Six Months Ended        Period from Inception
                                                                                June 30,            (October 13, 1998) to
                                                                       2000                1999          June 30, 2000
                                                                    (unaudited)        (unaudited)        (unaudited)
                                                                   ------------------------------------------------------
Cash flows from operating activities
   Net loss                                                        $(12,530,217)      $   (795,271)      $(20,491,503)
   Adjustments to reconcile net loss to net cash and cash
     equivalents provided by (used in) operating activities:
      Non-cash items resulting from issuance of common stock,
         stock options and warrants                                   3,235,998                400          3,236,006
      Depreciation and amortization                                     230,157             12,290            230,150
      Allowance for accounts receivable                                  16,833               --               16,833
      Changes in:
         Inventory                                                         --                 --              (11,883)
         Accounts receivable                                           (277,818)              --             (277,818)
         Production costs                                            (1,086,186)              --           (1,086,186)
         Prepaid expenses and other current assets                     (105,690)            (2,500)          (116,140)
         Deposits                                                       (84,668)              --             (132,132)
         Debt offering costs                                               --                 --                 --
         Accounts payable                                               803,862             75,464            976,129
                                                                   --------------------------------------------------
Net cash used in operating activities                                (9,797,729)          (709,617)       (17,656,544)
                                                                   --------------------------------------------------
Cash flows from investing activities
   Purchase of property and equipment                                (1,022,111)          (122,613)        (1,624,121)
   Licensing rights                                                        --                 --             (173,686)
   Application for trademarks                                           (86,285)            (6,638)          (189,921)
                                                                   --------------------------------------------------
Net cash used in investing activities                                (1,108,396)          (129,251)        (1,987,728)
                                                                   --------------------------------------------------
Cash flows from financing activities
   Debt offering costs                                                  245,030               --              227,274
   Proceeds from notes and loans payable                              3,230,000             30,000          3,730,000
   Repayment of notes and loans payable                              (1,175,000)              --           (1,175,000)
   Proceeds from convertible note                                     2,500,000               --                 --
   Payments under capital lease obligations                             (28,789)            71,815             98,054
   Receipt of subscriptions                                                --              564,000          2,500,000
   Issuance of preferred stock                                             --                 --            5,000,002
   Proceeds from issuance of common stock                             4,263,831            275,000          9,413,051
                                                                   --------------------------------------------------
Net cash provided by financing activities:                            9,035,072            940,815         19,793,381
                                                                   --------------------------------------------------
Increase (decrease) in cash and cash equivalents                     (1,871,053)           101,947            149,109

Cash and cash equivalents, beginning of period                        2,020,162             21,276               --
                                                                   --------------------------------------------------
Cash and cash equivalents, end of period                           $    149,109       $    123,223       $    149,109
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