTH PERIODS ENDED SEPTEMBER 30, 2003 AS COMPARED TO
THREE MONTHS AND NINE MONTH PERIODS ENDED SEPTEMBER 30, 2002 (RESTATED FOR
DISPOSAL OF SUBSIDIARIES)

RESULTS OF OPERATIONS
-----------------------

We generated consolidated revenues of $444,736 and $1,199,688 for the three and
nine months ended September 30, 2003 as compared to $760,450 and $813,543 for
the three months and nine months ended September 30, 2002. The decrease in
revenues for this quarter when compared to the same quarter last year is due to
the structure of some K-12 contracts, which were required by the client to be
invoiced by September 30, 2002. We received fewer K-12 contracts for the period
ended September 30, 2003 vs. the same period in 2002 due to budget cuts from the
state of California in 2003. We also experienced an increase in higher education
contracts during the period ended September 30, 2003 vs. same period 2002 due to
an increase in target marketing to this sector. Our year to date revenues are
higher than the same period a year ago due to an increase in the total amount of
new contracts received. Currently, our cash needs include, but are not limited
to, legal and accounting services, and future acquisitions

NET REVENUES
-------------

We generated net revenues of $444,736 and $1,199,688 for the three and nine
months ended September 30, 2003 as compared to $760,450 and $813,543 for the
three months and nine months ended September 30, 2002. The decrease in revenues
for this quarter when compared to the same quarter last year is due to the
structure of some K-12 contracts, which were required by the client to be
invoiced by September 30, 2002. We received fewer K-12 contracts for the period
ended September 30, 2003 vs. the same period in 2002 due to budget cuts from the
state of California in 2003. We also experienced an increase in higher education
contracts during the period ended September 30, 2003 vs. same period 2002 due to
an increase in target marketing to this sector. Our year to date revenues are
higher than the same period a year ago due to an increase in the total amount of
new contracts received. All of our revenue in the current period is from Network
Installation Corp. Our operations from the subsidiaries disposed off in 2002
have been separately classified in the Statements of Operations.

COST OF REVENUES
------------------

We incurred Cost of Revenue of $358,131 and $916,244 for the three and nine
month period ended September 30, 2003 as compared to $ $439,631 and $479,617 for
the three and nine month period ended September 30, 2002. Our Cost of Revenue
decreased for the 3 months ended September 30, 2003 when compared to the same
period in 2002, due to a decrease in Revenues for the three month period ended
September 30, 2003. Our Cost Of Revenue for the nine month period ended
September 30, 2003 increased when compared to the same period in 2002, due to
increased Revenue for the nine month period ended September 30, 2003.

GENERAL, ADMINISTRATIVE AND SELLING EXPENSES
------------------------------------------------

We incurred costs of $1,332,236 and $1,823,409 for the three and nine month
ended September 30, 2003 as compared to $276,371 and $393,643 for the three
month and nine month periods ended September 30, 2002, respectively. General,
Administrative and Selling Expenses in the current period increased primarily
because we issued shares of common stock amounting $687,419 as consulting fees
in the current period as compared to issuance of common shares amounting to
$121,950 in the prior period. We issued 675,000 shares for directors' fees and
consulting fees in the period ended September 30, 2002.

NET LOSS BEFORE INCOME TAXES AND LOSS ON DISCONTINUED SEGMENTS
-----------------------------------------------------------------------

We had a loss before taxes of ($2,520,164) and ($2,816,694) for the three and
nine month periods ended September 30, 2003, as compared to a profit of $43,788
for the three month period ended September 30, 2002 and a loss of ($63,405) for
the nine month period ended September 30, 2002. The increase in net loss before
income taxes is due to the factors described above.

NET LOSS
---------

We had a loss of ($2,520,164) and ($2,815,894) for the three and nine month
periods ended September 30, 2003, as compared to a profit of $43,788 for the
three month period ended September 30, 2002 and a loss of ($62,605) for the nine
month period ended September 30, 2002. The decrease increase in net loss is due
to the factors described above.

BASIC AND DILUTED LOSS PER SHARE
-------------------------------------

Our basic and diluted loss per share for the quarter ended September 30, 2003
was ($0.23) as compared to net income per share of $0.01 for the quarter ended
September 30, 2002. Our basic and diluted loss for the year ended December 31,
2002 was ($10.98) compared to ($30.89) for the year ended December 31, 2001 due
to a reduction of our Net Loss.

TWLEVE MONTH PERIOD ENDED DECEMBER 31, 2002 AS COMPARED TO TWELVE MONTH
PERIODS ENDED DECEMBER 31, 2001 (restated for disposal of subsidiaries)

Results of Operations
------------------------

Consolidated revenues for the year ended December 31, 2002 were $804,080
compared to $294, 271 for the year ended December 31, 2001 due to
increased marketing and
contracts received.

Net Revenues
--------------

Net revenues for the year ended December 31, 2002 were $804,080 compared to
$294,271 for the year ended December 31, 2001 due to increased marketing and
contracts received.

Cost Of Revenues
------------------

Cost of revenues for the year ended December 31, 2002 were $568,444
compared to $171,635 for the year ended December 31, 2001 due to increased
revenue.

General, Administrative and Selling Expenses
-------------------------------------------------

General, Administrative and Selling Expenses for the year ended December 31,
2002 were $340,267 compared to $304,364 for the year ended December 31, 2001
due to increased personnel headcount.

Net loss
----------

Net Loss for the year ended December 31, 2002 was ($104,631) compared to
($181,728) for the year ended December 31, 2001 due to a reduction of our
General, Selling and Administrative costs as a percentage of our total
revenue.

Basic and diluted loss per share
--------------------------------------

Our basic and diluted loss for the year ended December 31, 2002 was
($10.98) compared to ($30.89) for the year ended December 31, 2001 due to a
reduction of our Net Loss.

LIQUIDITY AND CAPITAL RESOURCES
----------------------------------

As of September 30, 2003, our Current Assets were $419,993 and Current
Liabilities were $2,340,871. Cash and cash equivalents were $667. Our
Stockholder's Deficit at September 30, 2003 was ($2,291,733).

We had a net usage of cash due to operating activities in September 30, 2003 and
2002 of $460,497 and $86,783 respectively. We had net cash provided by financing
activities of $443,178 and $73,206 for the nine month period ended September 30,
2003 and 2002, respectively. We had $336,150 from borrowings in the period ended
September 30, 2003 as compared to $0 in the corresponding period last year. We
had a net usage of cash due to operating activities for the years ended December
31, 2002 and 2001 of $43,584 and ($28,163) respectively. We had net cash
provided by financing activities of ($34,142) and $50,000 for the years ended
December 31, 2002 and 2001, respectively. We had $0 from borrowings in the year
ended December 31, 2002 as compared to $50,000 in the corresponding period in
2001.

Our obligations include:

- a $3,500 payable based on the purchase agreement of our subsidiary;
- $44,000 in loans from a major shareholder and officer. The amount is
unsecured, due on demand and non interest bearing.
- We defaulted on a note that prohibited certain acquisitions when we
acquired our subsidiary. We are in the process of making payments with a
financing institution. The amount outstanding at September 30, 2003,
amounted to $39,949.
- We have notes payable to unrelated parties amounting to $21,781. These
notes are due on demand, bear interest rate of 6% per annum and are
unsecured.

On February 27, 2003, our subsidiary entered into a factoring and security
agreement to sell, transfer and assign certain accounts receivable to Orange
Commercial Credit, or OCC. OCC may at its sole discretion purchase any specific
account. All accounts sold are with recourse on seller. All of our property of
our subsidiary including accounts receivable, inventories, equipment and
promissory notes are collateral under this agreement. OCC will advance 80% of
the face amount of each account. The difference between the face amount of each
purchased account and advance on the purchased account shall be reserve and will
be released after deductions of discount and charge backs on the 15th and the
last day of each month. OCC charges 1% of gross face value of purchased
receivable for finance charge and 1% for administrative fees with minimum charge
of $750 on each settlement date. As of September 30, 2003, we factored
receivables of approximately $129,929. In connection with the factoring
agreement, we included fees of $10,752 in the period ended September 30, 2003.

On September 17, 2003, our subsidiary entered a factoring agreement with a
related entity for $76,000 face amount. This amount is payable in 30 days and
certain receivables were assigned and delivered. In the event that on the
maturity date, any amounts on the note remain, the holder can exercise its right
to increase the face amount by $10,000 per month that the Note remains unpaid.

In the year ended December 31, 2001, we issued debentures amounting to $720,000,
carrying an interest rate of 6% per annum, due in August 2003. The term of the
debentures were subsequently extended to August 2008. The holders are entitled
to, at any time or from time to time, convert the conversion amount into shares
of our common stock at a conversion price for each share of common stock equal
to the lower of (a) 120% of the losing bid price per share on the closing date,
and (b) 80% of the lowest closing bid price per share of our common stock for
the five trading days immediately preceding the date of conversion. As of
December 31, 2003, the outstanding balance of the debentures amounted to
$443,501.

On April 7, 2003, we issued convertible debentures of $140,000 to eFund Capital
and Ashford Capital LLC. The holders of the debentures are entitled to convert
the face amount of this debentures, plus accrued interest at the lesser of (i)
75% of the lowest closing bid price during the 15 trading days prior to the
conversion date or (ii) 100% of the average of the closing bid prices for the 20
trading days immediately preceding the closing date. The convertible debentures
shall pay 6% cumulative interest, in cash or in shares of common stock, at our
option, at the time of each conversion. The debentures are payable on April 8,
2008. The convertible debentures are convertible into shares of our common
stock.

On April 7, 2003, we issued debentures amounting to $105,000 to Dutchess Private
Equities Fund, LP carrying an interest rate of 6% per annum, due in April 2008.
The face amount of this debenture may be converted, in whole or in part, any
time. The holders are entitled to convert the face amount of the debenture, plus
accrued interest, anytime at the lesser of (i) 75% of the lowest closing bid
price during the 15 trading days prior to the Conversion Date or (ii) 100% of
the average of the closing bid prices for the 20 trading days immediately
preceding the Closing Date. The convertible debentures are convertible into
shares of our common stock.

During the period ended September 30, 2003, we issued $158,000 debentures to
Dutchess Private Equities Fund, LP. These debentures carry an interest rate of
6% per annum, due in July to September 2008. The face amount of these debentures
may be converted, in whole or in part, any time following the closing date. The
holder is entitled to convert the face amount of this debenture, plus accrued
interest, anytime, at the lesser of (i) 75% of the lowest closing bid price
during the 15 trading days prior to the Conversion Date or (ii) 100% of the
average of the closing bid prices for the 20 trading days immediately preceding
the Closing Date. The convertible debentures are convertible into shares of our
common stock.

Convertible promissory notes payable

In the year ended December 31, 2001, we issued convertible promissory notes of
$100,000 due on April 1, 2004, carrying an interest rate of 10% per annum. The
holder of $100,000 promissory notes is entitled to convert the conversion amount
into shares of common stock of the Company, par value $.001, at any time, per
share at a conversion price for each share of common stock equal $7.00 per share
of common stock. The note is secured and collateralized by shares of common
stock of the Company at one share per every five dollars of the principal. As of
September 30, 2003, the outstanding value of this note is $75,000.

We have signed an Investment Agreement with Preston Capital for $2,500,000 in an
Equity Line arrangement. The Investment Agreement allows us to "put" to Preston
Capital at least $10,000, but no more than $100,000. The purchase price for our
common stock identified in the Put Notice shall be equal to 95% of the average
of four lowest posted bid prices of our common stock during the five days after
we deliver the put notice to Preston Capital. We can initiate a new put after we
close on the prior put.

We believe funds from operations and the Equity Line will provide sufficient
capital for the next twelve months.

SUBSIDIARIES
------------

As of January 15, 2004 we had one subsidiary, Network Installation Corporation.
Network Installation Corp. is the name of both the parent company incorporated
in the state of Nevada and the subsidiary incorporated in the state of
California.

DESCRIPTION OF PROPERTY

We currently sublease 2,500 sq ft. of office space located in a technology park
at 18 Technology Dr., Suite 140A, Irvine, CA. Our monthly rent is approximately
$2,300 per month, and our lease runs month to month.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

On October 7, 2002, we issued 51,361 shares of common stock in the name of
Delaware Charter Guarantee and Trust, FBO Greg Mardock, our CEO and a director
at that time, in exchange for a promissory note of $64,588 principal amount and
interest of $5,861. This transaction is no less favorable than if we had entered
into it on an arms length basis with an unrelated third party.

On October 8, 2002, we issued to 21,250 and 8,750 shares to Edward R. Fearon,
and Escamilla Capital Corporation respectively, both related parties. Fearon
and Hector Escamilla were each an officer and director of both Primavera Corp.
and Escamilla Capital Corporation. In addition, Fearon was CEO of our former
subsidiary NTSB. These shares were issued in exchange for notes issued by
Primavera Corporation to BECO M-A, L.P. and BECO Joint Venture No. 1 amounting
to $60,000 and accrued interest of $16,595 total consideration of $76,595.
Fearon and Escamillia were also officers and directors of BECO M-A, L.P. and
BECO Joint Venture No. 1. When we acquired Primavera Corp. we also acquired its
liability to BECO M-A, L.P. and BECO Joint Venture No. 1. Mr. Fearon and
Escamilla Capital Corporation agreed to accept shares to settle the debt
instead of cash. This transaction is no less favorable than if we had entered
into it on an arms length basis with an unrelated third party.

On October 31, 2002, Western Cottonwood Corporation, a related entity, agreed to
convert $2,000,000 in debt owed by us to 200 shares of our Series A Preferred
Stock. Subsequent to December 31, 2002 the shares were not issued and the
agreement was mutually voided. This transaction is no less favorable than if we
had entered into it on an arms length basis with an unrelated third party.

On November 5, 2002, we issued Western Cottonwood Corp 75,000 shares of common
stock in exchange for $75,000 in Promissory Notes. Subsequent to December 31,
2002 the note was amended to be in exchange for $300,000 in Promissory Notes.
This transaction is no less favorable than if we had entered into it on an arms
length basis with an unrelated third party.

On April 7, 2003, we issued 800,000 shares of common stock to Dutchess Private
Equities Fund as inducement for debentures amounting to $80,000. The shares were
valued at $120,000. This transaction is no less favorable than if we had entered
into it on an arms length basis with an unrelated third party.

On April 8th, 2003, we entered into an agreement to rescind the acquisition of
W3M, Inc., dba Paradigm Cabling Systems, from its inception. The agreement was
made available in our 10-KSB filed on April 15, 2003. In order to acquire 80% of
the outstanding common stock of Paradigm, we entered into an acquisition
agreement dated October 31, 2002. Pursuant to the terms of the acquisition, 80%
of the outstanding capital stock of Paradigm was transferred to us. In exchange,
we agreed to issue shares of a new Series A Convertible Preferred Stock to the
exchanging shareholders of Paradigm as follows:

Name No. Of Shares of Series A Convertible Preferred
- ---- -----------------------------------------------
Michael Cummings 71.25 shares
Ashford Capital 71.25 shares
Total 142.50 shares

This transaction is no less favorable than if we had entered into it on an arms
length basis with an unrelated third party.

We subsequently agreed with Paradigm to void the Transaction ab initio (that is,
at its inception), with the effect that Paradigm is the owner of its Assets and
Liabilities and the shares of our Preferred Stock issued to Paradigm are
restored to the status of authorized but unissued shares. We exchanged mutual
general releases with Paradigm in order to restore the parties to their
respective positions immediately prior to the execution and delivery of the
purchase agreement. This transaction is no less favorable than if we had entered
into it on an arms length basis with an unrelated third party.

On April 9, 2003, we entered into a Restructuring & Release Agreement with Greg
Mardock, John Freeland, Western Cottonwood Corporation, Atlantis Partners and
VLK Capital Corp. Pursuant to this Agreement, Greg Mardock resigned as our
director and employee and Michael A. Novielli, Douglas H. Leighton and Theodore
J. Smith, Jr. were appointed as directors. Listed below are additional
obligations of parties to the Agreement:

- Western Cottonwood Corporation agreed to forgive $1,984,849.99 in Notes
receivable and interest receivable as of December 31, 2002.

- Greg Mardock resigned as our officer and employee.

- Messrs. Mardock and Freeland immediately released any and all claims to
collateral, security or title of any of our assets.

- Western Cottonwood and Atlantis Partners will maintain a combined ownership
percentage of 4.9%. The percentage ownership of 4.9% shall be non-dilutive
through our first merger or acquisition transaction with a going concern.

- Greg Mardock will maintain an ownership percentage of 2.0%. His ownership
percentage of 2.0% shall be non-dilutive through our first merger or
acquisition transaction with a going concern.

- We issued 690,000 shares of common stock as a part of restructuring
agreement at a value of $1,727,908. All stock issued to the parties to this
Agreement was restricted and had no registration rights. The parties also
agreed to additional rules governing resale of the shares. The shares may
not be sold either in the public market nor in a private transaction for a
period of one year, the parties may not sell more than one twelfth of their
entire ownership stake in any one month for a period covering the
thirteenth month through the twenty fourth month. Additionally, for a
period of time the stock is not transferable and may not be loaned. This
transaction is no less favorable than if we had entered into it on an arms
length basis with an unrelated third party.

On April 8, 2003 we entered into a Consulting Agreement with Dutchess Advisors
LLC, where Dutchess would provide the following services:

- Assist us with our capitalization and restructuring; and

- Assist us with our business development by seeking potential business
partners, candidates for joint ventures, mergers and acquisitions or
qualified persons to join our board of directors. This transaction as no
less favorable than if we had entered into it on an arms length basis with
an unrelated third party.

We agreed to pay Dutchess Advisors, LLC 700,000 shares of common stock for these
Services. These shares were valued at $105,000. Additionally, we agreed to pay
$3,000 per month for non accountable expenses for months 1-12 and $5,000 per
month for months 13-24. The term of the Consulting Agreement is 24 months. This
transaction as no less favorable than if we had entered into it on an arms
length basis with an unrelated third party.

On May 16, 2003, we entered into a Stock Purchase Agreement with Michael
Cummings, the owner of 100% of the outstanding shares of common stock of Network
Installation, Inc., or Network. Pursuant to this Agreement, we acquired all
outstanding shares of common stock of Network. The purchase price consisted of
$50,000 and 7,382,000 shares of our common stock. In addition, we agreed to
issue a five year option to purchase an additional 618,000 shares of our common
stock to Mr. Cummings if Network's total revenue exceeds $450,000 for the period
beginning on June 1, 2003 and ending August 31, 2003. The options are
exercisable at a price equal to the closing bid price of our common stock on
August 29, 2003 which was $2.95. As of January 15, 2004, Mr. Cummings has not
exercised the options. At the time of the acquisition there were no material
relationships between us and Mr. Cummings. As a result of the acquisition, Mr.
Cummings replaced Mr. Novielli as Chief Executive Officer and became our
director. Mr. Novielli remained as Chairman of the Board of Directors. This
transaction is no less favorable than if we had entered into it on an arms
length basis with an unrelated third party.

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Bid and ask quotations for our common shares are routinely submitted by
registered broker dealers who are members of the National Association of
Securities Dealers on the NASD Over-the-Counter Electronic Bulletin Board. These
quotations reflect inner-dealer prices, without retail mark-up, mark-down or
commission and may not represent actual transactions. The high and low bid
information for our shares for each quarter for the last two years, so far as
information is reported, through the quarter ended December 31, 2003, as
reported by the Bloomburg Financial Network, are as follows:

Quarter Ended High Bid Low Bid

September 30, 2001 $4.50 $0.80
December 31, 2001 $1.25 $0.66
March 31, 2002 $0.86 $0.22
June 30, 2002 $0.51 $0.15
September 30, 2002 $0.20 $0.02
December 31, 2002 $0.03 $0.00
March 31, 2003 $2.00 $0.05
June 30, 2003 $0.35 $0.15
September 30, 2003 $5.35 $0.80
December 31, 2003 $3.50 $3.10
March 31, 2004 $3.65 $3.50

* Through January 16, 2004.

NUMBER OF SHAREHOLDERS

As of January 14, 2004 we had approximately 1,000 shareholders of record.

PENNY STOCK RULES

Our stock has had a market price of less than $5.00 per share. The SEC has
adopted regulations which generally define "penny stock" to be any equity
security that has a market price less than $5.00 per share or an exercise price
less than $5.00 per share, subject to certain exceptions. Accordingly, our
common stock is subject to rules that impose additional sales practice
requirements on broker-dealers who sell such securities to persons other than
established customers and accredited investors (generally those with assets in
excess of $1,000,000 or annual income exceeding $200,000, or $300,000 together
with their spouse). For transactions covered by these rules, the broker-dealer
must make a special suitability determination for the purchase of such
securities and have received the purchaser's written consent to the transaction
prior to the purchase. Additionally, for any transaction involving a penny
stock, unless exempt, the rules require the delivery, prior to the transaction,
of a disclosure schedule prepared by the SEC relating to the penny stock market.
The broker-dealer also must disclose the commissions payable to both the
broker-dealer and the registered representative, current quotations for the
securities and, if the broker-dealer is the sole market-maker, the broker-dealer
must disclose this fact and the broker-dealer's presumed control over the
market. Finally, monthly statements must be sent disclosing recent price
information for the penny stock held in the account and information on the
limited market in penny stocks. Consequently, the "penny stock" rules may
restrict the ability of broker-dealers to sell our common stock and may affect
the ability of investors to sell our common stock in the public market.

DIVIDENDS

We have never declared dividends on our common shares and we do not anticipate
declaring any dividends in the foreseeable future, though there are no existing
restrictions on the authority of the Board of Directors to declare dividends out
of funds legally available for the payment of dividends.

EXECUTIVE COMPENSATION

The following table sets forth the annual and long-term compensation for the
fiscal years ended December 31, 2002, 2001 and 2000 paid or accrued by us to our
Chief Executive Officer. No executive officers earned more than $100,000 in the
2002, 2001 and 2000 fiscal years.

SUMMARY COMPENSATION TABLE

Annual Compensation
--------------------------------------

Restricted
Name and . Stock Other Annual
Principal Position Year Salary (1) Bonus Award Compensation
---------------------- ------ --------- ------ ---------- --------------
Greg Mardock. . . . . . 2000 -0- -0- -0- -0-
Chief Executive Officer (1) 2001 -0- -0- 156,666 -0-
(2) 2002 $ 12,000 -0- -0- -0-

(1) Mr. Mardock received compensation from Mardock, Inc., a subsidiary of our
wholly-owned subsidiary, Flexxtech Holdings, Inc.

(2) Mr. Mardock received compensation from Mardock, Inc., a subsidiary of our
wholly-owned subsidiary at that time, Flexxtech Holdings, Inc. VLK Capital
Corp. was issued 5,909,333 shares of common stock for managerial services
valued at $.902 per share, as amended for the 18 month period from January
2001 through June 2002. VLK subsequently issued 783,333 shares to Greg
Mardock.

Mr. Mardock resigned in April, 2003. Mr. Cummings became our Chief Executive
Officer in May, 2003.

DIRECTORS COMPENSATION

We do not have a formal or informal plan or written or unwritten commitments to
compensate directors.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

None of our directors or executive officer serves as a member of the Board of
Directors or Compensation Committee of any entity that has one or more executive
officers serving as a member of our Board of Directors.

EMPLOYMENT AGREEMENT

We executed an employment agreement with Mr. Cummings on May 23, 2003. The
employment agreement shall continue in effect for a period of one year and can
be renewed upon mutual agreement between Mr. Cummings and us. We may terminate
the employment agreement at our discretion during the initial term, provided
that we shall pay Mr. Cummings an amount equal to payment at Mr. Cumming's base
salary rate for six months. We can also terminate the employment agreement for
cause with no financial obligations to Mr. Cummings.

Mr. Cummings currently earns a gross salary of $16,000 per month and 5% of the
adjusted net profits for a two-year period ending on May 23, 2005.

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS

INDEPENDENT AUDITORS' REPORT

To the Stockholders and Board of Directors Network Installation Corporation

We have audited the accompanying balance sheets of Network Installation
Corporation, a California Corporation, as of December 31, 2002 and 2001 and the
related statements of operations, stockholders' equity (deficit) and cash flows
for each of the two years in the period ended December 31, 2002. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Network Installation
Corporation as of December 31, 2002 and 2001 and the results of its operations
and its cash flows for each of the two years in the period ended December 31,
2002, in conformity with accounting principles generally accepted in the United
States of America.

The Company's financial statements are prepared using the generally accepted
accounting principles applicable to a going concern, which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. The Company has accumulated deficit of $389,675 and the Company's
total liabilities exceeded the total assets by $379,675 and $235,727 as of
December 31, 2002 and 2001, respectively. These factors as discussed in Note 3
to the financial statements, raises substantial doubt about the Company's
ability to continue as a going concern. Management's plans in regard to these
matters are also described in Note 3. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.

KABANI & COMPANY, INC.
CERTIFIED PUBLIC ACCOUNTANTS

FOUNTAIN VALLEY, CALIFORNIA

July 1, 2003

NETWORK INSTALLATION CORP. & SUBSIDIARY
(Formerly, Flexxtech Corporation)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NETWORK INSTALLATION CORPORATION
BALANCE SHEETS
DECEMBER 31, 2002 AND 2001

ASSETS
----------
2002 2001
---------- ----------
CURRENT ASSETS:
Cash & cash equivalents. . . . . . . . . . . . . . . . $ 17,319 $ 13,577
Accounts receivable. . . . . . . . . . . . . . . . . . - 50,219
---------- ----------
Total current assets . . . . . . . . . . . . . . . . 17,319 63,796

PROPERTY AND EQUIPMENT, NET. . . . . . . . . . . . . . . 10,262 7,917

RECEIVABLE FROM RELATED PARTY. . . . . . . . . . . . . . 73,206 73,206

$ 100,787 $ 144,919
========== ==========

LIABILITIES AND STOCKHOLDER'S DEFICIT
---------------------------------------

CURRENT LIABILITIES:
Accounts payable & accrued expenses. . . . . . . . . . $ 430,462 $ 330,646
Note payable . . . . . . . . . . . . . . . . . . . . . 50,000 50,000
---------- ----------
Total current liabilities. . . . . . . . . . . . . . 480,462 380,646

COMMITMENT & CONTINGENCY

STOCKHOLDER'S DEFICIT
Common stock, no par value; Authorized shares 500,000,
Issued and outstanding shares 10,000. . . . . . . . . 10,000 10,000
Accumulated deficit. . . . . . . . . . . . . . . . . . (389,675) (245,727)
---------- ----------
Total stockholder's deficit. . . . . . . . . . . . . (379,675) (235,727)

$ 100,787 $ 144,919
========== ==========

NETWORK INSTALLATION CORPORATION
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001

2002 2001
---------- ----------

NET REVENUE . . . . . . . . . . . . . . . . . $ 804,080 $ 294,271

COST OF REVENUE . . . . . . . . . . . . . . . 568,444 171,635
---------- ----------

GROSS PROFIT. . . . . . . . . . . . . . . . . 235,636 122,636

Operating expenses. . . . . . . . . . . . . . 340,267 304,364
---------- ----------

INCOME (LOSS) FROM OPERATIONS . . . . . . . . (104,631) (181,728)

Non-operating income (expense):
Interest expense. . . . . . . . . . . . . . (4,375) (1,405)
Litigation. . . . . . . . . . . . . . . . . - (125,000)
---------- ----------
Total non-operating income (expense). . . . (4,375) (126,405)
---------- ----------

LOSS BEFORE INCOME TAXES. . . . . . . . . . . (109,006) (308,133)

Provision for income taxes. . . . . . . . . . 800 800

NET LOSS. . . . . . . . . . . . . . . . . . . $(109,806) $(308,933)
========== ==========

BASIC AND DILUTED WEIGHTED AVERAGE NUMBER OF
COMMON STOCK OUTSTANDING. . . . . . . . . 10,000 10,000
========== ==========

BASIC AND DILUTED NET LOSS PER SHARE. . . . . $ (11) $ (31)
========== ==========

NETWORK INSTALLATION CORPORATION
STATEMENTS OF STOCKHOLDER'S EQUITY (DEFICIT)
FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001

TOTAL
COMMON STOCK STOCKHOLDER'S
------------
NUMBER OF ACCUMULATED EQUITY
SHARES AMOUNT DEFICIT (DEFICIT)
------------ -------------- ---------- ----------
BALANCE AT JANUARY 1, 2001 . 10,000 $ 10,000 $ 63,206 $ 73,206

Net loss for the year 2001 . - - (308,933) (308,933)
------------ -------------- ---------- ----------

BALANCE AT DECEMBER 31, 2001 10,000 10,000 (245,727) (235,727)

Distribution . . . . . . . . - - (34,142) (34,142)

Net loss for the year 2002 . - - (109,806) (109,806)
------------ -------------- ---------- ----------

BALANCE AT DECEMBER 31, 2002 10,000 $ 10,000 $(389,675) $(379,675)
============ ============== ========== ==========

NETWORK INSTALLATION CORPORATION
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001

2002 2001
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss. . . . . . . . . . . . . . . . . . . . . . . $(109,806) $(308,933)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation and amortization . . . . . . . . . . . 3,355 343
(Increase) decrease in current assets:
Accounts receivables. . . . . . . . . . . . . . . 50,219 (50,219)
Increase (decrease) in current liabilities:
Accounts payable and accrued expense. . . . . . . 99,816 330,646
---------- ----------
Total Adjustments . . . . . . . . . . . . . . . . . . 153,390 280,770
---------- ----------
Net cash provided by (used in) operating activities 43,584 (28,163)
---------- ----------

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property & equipment . . . . . . . . (5,700) (8,260)
---------- ----------
Net cash used in investing activities . . . . . . . (5,700) (8,260)
---------- ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
Distribution to shareholder . . . . . . . . . . . . (34,142) -
Proceed from line of credit . . . . . . . . . . . . - 50,000
---------- ----------
Net cash provided by (used in) financing activities (34,142) 50,000
---------- ----------

NET INCREASE IN CASH & CASH EQUIVALENTS . . . . . . . . 3,742 13,577

CASH & CASH EQUIVALENTS, BEGINNING BALANCE. . . . . . . 13,577 -

CASH & CASH EQUIVALENTS, ENDING BALANCE . . . . . . . . $ 17,319 $ 13,577
========== ==========

1. DESCRIPTION OF BUSINESS AND SEGMENTS

Network Installation Corporation ("the Company"), a privately held corporation
was organized on July 18, 1997, under the laws of the State of California. The
Company is a full service computer cabling, networking and telecommunications
integrator contractor, providing networks from stem to stem in house. The
Company participates in the worldwide network infrastructure market to end
users, structured cabling market and the telephony services.

On May 23, 2003, all the outstanding Common Shares of the Company were acquired
by Flexxtech Corporation, a Nevada corporation. The purchase price consisted of
$50,000 cash, 7,382,000 shares of Flexxtech Corporation's common stock and five
year option to purchase an additional 618,000 shares of Flexxtech Corporation's
stock if the Company's total revenue exceeds $450,000 for the period beginning
on June 1, 2003 and ending August 31, 2003. The option is exercisable at a price
equal to the closing bid price of the stock on August 31, 2003.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

USE OF ESTIMATES

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

CASH AND CASH EQUIVALENTS

The Company considers all liquid investments with a maturity of three months or
less from the date of purchase that are readily convertible into cash to be cash
equivalents.

ALLOWANCE FOR DOUBTFUL ACCOUNTS

In determining the allowance to be maintained, management evaluates many factors
including industry and historical loss experience. The allowance for doubtful
accounts is maintained at an amount management deems adequate to cover estimated
losses. The Company considers accounts receivable to be fully collectible;
accordingly, no allowance for doubtful accounts is required.

PROPERTY & EQUIPMENT

IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS

In August 2001, the FASB issued Statement No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets" ("FAS 144"). FAS 144 clarifies the
accounting for the impairment of long-lived assets and for long-lived assets to
be disposed of, including the disposal of business segments and major lines of
business. The Company has implemented FAS 144 for this fiscal year. Long-lived
assets are reviewed when facts and circumstances indicate that the carrying
value of the asset may not be recoverable. When necessary, impaired assets are
written down to estimated fair value based on the best information available.
Estimated fair value is generally based on either appraised value or measured by
discounting estimated future cash flows. Considerable management judgment is
necessary to estimate discounted future cash flows. Accordingly, actual results
could vary significantly from such estimates.

As of December 31, 2002, no impairment has been indicated.

FAIR VALUE OF FINANCIAL INSTRUMENTS

Statement of financial accounting standard No. 107, Disclosures about fair value
of financial instruments, requires that the Company disclose estimated fair
values of financial instruments. The carrying amounts reported in the statements
of financial position for current assets and current liabilities qualifying as
financial instruments are a reasonable estimate of fair value.

REVENUE RECOGNITION

Under the Completed-Contract Method, revenues and expenses are recognized when
services have been performed and the projects have been completed. For projects,
which have been completed but not yet billed to customers, revenue is recognized
based on management's estimates of the amounts to be realized. When such
projects are billed, any differences between the initial estimates and the
actual amounts billed are recorded as increases or decreases to revenue.
Expenses are recognized in the period in which the corresponding liability is
incurred. Because of short duration of the contracts, the Company did not have
any work in progress as of June 30, 2003.

The Company's revenue recognition policy for sale of network products is in
compliance with Staff accounting bulletin (SAB) 101. Revenue from the sale of
network products is recognized when a formal arrangement exists, the price is
fixed or determinable, the delivery is completed and collectibility is
reasonably assured. Generally, the Company extends credit to its customers and
does not require collateral. The Company performs ongoing credit evaluations of
its customers and historic credit losses have been within management's
expectations.

ADVERTISING

The Company expenses advertising costs as incurred. Advertising expenses for the
year ended December 31, 2002 and 2001 were $-0-.

INCOME TAXES

The Company had elected for federal income tax purposes, under the Internal
Revenue Code and the States of Texas and California, to be an S-corporation. In
lieu of corporation income taxes, the stockholders of an S-corporation are taxed
on their proportionate share of the Company's taxable income. Therefore, no
provision or liability for federal or state income taxes other than state
franchise tax for California and Texas have been included in these financial
statements.

SEGMENT REPORTING

Statement of Financial Accounting Standards No. 131 ("SFAS 131"), "Disclosure
About Segments of an Enterprise and Related Information" requires use of the
"management approach" model for segment reporting. The management approach model
is based on the way a company's management organizes segments within the company
for making operating decisions and assessing performance. Reportable segments
are based on products and services, geography, legal structure, management
structure, or any other manner in which management disaggregates a company. SFAS
131 has no effect on the Company's consolidated financial statements as
substantially all of the Company's operations are conducted in one industry
segment.

RISKS AND UNCERTAINTIES

VULNERABILITY DUE TO SUPPLIER CONCENTRATIONS - The Company had a major source
for the supply of materials in 2002 and 2001. The percentages of purchases from
this source were 94% and 93% of total purchases in the year ended December 31,
2002 and 2001, respectively. Total outstanding balances due this supplier as of
December 31, 2002 and 2001 were $84,452 and $20,312, respectively. The Company
purchases its products from various distributors. Should any of these
distributors cease operations, the Company believes that its business would not
be adversely affected because these products are readily available from multiple
distributors locally, regionally or nationally.

VULNERABILITY DUE TO CUSTOMER CONCENTRATIONS - Total sales to three major
customers in the year ended December 31, 2002 amounted to approximately $428,000
and to four major customers in the year ended December 31, 2001 amounted to
$277,000. The Company had receivable balance of $-0- from these customers as of
December 31, 2002 and $1,372 as of December 31, 2001.

RECENT PRONOUNCEMENTS

In May 2002, the Board issued SFAS No. 145, Rescission of FASB Statements No. 4,
44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections ("SFAS
145"). SFAS 145 rescinds the automatic treatment of gains or losses from
extinguishments of debt as extraordinary unless they meet the criteria for
extraordinary items as outlined in APB Opinion No. 30, Reporting the Results of
Operations, Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions. SFAS
145 also requires sale-leaseback accounting for certain lease modifications that
have economic effects that are similar to sale-leaseback transactions and makes
various technical corrections to existing pronouncements. The provisions of SFAS
145 related to the rescission of FASB Statement 4 are effective for fiscal years
beginning after May 15, 2002, with early adoption encouraged. All other
provisions of SFAS 145 are effective for transactions occurring after May 15,
2002, with early adoption encouraged. The adoption of SFAS 145 does not have a
material effect on the earnings or financial position of the Company.

In June 2002, the FASB issued SFAS No. 146 "Accounting for Costs Associated with
exit or Disposal Activities." This Statement addresses financial accounting and
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force (EITF) Issue No. 94-3, "Liability Recognition for
Certain Employee Termination Benefits and Other Costs to Exit an Activity
(including Certain Costs Incurred in a Restructuring)." This Statement requires
that a liability for a cost associated with an exit or disposal activity be
recognized when the liability is incurred. Under Issue 94-3 a liability for an
exit cost as defined, was recognized at the date of an entity's commitment to an
exit plan. The adoption of SFAS 146 does not have a material effect on the
earnings or financial position of the Company.

In October 2002, the FASB issued SFAS No. 147, "Acquisitions of Certain
Financial Institutions." SFAS No. 147 removes the requirement in SFAS No. 72 and
Interpretation 9 thereto, to recognize and amortize any excess of the fair value
of liabilities assumed over the fair value of tangible and identifiable
intangible assets acquired as an unidentifiable intangible asset. This statement
requires that those transactions be accounted for in accordance with SFAS No.
141, "Business Combinations," and SFAS No. 142, "Goodwill and Other Intangible
Assets." In addition, this statement amends SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets," to include certain financial
institution-related intangible assets. The adoption of SFAS 147 does not have a
material effect on the earnings or financial position of the Company.

In November 2002, the FASB issued FASB Interpretation No. 45, "Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others" (FIN 45). FIN 45 requires that upon
issuance of a guarantee, a guarantor must recognize a liability for the fair
value of an obligation assumed under a guarantee. FIN 45 also requires
additional disclosures by a guarantor in its interim and annual financial
statements about the obligations associated with guarantees issued. The
recognition provisions of FIN 45 are effective for any guarantees issued or
modified after December 31, 2002. The disclosure requirements are effective for
financial statements of interim or annual periods ending after December 15,
2002The adoption of this pronouncement does not have a material effect on the
earnings or financial position of the Company.

In December 2002, the FASB issued SFAS No. 148 "Accounting for Stock Based
Compensation-Transition and Disclosure". SFAS No. 148 amends SFAS No. 123,
"Accounting for Stock Based Compensation", to provide alternative methods of
transition for a voluntary change to the fair value based method of accounting
for stock-based employee compensation. In addition, this Statement amends the
disclosure requirements of Statement 123 to require prominent disclosures in
both annual and interim financial statements about the method of accounting for
stock-based employee compensation and the effect of the method used, on reported
results. The Statement is effective for the Companies' interim reporting period
ending January 31, 2003. The adoption of SFAS 148 does not have a material
effect on the earnings or financial position of the Company.

On April 30, 2003, the FASB issued FASB Statement No. 149 (FAS 149), Amendment
of Statement 133 on Derivative Instruments and Hedging Activities. FAS 149
amends and clarifies the accounting guidance on (1) derivative instruments
(including certain derivative instruments embedded in other contracts) and (2)
hedging activities that fall within the scope of FASB Statement No. 133 (FAS
133), Accounting for Derivative Instruments and Hedging Activities. FAS 149 also
amends certain other existing pronouncements, which will result in more
consistent reporting of contracts that are derivatives in their entirety or that
contain embedded derivatives that warrant separate accounting. FAS 149 is
effective (1) for contracts entered into or modified after June 30, 2003, with
certain exceptions, and (2) for hedging relationships designated after June 30,
2003. The guidance is to be applied prospectively. The Company does not expect
the adoption of SFAS No. 149 to have a material impact on its financial position
or results of operations or cash flows.

On May 15, 2003, the Financial Accounting Standards Board (FASB) issued FASB
Statement No. 150 (FAS 150), Accounting for Certain Financial Instruments with
Characteristics of both Liabilities and Equity. FAS 150 changes the accounting
for certain financial instruments that, under previous guidance, could be
classified as equity or "mezzanine" equity, by now requiring those instruments
to be classified as liabilities (or assets in some circumstances) in the
statement of financial position. Further, FAS 150 requires disclosure regarding
the terms of those instruments and settlement alternatives. FAS 150 affects an
entity's classification of the following freestanding instruments: a)
Mandatorily redeemable instruments b) Financial instruments to repurchase an
entity's own equity instruments c) Financial instruments embodying obligations
that the issuer must or could choose to settle by issuing a variable number of
its shares or other equity instruments based solely on (i) a fixed monetary
amount known at inception or (ii) something other than changes in its own equity
instruments d) FAS 150 does not apply to features embedded in a financial
instrument that is not a derivative in its entirety. The guidance in FAS 150 is
generally effective for all financial instruments entered into or modified after
May 31, 2003, and is otherwise effective at the beginning of the first interim
period beginning after June 15, 2003. For private companies, mandatorily
redeemable financial instruments are subject to the provisions of FAS 150 for
the fiscal period beginning after December 15, 2003. The Company does not expect
the adoption of SFAS No. 150 to have a material impact on its financial position
or results of operations or cash flows.

3. GOING CONCERN

The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles which contemplate continuation of the
Company as a going concern. However, the Company has accumulated deficit of
$389,675 at December 31, 2002, including net losses of $109,806 and $308,933 for
the years ended December 31, 2002 and 2001, respectively. The Company's total
liabilities exceeded its total assets by $379,675 as of December 31, 2002. The
continuing losses have adversely affected the liquidity of the Company. The
Company faces continuing significant business risks, including but not limited
to, its ability to maintain vendor and supplier relationships by making timely
payments when due.

In view of the matters described in the preceding paragraph, recoverability of a
major portion of the recorded asset amounts shown in the accompanying balance
sheet is dependent upon continued operations of the Company, which in turn is
dependent upon the Company's ability to raise additional capital, obtain
financing and to succeed in its future operations. The financial statements do
not include any adjustments relating to the recoverability and classification of
recorded asset amounts or amounts and classification of liabilities that might
be necessary should the Company be unable to continue as a going concern.

Management has taken the following steps to revise its operating and financial
requirements, which it believes are sufficient to provide the Company with the
ability to continue as a going concern. Management devoted considerable effort
during the period ended December 31, 2002, towards (i) reduction of salaries and
general and administrative expenses. In that regard, the Company consummated a
transaction whereby 100% of the Company's outstanding shares were acquired by
Flexxtech Corporation (note 12).

4. PROPERTY AND EQUIPMENT

Property and equipment comprised of following on December 31, 2002 and 2001:

2002 2001
Furniture & fixtures $ 3,160 $ 3,160
Machinery & Equipment 10,800 5,100
13,960 8,260
Less Accumulated
Depreciation ( 3,698) (343)
$ 10,262 $ 7,917

5. RECEIVABLE FROM RELATED PARTY

On January 1, 2001, the Company sold all the assets and liabilities for $73,206
to an entity related by a common officer and shareholder. The amount is due on
demand and bears no interest. The Company did not have any activities from
January 1, 2001 to September 30, 2001 and resumed the operation in October 2001.

6. ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consisted of following on December 31,
2002 and 2001:

2002 2001
Accounts payable $ 141,275 $ 81,265
Payroll taxes payable 122,123 122,123
Accrued expenses 167,064 127,258
$ 430,462 $ 330,646

The payroll taxes liabilities are for the calendar years from 1999 through 2001.
The Company has agreed to pay $6,500 per month to the tax collecting
authorities, beginning March 15, 2003 until the entire amount is paid in full.

7. NOTE PAYABLE

The Company has an unsecured note of $50,000, guaranteed by the officer and
shareholder of the Company, bearing an interest rate of 8.75%. The note was
payable through a revolving line of credit, which commenced on November 6, 2001,
the date of the note, and was to be expired in three years following the note
date. The Company was to pay a total of 36 payments of interest only on the
disbursed balance beginning one month from the note date and every month
thereafter. The term period was to commence upon the termination of the
revolving line of credit period. During the term period, the Company was to pay
principal and interest payments in equal installment sufficient to fully
amortize the principal balance outstanding, beginning one month from the
commencement of the term period. All remaining principal and accrued interest
was due and payable 7 years from the date of the note.

As a result of acquisition by Flexxtech (note 12) subsequent to the year ended
December 31, 2002, the Company was in default on this note, since the note
prohibited a change of ownership over 25% of the Company's common stock
outstanding. The entire principal amount became due upon default and the
revolving line of credit is no longer available to the Company. The Company is
in the process of making payment arrangement with the financing institution.

The interests on this note were $4,375 and $729 for the year ended December 31,
2002 and 2001, respectively.

8. COMMITMENT & LITIGATION

LEASE:

The Company paid the usage charge each month for its office space. On February
5, 2003, the Company entered into short term rental agreement for 90 days and
month to month thereafter. The monthly rental is $2,289.

The rent expenses were $12,323 and $ 10,199 for the year ended December 31, 2002
and 2001, respectively.

LITIGATION:

The Company was the defendant in a collection action brought by a vendor. The
allegation is that the Company failed to pay for goods and services provided by
the vendor in the amount of $125,000. This amount was accrued in the financial
statements for the year ended December 31, 2001.

9. STOCKHOLDERS' EQUITY

During the years ended December 31, 2002 and 2001, the Company did not issue any
additional shares. Company has 10,000 issued and outstanding shares at the end
of December 31, 2002 and 2001.

10. BASIC AND DILUTED NET LOSS PER SHARE Basic and diluted net loss per share
for the twelve-month period ended December 31, 2002 and 2001 were determined by
dividing net loss for the periods by the weighted average number of basic and
diluted shares of common stock outstanding.

11. SUPPLEMENTAL DISCLOSURE OF CASH FLOWS

The Company prepares its statements of cash flows using the indirect method as
defined under the Financial Accounting Standard No. 95.

The Company paid interest of $3,526 and $676 during the year ended December 31,
2002 and 2001, respectively. The Company paid income taxes of $-0- during the
years ended December 31, 2002 and 2001.

12. SUBSEQUENT EVENT

On May 23, 2003, Flexxtech Corporation (Flex) and the Company closed a purchase
agreement whereby Flex acquired 100% of the issued and outstanding common stock
of the Company. The purchase price consisted of $50,000 cash, 7,382,000 shares
of Flex's common stock and five year option to purchase an additional 618,000
shares of Flex's if the Company's total revenue exceeds $450,000 for the period
beginning on June 1, 2003 and ending August 31, 2003. The option is exercisable
at a price equal to the closing bid price of the stock on August 31, 2003.

Pursuant to the terms of the share exchange agreement, control of the combined
companies passed to the former shareholders of the Company. This type of share
exchange has been treated as a capital transaction accompanied by
recapitalization of the Company in substance, rather than a business
combination, and is deemed a "reverse acquisition" for accounting purposes since
the former owners of the Company controlled majority of the total common shares
outstanding immediately following the acquisition. No pro forma financial
statements are being presented as Flex had no significant asset prior to the
acquisition.

NETWORK INSTALLATION CORP.
(FORMERLY, FLEXXTECH CORPORATION)
CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 2003
(UNAUDITED)

ASSETS
Current Asset:
Cash and cash equivalents . . . . . . . . . . . . $ 667
Accounts receivable . . . . . . . . . . . . . . . 337,763
Notes receivable - related parties. . . . . . . . 79,214
Other current assets. . . . . . . . . . . . . . . 2,289
------------
Total Current Assets. . . . . . . . . . . . . . . . . . . 419,933

Property and Equipment, net. . . . . . . . . . . . . . . . . . . 7,739

TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . $ 427,672
============

LIABILITIES & STOCKHOLDERS' DEFICIT
Current Liabilities:
Accounts payable and accrued expenses . . . . . . $ 1,361,852
Loans payable . . . . . . . . . . . . . . . . . . 61,730
Loans payable related parties . . . . . . . . . . 47,500
Due to factor . . . . . . . . . . . . . . . . . . 205,929
Convertible debt - current. . . . . . . . . . . . 663,860
------------
Total Current Liabilities . . . . . . . . . . . . . . . . 2,340,871

Long-term Liabilities:
Convertible debt net of debenture cost. . . . . . 378,000

STOCKHOLDERS' DEFICIT
Common stock, authorized 100,000,000 shares at $.001 par
value, issued and outstanding 12,616,330 shares. . 12,616
Additional paid in capital. . . . . . . . . . . . . . . 2,252,587
Shares to be issued . . . . . . . . . . . . . . . . . . 16,900
Accumulated deficit . . . . . . . . . . . . . . . . . . (4,573,302)
------------
Total Stockholders' Deficit . . . . . . . . . . . . (2,291,199)
------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT. . . . . . . . . . . $ 427,672
============

NETWORK INSTALLATION CORP.
(FORMERLY, FLEXXTECH CORPORATION)
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
2003 2002 2003 2002
-------------------- ------------------- ------------ -----------
NET REVENUE. . . . . . . . . . $ 444,736 $ 760,450 $ 1,199,680 $ 813,543

COST OF REVENUE. . . . . . . . 358,131 439,631 916,244 479,617
-------------------- ------------------- ------------ -----------

GROSS PROFIT . . . . . . . . . 86,605 320,819 283,436 333,926

OPERATING EXPENSES . . . . . . 1,332,236 276,371 1,823,409 393,643

LOSS FROM OPERATIONS . . . . . (1,245,631) 44,448 (1,539,973) (59,717)

Other income (expense)
Loss on conversion of
debenture. . . . . . . . . . (59,740) - (59,740) -
Interest expense . . . . . . (1,214,793) (660) (1,216,981) (3,688)
-------------------- ------------------- ------------ -----------
Total other income (expense) (1,274,533) (660) (1,276,721) (3,688)

LOSS BEFORE INCOME TAXES. . . . (2,520,164) 43,788 (2,816,694) (63,405)

Provision of Income tax. . . . . - - 800 800

NET LOSS . . . . . . . . . . . $ (2,520,164) $ 43,788 $(2,817,494) $ (64,205)
==================== =================== ============ ===========

Basic and diluted loss per
Share $ (0.23) $ 0.01 $ (0.30) $ (0.01)
==================== =================== ============ ===========

Basic and diluted weighted
average shares outstanding. 11,127,512 7,382,000 9,320,787 7,382,000
=================== =================== ============ ===========

* The basic and diluted net loss per share has been restated to retroactively
effect a 200:1 reverse stock split at January 23, 2003

Weighted average number of shares used to compute basic and diluted loss
per share is the same since the effect of dilutive securities is
anti-dilutive.

NETWORK INSTALLATION CORP.
(FORMERLY, FLEXXTECH CORPORATION)
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTH PERIODS ENDED SEPTEMBER 30, 2003 AND 2002
(UNAUDITED)

2003 2002
------------ ---------

CASH FLOWS FROM OPERATING ACTIVITIES

Net Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(2,817,494) $(64,205)
Adjustments to reconcile net loss to cash provided by (used in)
operating activities
Depreciation and amortization. . . . . . . . . . . . . . . 2,523 1,679
Issuance of stocks for consulting services & compensation. 2,089,250 -
Options granted for compensation . . . . . . . . . . . . . 6,987 -
Loss on settlement of debt . . . . . . . . . . . . . . . . 59,740 -
(Increase) / decrease in current assets
Accounts receivable. . . . . . . . . . . . . . . . . (337,763) (63,829)
Deposits & other current assets . . . . . . . . . . (969) (8,895)
Increase /(decrease) in current liabilities
Accrued expenses & accounts payable. . . . . . . . . 537,229 48,467
------------ ---------
NET CASH PROVIDED BY (USED IN) OPERATING
ACTIVITIES FROM CONTINUED OPERATIONS . . . . . (460,497) (86,783)
------------ ---------

CASH FLOWS FROM INVESTING ACTIVITIES
Cash received in acquisition of subsidiary. . . . . . 667 -
------------ ---------
NET CASH PROVIDED BY INVESTING ACTIVITIES . . . . . . 667 -

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from factor . . . . . . . . . . . . . . . . . 205,929 -
Proceeds from notes receivable . . . . . . . . . . . . - 73,206
Proceeds from borrowings . . . . . . . . . . . . . . . 336,150 -
Payments of loans. . . . . . . . . . . . . . . . . . . (98,901) -
------------ ---------
NET CASH PROVIDED BY FINANCING ACTIVITIES. . . . . . . 443,178 73,206
------------ ---------

NET DECREASE IN CASH AND CASH EQUIVALENTS. . . . . . . . . . . . (16,652) (13,577)

CASH AND CASH EQUIVALENTS -BEGINNING . . . . . . . . . . . . . . 17,319 13,577
------------ ---------

CASH AND CASH EQUIVALENTS -ENDING. . . . . . . . . . . . . . . . $ 667 $ -
============ =========

1. BASIS OF PREPARATION:

The accompanying unaudited condensed interim financial statements have been
prepared in accordance with the rules and regulations of the Securities and
Exchange Commission for the presentation of interim financial information, but
do not include all the information and footnotes required by generally accepted
accounting principles for complete financial statements. The audited financial
statements for the two years ended December 31, 2002 and 2001 were filed on
April 23, 2003 with the Securities and Exchange Commission and is hereby
referenced. In the opinion of management, all adjustments considered necessary
for a fair presentation have been included. Operating results for the nine-month
periods ended September 30, 2003 are not necessarily indicative of the results
that may be expected for the year ended December 31, 2003.

RECAPITALIZATION

On May 23, 2003, Flexxtech Corporation (Flex) and Network Installation
Corporation (NIC) closed a purchase agreement whereby Flex acquired 100% of the
issued and outstanding common stock of Network Installation Corporation (NIC).
The purchase price consisted of $50,000 cash, 7,382,000 shares of the Company's
common stock and five year option to purchase an additional 618,000 shares of
the Company stock if NIC's total revenue exceeds $450,000 for the period
beginning on June 1, 2003 and ending August 31, 2003. The option is exercisable
at a price equal to the closing bid price of the stock on August 31, 2003.

Pursuant to the terms of the share exchange agreement, control of the combined
companies passed to the former shareholders of NIC. This type of share exchange
has been treated as a capital transaction accompanied by recapitalization of NIC
in substance, rather than a business combination, and is deemed a "reverse
acquisition" for accounting purposes since the former owners of NIC controlled
majority of the total common shares outstanding immediately following the
acquisition. No pro forma financial statements are being presented as Flex had
no significant asset prior to the acquisition.

All significant intercompany accounts and transactions have been eliminated in
consolidation. The historical results for the period ended September 30, 2003
include the accounts of Flex (from the acquisition date) and Network
Installation Corporation for the nine month period ended September 30, 2003,
while the historical results for the periods ended September 30, 2002 include
only Network Installation Corporation.

BASIC AND DILUTED NET LOSS PER SHARE

Net loss per share is calculated in accordance with the Statement of financial
accounting standards No. 128 (SFAS No. 128), "Earnings per share". SFAS No. 128
superseded Accounting Principles Board Opinion No.15 (APB 15). Net loss per
share for all periods presented has been restated to reflect the adoption of
SFAS No. 128. Basic net loss per share is based upon the weighted average number
of common shares outstanding. Diluted net loss per share is based on the
assumption that all dilutive convertible shares and stock options were converted
or exercised. Dilution is computed by applying the treasury stock method. Under
this method, options and warrants are assumed to be exercised at the beginning
of the period (or at the time of issuance, if later), and as if funds obtained
thereby were used to purchase common stock at the average market price during
the period.

DESCRIPTION OF BUSINESS

Flex was organized on March 24, 1998, under the laws of the State of Nevada, as
Color Strategies. On December 20, 1999, Flex changed its name to Infinite
Technology Corporation. Flex changed its name to Flexxtech Corporation in April
2000.

A certificate of amendment was filed on July 10, 2003 to change the Company's
name from Flexxtech Corporation to Network Installation Corp.

NIC was incorporated on July 18, 1997, under the laws of the State of
California. The Company is a full service computer cabling, networking and
telecommunications integrator contractor, providing networks from stem to stem
in house. The Company participated in the worldwide network infrastructure
market to end users, structured cabling market and the telephony services.

REVENUE RECOGNITION

The Company's revenue recognition policies are in compliance with all applicable
accounting regulations, including American Institute of Certified Public
Accountants (AICPA) Statement of Position (SOP) 81-1, Accounting for Performance
of Construction-Type and Certain Production-Type Contracts. Revenues from
installations, cabling and networking contacts are recognized when the contracts
are completed (Completed-Contract Method). The completed-contract method is used
because the contracts are short-term in duration or the Company is unable to
make reasonably dependable estimates of the costs of the contracts. Under the
Completed-Contract Method, revenues and expenses are recognized when services
have been performed and the projects have been completed. For projects, which
have been completed but not yet billed to customers, revenue is recognized based
on management's estimates of the amounts to be realized. When such projects are
billed, any differences between the initial estimates and the actual amounts
billed are recorded as increases or decreases to revenue. Expenses are
recognized in the period in which the corresponding liability is incurred.
Because of short duration of the contracts, the Company did not have any work in
progress as of September 30, 2003.

ISSUANCE OF SHARES FOR SERVICE

The Company accounts for the issuance of equity instruments to acquire goods and
services based on the fair value of the goods and services or the fair value of
the equity instrument at the time of issuance, whichever is more reliably
measurable.

RECLASSIFICATIONS

For comparative purposes, prior years' consolidated financial statements have
been reclassified to conform with report classifications of the current year.

2. RECENT PRONOUCEMENTS

On April 30 2003, the FASB issued FASB Statement No. 149 (FAS 149), Amendment of
Statement 133 on Derivative Instruments and Hedging Activities. FAS 149 amends
and clarifies the accounting guidance on (1) derivative instruments (including
certain derivative instruments embedded in other contracts) and (2) hedging
activities that fall within the scope of FASB Statement No. 133 (FAS 133),
Accounting for Derivative Instruments and Hedging Activities. FAS 149 also
amends certain other existing pronouncements, which will result in more
consistent reporting of contracts that are derivatives in their entirety or that
contain embedded derivatives that warrant separate accounting. FAS 149 is
effective (1) for contracts entered into or modified after June 30, 2003, with
certain exceptions, and (2) for hedging relationships designated after June 30,
2003. The guidance is to be applied prospectively. The adoption of SFAS No. 149
does not have a material impact on the Company's financial position or results
of operations or cash flows.

On May 15, 2003, the Financial Accounting Standards Board (FASB) issued FASB
Statement No. 150 (FAS 150), Accounting for Certain Financial Instruments with
Characteristics of both Liabilities and Equity. FAS 150 changes the accounting
for certain financial instruments that, under previous guidance, could be
classified as equity or "mezzanine" equity, by now requiring those instruments
to be classified as liabilities (or assets in some circumstances) in the
statement of financial position. Further, FAS 150 requires disclosure regarding
the terms of those instruments and settlement alternatives. FAS 150 affects an
entity's classification of the following freestanding instruments: a)
Mandatorily redeemable instruments b) Financial instruments to repurchase an
entity's own equity instruments c) Financial instruments embodying obligations
that the issuer must or could choose to settle by issuing a variable number of
its shares or other equity instruments based solely on (i) a fixed monetary
amount known at inception or (ii) something other than changes in its own equity
instruments d) FAS 150 does not apply to features embedded in a financial
instrument that is not a derivative in its entirety. The guidance in FAS 150 is
generally effective for all financial instruments entered into or modified after
May 31, 2003, and is otherwise effective at the beginning of the first interim
period beginning after June 15, 2003. For private companies, mandatorily
redeemable financial instruments are subject to the provisions of FAS 150 for
the fiscal period beginning after December 15, 2003. The adoption of SFAS No.
150 does not have a material impact on the Company's financial position or
results of operations or cash flows.

3. GOING CONCERN OPINION

The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles which contemplate continuation of the
Company as a going concern. However, the Company has accumulated deficit of
$4,573,302 including a net loss of $2,817,494 for the nine month period ended
September 30, 2003. The continuing losses have adversely affected the liquidity
of the Company. The Company faces continuing significant business risks,
including but not limited to, its ability to maintain vendor and supplier
relationships by making timely payments when due.

Management has taken the following steps to revise its operating and financial
requirements, which it believes are sufficient to provide the Company with the
ability to continue as a going concern. Management devoted considerable effort
during the period ended September 30, 2003, towards obtaining additional equity
financing through various private placements and evaluation of its distribution
and marketing methods.

4. NOTES RECEIVABLE/PAYABLE - RELATED

Notes receivable from related parties

The Company has a receivable from a company related by common officer amounting
$80,534 as of September 30, 2003. The amount is unsecured, due on demand and non
interest bearing.

Notes payable to related parties
------------------------------------

The Company has $3,500 payable based on the purchase agreement of the subsidiary
and $44,000 loan payable to the major shareholder and officer of the Company.
The loan amounts are unsecured, due on demand and non interest bearing.

5. LOAN PAYABLE

The Company has an unsecured note payable of $47,500, guaranteed by the officer
and shareholder of the Company, bearing an interest rate of 8.75%. The note was
payable through a revolving line of credit, which commenced on November 6, 2001,
the date of the note, and was to be expired in three years following the note
date. The Company was to pay a total of 36 payments of interest only on the
disbursed balance beginning one month from the note date and every month
thereafter. The term period was to commence upon the termination of the
revolving line of credit period. During the term period, the Company was to pay
principal and interest payments in equal installment sufficient to fully
amortize the principal balance outstanding, beginning one month from the
commencement of the term period. All remaining principal and accrued interest
was due and payable 7 years from the date of the note.

As a result of acquisition of the Company by Flex, the Company was in default on
this note, since the note prohibited a change of ownership over 25% of the
Company's common stock outstanding. The entire principal amount became due upon
default and the revolving line of credit is no longer available to the Company.
The Company is in the process of making payment arrangement with the financing
institution. The amount outstanding at September 30, 2003, amounted to $39,949.

The Company has notes payable to unrelated parties amounting $21,781. These
notes are due on demand, bear interest rate of 6% per annum and unsecured.

6. DUE TO FACTOR

On February 27, 2003, the Company entered into a factoring and security
agreement to sell, transfer and assign certain accounts receivable to Orange
Commercial Credit (OCC). OCC may on its sole discretion purchase any specific
account. All accounts sold are with recourse on seller. All of the Company's
property including accounts receivable, inventories, equipment and promissory
notes are collateral under this agreement. OCC will advance 80% of the face
amount of each account. The difference between the face amount of each purchased
account and advance on the purchased account shall be reserve and will be
released after deductions of discount and charge backs on the 15th and the last
day of each month. OCC charges 1% of gross face value of purchased receivable
for finance charge and 1% for administrative fees with minimum charge of $750 on
each settlement date. As of September 30, 2003, the Company factored receivables
of approximately $129,929. In connection with the factoring agreement, the
Company included fees of $10,752 in the period ended September 30, 2003.

On September 17, 2003, the Company entered a factoring agreement with a related
entity for $76,000 face amount. This amount is payable in 30 days and certain
receivables were assigned and delivered. In the event that on the maturity date,
any amounts on the note remain, the holder can exercise its right to increase
the face amount by $10,000 per month that the Note remains unpaid.

7. INCOME TAXES

The Company filed its tax returns through 2002 as an S corporation. The Company
accounts for income taxes under Statement of Financial Accounting Standards No.
109 (SFAS 109). Under SFAS 109, deferred income taxes are reported using the
liability method. Deferred tax assets are recognized for deductible temporary
differences and deferred tax liabilities are recognized for taxable temporary
differences. Temporary differences are the differences between the reported
amounts of assets and liabilities and their tax bases. Deferred tax assets are
reduced by a valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets will not be
realized. Deferred tax assets and liabilities are adjusted for the effects of
changes in tax laws and rates on the date of enactment.

Through September 30, 2003, the Company incurred net operating losses for tax
purposes of approximately $2,800,000. The net operating loss carryforwards may
be used to reduce taxable income through the year 2023. Net operating loss for
carryforwards for the State of California are generally available to reduce
taxable income through the year 2008. The availability of the Company's net
operating loss carryforwards are subject to limitation if there is a 50% or more
positive change in the ownership of the Company's stock. The provision for
income taxes consists of the state minimum tax imposed on corporations.

8. STOCKHOLDERS' EQUITY

During period ended September 30, 2003, the Company issued stocks at various
times, as described per the following. The stocks were valued at the average
fair market value of the freely trading shares of the Company as quoted on OTCBB
on the date of issuance.

STOCK SPLIT

On January 23, 2003, Flex announced a 1 for 200 reverse stock split of its
common stock. All fractional shares are rounded up and the authorized shares
remain the same. The financial statements have been retroactively restated for
the effects of stock splits.

COMMON STOCK:

During period ended September 30, 2003, the Company issued common stock as
follows:

75,000 shares of common stock were issued to an entity related through common
officer at that time, for consulting fees, amounting $3,750.

The Company issued 700,000 shares of common stock to the major shareholder for
consulting services amounting $105,000.

The Company issued 400,000 shares of common stock to directors for directors'
fees amounting $610,800.

The Company issued 275,000 shares of common stock to the major shareholder for
consulting services amounting $278,750.

The Company issued 65,923 shares of common stock valued at $158,641 for
conversion of debenture amount of $98,901. The difference of the value of the
stock issued and debenture amount of $59,740 was charged as a loss on
conversion.

The Company issued 1,550,000 shares to the major shareholder per debenture
agreement. $1,199,700 interest was recorded in the financial statement for these
shares.

CONVERTIBLE DEBENTURES:

In the year ended December 31, 2001, the company issued debentures amounting
$720,000, carrying an interest rate of 6% per annum, due in August 2003. The
holders are entitled to, at any time or from time to time, convert the
conversion amount into shares of common stock of the Company, par value $.001
per share at a conversion price for each share of common stock equal to the
lower of (a) 120% of the losing bid price per share (as reported by Bloomberg,
LP) on the closing date, and (b) 80% of the lowest closing bid price per share
(as reported by Bloomberg, LP) of the Company's common stock for the five
trading days immediately preceding the date of conversion. The Company recorded,
in accordance with EITF 00-27 and 98-5, a beneficial conversion feature on the
issuance of the convertible debentures amounting $180,000 reflected in the
interest expense in the financial statement. As of September 30, 2003, the
outstanding balance of the debentures amounted to $563,860 out of which, $38,524
pertains to major shareholder.

On April 7, 2003, in connection with the recession agreement (note 12), the
Company issued convertible debentures of $140,000 to various parties. The
Company has recorded the debentures as recession cost in the financial
statements at December 31, 2002. The Holder of the debentures is entitled to
convert the face amount of this Debenture, plus accrued interest, anytime
following the Restricted Period, at the lesser of (i) 75% of the lowest closing
bid price during the fifteen (15) trading days prior to the Conversion Date or
(ii) 100% of the average of the closing bid prices for the twenty (20) trading
days immediately preceding the Closing Date ("Fixed Conversion Price"), each
being referred to as the "Conversion Price". No fractional shares or scrip
representing fractions of shares will be issued on conversion, but the number of
shares issuable shall be rounded up or down, as the case may be, to the nearest
whole share. The Debentures shall pay six percent (6%) cumulative interest, in
cash or in shares of common stock, par value $.001 per share, of the Company
("Common Stock"), at the Company's option, at the time of each conversion. The
debentures are payable on April 8, 2008.

On April 7, 2003, the company issued debentures amounting $105,000 to a major
shareholder and a related party to a major shareholder, carrying an interest
rate of 6% per annum, due in April 2008. The face amount of this Debenture may
be converted, in whole or in art, any time following the Closing Date. Holder is
entitled to convert the face amount of this Debenture, plus accrued interest,
anytime following the Closing Date, at the lesser of (i) 75% of the lowest
closing bid price during the fifteen (15) trading days prior to the Conversion
Date or (ii) 100% of the average of the closing bid prices for the twenty (20)
trading days immediately preceding the Closing Date ("Fixed Conversion Price"),
each being referred to as the "Conversion Price". No fractional shares or scrip
representing fractions of shares will be issued on conversion, but the number of
shares issuable shall be rounded up or down, as the case may be, to the nearest
whole share.

The restriction period for the conversion of the debentures issued in April is
for one year period. The company has recorded a beneficial conversion feature
expense amounting $53,000 as interest expense in the financial statements for
the period ended June 30, 2003.

In connection with issuance of debentures, the Company issued 250,000 shares of
common stock to an unrelated party and 800,000 shares of common stock to a
related party. The shares issued to the unrelated party were recorded as
debenture issuance cost up-to the amount of debenture amounting $25,000. The
debentures have been presented net of debentures issuance cost in the financial
statements. The shares issued to the related party have been recorded as deemed
dividend amounting $120,000. The valuation of shares was based upon average fair
market value of the freely trading shares of the Company as quoted on OTCBB on
the date of issuance.

The Company has recorded, in accordance with EITF 00-27 and 98-5, a beneficial
conversion feature on the issuance of the convertible debentures in the nine
month period ended September 30, 2003, an amount of $134,000, reflected in the
financial statement as interest expense.

During the period ended September 30, 2003, the Company issued $158,000
debentures to a related party. These debentures carry an interest rate of 6% per
annum, due in July to September 2008. The face amount of these Debentures may be
converted, in whole or in part, any time following the Closing Date. Holder is
entitled to convert the face amount of this Debenture, plus accrued interest,
anytime following the Closing Date, at the lesser of (i) 75% of the lowest
closing bid price during the fifteen (15) trading days prior to the Conversion
Date or (ii) 100% of the average of the closing bid prices for the twenty (20)
trading days immediately preceding the Closing Date ("Fixed Conversion Price"),
each being referred to as the "Conversion Price". No fractional shares or scrip
representing fractions of shares will be issued on conversion, but the number of
shares issuable shall be rounded up or down, as the case may be, to the nearest
whole share.

The Company issued 1,550,000 shares to the major shareholder per debenture
agreement. Per the agreement, the Company was required to issue one hundred
thousand (100,000) shares of its common stock to holder, for each ten thousand
dollars ($10,000) invested. The Company recorded stock issued amounting
$1,199,700 as interest expense in the accompanying financial statements.

CONVERTIBLE PROMISSORY NOTES PAYABLE

In the year ended December 31, 2001, the Company issued convertible promissory
notes of $100,000 due on April 1, 2004, carrying an interest rate of 10% per
annum. The holder of $100,000 promissory notes is entitled to convert the
conversion amount into shares of common stock of the Company, par value $.001,
at any time, per share at a conversion price for each share of common stock
equal $7.00 per share of common stock. The note is secured and collateralized by
shares of common stock of the Company at one share per every five dollars
($5.00) of the principal.

STOCK OPTION PLAN

The Company accounts for stock options under SFAS No. 123, "Accounting for
Stock-Based Compensation," as amended by SFAS No. 148, which contains a fair
value-based method for valuing stock-based compensation that entities may use,
which measures compensation cost at the grant date based on the fair value of
the award. Compensation is then recognized over the service period, which is
usually the vesting period. Alternatively, SFAS No. 123 permits entities to
continue accounting for employee stock options and similar equity instruments
under Accounting Principles Board (APB) Opinion 25, "Accounting for Stock Issued
to Employees." Entities that continue to account for stock options using APB
Opinion 25 are required to make pro forma disclosures of net income and earnings
per share, as if the fair value-based method of accounting defined in SFAS No.
123 had been applied.

The Company accounts for its stock option plan under the recognition and
measurement principles of APB Opinion 25, "Accounting for Stock Issued to
Employees," and related interpretations. Stock-based employee compensation costs
are not reflected in net income, as all options granted under the plan had an
exercise price equal to the market value of the underlying common stock on the
date of grant. The following table illustrates the effect on net income and
earnings per share for the nine month period ended September 30, 2003, if the
Company had applied the fair value recognition provisions of SFAS No. 123, to
stock-based employee compensation (no options were issued in the period ended
September 30, 2002) as follows ($ in thousands, except per share amounts) :

Net loss - as reported $(2,817)
Stock-Based employee compensation
expense included in reported net
income, net of tax (7)

Total stock-based employee
compensation expense determined
under fair-value-based method for all
rewards, net of tax (10)
---------
Pro forma net loss $(2,834)
=========
Loss per share:
Basic, as reported 0.30
Diluted, as reported 0.30
Basic, pro forma 0.31
Diluted, pro forma 0.31

THE ASSUMPTIONS USED IN CALCULATING THE FAIR VALUE OF OPTIONS GRANTED USING THE
--------------------------------------------------------------------------------
BLACK-SCHOLES OPTION- PRICING MODEL ARE AS FOLLOWS:
---------------------------------------------------------

RISK-FREE INTEREST RATE 3.0%
EXPECTED LIFE OF THE OPTIONS 2 YEARS
EXPECTED VOLATILITY 100%
EXPECTED DIVIDEND YIELD 0

9. LITIGATION

In the year ended December 31, 2002, a suit was brought against the Company in
the Superior Court of the State of California, County of San Francisco, alleging
that the Company made false written and oral representations to induce the
plaintiff to invest in the company and that such investment occurred despite the
plaintiff's request that the funds be held in a brokerage account maintained by
a related entity. A co-defendant in the case also filed a cross-complaint in
the action alleging theories of recovery against the Company and several other
defendants and alleging fraud, breach of contract, misrepresentation,
conversion and securities fraud against the Company. On November 21, 2003, the
Company reached a settlement with the plaintiffs for $160,000, of which the
Company had already made a good faith payment of $20,000. The remaining payment
will be made in installments through April 2004. The Company has accrued for
the litigation liability in the accompanying financial statements.

On April 25, 2003 the Superior Court of the State of California, County
of Orange, entered a judgment in the amount of $46,120 against the Company
in favor of a vendor of the Company's former subsidiary, North Texas Circuit
Board, or NTCB. In addition, on August 20, 2002 the Company sold NTCB to a
third party. Pursuant to terms of the share purchase agreement, this third
party assumed all liabilities of NTCB. The Company plan to vigorously
oppose the action. The Company plans to file for vacate the judgment for lack of
personal service.

On April 29, 2003, an investor brought a suit against the Company in the
Superior Court of the State of California, County of Los Angeles, alleging
breach of contract pursuant to a settlement agreement executed between the
Company and the investor dated November 20, 2002. The suit alleges that
the Company are delinquent in its repayment of a $20,000 promissory note, of
which $5,000 has been repaid to date. The Company plan to vigorously oppose the
claims.

The Company may be involved in litigation, negotiation and settlement matters
that may occur in the day-to-day operations of the Company and its subsidiary.
Management does not believe implication of these litigations will have any other
material impact on the Company's financial statements.

10. SUPPLEMENTAL DISCLOSURE OF CASH FLOWS

The Company prepares its statements of cash flows using the indirect method as
defined under the Financial Accounting Standard No. 95.

The Company paid $-0- for income taxes and interest during the nine month period
ended September 30, 2003. The Company paid income taxes of $-0- and interest of
$26,500 during the nine month period ended September 30, 2002.

The statement of cash flows does not include effect of non-cash transaction of
issuance of shares (note 8).

11. RESTATEMENT

Subsequent to the issuance of the Company's financial statements for the period
ended September 30, 2003, the Company determined that a certain transaction and
presentation in the financial statements had not been accounted properly in the
Company's financial statements. The Company's 2003 financial statements have
been restated to correct errors as follows:

(1) The acquisition of the Company by Flex was recorded under straight purchase
method instead of under the reverse acquisition method.

The Company has restated its financial statements for the period ended September
30, 2003. The effect of the correction of all the errors is as follows:

AS PREVIOUSLY AS
Period ended September 30, 2003 REPORTED RESTATED

BALANCE SHEET:

Goodwill $ 1,745,840 $ -

TOTAL ASSETS $ 2,174,832 $ 427,672

STATEMENT OF SHAREHOLDERS' DEFICIT
Accumulated deficit: $(20,636,241) $(4,573,302)
Additional paid in capital $ 20,066,110 $ 2,252,587
Total stockholders' deficit $ (540,615) $(2,291,199)

STATEMENT OF OPERATIONS:
Net revenues $ 641,307 $ 1,199,680
Gross profit $ 138,111 $ 283,436
Operating expenses $ 1,634,005 $ 1,823,409
Operating Loss $ 1,495,894 $ 1,539,973
Net loss $ 2,931,660 $ 2,817,494
Basic and diluted net loss per share $ (0.53) $ (0.30)

ADDITIONAL INFORMATION

Our common stock is registered with the SEC under section 12(g) of the
Securities Exchange Act of 1934. We file with the SEC periodic reports on Forms
10-KSB, 10-QSB and 8-K, and proxy statements, and our officers and directors
file reports of stock ownership on Forms 3, 4 and 5. We intend to send annual
reports containing audited financial to the shareholders. Additionally, we filed
with the Securities and Exchange Commission a registration statement on Form
SB-2 under the Securities Act of 1933 for the shares of common stock in the
offering, of which this prospectus is a part. This prospectus does not contain
all of the information in the registration statement and the exhibits and
schedule that were filed with the registration statement. For further
information we refer you to the registration statement and the exhibits and
schedule that were filed with the registration statement.

Statements contained in this prospectus about the contents of any contract or
any other document that is filed as an exhibit to the registration statement are
not necessarily complete, and we refer you to the full text of the contract or
other document filed as an exhibit to the registration statement. A copy of the
registration statement and the exhibits and schedules that were filed with the
registration statement may be inspected without charge at the Public Reference
Room maintained by the Securities and Exchange Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549, and copies of all or any part of the registration
statement may be obtained from the Securities and Exchange Commission upon
payment of the prescribed fee. Information regarding the operation of the Public
Reference Room may be obtained by calling the Securities and Exchange Commission
at 1-800-SEC-0330.

The Securities and Exchange Commission maintains a web site that contains
reports, proxy and information statements, and other information regarding
registrants that file electronically with the SEC. The address of the site is
www.sec.gov.
----------

PART II. INFORMATION NOT REQUIRED IN PROSPECTUS

INDEMNIFICATION OF DIRECTORS AND OFFICERS

Under the foregoing provisions of our Certificate of Incorporation and By-Laws,
each person who is or was a director or officer of Registrant shall be
indemnified by the Registrant as of right to the full extent permitted or
authorized by the General Corporation Law of Nevada. Under such law, to the
extent that such person is successful on the merits of defense of a suit or
proceeding brought against such person by reason of the fact that such person is
a director or officer of the Registrant, such person shall be indemnified
against expenses, including attorneys' fees, reasonably incurred in connection
with such action. If unsuccessful in defense of a third-party civil suit or a
criminal suit or if such a suit is settled, such a person shall be indemnified
under such law against both (1) expenses (including attorneys' fees) and (2)
judgments, fines and amounts paid in settlement if such person acted in good
faith and in a manner such person reasonably believed to be in, or not opposed
to, the best interests of the Registrant, and with respect to any criminal
action, had no reasonable cause to believe such person's conduct was unlawful.
If unsuccessful in defense of a suit brought by or under the right of the
Registrant, or if such suit is settled, such a person shall be indemnified under
such law only against expenses (including attorneys' fees) incurred in the
defense or settlement of such suit if such person acted in good faith and in a
manner such person reasonably believed to be in, or not opposed to, the best
interests of the Registrant, except that if such a person is adjudicated to be
liable in such suit for negligence or misconduct in the performance of such
person's duty to the Registrant, such person cannot be made whole even for
expenses unless the court determines that such person is fairly and reasonably
entitled to be indemnified for such expenses.

OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth our expenses in connection with this registration
statement. All of these expenses are estimates, other than the fees and expenses
of legal counsel and filing fees payable to the Securities and Exchange
Commission.

Filing Fee--Securities and Exchange Commission $400
Legal Expenses $6,000
Accounting Expenses $7,500
Blue Sky Fees and Expenses $1,000
Printing Expenses $3,000
Miscellaneous expenses $2,100
---------
Total: $20,000

ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES

In the three months ended September 30, 2001, we sold a total of 31,996 shares
of common stock without registration pursuant to the exemptions afforded by
Regulation D resulting in gross proceeds of $30,320. These sales were
undertaken under Rule 506 of Regulation D under the Securities Act of 1933, as
amended, by the fact that:

- the sales were made to a sophisticated or accredited investors, as defined
in Rule 502;

- we gave each purchaser the opportunity to ask questions and receive answers
concerning the terms and conditions of the offering and to obtain any
additional information which we possessed or could acquire without
unreasonable effort or expense that is necessary to verify the accuracy of
information furnished;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

We utilized the services of finders in placing the 31,996 shares of common
stock. We did not utilize the services of brokers or underwriters. The Offering
was self-underwritten. The Offering expenses were approximately 15% of the gross
Offering proceeds. The balance of the Offering expenses were related to general
sales expenses, including, but not limited to, due diligence, accounting and
legal expenses.

In the three months ended September 30, 2001, we sold 6,676 shares of common
stock pursuant to the provisions of Regulation S resulting in gross proceeds of
$5,600. We relied on the following facts:

- The offer was made in an offshore transaction because, at the time the buy
order was originated, we reasonably believed the buyer was outside the
United States.
- No directed selling efforts were made in the United States in connection
with the offer.

We utilized the services of finders in placing the 6,676 shares of common stock.
We did not utilize the services of brokers or underwriters. The Offering was
self-underwritten. The Offering expenses were approximately 15% of the gross
Offering proceeds. The balance of the Offering expenses were related to general
sales expenses, including, but not limited to, due diligence, accounting and
legal expenses.

In August, 2001 we commenced a convertible debenture offering. The placement
agent was May Group, Inc. May Davis received 200,000 shares of common stock
pursuant to Regulation D and cash consideration as a fee. These sales were
undertaken under Rule 506 of Regulation D under the Securities Act of 1933, as
amended, by the fact that:

- the sales were made to a sophisticated or accredited investors, as defined
in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

During the period between June 2001 and December 2001, we sold Convertible
Debentures to the following persons in the amounts indicated below.

Number Amount Name of Bondholder
- ------ ------ ------------------
001 $10,000 Bonnie Goldstein
002 $10,000 Neil Jones
003 $20,000 Terry and Carol Conner
004 $10,000 Robert Dutch
005 $20,000 Howard and Elaine Bull
006 $50,000 Daniel Grillo
007 $10,000 Jon Cummings
008 $10,000 Richard Dredge
009 $10,000 Seymour Niesen
010 $10,000 John Williams
011 $10,000 Koenraad Blot
012 $10,000 Steven and Mary LeMott
013 $10,000 Andrew Geiss
014 $10,000 John and Dianna McNeish
015 $10,000 Carl Ziegler
016 $10,000 Michael Beecher
017 $10,000 Michael Dahlquist
018 $10,000 Carl Hoehner
019 $20,000 Vernon Koto
020 $20,000 Kenneth E. Rogers
021 $10,000 John Bollinger
022 $10,000 Richard Blue
023 $10,000 Frank Damato
----------
$310,000

Second Tranche

20,000 Craig Wexler
30,000 Lawrence Wexler
12,500 Andrew Smith
12,500 Global Coast Insurance
95,000 Charles Mangione
----------
$170,000

We have also sold debentures to the following investors in the following
amounts.

180,000 David Wykoff
60,000 Dutchess Private Equities Fund, L.P.
---------
$240,000

These sales were undertaken under Rule 506 of Regulation D under the Securities
Act of 1933, as amended, by the fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

For the 18 month period from January 2001 through June 2002, we issued to VLK
Capital Corp. 5,909,333 shares of common stock for managerial services valued at
$.902 per share, as amended. Of these shares, 783,333 shares were subsequently
transferred to Greg Mardock, our president at that time, and an additional
2,646,000 were transferred to Edward Fearon, an officer and director of
Primavera Corporation and North Texas Circuit Board, and 500,000 were
transferred to Raymond Craig, a shareholder. These sales were undertaken under
Rule 506 of Regulation D under the Securities Act of 1933, as amended, by the
fact that:

- the sales were made to a sophisticated or accredited investors, as defined
in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

During the fourth quarter of 2001 we issued additional shares of Network
Installation common stock to:

- Ten shareholders purchased shares 44,344 at $0.65 per share
- Three shareholders purchased 12,337 shares at $0.75 per share
- One shareholder purchased 4,000 shares at $0.55 per share

Additionally, we issued seven shareholders 100,028 shares for services and one
additional shareholder 600,000 shares collected against a loan.

These sales during the forth quarter of 2001 described in the immediately
preceding paragraphs were undertaken under Rule 506 of Regulation D under the
Securities Act of 1933, as amended, by the fact that:

- the sales were made to a sophisticated or accredited investors, as defined
in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

During the forth quarter of 2001 we issued additional shares without
registration under the Act in reliance on the exemption from registration
provided by Regulation S under the Act, as follows:

- One shareholder purchased 249,920 shares at $.202 per share - One
shareholder purchased 69,709 shares at $0.21 per share - One shareholder
purchased 130,000 shares at $0.35 per share

These sales constitute a total of 442,629 shares issued in reliance on
Regulation S. We relied on the following facts:

In the 12 months ended December 31, 2002 and pursuant to Regulation D or
Regulation S we issued a total of 67,725,390 shares of which 11,317,851 shares
were sold for cash. The breakdown of shares sold for cash for the 12 Months
ended December 31, 2002 are as follows:

Quarter Amount of Securities Regulation Gross Proceeds

1st 1,900,634 S $284,378.12
1st 232,000 D $ 58,000.00
2nd 3,482,396 S $462,813.61
2nd 59,452 D $ 19,060.00
3rd 194,120 S $ 13,879.24
3rd 150,000 D $ 3,500.00
4th 5,299,249 S $ 23,591.57
---------- -----------
Total 11,317,851 $865,222.54
========== ===========

The sales described in the immediately preceding chart as being sold pursuant to
Regulation D were undertaken under Rule 506 of Regulation D under the Securities
Act of 1933, as amended, by the fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

For the sales described in the preceding chart as being sold pursuant to
Regulation S, we relied on the following facts:

During the first quarter ended March 31, 2002, we sold 10,679 shares for cash in
the amount of $343,358. We issued 1,133 shares of common stock for consulting
services amounting $113,000 to Atlantis Partners. We issued 1,050 shares of
common stock for compensation amounting $92,400. We issued 4,250 shares of
common stock to Western Cottonwood Corporation as collateral against a debt of
$283,700.

The sales described in the immediately preceding paragraph were undertaken under
Rule 506 of Regulation D under the Securities Act of 1933, as amended, by the
fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

During the second quarter ended June 30, 2002, we sold 18,376 shares for cash in
the amount of $480,833. We issued 10,413 shares of common stock for consulting
services valued at $479,644. We also settled debts amounting to $259,200 by
issuing 6,081 shares of common stock valued at $431,644.

The sales described in the immediately preceding paragraph were undertaken under
Rule 506 of Regulation D under the Securities Act of 1933, as amended, by the
fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

During the third quarter ended September 30, 2002, we issued 9,375 shares for
finder's fee related to sale of common stock. The shares issued for finders'
fees were valued at $93,750. Included in those shares were 7,500 shares valued
at $75,000 to Atlantis Partners. We issued 10,000 shares issued at $100,000 to
an investor for a price difference adjustment. The price difference adjustment
is the excess amount received from an investor on the sale of common stock over
the market price. We issued 175 shares for consulting services valued at $3,233.
We issued 7,500 shares to Greg Mardock, our President at that time as
compensation, and valued at $138,596. We issued 10,076 shares of common stock
valued on conversion of debentures at $140,527. We also settled a debt of
$100,000 payable to Western Cottonwood Corporation, by issuing 25000 shares
valued at $250,000 resulting in a loss of $150,000 on settlement of the debt.
During the three month period ended September 30, 2002, we sold 1,721 shares of
common stock for cash in the amount of $17,088.

The sales described in the immediately preceding paragraph were undertaken under
Rule 506 of Regulation D under the Securities Act of 1933, as amended, by the
fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

During the fourth quarter ended December 31, 2002, we issued common stock to
various parties as per follows:

a) On October 7, 2002, 51,361 shares of common stock valued at $70,449 were
issued in the name of Delaware Charter Guarantee and Trust, FBO Greg Mardock,
our President at that time, in exchange for Promissory Notes of $64,588
principal amount and interest of $5,861.

b) On October 8, 2002, Edward R. Fearon, the former President of Primavera and
Escamilla Capital Corporation received 6,250 and 8,750 shares respectively,
valued at a total of $60,000.

c) On October 8, 2002, Edward R. Fearon, the former President of Primavera was
issued 15,000 shares of common stock valued at $60,000 for consulting services
performed during the year ended December 31, 2002.

d) On November 5, 2002 Western Cottonwood Corp was issued 75,000 shares of
common stock valued at $300,000 in exchange for a debt of $300,000.

e) During the three month ended December 31, 2002, we settled debentures
amounting $50,800 by issuing 34,940 shares of common stock valued at $50,800.

f) We issued 5,000 shares to a consultant valued at $20,000 for same amount of
services performed during the year ended December 31, 2002.

g) During the three months ended December 31, 2002, we issued 26,496 shares of
common stock for cash amounting $23,882.

The sales during the fourth quarter ended December 31, 2002 were undertaken
under Rule 506 of Regulation D under the Securities Act of 1933, as amended, by
the fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

During the year ended December 31, 2002, we issued debentures amounting
$720,000, carrying an interest rate of 6% per annum, due in August 2003. During
the three month period ended December 31, 2002, we issued debentures amounting
to $134,000.

The sales of the debentures described in the immediately preceding paragraph
were undertaken under Rule 506 of Regulation D under the Securities Act of 1933,
as amended, by the fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

During the year ended December 31, 2002, we issued 45,016 shares of common stock
in conversion of debentures amounting to $191,327.

The sales of the shares of common stock described in the immediately preceding
paragraph were undertaken under Rule 506 of Regulation D under the Securities
Act of 1933, as amended, by the fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

In April 2003, in connection with the rescission agreement, we issued
convertible debentures of $140,000 to various investors.

The sales of the convertible debentures described in the immediately preceding
paragraph were undertaken under Rule 506 of Regulation D under the Securities
Act of 1933, as amended, by the fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

In 2002, we issued convertible promissory notes of $59,200 due on March 1, 2004
and $100,000 due on April 1, 2004, carrying an interest rate of 10% per annum.

The sales of the convertible promissory notes described in the immediately
preceding paragraph were undertaken under Rule 506 of Regulation D under the
Securities Act of 1933, as amended, by the fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

During the six month period ended June 30, 2003, we issued common stock as
follows:

- 75,000 shares of common stock were issued to an entity related through
common officer at that time, for consulting fees, amounting to $3,750; and

7,382,000 shares of common stock valued at $1,107,300 were issued for
acquisition of its subsidiary, Network Installation Corporation.

The sales of the common stock during the six month period ended June 30, 2003,
described in the immediately preceding paragraph, were undertaken under Rule 506
of Regulation D under the Securities Act of 1933, as amended, by the fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

On April 7, 2003, we issued 800,000 shares of common stock to a major
shareholder as inducement for debenture amounting $80,000.

On April 7, 2003, we issued 250,000 shares of common stock to an unrelated party
as inducement for debenture amounting $25,000.

On April 7, 2003, we issued debentures amounting $105,000, carrying an interest
rate of 6% per annum, due in April 2008 to Dutchess Private Equities Fund, L.P.

In April 2003, we issued 700,000 shares of common stock to the major
shareholder for consulting services amounting $105,000.

We issued 690,000 shares of common stock as a part of restructuring on April 9,
2003.

The sales of the common stock and debentures in April 2003 were undertaken under
Rule 506 of Regulation D under the Securities Act of 1933, as amended, by the
fact that:

- the sales were made to a sophisticated or accredited investors,
as defined in Rule 502;

- at a reasonable time prior to the sale of securities, we advised each
purchaser of the limitations on resale in the manner contained in Rule
502(d)2;

- neither we nor any person acting on our behalf sold the securities by any
form of general solicitation or general advertising; and

- we exercised reasonable care to assure that each purchaser of the
securities is not an underwriter within the meaning of Section 2(11) of the
Securities Act of 1933 in compliance with Rule 502(d).

EXHIBITS

EXHIBIT INDEX

NUMBER DESCRIPTION

3.1 Articles of Incorporation filed as Exhibit 3.1 to the Company's
Registration Statement on Form 10SB filed on March 5th, 1999 and
incorporated herein by reference.

3.2 Certificate of Amendment to Article of Incorporation filed as Exhibit 3.3
to the Company's Form 10-KSB on April 15, 2003.

3.3 By-laws filed as Exhibit 3.2 to the Company's Registration Statement on
Form 10SB filed on March 5th, 1999 and incorporated herein by reference.

3.4 Certificate of Amendment to the Certificate of Incorporation of Flexxtech
Corporation filed as Exhibit 4.1 to the Company's Form 10-QSB dated
November 13, 2003 and incorporated herein by reference.

4.1 Warrant #101 issued to C.C.R.I. Corp. on September 29, 2003.

4.2 Warrant #102 issued to C.C.R.I. Corp. on September 29, 2003.

5.1* Opinion of counsel

10.1 Consulting Agreement between the Company and Dutchess Advisors, LLC dated
April 1, 2003 filed as Exhibit 10.3 to the Company's Form 8-K on April 23,
2003 and incorporated herein by reference.

10.2 Reseller Agreement between Vivato, Inc. and the Company dated August 14,
2002 filed as Exhibit 10.1 to the Company's Form 10-QSB dated November 13,
2003 and incorporated herein by reference.

10.3 Motorola Reseller Agreement between Motorola, Inc. and the Company dated
August 18, 2003 filed as Exhibit 10.2 to the Company's Form 10-QSB dated
November 13, 2003 and incorporated herein by reference.

10.4 Short Term Rental Agreement between Vidcon Solutions Group, Inc. and the
Company dated February 5, 2003 filed as Exhibit 10.3 to the Company's Form
10-QSB dated November 13, 2003 and incorporated herein by reference.

10.5 Restructuring and Release Agreement Dutchess Advisors LLC, Dutchess Capital
Management LLC, Michael Novielli, Western Cottonwood Corporation, Atlantis
Partners, Inc., John Freeland, Greg Mardock, VLK Capital Corp. and the
Company dated April 9, 2003 filed as Exhibit 10.2 to the Company's Form 8-K
filed on April 23, 2003 and incorporated herein by reference.

10.6 Stock Purchase Agreement between Michael Cummings and the Company dated May
16, 2003 filed as Exhibit 2.1 to the Company's Form 8-K filed on June 13,
2003 and incorporated herein by reference.

10.7 Investment Agreement between the Company and Preston Capital Partner, LLC
dated January 21, 2004.

10.8 Registration Rights Agreement between the Company and Preston Capital
Partners, LLC dated January 21, 2004.

10.9 Placement Agent Agreement between the Company and Park Capital
Securities, LLC dated January 21, 2004.

21.1** List of Subsidiaries

23.1 Consent of independent auditors

23.2* Consent of counsel (contained in Exhibit 5.1)

* To be filed by amendment
** Previously filed

28. UNDERTAKINGS

The Registrant hereby undertakes that it will:

(1) File, during any period in which it offers or sells securities, a
post-effective amendment to this registration statement to:

(i) Include any prospectus required by Section 10(a)(3) of the Securities Act;

(ii) Reflect in the prospectus any facts of events which, individually or
together, represent a fundamental change in the information in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
offering price set forth in the "Calculation of Registration Fee" table in the
effective registration statement; and

(iii) Include any additional or changed material information on the plan of
distribution.

(2) For determining any liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the initial bona
fide offering.

(3) File a post-effective amendment to remove from registration any of the
securities that remain unsold at the end of the offering.

Insofar as indemnification for liabilities arising under the Securities Act of
1933 (the "Act") may be permitted to directors, officers, and controlling
persons of the small business issuer pursuant to the foregoing provisions, or
otherwise, the small business issuer has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable.

In the event that a claim for indemnification against such liabilities (other
than the payment by the small business issuer of expenses incurred or paid by a
director, officer or controlling person of the small business issuer in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the small business issuer will, unless in the opinion of its counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.

(1) For determining any liability under the Securities Act, treat the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant under Rule 424(b)(1), or (4) or 497(h) under
the Securities Act as part of this registration statement as of the time the
Commission declared it effective.

(2) For determining any liability under the Securities Act, treat each
post-effective amendment that contains a form of prospectus as a new
registration statement for the securities offered in the registration statement,
and that offering of the securities at that time as the initial bona fide
offering of those securities.

SIGNATURES

In accordance with the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements of filing on Form SB-2 and authorized this Registration
Statement to be signed on its behalf by the undersigned, in the State of
California, on January 21, 2004.

NETWORK INSTALLATION CORPORATION

By:/s/ Michael Cummings
-------------------------------------
Michael Cummings
Chief Executive Officer and Director

Signature Date

/s/ Michael Cummings January 21, 2004
- ---------------------------------------------
Michael Cummings, Chief Executive Officer
and Director

/s/ Michael Novielli January 21, 2004
- ----------------------------------------------
Michael Novielli, Director
(Principal Accounting Officer and
Principal Financial Officer)

/s/ Douglas Leighton January 21, 2004
- ----------------------------------------------
Douglas Leighton, Director

/s/ Theodore J. Smith, Jr. January 21, 2004
- ----------------------------------------------
Theodore J. Smith, Jr., Director