SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

[X]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
         EXCHANGE ACT OF 1934
                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999

[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
         EXCHANGE ACT OF 1934

                         Commission file number: 0-23871

                           BCS INVESTMENT CORPORATION
                 (Name of small business issuer in its charter)

                    COLORADO                          84-1434323
         (State or other jurisdiction of           (I.R.S. Employer
          incorporation or organization)          Identification No.)


    1708 DOLPHIN AVENUE, SUITE 400, KELOWNA, BRITISH COLUMBIA, V1Y 9S4 CANADA
         (Address of principal executive offices)          (Zip Code)


         Issuer's telephone number, including area code: (250) 717-8966

       Securities registered under Section 12(b) of the Exchange Act: NONE

         Securities registered under Section 12(g) of the Exchange Act:

                                  COMMON STOCK
                                  NO PAR VALUE

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


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

            Issuer's revenues for its most recent fiscal year. $8,847

               Aggregate market value of the voting stock held by
 non-affiliates of the registrant as of April 11, 2000: $2,242,267 (See Item 5)

    Number of shares outstanding of registrant's Common Stock, no par value,
                 as of April 11, 2000: 14,046,080 (See Item 11)

                    Documents incorporated by reference: NONE

       Transitional Small Business Disclosure Format (check one): Yes ___ No _X_


Exhibit index on consecutive page 21                         Page 1 of 51 Pages

                                       1
<PAGE>



                                     PART I

ITEM 1.          DESCRIPTION OF BUSINESS.

The  Company  was  incorporated  under  the  laws of the  State of  Colorado  on
September 19, 1997. From its inception to June 18, 1999, the Company operated as
a "shell"  company and its business  plan was to seek out and take  advantage of
business  opportunities  that may have the potential for profit,  and to acquire
such businesses, or a controlling interest therein.

On June 18,  1999,  a change in control of the Company  occurred in  conjunction
with closing under a  Reorganization  and Stock Purchase  Agreement  between the
Company  and  Workfire.com,  a Nevada  corporation  ("Workfire-Nevada").  As the
result of the Reorganization and Stock Purchase Agreement,  the Company acquired
89.00% of the issued and outstanding shares of Workfire-Nevada.

Prior to closing, the Company adopted the assumed name of Workfire.com,  Inc. At
a  shareholders'  meeting  held July 12,  1999,  the name  change  was  formally
approved with the shareholders  approving  Articles of Amendment to the Articles
of Incorporation of the Company.

Workfire-Nevada  is  completing a  distributed  Internet  performance  enhancing
system.  Workfire-Nevada's  proprietary and robust system is intended to provide
Internet users and content providers with products which improve the performance
and  usability of the  Internet.  Workfire-Nevada's  Genetic  Caching  system is
intended to provide  performance  improvements  and  bandwidth  savings  through
better  management  of the  transmission  of  data  between  a web  site  and an
end-user.  The Genetic Caching server software will be marketed to large content
providers who are looking for a competitive edge and are motivated to make their
customers'  browsing  experience  as enjoyable  as  possible.  Workfire-Nevada's
client software will be marketed to all Internet users.  Workfire-Nevada intends
to segment the market between different  Internet access methods so the benefits
of the technology can be clearly presented to each segment.

In connection with an offer to provide funding to  Workfire-Nevada,  on November
5,  1999,  the Board of  Directors  of the  Company  approved  a  resolution  to
distribute all of the shares of Workfire-Nevada  owned by the Company,  pro rata
to the Company's shareholders (the "Share Distribution"). The Share Distribution
was made to  shareholders  of record as at the close of business on November 12,
1999.

On  February  7,  2000,  the  Company's  shareholders  approved  a change of the
Company's  name  to  BCS  Investment  Corporation.  As a  result  of  the  Share
Distribution,  the  Company  has no  subsidiary,  no current  operations  and no
material assets. As such, the Company can be defined as a "shell" company, whose
sole purpose at this time is to locate and  consummate  a merger or  acquisition
with a private  entity.  The Board of  Directors  of the  Company has elected to
commence  implementation of the Company's principal business purpose,  described
below under "Plan of Operation."

INVESTMENT COMPANY ACT OF 1940

Although the Company will be subject to regulation  under the  Securities Act of
1933, as amended (the  "Securities  Act"),  and the  Securities  Exchange Act of
1934, as amended (the "Exchange Act"),  management believes the Company will not
be subject to regulation  under the  Investment  Company Act of 1940, as amended
(the  "Investment  Company Act"),  insofar as the Company will not be engaged in
the  business of investing  or trading in  securities.  In the event the Company
engages in business  combinations  which result in the Company  holding  passive
investment  interests in a number of entities,  the Company  could be subject to
regulation under the Investment Company Act. In such event, the Company would be
required  to register  as an  investment  company and could be expected to incur
significant  registration  and  compliance  costs.  The Company has  obtained no
formal  determination  from the  Securities  and Exchange  Commission  as to the
status of the Company  under the  Investment  Company Act and,  consequently,  a
violation   of  such  Act  could   subject  the  Company  to  material   adverse
consequences.

                                       2
<PAGE>

INVESTMENT ADVISERS ACT OF 1940

Under Section 202(a)(11) of the Investment  Advisers Act of 1940, as amended, an
"investment  adviser"  means any person who,  for  compensation,  engages in the
business  of  advising  others,  either  directly  or  through  publications  or
writings,  as to the value of securities or as to the  advisability of investing
in, purchasing, or selling securities, or who, for compensation and as part of a
regular  business,   issues  or  promulgates   analyses  or  reports  concerning
securities.  The  Company  shall  only  seek to  locate  a  suitable  merger  of
acquisition candidate, and does not intend to engage in the business of advising
others in investment matters for a fee or otherwise.

FORWARD LOOKING STATEMENTS

Pursuant to the "safe harbor"  provisions of the Private  Securities  Litigation
Reform Act of 1995 (the "PSLRA"), the Company cautions readers regarding forward
looking  statements  found in the  following  discussion  and  elsewhere in this
report  and in any other  statement  made by, or on the  behalf of the  Company,
whether or not in future filings with the  Securities  and Exchange  Commission.
Forward  looking  statements are statements not based on historical  information
and which relate to future  operations,  strategies,  financial results or other
developments.  Forward looking  statements are necessarily  based upon estimates
and assumptions that are inherently  subject to significant  business,  economic
and competitive  uncertainties and  contingencies,  many of which are beyond the
Company's control and many of which, with respect to future business  decisions,
are subject to change.  These  uncertainties and contingencies can affect actual
results and could cause actual results to differ materially from those expressed
in any  forward  looking  statements  made by or on behalf of the  Company.  The
Company disclaims any obligation to update forward looking statements.

PLAN OF OPERATION

The Company  intends to seek to acquire  assets or shares of an entity  actively
engaged in a business that generates  revenues,  in exchange for its securities.
The Company  has not  identified  a  particular  acquisition  target and has not
entered into any negotiations regarding such an acquisition.  Management intends
to contact investment bankers, corporate financial analysts, attorneys and other
investment industry  professionals  through various media. None of the Company's
officers,  directors,  promoters or affiliates  have engaged in any  preliminary
contact or discussions with any  representative  of any other company  regarding
the  possibility  of an acquisition or merger between the Company and such other
company as of the date of this report.

Depending  upon  the  nature  of  the  relevant  business  opportunity  and  the
applicable  state  statutes  governing  the manner in which the  transaction  is
structured,  the Company's  Board of Directors  expects that it will provide the
Company's  shareholders  with  complete  disclosure  documentation  concerning a
potential  business  opportunity  and the  structure  of the  proposed  business
combination prior to consummation. Such disclosure is expected to be in the form
of a proxy, information statement, or report.

While such disclosure may include audited financial  statements of such a target
entity,  there is no assurance that such audited  financial  statements  will be
available.  The Board of Directors does intend to obtain  certain  assurances of
value of the target entity's  assets prior to  consummating  such a transaction,
with further  assurances  that audited  financial  statements  would be provided
within sixty days after closing.  Closing documents will include representations
that the value of the assets  conveyed to or otherwise so  transferred  will not
materially differ from the  representations  included in such closing documents,
or the transaction will be voidable.

Due to the  Company's  intent  to  remain  a shell  company  until a  merger  or
acquisition   candidate  is  identified,   it  is  anticipated   that  its  cash
requirements  will be minimal,  and that all  necessary  capital,  to the extent
required,  will be provided by the  directors or officers.  The Company does not
anticipate  that  it will  have  to  raise  capital  or  acquire  any  plant  or
significant  equipment in the next twelve months, unless a merger or acquisition
target is identified.

                                       3
<PAGE>

GENERAL BUSINESS PLAN

The  Company's  purpose  is to  seek,  investigate  and,  if such  investigation
warrants,  acquire an  interest  in business  opportunities  presented  to it by
persons  or firms who or which  desire to seek the  perceived  advantages  of an
Exchange Act registered corporation. The Company will not restrict its search to
any specific business,  industry,  or geographical  location and the Company may
participate  in a  business  venture  of  virtually  any  kind or  nature.  This
discussion of the proposed business is purposefully  general and is not meant to
be restrictive of the Company's virtually unlimited discretion to search for and
enter into potential business opportunities.  Management anticipates that it may
be able to  participate  in only one  potential  business  venture  because  the
Company  has  nominal  assets  and  limited  financial  resources.  This lack of
diversification  should be considered a substantial  risk to shareholders of the
Company because it will not permit the Company to offset  potential  losses from
one venture against gains from another.

The Company may seek a business  opportunity  with  entities  that have recently
commenced operations, or that wish to utilize the public marketplace in order to
raise  additional  capital in order to expand into new  products or markets,  to
develop a new product or service, or for other corporate  purposes.  The Company
may acquire assets and establish wholly-owned subsidiaries in various businesses
or acquire existing businesses as subsidiaries.

Management  anticipates that the selection of a business opportunity in which to
participate  will be  complex  and  extremely  risky.  Due to  general  economic
conditions,  rapid  technological  advances  being made in some  industries  and
shortages  of available  capital,  management  believes  that there are numerous
firms seeking the perceived benefits of a publicly registered corporation.  Such
perceived  benefits may include,  among other things,  facilitating or improving
the  terms  on  which  additional  equity  financing  may be  sought,  providing
liquidity for incentive stock options or similar benefits to key employees,  and
providing  liquidity  (subject to restrictions  of applicable  statutes) for all
shareholders.  Potentially,  available business  opportunities may occur in many
different  industries  and at various stages of  development,  all of which will
make  the  task of  comparative  investigation  and  analysis  of such  business
opportunities extremely difficult and complex.

The Company has, and will continue to have, no capital with which to provide the
owners of business  opportunities  with any  significant  cash or other  assets.
However,  management  believes  the  Company  will be able to  offer  owners  of
acquisition  candidates  the  opportunity  to  acquire a  controlling  ownership
interest in a publicly  registered  company without  incurring the cost and time
required  to conduct  an initial  public  offering.  The owners of the  business
opportunities  will,  however,  incur  significant legal and accounting costs in
connection with the acquisition of a business  opportunity,  including the costs
of preparing  annual (Form 10-K or 10-KSB),  quarterly (Form 10-Q or 10-QSB) and
current reports (Form 8-K),  agreements and related documents.  The Exchange Act
specifically  requires that any merger or acquisition  candidate comply with all
applicable  reporting  requirements,  which include  providing audited financial
statements  to be  included  within  the  numerous  filings  required  under the
Securities Exchange Act. Nevertheless, the officers and directors of the Company
have not conducted  market research and are not aware of statistical  data which
would support the perceived benefits of a merger or acquisition  transaction for
the owners of a business opportunity.

The analysis of new business  opportunities  will be undertaken by, or under the
supervision  of, the  officers and  directors of the Company,  none of whom is a
professional business analyst.  Management intends to concentrate on identifying
preliminary  prospective  business  opportunities  which may be  brought  to its
attention through present associations of the Company's officers and directors,
or  by  the   Company's   shareholders.   In  analyzing   prospective   business
opportunities, management will consider such matters as the available technical,
financial  and  managerial  resources;   working  capital  and  other  financial
requirements; history of operations, if any; prospects for the future; nature of
present and  expected  competition;  the quality and  experience  of  management
services which may be available and the depth of that management;  the potential
for further research, development, or exploration; specific risk factors not now
foreseeable but which then may be anticipated to impact the proposed  activities
of the Company; the potential for growth or expansion; the potential for profit;
the perceived public recognition of acceptance of products, services, or trades;
name identification;  and other relevant factors.  Officers and directors of the
Company  expect to meet  personally  with  management  and key  personnel of the
business  opportunity  as part of their "due  diligence"  investigation.  To the
extent  possible,  the Company  intends to utilize  written reports and personal
investigations  to evaluate the above  factors.  The Company will not acquire or
merge with any company that cannot provide audited financial statements within a
reasonable period of time after closing of the proposed transaction.

                                       4
<PAGE>

Management of the Company,  while not especially experienced in matters relating
to the new business of the Company,  shall rely upon their own efforts and, to a
much lesser extent, the efforts of the Company's shareholders,  in accomplishing
the business  purposes of the Company.  It is not  anticipated  that any outside
consultants or advisors, except for the Company's legal counsel and accountants,
will be utilized by the Company to effectuate its business purposes. However, if
the  Company  does retain such an outside  consultant  or advisor,  any cash fee
earned   by  such   party   will  most   likely  be  paid  by  the   prospective
merger/acquisition  candidate,  as the  Company has no cash assets with which to
pay such  obligation.  As of the date of this report,  the Company does not have
any  contracts  or  agreements  with  any  outside   consultants  and  none  are
contemplated.

Management  will not restrict  the  Company's  search for any  specific  kind of
firms, but may acquire a venture that is in its preliminary or development stage
or is already operating.  It is impossible to predict at this time the status of
any business in which the Company may become engaged,  in that such business may
need to seek additional capital,  may desire to have its shares publicly traded,
or may seek other perceived advantages which the Company may offer. Furthermore,
management  does not  intend to seek  capital to finance  the  operation  of any
acquired  business  opportunity  until such time as the Company has successfully
consummated a merger or acquisition.

It  is  anticipated  that  the  Company  will  incur  nominal  expenses  in  the
implementation  of its  business  plan.  Because the Company has no capital with
which to pay these anticipated expenses,  present management of the Company will
pay these  charges  with their  personal  funds,  as interest  free loans to the
Company. If additional funding is necessary, management and/or shareholders will
continue to provide capital or arrange for outside  funding.  However,  the only
opportunity  which  management  has to have these  loans  repaid  will be from a
prospective merger or acquisition  candidate.  Management's  agreements with the
Company contain no negative covenants that would impede or prevent  consummation
of a proposed transaction.  There is no assurance, however, that management will
continue to provide capital  indefinitely if a merger candidate cannot be found.
If a merger candidate cannot be found in a reasonable period of time, management
may be required  reconsider  its  business  strategy,  which could result in the
dissolution of the Company.

ACQUISITION OF OPPORTUNITIES

In implementing a structure for a particular business  acquisition,  the Company
may become a party to a merger, consolidation, reorganization, joint venture, or
licensing  agreement with another  corporation  or entity.  The Company may also
acquire  stock or assets  of an  existing  business.  On the  consummation  of a
transaction,  it is probable that the present management and shareholders of the
Company will no longer be in control of the Company. In addition,  the Company's
directors may, as part of the terms of the acquisition  transaction,  resign and
be replaced by new directors without a vote of the Company's shareholders or may
sell  their  stock in the  Company.  Any and all such sales will only be made in
compliance  with the  securities  laws of the United  States and any  applicable
state.

It is anticipated that any securities issued in any such reorganization would be
issued in reliance upon an exemption from registration  under applicable federal
and state  securities  laws.  In some  circumstances,  however,  as a negotiated
element of its  transaction,  the Company may agree to register all or a part of
such securities immediately after the transaction is consummated or at specified
times  thereafter.  If  such  registration  occurs,  of  which  there  can be no
assurance,  it will be undertaken by the surviving  entity after the Company has
successfully  consummated a merger or  acquisition  and the Company is no longer
considered a "shell" company. Until a merger or acquisition is consummated,  the
Company will not attempt to register any additional securities.  The issuance of
substantial  additional  securities  and their  potential  sale into the trading
market may have a depressive effect on the value of the Company's securities.

While the actual  terms of a  transaction  to which the  Company  may be a party
cannot  be  predicted,  it may be  expected  that the  parties  to the  business
transaction  will find it desirable to avoid the creation of a taxable event and
thereby structure the acquisition in a so-called "tax-free" reorganization under
Sections 368(a)(1) or 351 of the Internal Revenue Code (the "Code"). In order to
obtain tax-free  treatment under the Code, it may be necessary for the owners of
the acquired  business to own 80% or more of the voting  stock of the  surviving
entity.  In such event, the shareholders of the Company would retain 20% or less
of the issued and outstanding shares of the surviving entity, which would result
in significant dilution in the equity of such shareholders.

                                       5
<PAGE>


As part of the Company's "due diligence"  investigation,  officers and directors
of the Company will meet personally with management and key personnel, may visit
and inspect material facilities,  obtain independent analysis of verification of
certain information provided,  check references of management and key personnel,
and take other reasonable  investigative measures to the extent of the Company's
limited financial  resources and management  expertise.  The manner in which the
Company  participates  in an  opportunity  will  depend  on  the  nature  of the
opportunity,  the respective needs and desires of the Company and other parties,
the management of the opportunity and the relative  negotiation  strength of the
Company and such other management.

With  respect to any merger or  acquisition  negotiations  with  target  company
management  is expected  to focus on the  percentage  of the  Company  which the
target  company  shareholders  would  acquire  in  exchange  for  all  of  their
shareholdings  in the target company.  Depending upon,  among other things,  the
target company's assets and liabilities,  the Company's shareholders will in all
likelihood  hold a substantially  lesser  percentage  ownership  interest in the
Company  following any merger or  acquisition.  The percentage  ownership may be
subject to  significant  reduction  in the event the  Company  acquires a target
company  with  substantial  assets.  Any merger or  acquisition  effected by the
Company can be expected to have a significant  dilutive effect on the percentage
of shares held by the Company's then shareholders.

The  Company  will  participate  in  a  business   opportunity  only  after  the
negotiation and execution of appropriate written agreements.  Although the terms
of such agreements  cannot be predicted,  generally such agreements will require
some specific representations and warranties by all of the parties, will specify
certain  events of default,  will detail the terms of closing and the conditions
that must be satisfied by each of the parties  prior to and after such  closing,
will outline the manner of bearing costs,  including  costs  associated with the
Company's attorneys and accountants, will set forth remedies on default and will
include miscellaneous other terms.

As stated previously, the Company will not acquire or merge with any entity that
cannot provide  independent  audited  financial  statements  within a reasonable
period of time after closing of the proposed transaction. The Company is subject
to the reporting  requirements of the Securities Exchange Act. Included in these
requirements is the affirmative duty of the Company to file independent  audited
financial statements as part of its Form 8-K to be filed with the Securities and
Exchange Commission upon consummation of a merger or acquisition, as well as the
Company's  audited  financial  statements  included in its annual report on Form
10-K (or 10-KSB, as applicable).  If such audited  financial  statements are not
available  at  closing,  or within  time  parameters  necessary  to  insure  the
Company's  compliance  with the  requirements  of the  Exchange  Act,  or if the
audited financial statements provided do not conform to the representations made
by the candidate to be acquired in the closing documents,  the closing documents
will provide that the proposed transaction will be voidable at the discretion of
the present  management  of the  Company.  If such  transaction  is voided,  the
agreement will also contain a provision  providing for the acquisition entity to
reimburse the Company for all costs associated with the proposed transaction.

YEAR 2000 DISCLOSURE

Many  existing  computer  programs use only two digits to identify a year in the
date field.  These programs were designed and developed without  considering the
impact of the upcoming  change in the century.  If not corrected,  many computer
applications could fail or create erroneous results by or at the year 2000. As a
result,  many companies will be required to undertake  major projects to address
the Year 2000  issue.  Because  the Company  currently  has no material  assets,
including any personal  property such as computers,  it is not anticipated  that
the  Company  will  suffer  any  negative  impact as a result of this  potential
problem.  However,  it is  possible  that  this  issue may have an impact on the
Company after it  consummates  a merger or  acquisition.  Management  intends to
address  this  potential  problem  with any  prospective  merger or  acquisition
candidate. There can be no assurances that new management of the Company will be
able to  avoid a  problem  in this  regard  after a  merger  or  acquisition  is
consummated.



                                       6
<PAGE>



COMPETITION

The  Company  will  remain an  insignificant  participant  among the firms which
engage in the acquisition of business opportunities.  There are many established
venture  capital  and  financial  concerns  which  have  significantly   greater
financial and personnel  resources and technical  expertise than the Company. In
view of the Company's combined extremely limited financial resources and limited
management  availability,  the  Company  will  continue  to be at a  significant
competitive disadvantage compared to the Company's competitors.

RISK FACTORS

The  Company's  business  is subject to numerous  risk  factors,  including  the
following:

NO  REVENUE  AND  MINIMAL  ASSETS.  The  Company,  as  a  result  of  the  Share
Distribution,  has no  operations  or revenues.  The Company has no  significant
assets or financial  resources.  The Company  will, in all  likelihood,  sustain
operating  expenses  without   corresponding   revenues,   at  least  until  the
consummation of a business combination. This may result in the Company incurring
a net  operating  loss that will  increase  continuously  until the  Company can
consummate a business combination with a profitable business opportunity.  There
is no assurance  that the Company can identify such a business  opportunity  and
consummate such a business combination.

SPECULATIVE  NATURE  OF  COMPANY'S  PROPOSED  OPERATIONS.  The  success  of  the
Company's  proposed  plan of  operation  will  depend  to a great  extent on the
operations,  financial  condition  and  management  of the  identified  business
opportunity.  While  management  intends to seek  business  combination(s)  with
entities having established  operating histories,  there can be no assurance the
Company will be successful in locating candidates meeting such criteria.  In the
event  the  Company  completes  a  business  combination,  the  success  of  its
operations  may be dependent  upon  management of the successor  firm or venture
partner firm and numerous other factors beyond the Company's control.

SCARCITY OF AND COMPETITION FOR BUSINESS  OPPORTUNITIES  AND  COMBINATIONS.  The
Company is and will continue to be an insignificant  participant in the business
of seeking mergers with,  joint ventures with and  acquisitions of small private
and public entities.  A large number of established and well-financed  entities,
including  venture  capital  firms,  are active in mergers and  acquisitions  of
companies that may be desirable  target  candidates for the Company.  Nearly all
such  entities  have  significantly   greater  financial  resources,   technical
expertise and managerial  capabilities than the Company and,  consequently,  the
Company will be at a competitive  disadvantage in identifying  possible business
opportunities and successfully completing a business combination.  Moreover, the
Company  will also  compete in seeking  merger or  acquisition  candidates  with
numerous other small public companies.

NO AGREEMENT FOR BUSINESS  COMBINATION OR OTHER TRANSACTION.  The Company has no
arrangement,  agreement  or  understanding  with respect to engaging in a merger
with,  joint venture with or acquisition  of, a private or public entity.  There
can be no  assurance  that the Company will be  successful  in  identifying  and
evaluating   suitable  business   opportunities  or  in  concluding  a  business
combination.  Management has not identified any particular  industry or specific
business within an industry for evaluation by the Company. There is no assurance
management  will be able to negotiate a business  combination on terms favorable
to the Company.

NO  STANDARDS  FOR  BUSINESS  COMBINATION.  The  Company has not  established  a
specific length of operating  history or a specified level of earnings,  assets,
net worth or other  criteria  which the Company will  require a target  business
opportunity to have achieved. Accordingly, the Company may enter into a business
combination with a business opportunity having no significant operating history,
losses, limited or no potential for earnings, limited assets, negative net worth
or other characteristics that are indicative of development stage companies.

CONTINUED  MANAGEMENT  CONTROL,  LIMITED  TIME  AVAILABILITY.  While  seeking  a
business combination,  management  anticipates devoting up to 40 hours per month
to the  business of the  Company.  The Company has not entered  into  employment
agreements with any of its current  officers and is not expected to do so in the
foreseeable  future.  The Company has not obtained key man life insurance on any
of its officers or directors.  Notwithstanding  the combined limited  experience
and  time  commitment  of  management,  loss  of the  services  of any of  these
individuals would adversely

                                       7
<PAGE>

affect  development  of the Company's  business and its likelihood of continuing
operations. See "Directors, Executive Officers, Promoters and Control Persons."

CONFLICTS  OF  INTEREST - GENERAL.  Officers  and  directors  of the Company may
participate in business  ventures which could be deemed to compete directly with
the Company.  Additional conflicts of interest and non-arm's length transactions
may also arise in the event the Company's  officers or directors are involved in
the management of any firm with which the Company transacts business.

REPORTING REQUIREMENTS MAY DELAY OR PRECLUDE ACQUISITION.  Sections 13 and 15(d)
of the Securities  Exchange Act require  reporting  companies to provide certain
information   about  significant   acquisitions,   including  audited  financial
statements  for the  company  acquired,  covering  one,  two,  or  three  years,
depending on the relative size of the acquisition. The time and additional costs
that may be incurred by some target  entities  to prepare  such  statements  may
significantly  delay  or  essentially  preclude  consummation  of  an  otherwise
desirable acquisition by the Company.  Acquisition prospects that do not have or
are unable to obtain the required audited  statements may be  inappropriate  for
acquisition  so long  as the  reporting  requirements  of the  Exchange  Act are
applicable.

LACK OF MARKET  RESEARCH  OR  MARKETING  ORGANIZATION.  The  Company has neither
conducted,  nor have others made  available  to it,  results of market  research
indicating  that market demand exists for the  transactions  contemplated by the
Company.  Moreover, the Company does not have, and does not plan to establish, a
marketing  organization.  Even in the event demand is identified for a merger or
acquisition  contemplated by the Company, there is no assurance the Company will
be successful in completing any such business combination.

LACK OF DIVERSIFICATION.  The Company's proposed operations, even if successful,
will in all likelihood result in the Company engaging in a business  combination
with a business  opportunity.  Consequently,  the  Company's  activities  may be
limited to those engaged in by business  opportunities  which the Company merges
with or acquires.  The Company's  inability to diversify its  activities  into a
number of areas may  subject  the  Company  to  economic  fluctuations  within a
particular business or industry and therefore increase the risks associated with
the Company's operations.

GOVERNMENT  REGULATION.  Although the Company  will be subject to the  reporting
requirements under the Exchange Act, management believes the Company will not be
subject to regulation  under the Investment  Company Act, insofar as the Company
will not be engaged in the business of investing  or trading in  securities.  In
the event the  Company  engages in  business  combinations  which  result in the
Company  holding  passive  investment  interests  in a number of  entities,  the
Company could be subject to regulation under the Investment Company Act. In such
event,  the Company would be required to register as an  investment  company and
could be expected to incur  significant  registration and compliance  costs. The
Company has obtained no formal  determination  from the  Securities and Exchange
Commission as to the status of the Company under the Investment Company Act and,
consequently,  violation  of such Act could  subject  the  Company  to  material
adverse consequences.

PROBABLE CHANGE IN CONTROL AND MANAGEMENT.  A business combination involving the
issuance of the  Company's  common  stock  will,  in all  likelihood,  result in
shareholders  of a private  company  obtaining  a  controlling  interest  in the
Company.  Any such business combination may require management and/or affiliates
of the  Company to sell or  transfer  all or a portion of the  Company's  common
stock  held by them,  or resign as  members  of the  Board of  Directors  of the
Company.  The resulting change in control of the Company could result in removal
of one or more present officers and directors of the Company and a corresponding
reduction in or elimination of their  participation in the future affairs of the
Company.

REDUCTION OF PERCENTAGE SHARE OWNERSHIP  FOLLOWING A BUSINESS  COMBINATION.  The
Company's primary plan of operation is based upon a business  combination with a
private concern which,  in all  likelihood,  would result in the Company issuing
securities  to  shareholders  of any  such  private  company.  The  issuance  of
previously authorized and unissued common stock of the Company would result in a
reduction  in  the  percentage  of  shares  owned  by  present  and  prospective
shareholders  of the Company and may result in a change in control or management
of the Company.

                                       8
<PAGE>

"PENNY" STOCK REGULATION OF BROKER-DEALER SALES OF COMPANY  SECURITIES.  The SEC
has adopted  rules that  regulate  broker-dealer  practices in  connection  with
transactions in "penny stocks".  Generally,  penny stocks are equity  securities
with a price of less than $5.00  (other than  securities  registered  on certain
national securities  exchanges or quoted on the NASDAQ system). If the Company's
shares are traded for less than $5 per share,  as they currently are, the shares
will be subject to the SEC's  penny  stock rules  unless (1) the  Company's  net
tangible  assets exceed  $5,000,000  during the  Company's  first three years of
continuous  operations  or $2,000,000  after the Company's  first three years of
continuous  operations;  or (2) the Company has had average  revenue of at least
$6,000,000  for  the  last  three  years.   The  penny  stock  rules  require  a
broker-dealer, prior to a transaction in a penny stock not otherwise exempt from
the rules, to deliver a standardized risk disclosure  document prescribed by the
SEC that  provides  information  about penny  stocks and the nature and level of
risks in the  penny  stock  market.  The  broker-dealer  also must  provide  the
customer  with  current  bid and  offer  quotations  for the  penny  stock,  the
compensation  of the  broker-dealer  and its  salesperson in the transaction and
monthly account  statements showing the market value of each penny stock held in
the customer's account. In addition, the penny stock rules require that prior to
a  transaction  in a penny  stock not  otherwise  exempt from those  rules,  the
broker-dealer must make a special written  determination that the penny stock is
a suitable  investment  for the  purchaser and receive the  purchaser's  written
agreement to the transaction. These requirements may have the effect of reducing
the level of trading  activity in the secondary  market for a stock that becomes
subject to the penny  stock  rules.  As long as the  Company's  Common  Stock is
subject to the penny stock  rules,  the holders of the Common  Stock may find it
difficult to sell the Common Stock of the Company.

TAXATION.  Federal and state tax consequences will, in all likelihood,  be major
considerations in any business combination the Company may undertake. Currently,
such  transactions  may be structured  so as to result in tax-free  treatment to
both  companies,  pursuant  to various  federal  and state tax  provisions.  The
Company  intends to  structure  any business  combination  so as to minimize the
federal and state tax  consequences  to both the Company and the target  entity;
however,  there can be no assurance that such business combination will meet the
statutory  requirements  of a tax-free  reorganization  or that the parties will
obtain the intended  tax-free  treatment  upon a transfer of stock or assets.  A
non-qualifying reorganization could result in the imposition of both federal and
state taxes which may have an adverse effect on both parties to the transaction.

REQUIREMENT   OF  AUDITED   FINANCIAL   STATEMENTS   MAY   DISQUALIFY   BUSINESS
OPPORTUNITIES.  Management believes that any potential business opportunity must
provide  audited  financial  statements  for  review for the  protection  of all
parties  to  the  business   combination.   One  or  more  attractive   business
opportunities  may choose to forego the  possibility  of a business  combination
with the  Company,  rather than incur the  expenses  associated  with  preparing
audited financial statements.

EMPLOYEES

The Company has no full time  employees.  The Company's  President and Secretary
have  agreed  to  allocate  a portion  of their  time to the  activities  of the
Company, without compensation.  These officers anticipate that the business plan
of the Company can be implemented by their devoting an aggregate of 40 hours per
month to the  business  affairs of the Company and,  consequently,  conflicts of
interest may arise with respect to the limited time commitment by such officers.
The Company does not expect any significant  changes in the number of employees,
until the Company completes a business combination.

The Company's  officers and directors may become  involved with other  companies
who  have a  business  purpose  similar  to that of the  Company.  As a  result,
potential conflicts of interest may arise in the future. If such a conflict does
arise and an officer or  director  of the  Company is  presented  with  business
opportunities  under  circumstances where there may be a doubt as to whether the
opportunity  should  belong to the Company or another  "shell"  company they are
affiliated with, they will disclose the opportunity to all such companies.


ITEM 2.          DESCRIPTION OF PROPERTY.

The Company has no properties  and at this time has no agreements to acquire any
properties.  The Company  intends to attempt to acquire  assets or a business in
exchange for its securities.

                                       9
<PAGE>


The  Company  operates  from its  offices  at 1708  Dolphin  Avenue,  Suite 400,
Kelowna, British Columbia, V1Y 9S4 Canada. Space is provided to the Company on a
rent free basis by Workfire Development Corporation,  and it is anticipated that
this  arrangement  will  remain  until  such  time as the  Company  successfully
consummates a merger or  acquisition.  Management  believes that this space will
meet the Company's needs for the foreseeable future.


ITEM 3.          LEGAL PROCEEDINGS.

None.


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

None.


                                     PART II

ITEM 5.          MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

The Company's  Common Shares have been listed on the  Over-the-Counter  Bulletin
Board  (the "OTC  Bulletin  Board")  operated  by the  National  Association  of
Securities  Dealers (the  "NASD"),  since  approximately  October 16, 1999.  The
Company's shares were listed under the symbol "BUFK",  until  approximately June
21, 1999. As a result of the  Reorganization and Stock Purchase  Agreement,  the
Company's  symbol changed to "WKFR" and its shares were traded under that symbol
until  approximately  February 11, 2000.  Currently,  the  Company's  shares are
listed under the symbol "BCSC". The following table sets forth the range of high
and low  closing  bid  quotations  of the common  stock for each  quarter  since
October 16, 1999:


<TABLE>
<CAPTION>
                                                                               BID OR TRADE PRICES


1999 FISCAL YEAR                                                        HIGH                            LOW

<S>                                                                    <C>                             <C>
Quarter Ending 06/30/99...................................             $6.125                          $4.438
Quarter Ending 09/30/99...................................             $6.000                          $1.000
Quarter Ending 12/31/99...................................             $2.750                          $0.312
</TABLE>



The above  quotations  reflect  inter-dealer  prices,  without  retail  mark-up,
mark-down,  or commission and may not necessarily represent actual transactions.
The last  reported bid and ask prices of the  Company's  Common Stock by the OTC
Bulletin Board were both $0.5625, respectively, on February 11, 2000.

The above  quotations  reflect  inter-dealer  prices,  without  retail  mark-up,
mark-down, or commission and may not represent actual transactions.

As of April 11,  2000,  there were 142 record  holders of the  Company's  Common
Stock.

During the last two fiscal years,  no cash  dividends  have been declared on the
Company's common stock and management does not anticipate that dividends will be
paid in the foreseeable future.

                                       10
<PAGE>


RECENT SALES OF UNREGISTERED SECURITIES

None.


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

GENERAL

The  Company  was  incorporated  under  the  laws of the  State of  Colorado  on
September 19, 1997. From its inception to June 18, 1999, the Company operated as
a "shell"  company and its business  plan was to seek out and take  advantage of
business  opportunities  that may  have had the  potential  for  profit,  and to
acquire such businesses, or a controlling interest therein.

On June 18, 1999, a change in control of the Company  occurred,  in  conjunction
with closing under a  Reorganization  and Stock Purchase  Agreement  between the
Company  and  Workfire-Nevada.  As the  result  of a  Reorganization  and  Stock
Purchase  Agreement,  the Company  acquired 89.00% of the issued and outstanding
shares of  Workfire-Nevada.  On November 5, 1999,  the board of directors of the
Company approved a resolution to distribute all of the shares of Workfire-Nevada
owned  by the  Company,  pro  rata  to the  Company's  shareholders.  The  Share
Distribution  was made to  shareholders of record as at the close of business on
November 12, 1999.

As of the date of this  report the Company had no source of income and must rely
entirely  upon loans and equity  investments  from  affiliates  to pay operating
expenses.

Accordingly,  the  financial  statements  for the year ended  December 31, 1999,
reflect the operations and cash flows of Workfire-Nevada  for the period January
1, 1999 to  November  12,  1999,  combined  with those of the parent  (the shell
company) from  acquisition  on June 18, 1999.  The  comparative  figures for the
period from July 7, 1998 to December 31, 1998 are those of Workfire-Nevada.

PLAN OF OPERATION

The Company  currently has no capital to fund  operations or on-going  expenses.
The  Company  must  rely upon  loans  and  investments  from  affiliates  to pay
operating  expenses.  There are no assurances that such affiliates will continue
to advance  funds to the  Company or will  continue  to invest in the  Company's
securities. In the event the Company is unable to obtain additional financing it
may be unable to identify and/or acquire a suitable business opportunity. During
the twelve  months  following the filing of this report,  management  intends to
seek to  acquire  assets or shares of an entity  actively  engaged in a business
that generates revenues, in exchange for the Company's  securities.  The Company
has not identified a particular  acquisition target and has not entered into any
negotiations  regarding  such an  acquisition.  Management  intends  to  contact
investment bankers, corporate financial analysts, attorneys and other investment
industry  professionals  through various media. None of the Company's  officers,
directors,  promoters or affiliates have engaged in any  preliminary  contact or
discussions  with  any   representative  of  any  other  company  regarding  the
possibility  of an  acquisition  or merger  between  the  Company and such other
company as of the date of this report.

Depending  upon  the  nature  of  the  relevant  business  opportunity  and  the
applicable  state  statutes  governing  the manner in which the  transaction  is
structured,  the Company's  Board of Directors  expects that it will provide the
Company's  shareholders  with  complete  disclosure  documentation  concerning a
potential  business  opportunity  and the  structure  of the  proposed  business
combination prior to consummation. Such disclosure is expected to be in the form
of a proxy, information statement, or report.

While such disclosure may include audited financial  statements of such a target
entity,  there is no assurance that such audited  financial  statements  will be
available.  The Board of Directors does intend to obtain  certain  assurances of
value of the target entity's  assets prior to  consummating  such a transaction,
with further  assurances  that audited  financial  statements  would be provided
within sixty days after closing.  Closing documents will include representations
that the

                                       11
<PAGE>

value of the assets conveyed to or otherwise so transferred  will not materially
differ from the  representations  included  in such  closing  documents,  or the
transaction will be voidable.

Due to the  Company's  intent  to  remain  a shell  company  until a  merger  or
acquisition   candidate  is  identified,   it  is  anticipated   that  its  cash
requirements  will be minimal,  and that all  necessary  capital,  to the extent
required,  will be provided by the  directors or officers.  The Company does not
anticipate  that  it will  have  to  raise  capital  or  acquire  any  plant  or
significant  equipment in the next twelve months, unless a merger or acquisition
target is identified.

LIQUIDITY

The Company's  cash flows from  operating  activities  during 1999 and 1998 were
$(713,497)  and  $(317,749),  respectively.  The  increase  from 1998 to 1999 is
attributed to the Company's  increased net loss during the 1999 fiscal year. The
Company's  cash  flows  from  financing  activities  during  1999 and 1998  were
$507,728 and $679,635,  respectively.  The Company's financing activities during
1999  consisted  primarily of the issuance of common shares for cash  ($262,667)
and advances from a shareholder  ($224,990).  The Company expended  $108,363 and
$47,018 on capital  assets during 1999 and 1998,  respectively.  The increase is
related  to the  acquisition  of a  significant  amount of  computer  assets and
equipment during 1999.

At December 31, 1999 and 1998, the Company had working  capital of $11,313,  and
$309,265,  respectively.  The  decrease  in  working  capital is a result of the
distribution  of the shares of  Workfire-Nevada  to the Company's  shareholders.
Workfire-Nevada  was the  Company's  operating  subsidiary  and the  loss of the
operating subsidiary has left the Company with no material assets.

Since the Company has no  significant  source of revenue,  working  capital will
continue to be depleted  by  operating  expenses.  See  "Results of  Operations"
below.  The Company  presently has no external  sources of cash and is dependent
upon its management and shareholders for funding.

ASSETS

At December 31, 1999, the Company had total assets of $25,206, compared to total
assets of $378,876 at December 31, 1998. The majority of the Company's assets at
December 31,  1999,  consisted of prepaid  marketing  expenses.  At December 31,
1998, the majority of the Company's  assets consisted of cash. As of the date of
this report, the Company has essentially no assets.

RESULTS OF OPERATIONS

The Company has no current operations and has not generated any revenue from its
operations  since the change of control.  The Company  must rely  entirely  upon
loans from affiliates pay operating expenses.

During the fiscal years ended  December  31, 1999,  and 1998 the Company had net
losses of $793,190 and $328,086,  respectively. Due to the Share Distribution as
of the date of this report,  the Company  essentially  has no operations  and no
source of revenue.  The Company  continues to incur  professional fees and other
expenses.  If the Company does not find a suitable  acquisition  target or other
source of revenue, the Company will continue to incur net losses and may have to
cease operations  entirely.  This factor,  among others,  raises substantial and
compelling doubt about the Company's ability to continue as a going concern.

The  Company's  ability to continue  as a going  concern is  dependent  upon its
ability to generate  sufficient  cash flow to meet its  obligations  on a timely
basis,  to identify and close an  acquisition  with a suitable  target  company,
obtain additional financing or refinancing as may be required, and ultimately to
attain  profitability.  There are no assurances that the Company will be able to
obtain identify a suitable  acquisition target,  close such acquisition,  obtain
any such  financing or, if the Company is able to obtain  additional  financing,
that such financing will be on terms favorable to the Company.  The inability to
obtain  additional  financing when needed will have a material adverse effect on
the Company's operating results.

                                       12
<PAGE>

IMPACT OF THE YEAR 2000

The Year 2000 issue  arises  because  many  computerized  systems use two digits
rather than four to identify a year.  Date-sensitive  systems may  recognize the
year 2000 as 1900 or some other date, resulting in errors when information using
year 2000 dates is processed.  In addition,  similar  problems may arise in some
systems  which use certain  dates in 1999 to  represent  something  other than a
date. The effects of the Year 2000 issue may be experienced before, on, or after
January 1, 2000,  and, if not addressed,  the impact on operations and financial
reporting may range from minor errors to significant systems failure which could
affect the Company's  ability to conduct normal  business  operations.  The only
software  utilized  by the  Company  is a  general  ledger  accounting  program.
Management  believes the Company does not face  significant  internal  risk from
computer  failure or errors due to the Year 2000 Issue. It is not possible to be
certain that all aspects of the Year 2000 issue affecting the Company, including
those related to the efforts of customers,  suppliers,  or other third  parties,
will be fully  resolved.  As of the date of this  report,  the  Company  has not
experienced any problems related to the Year 2000.


ITEM 7.          FINANCIAL STATEMENTS.

Please refer to the pages beginning with F-1.


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

None.


                                    PART III

ITEM 9.          DIRECTORS,  EXECUTIVE OFFICERS,  PROMOTERS AND CONTROL PERSONS;
                 COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

DIRECTORS AND EXECUTIVE OFFICERS

The officers and directors of the Company are:

         NAME              AGE          TITLE(S)
         ----              ---          --------
         Nicholas Miller   48           President since November 1999
                                        Director since June 1999

         Philip Stern      40           Director since June 1999
                                        Treasurer and Secretary since April 2000

Thereafter,  directors  will  be  elected  for  one-year  terms  at  the  annual
stockholders' meeting. Officers will hold their positions at the pleasure of the
board of directors,  absent any  employment  agreement,  of which none currently
exists or is contemplated.  There is no arrangement or understanding between any
of the  directors  or officers of the Company and any other  person  pursuant to
which any director or officer was or is to be selected as a director or officer,
and there is no arrangement,  plan or understanding as to whether non-management
shareholders  will exercise their voting rights to continue to elect the current
directors to the Company's board. There are also no arrangements,  agreements or
understandings  between  non-management  shareholders and management under which
non-management  shareholders  may  directly  or  indirectly  participate  in  or
influence the management of the Company's affairs.

The directors and officers will devote their time to the Company's affairs on an
"as needed" basis,  which,  depending on the  circumstances,  could amount to as
little as two hours per month, or more than forty hours per month, but more than
likely will fall  within the range of five to ten hours per month.  There are no
agreements  or  understandings  for any  officer

                                       13
<PAGE>

or director to resign at the request of another person, and none of the officers
or directors are acting on behalf of, or will act at the direction of, any other
person.

NICHOLAS  MILLER.  Mr.  Miller  has over 25 years of  experience  in both  small
entrepreneurial and large corporate structures,  and over 18 years of direct P &
L   responsibility.   As  the  founder  of  several   high-technology   oriented
corporations,   Mr.   Miller  has   accumulated   a  wealth  of   experience  in
high-technology  start-ups,  marketing,  management,  and the  financing  of new
ventures.

From 1994 to 1996,  Mr. Miller was Founder,  President,  CEO and Chairman of the
DataLink  Systems  Corporation.  DataLink  is a  leading  provider  of  Personal
Information   Services   delivered   using  wireless   technologies,   including
alphanumeric  paging,  digital  cellular/PCS  short  message  service,  cellular
digital packet data and other  emerging  personal  communications  technologies.
Before DataLink, he owned a consulting practice that provided advice to emerging
growth and middle-market companies in the US and Canada, and founded a number of
companies in the software distribution and manufacturing sectors.

PHILIP  STERN.  Since 1996,  Mr. Stern has operated as a consultant  through his
company, Net Q & A, Inc., providing business plan development services primarily
to clients in the high-technology  sector. From 1990 through 1996, Mr. Stern was
CEO of  Simon/Ross  &  Associates,  Inc.,  which was engaged in the  business of
providing  MacIntosh  computer  training.  From 1986 to 1988,  he  directed  the
customer marketing function for MDI Mobile Data International  which was engaged
in the business of development and sale of mobile data communications system. He
holds a  bachelor's  degree  from  McGill  University  and an MBA  from  Harvard
Business School.

There are no family relationships  between any executive officer and/or director
of the Company.

LEGAL PROCEEDINGS

To the best of the Company's knowledge,  during the past five years no director,
person nominated to become a director,  executive  officer,  promoter or control
person of the Company has:

         (1)      Had any  bankruptcy  petition filed by or against any business
                  of which  such  person  was a  general  partner  or  executive
                  officer  either at the time of the  bankruptcy  or within  two
                  years prior to that time;

         (2)      Had any  conviction in a criminal  proceeding or being subject
                  to a pending criminal proceeding (excluding traffic violations
                  and other minor offenses);

         (3)      Been  subject  to  any  order,   judgment,   or  decree,   not
                  subsequently  reversed,  suspended or vacated, of any court of
                  competent jurisdiction,  permanently or temporarily enjoining,
                  barring,  suspending or otherwise  limiting his involvement in
                  any type of business, securities or banking activities; or

         (4)      Been found by a court of  competent  jurisdiction  (in a civil
                  action),   the  Securities  and  Exchange  Commission  or  the
                  Commodity  Futures  Trading  Commission  to  have  violated  a
                  federal  or  state  securities  or  commodities  law,  and the
                  judgment has not been reversed, suspended, or vacated.

PRIOR "SHELL" COMPANY EXPERIENCE

None of the Company's  officers and/or directors have had any direct  experience
in identifying emerging companies for investment and/or business combinations.

CONFLICTS OF INTEREST

Members of the Company's  management are associated with other firms involved in
a range of  business  activities.  Consequently,  there are  potential  inherent
conflicts of interest in their acting as officers and  directors of the Company.
Insofar as the officers and directors are engaged in other business  activities,
management  anticipates  they  will  devote  only a minor  amount of time to the
Company's affairs.

                                       14
<PAGE>

The officers and  directors of the Company are now and may in the future  become
shareholders,  officers or directors of other  companies which may be formed for
the purpose of engaging in business activities similar to those conducted by the
Company.  Accordingly,  additional direct conflicts of interest may arise in the
future with respect to such individuals acting on behalf of the Company or other
entities.  Moreover,  additional conflicts of interest may arise with respect to
opportunities which come to the attention of such individuals in the performance
of their duties or  otherwise.  The Company does not  currently  have a right of
first refusal  pertaining to opportunities  that come to management's  attention
insofar as such  opportunities  may relate to the  Company's  proposed  business
operations.

The officers and directors are, so long as they are officers or directors of the
Company,  subject to the restriction that all opportunities  contemplated by the
Company's  plan of  operation  which  come to  their  attention,  either  in the
performance  of  their  duties  or in  any  other  manner,  will  be  considered
opportunities  of, and be made  available to the Company and the companies  that
they are affiliated with on an equal basis. A breach of this requirement will be
a breach of the fiduciary  duties of the officer or director.  If the Company or
the  companies in which the  officers and  directors  are  affiliated  with both
desire to take  advantage of an  opportunity,  then said  officers and directors
would abstain from  negotiating and voting upon the  opportunity.  However,  all
directors may still  individually take advantage of opportunities if the Company
should decline to do so. Except as set forth above,  the Company has not adopted
any other conflict of interest policy with respect to such transactions.

The  Company  does not have any  standing  audit,  nominating,  or  compensation
committees of the Board of Directors.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section  16(a) of the  Securities  Exchange Act of 1934  requires the  Company's
officers and directors,  and persons who own more than 10% of a registered class
of the Company's equity securities,  to file reports of ownership and changes in
ownership  with the Securities  and Exchange  Commission  and Nasdaq.  Officers,
directors  and  greater  than  10%  percent  shareholders  are  required  by SEC
regulation  to furnish the Company  with copies of all Section  16(a) forms they
file. To the best of the Company's knowledge, Grant Peck, Dean Sessions, or Gary
Joiner,  former  officers and directors of the Company,  have not filed any Form
5's for the fiscal year ended  December 31, 1999.  Tom Taylor,  a former officer
and  director  of the  Company and  currently  a  principal  shareholder  of the
Company,  has not filed a Form 5 for the fiscal year ended  December  31,  1999.
Nicholas Miller,  an officer and director of the Company,  did not file any Form
3's upon being appointed as an officer and director of the Company. In addition,
to the best of the  Company's  knowledge,  other than  reports  filed by Tom and
Allison Taylor, no reports were filed by any other persons who owned 10% or more
of the Company's  registered equity securities during the period covered by this
report.


ITEM 10.          EXECUTIVE COMPENSATION.

The following table sets forth information for Grant W. Peck and Tom Taylor, the
Chief  Executive  Officers  ("CEO") of the Company  during the fiscal year ended
December 31, 1999.  No disclosure  need be provided for any  executive  officer,
other than the CEO,  whose total annual salary and bonus for the last  completed
fiscal year did not exceed $100,000. Accordingly, no other executive officers of
the Company are included in the table.

<TABLE>
<CAPTION>
                                                                                      LONG TERM COMPENSATION
                                                                            ------------------------------------------

                                          ANNUAL COMPENSATION                        AWARDS              PAYOUTS
                                ---------------------------------------------------------------------------------------

                                                                OTHER       RESTRICTED     SECURITIES
                                                                ANNUAL        STOCK        UNDERLYING                  ALL OTHER
NAME AND                                                        COMPEN-       AWARDS        OPTIONS/       LTIP         COMPEN-
PRINCIPAL POSITION      YEAR        SALARY($)      BONUS($)    SATION ($)       ($)          SARS($)     PAYOUTS ($)   SATION ($)
------------------------------------------------------------------------------------------------------------------------------------

<S>                     <C>         <C>               <C>         <C>           <C>        <C>              <C>           <C>
Grant W. Peck,          1999           -0-            -0-         -0-           -0-            -0-          -0-           -0-
President and Chief     1998           -0-            -0-         -0-           -0-            -0-          -0-           -0-
Executive Officer(1)<F1>1997           -0-            -0-         -0-           -0-            -0-          -0-           -0-

------------------------------------------------------------------------------------------------------------------------------------

                                       15
<PAGE>

<CAPTION>
                                                                                      LONG TERM COMPENSATION
                                                                            ------------------------------------------

                                          ANNUAL COMPENSATION                        AWARDS              PAYOUTS
                                ---------------------------------------------------------------------------------------

                                                                OTHER       RESTRICTED     SECURITIES
                                                                ANNUAL        STOCK        UNDERLYING                  ALL OTHER
NAME AND                                                        COMPEN-       AWARDS        OPTIONS/       LTIP         COMPEN-
PRINCIPAL POSITION      YEAR        SALARY($)      BONUS($)    SATION ($)       ($)          SARS($)     PAYOUTS ($)   SATION ($)
------------------------------------------------------------------------------------------------------------------------------------

<S>                     <C>         <C>               <C>         <C>           <C>        <C>              <C>           <C>
Tom Taylor, President   1999(3)<F3> 84,000(C$)        -0-         -0-           -0-            -0-          -0-           -0-
President and Chief     1998(3)<F3> 32,000 (C$)       -0-         -0-           -0-        300,000(5)       -0-           -0-
Executive Officer(2)<F2>1997(3)<F3>     -0-           -0-         -0-           -0-            -0-          -0-           -0-

------------------------------------------------------------------------------------------------------------------------------------

Nicholas Miller,        1999           -0-            -0-         -0-           -0-            -0-          -0-           -0-
President and Chief     1998           -0-            -0-         -0-           -0-            -0-          -0-           -0-
Executive Officer(4)<F4>1997           -0-            -0-         -0-           -0-            -0-          -0-           -0-

------------------------------------------------------------------------------------------------------------------------------------

<FN>
<F1>
(1)      Mr. Peck resigned effective June 18, 1999.
<F2>
(2)      Mr. Taylor was appointed President and CEO effective June 19, 1999 and
         he resigned effective November 12, 1999.
<F3>
(3)      Compensation paid through Workfire-Nevada.
<F4>
(4)      Mr. Miller was appointed President and CEO effective November 12, 1999.
<F5>
(5)      Includes 150,000 options granted to his wife, Allison Taylor.
</FN>
</TABLE>


The Company does not have any  employment  contracts with any of its officers or
directors. Such persons are employed by the Company on an at will basis, and the
terms and conditions of employment are subject to change by the Company.

STOCK OPTION PLANS

During June 1999,  the Company's  board of directors  adopted the Company's 1999
Stock  Option Plan.  The terms of the plan are  summarized  below.  Options were
granted under the plan to employees of Workfire-Nevada,  which at the time was a
subsidiary  of the  Company.  As a  result  of  the  Share  Distribution,  these
employees ceased to be employees of the Company and, as such, the options issued
to those  employees were terminated in accordance with the plan. As of April 11,
2000, no options were outstanding under the plan.

Pursuant to the 1999 Stock  Option Plan (the  "Plan") an  aggregate of 1,375,840
shares of the Company's common stock (the "Available  Shares") has been reserved
for issuance pursuant to the exercise of stock options  ("Options") which may be
granted to employees,  officers, and directors of the Company and consultants to
the  Company.  The Plan also  provides  for annual  adjustment  in the number of
Available  Shares,  commencing  upon the beginning of the next fiscal year, to a
number  equal to 9% of the  number  of shares  outstanding  as of the end of the
preceding fiscal year or 1,375,840 shares, whichever is greater.

The Plan is  designed  to (i)  induce  qualified  persons  to become  employees,
officers,  or  directors  of the  Company;  (ii)  reward  such  persons for past
services to the Company; (iii) encourage such persons to remain in the employ of
the  Company  or  associated  with  the  Company;  and (iv)  provide  additional
incentive  for such  persons to put forth  maximum  efforts  for the  success of
business of the Company. No stock options have been granted under this Plan.

The  Plan  will  be  administered  by the  Board  of  Directors  (the  "Board").
Transactions  under  the  Plan  are  intended  to  comply  with  all  applicable
conditions of Rule 16b-3 under the  Securities  Exchange Act of 1934, as amended
(the "1934 Act").  In addition to determining who will be granted  Options,  the
Board has the authority and discretion to determine when Options will be granted
and the number of Options to be granted.  The Board may determine  which Options
may be intended to qualify  ("Incentive  Stock  Option")  for special  treatment
under the  Internal  Revenue  Code of 1986,  as  amended  from time to time (the
"Code") or Non-Qualified  Options  ("Non-Qualified Stock Options") which are not
intended to so qualify.  See "Federal Income Tax Consequences"  below. The Board
also may determine the time or times when each Option becomes  exercisable,  the
duration  of the  exercise  period  for  Options  and the  form or  forms of the
instruments  evidencing  Options  granted  under the Plan.  The Board may adopt,
amend, and rescind such rules and regulations as in its opinion may be advisable
for the  administration  of the Plan.  The  Board  may  amend  the Plan  without
shareholder  approval  where  such  approval  is not  required  to  satisfy  any
statutory or regulatory requirements.

                                       16
<PAGE>


Grants to employee directors and  officer/directors  can be either Non-Qualified
Stock Options or Incentive Stock Options,  to the extent that they do not exceed
the Incentive Stock Option exercise limitations, and the portion of an option to
an employee director or officer/director  that exceeds the dollar limitations of
Code Section 422 will be treated as a Non-Qualified Stock Option.

The Board  also may  construe  the Plan and the  provisions  in the  instruments
evidencing  options granted under the Plan to employee and officer  participants
and is empowered to make all other determinations  deemed necessary or advisable
for the  administration  of the Plan.  The Board may not  adversely  affect  the
rights of any  participant  under any  unexercised  option or any potion thereof
without the consent of such  participant.  This Plan will remain in effect until
it is  terminated  by the Board,  except that no Incentive  Stock Option will be
granted after December 15, 2009.

The Plan  contains  provisions  for  proportionate  adjustment  of the number of
shares for  outstanding  options and the option  price per share in the event of
stock dividends,  recapitalizations resulting in stock splits or combinations or
exchanges of shares.

Participants  in the  Plan may be  selected  by the  Board  from  employees  and
officers of the Company and its  subsidiaries and consultants to the Company and
its subsidiaries. In determining the persons to whom options will be granted and
the  number of shares to be  covered  by each  option,  the Board will take into
account  the duties of the  respective  persons,  their  present  and  potential
contributions to the success of the Company, and such other factors as the Board
deems relevant to accomplish the purposes of the Plan.

Only employees of the Company and its  subsidiaries,  as the term  "employee" is
defined for the  purposes of the Code,  and  consultants  to the Company will be
entitled to receive  Incentive  Stock Options.  Incentive  Stock Options granted
under the Plan are  intended to satisfy all  requirements  for  incentive  stock
options under Section 422 of the Code and the Treasury Regulations thereunder.

Each  option  granted  under the Plan  will be  evidenced  by a  written  option
agreement  between  the  Company  and the  optionee.  The  option  price  of any
Incentive  Stock  Option may be not less than 100% of the Fair Market  Value per
share on the date of grant of the option; provided,  however, that any Incentive
Stock Option  granted under the Plan to a person owning more than ten percent of
the total combined voting power of the common stock will have an option price of
not less  than 110% of the Fair  Market  Value per share on the date of grant of
the Incentive Stock Option.  Each  Non-Qualified  Stock Option granted under the
Plan will be at a price no less than 85% of the Fair  Market  Value per share on
the date of grant thereof. "Fair Market Value" per share as of a particular date
is defined in the Plan as the last sale price of the  Company's  common stock as
reported on a national  securities exchange or on the NASDAQ System or, if none,
the average of the closing bid and asked prices of the Company's common stock as
reported by NASDAQ or, if such quotations are unavailable,  the value determined
by the Board in its discretion in good faith.

The exercise  period of options  granted under the Plan may not exceed ten years
from the date of grant  thereof.  Incentive  Stock  Options  granted to a person
owning more than ten percent of the total  combined  voting  power of the common
stock of the Company  will be for no more than five  years.  The Board will have
the  authority to  accelerate or extend the  exercisability  of any  outstanding
option at such time and under such  circumstances as it, in its sole discretion,
deems appropriate.  However,  no exercise period may be extended to increase the
term of the option beyond ten years from the date of the grant.

To exercise an option, the optionee must pay the full exercise price in cash, in
shares of common  stock  having a Fair Market Value equal to the option price or
in property or in a combination of cash,  shares,  and property and,  subject to
approval  of the  Board.  The  Board  has the sole and  absolute  discretion  to
determine whether or not property other than cash or common stock may be used to
purchase the shares of common  stock  thereunder  and, if so, to  determine  the
value of the property received.

An option may not be exercised unless the optionee then is an employee, officer,
or director  of the Company or its  subsidiaries,  and unless the  optionee  has
remained continuously as an employee,  officer, or director of the Company since
the date of grant of the  option.  If the  optionee  ceases  to be an  employee,
officer, or director of the Company or its

                                       17
<PAGE>

subsidiaries  other  than by reason  of death,  disability,  or for  cause,  all
options  granted to such  optionee,  fully  vested to such  optionee but not yet
exercised,  will terminate three months after the date the optionee ceases to be
an  employee,  officer or director  of the  Company.  All options  which are not
vested to an optionee,  under the conditions  stated in this paragraph for which
employment  ceases,  will immediately  terminate on the date the optionee ceases
employment or association.

If an optionee dies while an employee, officer or director of the Company, or if
the optionee's  employment,  officer, or director status terminates by reason of
disability,  all options  theretofore  granted to such optionee,  whether or not
otherwise exercisable, unless earlier terminated in accordance with their terms,
may be  exercised  at any  time  within  one  year  after  the  date of death or
disability of said optionee, by the optionee or by the optionee's estate or by a
person who acquired the right to exercise such options by bequest or inheritance
or otherwise by reason of the death or disability of the optionee.

Options granted under the Plan are not transferable other than by will or by the
laws of descent and distribution or pursuant to a qualified  domestic  relations
order  as  defined  by the  Code or Title I of the  Employee  Retirement  Income
Security Act of 1974, or the rules thereunder.  Options may be exercised, during
the lifetime of the optionee,  only by the optionee and  thereafter  only by his
legal representative. An optionee has no rights as a shareholder with respect to
any shares covered by an option until the option has been exercised.

As a condition  to the  issuance of shares upon the  exercise of an option,  the
Company  will  require  the  optionee  to pay to the  Company  the amount of the
Company's tax withholding  liability  required in connection with such exercise.
The Company, to the extent permitted or required by law, may deduct a sufficient
number of shares due to the  optionee  upon  exercise of the option to allow the
Company to pay such  withholding  taxes.  The Company is not obligated to advise
any optionee of the existence of any tax or the amount which the Company will be
so required to withhold.

FEDERAL INCOME TAX CONSEQUENCES

The  federal  income tax  discussion  set forth  below is  included  for general
information only. Optionees are urged to consult their tax advisors to determine
the particular tax  consequences  applicable to them,  including the application
and effect of foreign, state, and local income and other tax laws.
INCENTIVE  STOCK OPTIONS.  No income results to the holder of an Incentive Stock
Option upon the grant thereof or issuance of shares upon exercise  thereof.  The
amount  realized on the sale or taxable  exchange of the Option Shares in excess
of the option exercise price will be considered a capital gain,  except that, if
a sale,  taxable  exchange,  or other  disposition  occurs within one year after
exercise  of the  Incentive  Stock  Option or two  years  after the grant of the
Incentive   Stock  Option   (generally   considered   to  be  a   "disqualifying
disposition"),  the optionee will realize  compensation,  for federal income tax
purposes,  on the amount by which the lesser of (i) the fair market value on the
date of exercise or (ii) the amount realized on the sale of the shares,  exceeds
the exercise price. Any appreciation on the shares between the exercise date and
the  disposition  will be taxed to the optionee as capital gain.  The difference
between the exercise  price and the fair market value of the shares  acquired at
the time of exercise is a tax preference item for the purpose of calculating the
alternative  minimum tax on individuals  under the Code. This preference  amount
will not be included again in alternative minimum taxable income in the year the
taxpayer disposes of the stock.

NON-QUALIFIED STOCK OPTIONS. No compensation will be realized by the optionee of
a Non-Qualified  Stock Option at the time it is granted.  Upon the exercise of a
Non-Qualified  Stock Option,  an optionee will realize  compensation for federal
income tax purposes on the  difference  between the exercise  price and the fair
market  value of the shares  acquired at the time of  exercise.  If the optionee
exercises a Non-Qualified  Stock Option by surrendering  shares of the Company's
common  stock,  the optionee  will not  recognize  income or gain at the time of
exercise.

CONSEQUENCES TO THE COMPANY.  The Company recognizes no deduction at the time of
grant or exercise of an Incentive  Stock Option and  recognizes  no deduction at
the time of grant of a Non-Qualified  Stock Option. The Company will recognize a
deduction  at the  time of  exercise  of a  Non-Qualified  Stock  Option  on the
difference  between the option  price and the fair market value of the shares on
the date of grant. The Company also will recognize a deduction to the extent the
optionee recognizes income upon a disqualifying disposition of shares underlying
an Incentive Stock Option.

                                       18
<PAGE>


VESTING

Unless otherwise specified in an optionee's agreement, options granted under the
Plan will become vested with the optionee over a two-year period, with one-sixth
of the options  vesting  every four  months,  in  addition to any other  vesting
requirements determined by the Board at the time of grant.

EMPLOYMENT AGREEMENTS

The Company does not have any employment  agreements with any of its officers or
directors.

DIRECTORS COMPENSATION

The Company does not compensate directors in their capacity as such. The Company
does compensate directors for services provided in other capacities.


ITEM 11.          SECURITY   OWNERSHIP   OF   CERTAIN   BENEFICIAL   OWNERS  AND
                  MANAGEMENT.

The following table sets forth  information,  as of April 11, 2000, with respect
to the beneficial  ownership of the Company's  common stock by each person known
by the  Company  to be the  beneficial  owner of more than five  percent  of the
outstanding  Common  Stock and by directors  and  officers of the Company,  both
individually and as a group:


<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------
NAME AND ADDRESS OF                            SHARES OWNED BENEFICIALLY
BENEFICIAL OWNER                                     AND OF RECORD              PERCENT OF CLASS (1)<F1>
---------------------------------------------------------------------------------------------------------
<S>                                                    <C>                              <C>
Tom & Allison Taylor                                   2,971,348                        21.2%
3985 Gallaghers Circle
Kelowna, British Columbia
V1W 3Z9 Canada

---------------------------------------------------------------------------------------------------------
CEDE & Co.(2)<F2>                                      3,417,023                        24.4%
P.O. Box 222
Bowling Green Station
New York, NY 10274

---------------------------------------------------------------------------------------------------------
Lloydminister Enterprises Ltd.                         1,648,255                        11.8%
The Glassmill
1 Battersea Bridge Road
London, England SW11 3BG

---------------------------------------------------------------------------------------------------------
Eastlane Trading Limited                               1,401,578                        10.0%
28 Harcourt Street
Dublin 2 Ireland

---------------------------------------------------------------------------------------------------------
Walsall Trading Ltd.                                    762,458                          5.5%
c/o United House
14/16 Nelson Street
Douglas, Isle of Man

---------------------------------------------------------------------------------------------------------
Phillip Stern                                           35,880                           0.3%
49 Alberta Avenue
Toronto, Ontario
Canada M6H 2R5

                                       19
<PAGE>
<CAPTION>

---------------------------------------------------------------------------------------------------------
NAME AND ADDRESS OF                            SHARES OWNED BENEFICIALLY
BENEFICIAL OWNER                                     AND OF RECORD              PERCENT OF CLASS (1)<F1>
---------------------------------------------------------------------------------------------------------
<S>                                                    <C>                              <C>
---------------------------------------------------------------------------------------------------------
Nicholas Miller                                           -0-                             --
8135 East Butherus, Suite 3
Scottsdale, Arizona 85260

---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
Officers and directors as a group                       35,880                           .3%
(2 persons)
---------------------------------------------------------------------------------------------------------
-----------------
<FN>
<F1>
(1)      Where persons listed on this table have the right to obtain  additional
         shares of common stock through the conversion of convertible securities
         within 60 days from the date of this Report,  these  additional  shares
         are  deemed  to  be  outstanding  for  the  purpose  of  computing  the
         percentage of common stock owned by such persons, but are not deemed to
         be outstanding for the purpose of computing the percentage owned by any
         other  person.  Percentages  are based on  14,046,080  shares of common
         stock outstanding as of April 11, 2000.
<F2>
(2)      CEDE & Co. holds the shares in nominee name on behalf of  broker-dealer
         firms.
</FN>
</TABLE>

CHANGES OF CONTROL

A business  combination  involving  the issuance of the  Company's  common stock
will, in all likelihood, result in shareholders of a private company obtaining a
controlling  interest in the Company.  Any such business combination may require
the current  shareholders of the Company to sell or transfer all or a portion of
their  common  stock  and/or  resign from their  positions  as  officers  and/or
directors of the Company.  The resulting  change in control of the Company could
result in removal of the current management, and a corresponding reduction in or
elimination of their participation in the future affairs of the Company.


ITEM 12.          CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

At December 31, 2000,  the Company  owed  $22,035 to  Workfire-Nevada,  a former
subsidiary of the Company and current  shareholder of the Company,  for advances
made to the Company for operating expenses.

Under the terms of the Reorganization Agreement and related agreements, Grant W.
Peck  and  Dean  F.  Sessions,  who  were  directors,   officers  and  principal
shareholders of the Company, and Gary S. Joiner who was a principal  shareholder
of the Company,  each sold a substantial number of Class A and Class B Warrants.
The  warrants  sold were part of the units issued by the Company at inception in
consideration of pre-incorporation  services rendered.  At the time of issuance,
the units were valued at a total of $17,400.

Pursuant to the  Reorganization  Agreement and related  agreements,  the selling
price for such Warrants was a total of approximately $147,000. Accordingly, each
of the former  officers,  directors  and principal  shareholders  of the Company
realized  a  substantial  profit  from the sale of  Warrants  under the  Warrant
Purchase Agreement executed in conjunction with the Reorganization Agreement.

The Company employed the law firm of Frascona,  Joiner & Goodman, P.C., in which
one of its former principal shareholders,  Gary S. Joiner, is a shareholder,  to
provide legal services in connection with its organization,  the registration of
its shares, the filing of periodical  reports under the Securities  Exchange Act
of  1934,  and  in   conjunction   with   negotiation   and  closing  under  the
Reorganization  Agreement.  This firm was paid fees for such services based upon
the normal hourly rates of the persons providing legal services.

Until June 1999, rent was provided to the Company at no charge by Grant W. Peck,
the former  President of the Company.  Until the change of control,  the Company
accrued $50 per month as additional paid-in capital for this use.

                                       20
<PAGE>

ITEM 13.          EXHIBITS AND REPORTS ON FORM 8-K.

<TABLE>
(a)      Exhibits:


<CAPTION>
    REGULATION                                                                                           CONSECUTIVE
    S-B NUMBER                                          EXHIBIT                                          PAGE NUMBER

<S>                  <C>                                                                             <C>
       3.1           Articles of Incorporation, as amended (3)<F3>                                            34

       3.2           Bylaws (1)<F1>                                                                          N/A

       4.1           Warrant Agent Agreement (1)<F1>                                                         N/A

       4.2           Specimen Class A Warrant Certificate (1)<F1>                                            N/A

       4.3           Specimen Class B Warrant Certificate (1)<F1>                                            N/A

       4.4           Stock Option Plan                                                                        37

        11           Statement Re: Computation of Per Share Earnings                                 See Financial Statements

        27           Financial Data Schedule                                                                  50

       99.1          Reorganization and Stock Purchase Agreement (2)<F2>                                     N/A

---------------------------

<FN>
<F1>
(1)      Incorporated by reference from the Registration Statement on Form 10-SB
         filed with the Securities and Exchange Commission on March 4, 1998.

<F2>
(2)      Incorporated  by  reference  from the Current  Report on Form 8-K filed
         with the Securities and Exchange Commission dated June 18, 1999.

<F3>
(3)      The Company's  Articles of Incorporation  are incorporated by reference
         from the Registration Statement on Form 10-SB filed with the Securities
         and  Exchange  Commission  on  March 4,  1998.  The  amendments  to the
         Articles of Incorporation  relating to the change of the Company's name
         from Buffalo Capital VII, Ltd. to Workfire.com, Inc. and its subsequent
         change from Workfire.com,  Inc. to BCS Investment Corporation are being
         filed as Exhibit 3.1 to this Form 10-KSB.
</FN>
</TABLE>

(b)      The following reports on Form 8-K were filed during the last quarter of
         the period covered by this report:

         Form  8-K  dated  November  5,  1999  reporting  the   distribution  of
         Workfire-Nevada  shares  to  shareholders  of  the  Corporation  and an
         agreement with a third-party to provide funding to Workfire-Nevada.

                                       21
<PAGE>

                                   SIGNATURES

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

                                    BCS INVESTMENT CORPORATION



Dated: April 13, 2000               By:/S/NICHOLAS MILLER
                                            Nicholas Miller, President

         In accordance  with the  Securities  Exchange Act, this report has been
signed below by the  following  persons on behalf of the  registrant  and in the
capacities and on the dates indicated.


<TABLE>
<CAPTION>
SIGNATURE                                             TITLE                                         DATE


<S>                                                   <C>                                           <C>
/S/NICHOLAS MILLER                                    President and Director
Nicholas Miller                                       (Principal Executive Officer)                 APRIL 13, 2000


                                                      Secretary, Treasurer and Director
/S/PHILIP STERN                                       (Principal Financial and Accounting Officer)
Philip Stern                                                                                        APRIL 14, 2000

</TABLE>






                                       22
<PAGE>












                        Financial Statements of

                        WORKFIRE.COM, INC.

                        (A Development Stage Enterprise)

                        December 31, 1999







<PAGE>








AUDITORS' REPORT TO THE STOCKHOLDERS

We have audited the balance sheets of  Workfire.com,  Inc., a development  stage
enterprise,  as at  December  31,  1999  and 1998  and the  statements  of loss,
stockholders'  equity  and  comprehensive  income  and cash flows for the fiscal
periods then ended.  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 generally accepted auditing standards
in the  United  States of  America.  Those  standards  require  that we plan and
perform an audit to obtain reasonable assurance 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.

In our opinion,  these  financial  statements  present  fairly,  in all material
respects, the financial position of the Company as at December 31, 1999 and 1998
and the results of its operations and its cash flows for the fiscal periods then
ended in accordance with generally accepted accounting  principles in the United
States of America.



/S/KPMG LLP





Kelowna, Canada
February 14, 2000




                                      F-1
<PAGE>



WORKFIRE.COM, INC.
(A Development Stage Enterprise)
Balance Sheets
$ United States

December 31, 1999 and 1998

<TABLE>
<CAPTION>
==================================================================================================
                                                                  1999                        1998
--------------------------------------------------------------------------------------------------
<S>                                                        <C>                         <C>
ASSETS

Current assets
     Cash                                                  $         -                 $   315,658
     Accounts receivable                                             -                       4,297
     Prepaid expenses                                           25,206                       5,326
     ---------------------------------------------------------------------------------------------
                                                                25,206                     325,281

Due from related parties                                             -                      10,521

Capital assets                                                       -                      43,074
--------------------------------------------------------------------------------------------------
                                                           $    25,206                 $   378,876
==================================================================================================

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)

Current liabilities
     Accounts payable and accrued liabilities              $    13,893                 $    16,016

Due to related party (note 3)                                   22,035                       9,943


Stockholders' equity (deficiency)
     Capital stock (note 4)                                     58,133                       2,080
     Additional paid in capital                                837,370                     678,133
     Deficit accumulated during the development stage         (905,402)                   (328,086)
     Accumulated comprehensive income                             (823)                        790
     ----------------------------------------------------------------------------------------------
                                                               (10,722)                    352,917
---------------------------------------------------------------------------------------------------

                                                           $    25,206                 $   378,876
===================================================================================================
</TABLE>


See accompanying notes to financial statements.

Approved by the Board:


--------------------------------- Director


--------------------------------- Director


                                      F-2
<PAGE>

WORKFIRE.COM, INC.
(A Development Stage Enterprise)
Statements of Loss
$ United States

Year ended December 31, 1999 and period from incorporation on July 7, 1998 to
December 31, 1998

<TABLE>
<CAPTION>
================================================================================================================
                                                   From inception
                                                (July 7, 1998) to
                                                December 31, 1999                 1999                      1998
----------------------------------------------------------------------------------------------------------------
<S>                                               <C>                     <C>                      <C>

Revenue
     Interest                                     $        10,422         $      8,847             $       1,575

Expenses
     Research and development
        Consultants                                        42,049               41,490                       559
        Internet access charges                             8,454                6,336                     2,118
        Purchased research and development                100,000                   -                    100,000
        Salaries and benefits                             396,143              299,063                    97,080
        --------------------------------------------------------------------------------------------------------
                                                          546,646              346,889                   199,757
     General and administrative
        Amortization                                       26,820               22,876                     3,944
        Consulting                                         16,838               16,838                        -
        Foreign exchange                                   10,424               10,424                        -
        Interest on long term debt                          5,050                5,050                        -
        Marketing and promotion                           106,514               91,179                    15,335
        Office and administration                          53,148               40,563                    12,585
        Professional fees                                  73,856               62,883                    10,973
        Rent and utilities                                 49,849               38,051                    11,798
        Salaries and benefits                             171,321              112,127                    59,194
        Travel                                             52,860               36,785                    16,075
        Write off of loan receivable                       10,707               10,707                        -
        Write off of goodwill on purchase of
          shares held by minority stockholders             65,420               65,420                        -
        --------------------------------------------------------------------------------------------------------
                                                          642,807              512,903                   129,904
----------------------------------------------------------------------------------------------------------------
Loss before income taxes and minority interest         (1,179,031)            (850,945)                 (328,086)

Income taxes                                                2,234                2,234                        -
----------------------------------------------------------------------------------------------------------------
Loss before minority interest                          (1,181,265)            (853,179)                 (328,086)

Minority interest in loss of former subsidiary             59,989               59,989                        -
----------------------------------------------------------------------------------------------------------------
Net loss                                          $    (1,121,276)        $   (793,190)            $    (328,086)
================================================================================================================

Weighted average number of shares outstanding          12,589,664           13,350,662                11,020,374

Loss per share                                    $         (0.09)        $      (0.06)            $       (0.03)
================================================================================================================
</TABLE>

See accompanying notes to financial statements.


                                      F-3
<PAGE>

WORKFIRE.COM, INC.
(A Development Stage Enterprise)
Statements of Stockholders' Equity and Comprehensive Income
$ United States

Year ended December 31, 1999 and period from incorporation on July 7, 1998 to
December 31, 1998
<TABLE>
<CAPTION>
==================================================================================================================================
                                                                                          Deficit
                                                                                      Accumulated
                                        Number                     Additional          During the       Accumulated
                                            of       Capital          Paid in         Development     Comprehensive
                                        Shares         Stock          Capital               Stage            Income          Total
----------------------------------------------------------------------------------------------------------------------------------
<S>                                <C>           <C>               <C>               <C>              <C>               <C>
WTI
----------------------------------------------------------------------------------------------------------------------------------
Issued July 7, 1998 for cash
 at $0.0001 per share                8,032,000   $       803       $        -        $          -     $           -     $      803
Issued August 19, 1998 for
 cash at Cdn $0.20 (US $0.13)        1,250,000           125          166,542                   -                 -        166,067
Issued August 20, 1998 for
 cash at Cdn $1.00 (US $0.67)          350,000            35          233,298                   -                 -        233,333
Adjustment to record business
 combination (note 2(b))             2,368,000         1,080           (1,070)                  -                 -             10
Issued effective November 23, 1998
 pursuant to Offering Disclosure
 Document at $0.75 per share           372,533            37          279,363                   -                 -        279,400
Loss                                         -             -                -            (328,086)                -       (328,086)
Foreign currency translation
 adjustment                                  -             -                -                   -               790            790
----------------------------------------------------------------------------------------------------------------------------------
WTI balance, December 31, 1998      12,372,533         2,080          678,133            (328,086)              790        352,917
Issued March 11, 1999 pursuant to
 Offering Disclosure Document at
 $0.75 per share                       350,222            35          262,632                   -                 -        262,667
Voluntary cancellation of shares
 by shareholder, June 18, 1999      (1,000,000)         (100)             100                   -                 -              -
----------------------------------------------------------------------------------------------------------------------------------
WTI balance, June 18, 1999, prior
 to reorganization and stock
 purchase by BC7                    11,722,755   $      2,015      $  940,865        $   (328,086)    $         790     $  615,584
==================================================================================================================================
BC7
==================================================================================================================================
BC7 balance, December 31, 1998       4,620,000   $     32,900      $      750        $    (31,796)    $           -     $    1,854
Expenses paid by stockholder
 on behalf of the Company                    -              -           2,790                   -                 -          2,790
Issued June 14, 1999 upon
 5.804688 to 1 stock split          22,197,658              -               -                   -                 -              -
Voluntary cancellation of shares by
 stockholders, June 18, 1999       (23,253,303)       (28,527)         28,527                   -                 -              -
Increase in the book value of BC7's
 stockholders' equity to 89% of WTI          -         (2,580)        805,303            (260,201)              703        543,225
----------------------------------------------------------------------------------------------------------------------------------
BC7 balance, June 18, 1999 prior to
 reorganization and purchase of WTI
 stock                               3,564,355          1,793         837,370            (291,997)              703        547,869
Issued upon reorganization and
 purchase of 89% WTI stock, recorded
 at the book value of BC7's tangible
 net assets                         10,431,725             90               -                   -                 -             90
Issued October 6, 1999 for
 services at $1.125 per share           45,000         50,625               -                   -                 -         50,625
Issued November 9, 1999
 for services at $1.125 per share        5,000          5,625               -                   -                 -          5,625
Adjustment to record distribution of WFI's
 shares of WTI to stockholders,
 November 12, 1999                           -              -               -             179,785                 -        179,785
Loss                                         -              -               -            (793,190)                -       (793,190)
Foreign currency translation adjustment      -              -               -                   -            (1,526)        (1,526)
-----------------------------------------------------------------------------------------------------------------------------------
WFI balance, December 31, 1999      14,046,080   $     58,133      $  837,370        $   (905,402)    $        (823)    $  (10,722)
===================================================================================================================================
</TABLE>

Refer to note 1 a) for basis of reporting

See accompanying notes to financial statements.


                                      F-4
<PAGE>



WORKFIRE.COM, INC.
(A Development Stage Enterprise)
Statements of Cash Flows
$ United States

Year ended December 31, 1999 and period from incorporation on July 7, 1998 to
December 31, 1998

<TABLE>
<CAPTION>
==========================================================================================================
                                                    From inception
                                                 (July 7, 1998) to
                                                 December 31, 1999               1999                1998
----------------------------------------------------------------------------------------------------------
<S>                                                 <C>                   <C>                <C>
Cash provided by (used in):

Operations
     Net loss                                       $   (1,121,276)       $  (793,190)       $   (328,086)
     Items not involving cash:
       Amortization                                         26,820             22,876               3,944
       Services paid with share consideration               31,044             31,044                  -
       Minority interest                                   (59,989)           (59,989)                 -
       Write off of goodwill on purchase of
         shares held by minority stockholders               65,420             65,420                  -
     Changes in non-cash working capital:
       Accounts receivable                                  (2,701)             1,596              (4,297)
       Prepaid expenses                                    (34,200)           (28,874)             (5,326)
       Accounts payable and accrued liabilities             63,636             47,620              16,016
     -----------------------------------------------------------------------------------------------------
                                                        (1,031,246)          (713,497)           (317,749)

Financing
     Advances (to) from related parties                     66,909             67,487                (578)
     Advances from shareholder                             224,990            224,990                  -
     Issue of common shares for cash                       942,880            262,667             680,213
     Issue of common shares upon reorganization
       and stock purchase                                       90                 90                  -
     Adjustment to record distribution of WTI shares
       to shareholders net of non-cash items               (50,126)           (50,126)                 -
     Proceeds from long term debt net of
       repayments                                           75,766             75,766                  -
     Purchase of shares held by minority
       shareholders                                        (73,146)           (73,146)                 -
     -----------------------------------------------------------------------------------------------------
                                                         1,187,363            507,728             679,635

Investments
     Expenditures on capital assets                       (155,381)          (108,363)            (47,018)

Foreign currency translation adjustment                       (736)            (1,526)                790
----------------------------------------------------------------------------------------------------------
Increase (decrease) in cash                                     -            (315,658)            315,658

Cash, beginning of period                                       -             315,658                  -
----------------------------------------------------------------------------------------------------------
Cash, end of period                                 $           -         $        -         $    315,658
==========================================================================================================
</TABLE>

See accompanying notes to financial statements.


                                      F-5
<PAGE>


WORKFIRE.COM, INC.
(A Development Stage Enterprise)
Notes to Financial Statements
$ United States

Year ended December 31, 1999 and period from incorporation on July 7, 1998 to
December 31, 1998
================================================================================

     Workfire.com,  Inc. ("WFI" or the "Company") is a development stage company
     and was incorporated under the name of Buffalo Capital VII, Ltd. ("BC7") on
     September  19,  1997 under the laws of the state of  Colorado.  The Company
     adopted the name,  Workfire.com,  Inc. effective June 18, 1999 and formally
     changed its name from Buffalo  Capital VII, Ltd. to  Workfire.com,  Inc. on
     July 12, 1999.  During 1999,  the Company's  principal  business  activity,
     carried on through it's former subsidiary,  Workfire.com (formerly Workfire
     Technologies  Inc.)  ("WTI"),  was the  development  of software to deliver
     extended  internet  services to internet  users.  On November 12, 1999, the
     Company  distributed  its shares of  Workfire.com on a prorata basis to its
     stockholders  of  record on that date and  became a shell  company  with no
     active operations.

1.   SIGNIFICANT ACCOUNTING POLICIES:

     a)  Basis of reporting

         These financial statements include the accounts of the Company as noted
         below  and  the  results  of  operations  of  its  former  wholly-owned
         subsidiary,   WTI,  and  WTI's  wholly-owned   subsidiaries,   Workfire
         Technologies  International  Inc.  ("WTII")  and  Workfire  Development
         Corporation ("WDC"), to November 12, 1999.

         Effective  June 18, 1999, the Company  acquired 89% of the  outstanding
         common  shares of WTI.  As WTI  stockholders  obtained  control  of the
         Company  through the  exchange of their shares of WTI for shares of the
         Company,  the  acquisition  of WTI  has  been  accounted  for in  these
         financial statements as a reverse  acquisition.  On September 30, 1999,
         pursuant to the General  Corporation  Laws of the State of Nevada,  WTI
         paid  its  dissenting  stockholders  represented  by the  residual  11%
         minority  share  ownership,  what it determined to be the fair value of
         their shares,  and subsequently  cancelled the shares.  On November 12,
         1999,  the  Company  distributed  all of its shares of WTI on a prorata
         basis to its  stockholders  of record on that date.  Consequently,  the
         statements of loss and cash flows for the year ended  December 31, 1999
         reflect the results of  operations  and the cash flows of WTI,  and its
         wholly-owned subsidiaries, WTII and WDC, for the period from January 1,
         1999 to November 12,  1999,  combined  with those of the legal  parent,
         WFI, from  acquisition  on June 18, 1999, in accordance  with generally
         accepted   accounting   principles   for  reverse   acquisitions.   The
         comparative  figures for the period from  incorporation on July 7, 1998
         to December 31, 1998 are those of the legal subsidiary, WTI.

         In these notes to the financial statements,  the Company,  prior to the
         business  combination  with  WTI,  is  referred  to as BC7,  and  after
         completion of the business  combination and name change, is referred to
         as WFI.

     b)  Translation of financial statements

         The Company's  former  subsidiary,  Workfire  Development  Corporation,
         operates  in  Canada  and its  operations  are  conducted  in  Canadian
         currency.


                                      F-6
<PAGE>



WORKFIRE.COM, INC.
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
$ United States

Year ended December 31, 1999 and period from incorporation on July 7, 1998 to
December 31, 1998
================================================================================

1.   SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

     b)  Translation of financial statements (continued)

         These  statements  are  presented  in United  States  currency  for the
         convenience of readers accustomed to United States currency. The method
         of  translation  applied  prior to the  Company's  distribution  of its
         ownership  in WTI was as follows:

         i)    Monetary  assets and  liabilities  were translated at the rate of
               exchange in effect at the  distribution  date, being US $1.00 per
               Cdn $1.462.

         ii)   Non-monetary  assets  and  liabilities  were  translated  at  the
               exchange rate in effect at the transaction date.

         iii)  Revenues and expenses  were  translated  at the exchange  rate in
               effect at the transaction date.

         iv)   The net adjustment arising from the translation was recorded as a
               separate  component  of  stockholders'   equity  called  "foreign
               currency translation adjustment".

     c)  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 disclosures 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.

     d)  Financial instruments

         The fair values of cash,  accounts  receivable and accounts payable and
         accrued  liabilities  approximate  their  carrying  values  due  to the
         relatively  short periods to maturity of these  instruments.  It is not
         possible to  determine  the fair value of amounts  due from/to  related
         parties as a maturity date is not determinable. The maximum credit risk
         exposure for all financial assets is the carrying amount of that asset.

     e)  Amortization of capital assets

         The  capital  assets of WTI were  recorded  at cost.  Amortization  was
         provided using the following methods and annual rates:

         =======================================================================
         Asset                                           Method             Rate
         -----------------------------------------------------------------------
         Office equipment                     Declining balance             20%
         Computer equipment                   Declining balance             30%
         Computer software                    Declining balance            100%
         Leasehold improvements                   Straight line             10%
         -----------------------------------------------------------------------

         Amortization  was provided  at one-half of the annual rates in the year
         of acquisition.


                                      F-7
<PAGE>



WORKFIRE.COM, INC.
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
$ United States

Year ended December 31, 1999 and period from incorporation on July 7, 1998 to
December 31, 1998
--------------------------------------------------------------------------------

1.   SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

     f)  Technology

         Software development costs of WTI have been accounted for in accordance
         with Statement of Financial Accounting Standards No. 86, ACCOUNTING FOR
         THE  COSTS  OF  COMPUTER  SOFTWARE  TO BE  SOLD,  LEASED  OR  OTHERWISE
         MARKETED.  Under the standard,  capitalization of software  development
         costs  begins  upon the  establishment  of  technological  feasibility,
         subject  to  net   realizable   value   considerations.   Technological
         feasibility  was not established at November 12, 1999 and therefore all
         costs of acquiring,  developing  and enhancing the Workfire  technology
         were charged to earnings as incurred.

     g)  Loss per share

         Loss per share has been calculated using the weighted average number of
         common shares  outstanding  during the period. The full exercise of the
         stock options referred to in note 4 is  anti-dilutive  and consequently
         loss per share on a fully diluted basis has not been presented.

2.   BUSINESS COMBINATIONS:

     a)  Effective  June 18,  1999,  BC7 and WTI executed a  reorganization  and
         stock purchase  agreement.  BC7 issued  10,431,725 common shares to the
         shareholders  of WTI  in  consideration  for  89%  of  the  issued  and
         outstanding  common shares of WTI on the basis of 1 common share of BC7
         for each common share of WTI.

         As the former  shareholders of WTI obtained  control of BC7 through the
         share exchange,  this  transaction was accounted for in these financial
         statements  as  a  reverse  acquisition  and  the  purchase  method  of
         accounting was applied.  Under reverse acquisition  accounting,  WTI is
         considered  to have  acquired BC7 with the results of BC7's  operations
         included in the financial statements from the date of acquisition.  The
         acquisition has been recorded at the tangible net asset value of BC7 at
         the date of acquisition. The acquisition details are as follows:

         Net assets acquired
           Cash                                                           1,310
           Accounts payable                                              (1,220)
         -----------------------------------------------------------------------
                                                                             90
         =======================================================================

         Consideration given for net assets acquired
           10,431,725 Common shares issued                                   90
         =======================================================================

         As WTI is deemed to be the continuing entity,  stockholders'  equity of
         WFI (formerly  BC7) was increased by $543,225 as a result of accounting
         for this combination as a reverse acquisition.


                                      F-8
<PAGE>


WORKFIRE.COM, INC.
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
$ United States

Year ended December 31, 1999 and period from incorporation on July 7, 1998 to
December 31, 1998
--------------------------------------------------------------------------------

2.   BUSINESS COMBINATIONS (CONTINUED):

     b)  Effective   August  26,   1998,   WTII  and   Tantallon   Capital  Inc.
         ("Tantallon")  executed a  business  combination  agreement.  Tantallon
         issued  10,800,000  common  shares  to  the  shareholders  of  WTII  in
         consideration  for all of the issued and  outstanding  common shares of
         WTII on the basis of 1.12 common  shares of Tantallon  for every common
         share of WTII. As the former  shareholders of WTII obtained  control of
         Tantallon  through  the  share  exchange,  this  transaction  has  been
         accounted for in these  financial  statements as a reverse  acquisition
         and the purchase  method of accounting has been applied.  Under reverse
         acquisition  accounting,  WTII is considered to have acquired Tantallon
         with the results of Tantallon's operations included in the consolidated
         financial statements from the date of acquisition.  The acquisition has
         been  recorded  at the net  asset  value  of  Tantallon  at the date of
         acquisition. The acquisition details are as follows:

         Net assets acquired
           Cash                                                              10
         =======================================================================
         Consideration given for net assets acquired
           10,800,000 Common shares issued                                   10
         =======================================================================

         Effective  September  15,  1998,  Tatallon  merged  with  WTI  with the
         continuing company using the name Workfire.com.

         The 1998  consolidated  statements  of loss,  stockholders'  equity and
         comprehensive  income and cash flows  reflect the results of operations
         and cash  flows of WTII,  the legal  subsidiary,  for the  period  from
         incorporation  of WTII on July 7, 1998 to December 31,  1998,  combined
         with those of WTI (formerly  Tantallon)  the legal parent,  from August
         26, 1998, being the effective date of the acquisition,  to December 31,
         1998.

3.   DUE TO RELATED PARTY:

     The amount due to related  party is  unsecured,  non-interest  bearing  and
     without stated terms of repayment.

4.  CAPITAL STOCK:

    a)   Authorized:
             100,000,000 common voting shares, without par value
              10,000,000 non-voting preferred shares without par value

    b)   Stock option plan:

         The  Company  has  reserved  1,375,840  common  shares for  issuance to
         officers and key  employees  pursuant to its  Stock  Option Plan.  This
         amount is to be adjusted annually to be the greater of 9% of the issued
         common shares of the Company  outstanding at the end of the immediately
         preceding  fiscal  year,  or  1,375,840.  Unless the  option  agreement
         executed by an optionee expressly otherwise provides, no portion of the
         options can be  exercised  until at least three  months after the grant
         date (the "vesting date").


                                      F-9
<PAGE>


WORKFIRE.COM, INC.
(A Development Stage Enterprise)
Notes to Financial Statements (continued)
$ United States

Year ended December 31, 1999 and period from incorporation on July 7, 1998 to
December 31, 1998
--------------------------------------------------------------------------------

4.   CAPITAL STOCK (CONTINUED):

     b)  Stock option plan (continued):

         The following stock options were granted during the year ended December
         31, 1999:

<TABLE>
<CAPTION>
==============================================================================================================================
       Number      Granted     Exercised      Expired          Number      Exercise
 outstanding,   during the    during the       during    outstanding,     price per
beginning of          year          year     the year     end of year         share         Expiry date         Vesting date
        year
------------------------------------------------------------------------------------------------------------------------------
<S>             <C>           <C>            <C>         <C>              <C>           <C>                 <C>

           -         5,999             -            -           5,999     $  1.1875     September 7, 2004     December 7, 1999
           -        84,375             -            -          84,375         $2.93         June 19, 2009   September 19, 1999
           -        74,000             -            -          74,000         $2.93         June 19, 2009        June 19, 2000
           -        74,000             -            -          74,000         $2.93         June 19, 2009        June 19, 2001
           -        74,000             -            -          74,000         $2.93         June 19, 2009        June 19, 2002
------------------------------------------------------------------------------------------------------------------------------
           -       312,374             -            -         312,374
==============================================================================================================================
</TABLE>

         The Company  applies APB  Opinion  No. 25 in  accounting  for its stock
         options and, accordingly,  no compensation cost has been recognized for
         its stock options in the financial statements. These stock options were
         issued to officers and key  employees  of WTI. The Company  distributed
         its shares of WTI to its  stockholders on November 12, 1999, and became
         a shell company with no active or prospective  operations.  As a result
         of the  distribution  of WTI  stock on  November  12,  1999,  the stock
         options were  terminated  effective  February 12, 2000  pursuant to the
         terms of the  Company's  stock option plan since the  grantees  were no
         longer employees of the Company or its subsidiary. Accordingly, had the
         Company  determined  compensation  cost  based on the fair value at the
         grant date for its stock  options under SFAS No. 123, the Company's net
         loss for 1999 would not have required any adjustment.

5.   THE YEAR 2000 ISSUE

     The Year 2000 Issue arises because many computerized systems use two digits
     rather than four to identify a year.  Date-sensitive  systems may recognize
     the  year  2000 as 1900  or some  other  date,  resulting  in  errors  when
     information  using  year 2000  dates is  processed.  In  addition,  similar
     problems  may  arise in some  systems  which use  certain  dates in 1999 to
     represent  something  other  than a date.  Although  the change in date has
     occurred,  it is not possible to conclude that all aspects of the Year 2000
     Issue that may affect the entity,  including  those  related to  customers,
     suppliers, or other third parties, have been fully resolved.





                                      F-10
<PAGE>