F-7

NOTES TO FINANCIAL STATEMENTS

1. ORGANIZATION AND BUSINESS

Planet Resources, Inc. (“Planet”) was incorporated in the State of Delaware on March 26, 1999, as a wholly owned subsidiary of Internet Law Library, Inc. (“Internet Law”). Planet was formed in connection with the execution of an Agreement and Plan of Distribution (the ‘Distribution Agreement’) by and between Internet Law and Planet dated March 25, 1999. Under terms of the Distribution Agreement, Internet Law will transfer certain of its assets to Planet including mineral rights and related equipment and shares and options of Planet will be distributed to the Internet Law stockholders in a tax-free exchange. Planet intends to become a public company upon the effectiveness of a registration statement.

Planet has no commercial operations although management is evaluating various future operating strategies, including the merger of Planet with operating entities. Planet has incurred minimal expenses for professional and other costs, which have been reflected on the accompanying statement of operations.

Basic Loss Per Share – Basis loss per share of common stock is based on the weighted average number of shares outstanding during the period.

Income Taxes - Planet has had losses since inception and therefore has not been subject to federal income taxes. As of May 31, 2000, Planet had accumulated net operating loss carryforwards for income tax purposes of approximately $27,000. These carryforwards begin to expire in 2019. The Tax Reform Act of 1986 provided for an annual limitation on the use of net operating loss and tax credit carryforwards following certain ownership changes that limit Planet’s ability to utilize these carryforwards. Additionally, because U.S. tax laws limit the time during which net operating loss and tax credit carryforwards may be applied against future taxable income and tax liabilities, Planet may not be able to take full advantage of its net operating loss and tax credits for federal income tax purposes. Since Planet has had net operating loss carryforwards since inception and there is no assurance of future taxable income, a valuation allowance has been established to fully offset the deferred tax assets of approximately $9,000.

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.

Capital Stock. On May 15, 2000, the Company filed with the Secretary of State of Delaware a Certificate of Correction (the “Certificate”) to correct an error in the Certificate of Incorporation of Planet Resources, Inc. filed in the Office of the Secretary of State of Delaware on March 26, 1999. This Certificate corrected the previous Certificate of Incorporation as follows: the aggregate number of shares of all classes of capital stock which the Corporation has the authority to issue is 2,010,000 of which 2,000,000 are to be shares of common stock, $.001 par value per share, and of which 10,000 are to be shares of serial preferred stock, $.001 par value per share. The original Certificate of Incorporation authorized the Company to issue 26,000,000 of all classes of capital stock of which 25,000,000 were shares of common stock, $.001 par value per share, and of which 1,000,000 were shares of serial preferred stock, $.001 par value per share all of which have been disclosed in previously issued financial statements.

Contemporaneously with the filing of the Certificate, the Board of Directors of the Company authorized an increase in the number of outstanding common shares from 1,000 to 100,000 in order to effectuate what is generally referred to as a “forward split.”

2. PROFORMA EFFECTS OF DISTRIBUTION AGREEMENT

                                                         Actual       Proforma
                                                         ------       --------
                                     ASSETS
                                     ------

CURRENT ASSETS
  Cash                                                   $ 9,197       $ 9,197
                                                    -------------  ------------
                                                    -------------  ------------

      Total current assets                                 9,197         9,197
                                                    -------------  ------------
                                                    -------------  ------------

  MINERAL RIGHTS                                             N/A             0
                                                    -------------  ------------

TOTAL ASSETS                                             $ 9,197       $ 9,197
                                                    =============  ============
                                                    =============  ============

                    LIABILITIES AND STOCKHOLDERS' EQUITY
                    ------------------------------------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
  Preferred stock - par value $.001; 10,000 shares
   authorized, none issued or outstanding                $   -0-       $   -0-
  Common stock - par value $.001; 2,000,000 shares
   authorized, 100,000 actual and 2,000,000 proforma
   shares issued and outstanding                             100         2,000
  Additional paid-in capital                              36,175        34,275
  Retained earnings (deficit)                           (27,078)      (27,078)
                                                    -------------  ------------
                                                    -------------  ------------

      Total stockholders' equity                           9,197         9,197
                                                    -------------  ------------
                                                    -------------  ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY               $ 9,197       $ 9,197
                                                     =============  ============

            SEC Registration Fee*...................     $30
            Legal Fees and Expenses*..................15,000
            Accounting Fees and Expenses*...........   2,500
            Financial Printing*.....................   5,000
            Transfer Agent Fees*....................   1,500
            Blue Sky Fees and Expenses*.............   3,000
            Miscellaneous*..........................   2,500
                                                     --------
                                                     --------
            TOTAL**................................. $29,530
                                                     ========

   Exhibit No.    Description of Document
   -----------   -------------------------
   1.1  Agreement and Plan of Distribution**
   3.1  Certification of Incorporation**
   3.1.1  Amendment of Certificate of Incorporation changing name from New Planet to
        Planet.**
   3.2  By-Laws**
   4.1  Common Stock Option Agreement**
   4.2  Form of Common Stock Option Certificate (included as an exhibit to Exhibit 4.1)**
   4.3  Form of Common Stock Certificate**
   5.1  Opinion of Sonfield and Sonfield*
   8.1  Opinion of Sonfield and Sonfield with respect to tax matters (included as part of
        Exhibit 5.1).*
   10.1  Planet Incentive Stock Option Plan**
   10.2  Indemnification Agreement between Planet and A.W.  Dugan**
   10.3  Indemnification Agreement between Planet and Jacque N.  York**
   10.4  Indemnification Agreement between Planet and Michael K. Branstetter**
   10.5  Indemnification Agreement between Planet and Danyel Owens**
   10.6  Indemnification Agreement between Planet and Internet Law Library, Inc. under its
        former name**
   10.7  Lease Agreement with City of Mullan, Idaho (included as an exhibit to Exhibit
        10.8)**
   10.8  Form of Assignment of Mineral Lease**
10.9  Form of Mineral Deed**
10.10   Opinion of Geologist as to the Potential Value of the Planet Mineral Property*
   23.1  Consent of Harper and Pearson Company*
23.2  Consent of Sonfield and Sonfield*
23.3  Consulting Agreement by and between Genesis Financial Group, L.L.C. and Planet
        Resources, Inc.**
23.4  Extension to Consulting Agreement by and between Genesis Financial Group, L.L.C. and
        Planet Resources, Inc.*

LEON SONFIELD (1865-1934)          ATTORNEYS AT LAW                     NEW YORK
GEORGE M. SONFIELD (1899-1967)                                       LOS ANGELES
ROBERT L. SONFIELD (1893-1972)                                  WASHINGTON, D.C.
   ____________________         770 SOUTH POST OAK LANE
                                 HOUSTON, TEXAS 77056
FRANKLIN  D.  ROOSEVELT,  JR.
(1914-1988)                    www.sonfield.com

                                   Telecopier (713)
ROBERT L. SONFIELD, JR.                877-1547
Managing Director                        ____
                               Telephone (713) 877-8333