Orcatron is expanding its product line into the retail market with a communication system that is expected to to be in high demand in the new Millennium. The Company's latest product the Scubaphone SPORT has been exhibited at trade shows in New Orleans and Singapore and, in both instances, won the "hot product" award.

The Scubaphone SPORT, a digital signal processor based, low cost product is targeted at retail dive shops and diving resorts. The Scubaphone SPORT enables any number of divers to communicate with each other enhancing the enjoyment and safety of the diving experience. With a range of 50m to 500m, this product provides voice communication of a quality comparable to Orcatron's professional line.

Independent market research, most recently from Business Consulting Services Ltd.,of Vancouver, B.C. Canada reports that the majority of divers, diving instructors and resort owners surveyed in Canada., Florida, Texas and California indicated a high level of buying intention. The study predicts a strong retail market for the Scubaphone SPORT, priced in the US $500 range. The study also suggests that recreational scuba diving is a rapidly growing sport. With approximately 3,300,000 active recreational divers in the United States alone, 6,900,000 worldwide, and annual growth rate of 9% per annum, the recreational market offers a significant opportunity for those companies that can provide a high quality communications product at an affordable price. The revenue projection for the Scubaphone SPORT assumes an explosive growth in sales to 100,000 units per annum by 2003 which represents a 2% annual penetration of the active diver population, leaving significant upside to future growth.