SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

(Mark One)

[X]  ANNUAL REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES  EXCHANGE
     ACT OF 1934

                   For the Fiscal Year Ended December 31, 2000

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

        For the transition period from ______________ to _______________.

                          Commission File No. 2-96366-A

                     AFFINITY INTERNATIONAL MARKETING, INC.
                 -----------------------------------------------
                (Name of registrant as specified in its charter)

          Florida                                       59-2483405
-------------------------------           --------------------------------------
(State or other jurisdiction of          (I.R.S. Employer Identification Number)
incorporation or organization)

       2300 Glades Road, Suite 450, West Tower, Boca Raton, Florida 33431
       ------------------------------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, Include Area Code:  (561) 750-7200

Securities Registered Pursuant to Section 12(b) of the Act:

         Title of Each Class           Name of Each Exchange on Which Registered
         -------------------           -----------------------------------------
                None                                     None

Securities Registered Pursuant to Section 12(g) of the Act:

                          Common Stock, $.001 par value
                          ------------------------------
                                (Title of Class)

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports);  and (2) has been subject to such
filing requirements for the past ninety (90) days. Yes X  No
                                                      ---   ---

     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not 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-K or any amendment to this
Form 10-K. [ ]

     28,990,756  shares of common stock of the Registrant were outstanding as of
May 15,  2001.  As of such date,  the  aggregate  market value of the voting and
non-voting common equity held by  non-affiliates,  based on the closing price on
the OTC Bulletin Board, was approximately $440,677.
<PAGE>

                                TABLE OF CONTENTS



                                                                            Page
                                                                            ----

PART I

         ITEM 1.      BUSINESS............................................    1
         ITEM 2.      PROPERTIES..........................................    1
         ITEM 3.      LEGAL PROCEEDINGS...................................    1
         ITEM 4.      SUBMISSION OF MATTERS TO A VOTE OF SECURITY
                      HOLDERS.............................................    2

PART II

         ITEM 5.      MARKET FOR REGISTRANT'S COMMON EQUITY
                      AND RELATED STOCKHOLDER MATTERS.....................    3
         ITEM 6.      SELECTED FINANCIAL DATA.............................    5
         ITEM 7.      MANAGEMENT'S DISCUSSION AND ANALYSIS
                      OF FINANCIAL CONDITION AND RESULTS
                      OF OPERATIONS.......................................    5
         ITEM 7A.     QUANTITATIVE AND QUALITATIVE DISCLOSURES
                      ABOUT MARKET RISK...................................    7
         ITEM 8.      FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.........    7
         ITEM 9.      CHANGES IN AND DISAGREEMENTS WITH
                      ACCOUNTANTS ON ACCOUNTING AND
                      FINANCIAL DISCLOSURE................................    8

PART III

         ITEM 10.     DIRECTORS AND EXECUTIVE OFFICERS OF THE
                      REGISTRANT..........................................    9
         ITEM 11.     EXECUTIVE COMPENSATION..............................   10
         ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
                      OWNERS AND MANAGEMENT...............................   10
         ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED
                      TRANSACTIONS........................................   11

PART IV

         ITEM 14.     EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND
                      REPORTS ON FORM 8-K.................................   11

SIGNATURES

<PAGE>

                                     PART I

     This Form 10-K contains  forward-looking  statements  within the meaning of
Section 27A of the  Securities  Act of 1933 and  Section  21E of the  Securities
Exchange Act of 1934. The Company's actual results could differ  materially from
those set forth in the  forward-looking  statements.  Certain factors that might
cause such a difference are discussed in the section  entitled  "Certain Factors
Affecting Future Operating Results" beginning on page 8 of this Form 10-K.

ITEM 1.  BUSINESS

     Incorporated  in  Florida  on  January  16,  1985,  Affinity  International
Marketing,  Inc. (the "Company"),  formerly Treasure and Exhibits International,
Inc. which was formerly Vanderbilt Square Corporation, originally engaged in the
business  of  equipment  rental  through  our wholly  owned  subsidiary  Hi-Tech
Leasing,  Inc. At that time we also provided  management services to Corrections
Services, Inc. ("CSI"). In July 1997, we sold our subsidiary to CSI and received
2,000,000  shares of CSI stock which were  subsequently  distributed  to Company
shareholders as dividends.  On September 10, 1997, we entered a letter of intent
to acquire an affiliated company, Michael's International Treasure Jewelry, Inc.
("Michael's");  and shortly thereafter the Company and Michaels,  as co-lessees,
entered a lease purchase agreement with Seahawk Deep Ocean Technology, Inc. (and
its partners,  collectively "Seahawk") to acquire certain Treasure and artifacts
(the  "Artifacts")  known as the Dry Tortugas  Treasure.  As a compliment to the
proposed  Michaels  acquisition,  on March 19, 1998,  we exercised our option to
purchase the Artifacts for $682,500 in cash, a $200,000 promissory note, and the
issuance  of  9,500,000  shares of our common  stock,  with  certain put options
attached. We borrowed the cash portion of this transaction, as well as the funds
to pay off the $200,000  not, from our affiliate  First Capital  Services,  Inc.
("First  Capital").  After completing a lengthy due diligence  process,  and the
determination that Michael's  operations could not be audited,  we abandoned the
Michael's acquisition.  On December 31, 1998, we sold a portion of the Artifacts
to  an  unrelated  third  party  purchaser  in  exchange  for  a  $750,000  note
receivable. Simultaneously, the purchaser entered into a credit arrangement with
First Capital, who paid the Company the $750,000 and took a security interest in
those pieces of the Artifacts purchased. The purchaser subsequently defaulted on
its loan obligation to First Capital, who then accepted the pledged Artifacts in
lieu of foreclosure.

     The Company has no operations  and plans to locate and consummate a reverse
merger or reverse acquisition with an unidentified private entity. The Company's
ability to  continue  operations  is  contingent  upon its ability to identify a
prospective target business.

     In March 2001,  we changed our name to  Affinity  International  Marketing,
Inc.

Employees

     Mr. Kenneth De Fillipo is the Company's only employee.

ITEM 2.  PROPERTIES

     Since September 1999, we utilized offices at 2300 Glades Road, Suite 450 in
Boca Raton, Florida, cost free from our affiliate First Capital.

ITEM 3.  LEGAL PROCEEDINGS

     In October 1999, Odyssey Marine Exploration,  Inc.  ("Odyssey")  obtained a
default judgment against us in the approximate  amount of $340,000 in connection
with its claims that the Company  allegedly  had failed to honor the put options
set forth in the Artifact purchase agreement. Thereafter Mr. Schwartz negotiated
and personally  guaranteed a forbearance  agreement  which provided that Odyssey
would not execute on the  judgment  and would  transfer  its common stock of the
Company to Mr.  Schwartz  provided  that Mr.  Schwartz  and/or the Company  make
weekly payments of $25,000.  After Mr. Schwartz paid approximately  $100,000, we
defaulted on the  remainder  of the weekly  payments.  Mr.  Schwartz and Odyssey
reached a subsequent oral agreement which provides that Odyssey will keep all of
its shares of the Company's common stock, provided such shares are free trading,
in  consideration  of the sum of $45,000.

                                       1
<PAGE>

     In connection  with the acquisition of the casino ship, we executed a lease
purchase option with  Entertainment  Cruises,  Inc.,  which provided for monthly
lease payments of $80,000 payable in advance quarterly, as well as reimbursement
for  insurance,  crew costs and other  operating  expenses.  Upon  return of the
ship's first voyage, we discovered that the ship was materially unfit to sail in
high seas and/or in seas  extending  over three miles from the shoreline in that
the ship did not have  sufficient  stabilizers to provide  sufficient  passenger
comfort.   We  believed  that  this   constituted  a  material   breach  of  the
lease/purchase agreement and/or fraud in the inducement of the execution of such
agreement,  and has prevented us from continuing our floating casino operations.
We returned the ship to the lessor, who then filed a lawsuit against the Company
claiming  damages in excess of $1,000,000.  We are  aggressively  defending this
lawsuit and are pursuing our counterclaims against the lessor,  including fraud,
misrepresentation, breach of contract and warranty.

     In  connection  with the cessation of our casino ship  operations,  Merrill
Stephens  Dry  Dock,  Inc.  sued  us  in  the  Dade  County  Circuit  Court  for
approximately   $23,000  for  services  and  materials   allegedly  provided  in
connection  with the  building  of a  platform  for the ship.  We have  retained
counsel to defend this matter and Mr.  Schwartz  has agreed to attempt to settle
this matter with personal funds.  Terminal  Plaza,  Inc. a dock facility in Dade
County  where we docked  and  loaded  the ship has also sued us and  obtained  a
default judgment in the approximate amount of approximately  $130,000 for claims
relating  to a one year lease for office and dockage in Dade  County.  The lease
provided for monthly  payments of $12,000 plus $1.00 per  passenger in excess of
7,500.  We have  entered  into a verbal  agreement  to settle  this  matter  for
$15,000,  which is subject to final  documentation.

     In December  1998 we  acquired  the assets of an adult  gaming  facility in
Sunny Isles Beach,  Florida,  along with an assignment of the lease  facility in
exchange for 1,500,000  shares of the Company's common stock and assumption of a
$750,00 note payable to First Capital.  We also entered into a verbal  agreement
with the seller to operate the  facility on our  behalf.  We operated  the adult
gaming  facility  until  October  1999;  and  thereafter  closed and vacated the
facility  upon  determining  that the  business  was not viable.  First  Capital
accepted the gambling  machines and related  assets as settlement of amounts due
under the $750,000  note.  The seller  claimed  $100,000 for past due management
fees for which and we have  reached a settlement  agreement  with the seller for
$80,000. We have paid $25,000 of this amount and owe $55,000.

     During the last quarter of 1999,  Mr. Lee  Summers,  the  Company's  former
chief  executive  officer,  sued us for  alleged  back wages in the  approximate
amount of $40,000 in the Palm Beach County State Circuit Court.  We have reached
an  agreement to settle this matter for the  issuance of  approximately  150,000
shares of the Company's  common  stock.  Although an agreement has been reached,
the consideration has not been transfered.

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

     None.


                                       2
<PAGE>

                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

     The  Company's  common stock  trades on the Over the Counter  Market on the
National  Association of securities  Dealers OTC Bulletin Board under the symbol
"AIMI". The following table sets forth the high and low closing sales prices for
the periods indicated.

                                                    High          Low
                                                   -------      --------

Calendar Year 2000

         Fourth Quarter.....................        $.17         .029
         Third Quarter......................         .27          .10
         Second Quarter.....................         .76        .1625
         First Quarter......................         .76         .135

Calendar Year 1999

         Fourth Quarter.....................        $.34         $.06
         Third Quarter......................         .43          .06
         Second Quarter.....................         .28          .09
         First Quarter......................         .38          .18

Calendar Year 1998

         Fourth Quarter.....................        $.28         $.03
         Third Quarter......................         .16          .03
         Second Quarter.....................         .21          .03
         First Quarter......................         .28          .12

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

     At May 15, 2001, the bid price of the Common Stock was $.02.

Holders

     As of May 15,  2001,  there  were  approximately  150  holders  of  record.
Additional  shares  of  the  Company's  common  stock  are  held  by  additional
shareholders at brokerage firms and/or clearing houses.  The Company  therefore,
was unable to determine the precise number of beneficial  owners of common stock
as of May 15, 2001.

Dividends

     The  Company  has never  declared  or paid any cash  dividend on its Common
Stock and does not expect to declare or pay any such dividend in the foreseeable
future.

                                       3
<PAGE>

Sales of Unregistered Securities

     In  connection  with our proposed  acquisition  of Michael's  International
Treasure Jewelry, Inc.  ("Michael's");  the Company and Michaels, as co-lessees,
entered a lease purchase agreement with Seahawk Deep Ocean Technology, Inc. (and
its partners,  collectively "Seahawk") to acquire certain Treasure and artifacts
(the  "Artifacts")  known as the Dry Tortugas  Treasure.  On March 19, 1998,  we
exercised  our option to purchase the  Artifacts  for $682,500  cash, a $200,000
promissory  note,  and the  issuance  of  9,500,000  shares of  common  stock to
Seahawk, with certain put options attached.

     On  July   24,   1998,   First   Consolidated   Financial   Corp.   ("First
Consolidated"), a closely held Florida corporation under common control with the
Company acquired 2,876,429 shares of restricted common stock of the Company from
Seahawk Deep Ocean Technology,  Inc., a Colorado  corporation which acquired the
shares as part of the  consideration  paid by the Company for the acquisition of
the  Artifacts  on or about March 19,  1998.  Pursuant to the terms of the stock
purchase agreement, First Consolidated paid $450,677 to acquire the common stock
from  Seahawk.  First  Consolidated  paid  approximately  40% at closing and the
balance  by  installment  payments.  First  Consolidated's  director  and  chief
executive  officer  is Mr.  Larry  Schwartz,  who is a former  president  of the
Company.

     On  December  29,  1998 we  acquired  the assets of  American  Consolidated
Amusement,  Inc., which consisted of approximately  200 gambling  machines along
with a related 4000 square foot leasehold interest located in Sunny Isles Beach,
Florida,  in consideration for the issuance of 1,500,000 shares of the Company's
common  stock to American  Consolidated  Amusement,  Inc.  and  assumption  of a
$750,000  note  owed to First  Capital,  which  was  secured  by a pledge of the
gambling  machines.  During this same time period, we issued 1,500,000 shares of
common stock valued at $202,500 to Mr. Larry  Schwartz in  satisfaction  of past
due management fees owed to First Consolidated Corp. and in consideration of his
personally guaranteeing certain corporate obligations.

     Pursuant to the  agreement  between the  Company,  Mr.  Larry  Schwartz and
Odyssey  Marine  Exploration,  Inc.,  executed on  November  10, 1999 to forbear
execution of the default judgment acquired by Odyssey in the approximate  amount
$340,000,  Mr. Larry Schwartz  acquired  480,000 shares of the Company's  common
stock directly from Odyssey.

                                       4
<PAGE>

ITEM 6.  SELECTED FINANCIAL DATA

     The Company's historical figures as of and for the years ended December 31,
1996,  1997,  1998,  1999 and  2000  have  been  derived  from its  consolidated
financial  statements and related notes. The historical  figures that follow are
qualified by reference to our financial statements and the related notes thereto
set forth herein.
<TABLE>


                                                       Years ended December 31,
                                     ----------------------------------------------------------
                                       1996        1997        1998        1999          2000
                                     --------    --------    --------     -------       -------
<S>                                  <C>         <C>         <C>          <C>           <C>

Income Statement Data:
Revenues............................  $ 227,902    $ 144,283          -           -             -
General and Administrative Expenses.    169,509      130,047   218,899     598,723       73,710
Net income (loss)...................     59,443       20,840  (999,146) (2,071,642)      (73,710)
Net income (loss) per share.........      $ 0.0        $ 0.0    $ (.04)     $ (.07)       $ (.00)
Weighted average shares
   outstanding...................... 14,847,281   16,437,088 23,648,920  28,990,756    28,990,756

Balance Sheet Data:
Total assets........................  1,063,919      195,938  3,471,597      21,261        18,886
Total liabilities...................     51,673       17,083  3,886,888   1,937,601     2,008,936
</TABLE>


ITEM 7. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

This Form 10-K contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934.  The Company's  actual results could differ  materially  from those set
forth in the forward-looking  statements.  Certain factors that might cause such
difference  are discussed in the section  entitled  "Certain  Factors  Affecting
Future Operating Results" beginning on page 7 of this Form 10-K.

Results of Operations

Year Ended December 31, 2000 Compared to Year Ended December 31, 1999

     Revenues.  Net  revenues  were $0 for the  year  ended  December  31,  1999
compared to $0 for the year ended  December  31, 2000.  Realized and  unrealized
gain in investments in marketable  securities was $0 for the year ended December
31, 2000 compared to a loss of $(10,009) for the year ended December 31, 19999.

     General and administrative  expenses.  General and  administrative  expense
decreased by 88% from  $598,723 for the year ended  December 31, 1999 to $73,710
for the year ended December 3,1 2000. The decrease in general and administrative
expenses was primarily  attributable to the absence of start-up costs associated
with the maiden voyage of our casino cruise ship and the acquisition of an adult
gaming  complex in Sunny Isles,  Florida,  as well as leasing costs to berth the
ship which was partially offset by increased legal and accounting fees.

     Losses  from  Continuing  Operations.  Losses  from  continuing  operations
totaled  $(73,710),  for the year ended December 31, 2000, as compared to losses
of $(598,923) for the year ended  December 31, 1999.  This decrease is primarily
attributable to the absence of start-up costs  associated with the maiden voyage
of our casino  cruise ship and the  acquisition  of an adult  gaming  complex in
Sunny  Isles,  Florida,  as well as  leasing  costs to berth the ship  which was
partially offset by increased legal and accounting fees.

     Losses  from  Discontinued  Operations.  In  2000  we  had no  losses  from
discontinued  operations.  In 1999 we ceased  operations  related  to the casino
operations,  and sold a portion of the Artifacts  for $750,000.  The revenue and
related costs are included in discontinued  operations.  Loss from  discontinued
operations totaled  $(1,281,983) for the year ending December 31, 1999, compared
to a loss of $0. As a  result,  we had a net loss of  $(2,071,642)  for the year
ended December 31, 1999 compared to a net loss of $(73,710) realized in 2000.

                                       5
<PAGE>

Year Ended December 31, 1999 Compared to Year Ended December 31, 1998

     Revenues.  Revenues  were $0 for both the year ended  December 31, 1998 and
for  the  year  ended  December  31,  1999.  Realized  and  unrealized  gain  in
investments  in  marketable  securities  decreased by 393.5% from $3,410 for the
year ended  December  31, 1998 to a loss of $10,009 for the year ended  December
31, 1999. The loss on investments  was  attributable  to a decline in the market
price.

     General and administrative  expenses.  General and  administrative  expense
increased by $379,824 or 173.5% from  $218,899 in 1998 to $598,723 in 1999.  The
increase in general and  administrative  expenses was primarily  attributable to
increased costs incurred in connection with operations of the casino cruise ship
and land based casino.

     Losses  from  Continuing  Operations.  Losses  from  continuing  operations
totaled  $(1,149,176),  for the year ended  December  31,  1999,  an increase of
$645,622 or 184.8% from  losses of  $(503,554)  during  1998.  This  increase is
primarily attributable to increased interest expense and salary expense.

     Losses from  Discontinued  Operations.  In 1998 we  abandoned  our intended
acquisition  of Michael's  International  Treasure  Jewelry  Inc.,  and began to
liquidate our investment of Artifacts.  In 1999 we ceased operations  related to
the casino  operations,  and sold a portion of the Artifacts  for $750,000.  The
revenue and related costs are included in discontinued  operations.  Losses from
discontinued  operations  totaled  $1,281,983  for the year ending  December 31,
1999,  compared to losses of $785,592 for the year ended  December 31, 1998. The
losses in 1999 are  attributable  to revenues of $287,000  which were offset by:
direct  costs of  $64,000;  maintenance  charges for the cruise ship of $77,000;
lease and berth space costs of $379,000 and accounting for a default judgment of
$130,000  pursuant  to claims  relating to  berthing  space of our casino  ship;
settlement  of a  lawsuit  involving  claims  for  outstanding  management  fees
relating to the operation of the adult gaming facility in the amount of $80,000;
wages and  subcontracting  fees of $391,000;  payroll tax of $34,000;  marketing
costs of $85,000;  and depreciation of $39,000; and other miscellaneous costs of
$289,000.  During  the  year  ended  December  31,  1999,  we also had a loss on
disposal of  discontinued  operations of  $(181,483).  We recorded an income tax
benefit of $541,000 in connection with losses from discontinued operations. As a
result,  we had a net loss of $(2,071,642)  for the year ended December 31, 1999
compared to a loss of $(999,146) for the year ended December 31, 1998.

Liquidity and Capital Resources

Year Ended December 31, 2000 Compared to Year Ended December 31, 1999

     At December 31, 2000, we had a working capital deficit of $(1,997,672)  and
a cash  balance  of  $11,264.  This  compares  to a working  capital  deficit of
$(1,923,962)  and a cash balance of $4,095 at December 31, 1999. At December 31,
2000,  we had current  assets of $11,264 as compared to $13,639 at December  31,
1999;  total  assets of $18,886 at  December  31, 2000 as compared to $21,261 at
December 31, 1999;  current and total  liabilities of $2,008,936 at December 31,
2000 as compared to  $1,973,601  at December  31,  1999; a negative net worth of
$(1,990,050)  at  December  31,  2000 as  compared  to a  negative  net worth of
$(1,916,340) at December 31, 1999.

Year Ended December 31, 1999 Compared to Year Ended December 31, 1998

     At December 31, 1999, we had a working  capital deficit of $1,923,962 and a
cash balance of $4,095.  This compares to working  capital deficit of $3,115,791
and a cash balance of $1,544 at December 31, 1998.  At December 31, 1999, we had
current  assets of $13,639 as compared to $771,097 at December 31,  1998;  total
assets of $21,261 at December 31, 1999 as compared to $3,471,597 at December 31,
1998;  current and total  liabilities  of  $1,937,601  at  December  31, 1999 as
compared  to  $3,886,888  at  December  31,  1998;  and a negative  net worth of
$1,916,340  at December 31, 1999 as compared to a negative net worth of $415,291
at December 31, 1998. The decrease in assets was  principally  the result of the
surrender  of  collateral  in lieu  of  foreclosure,  and a  decrease  in  notes
receivable  of $750,000 from the purchaser of the Artifacts and the recording of
net assets for discontinued operations.

                                       6
<PAGE>

     During the year ended  December  31,  1999,  we had an increase in cash and
cash  equivalents  of $2,551,  from $1,544 to $4,095.  This increase in cash was
principally due to collections of $750,000 of notes  receivables,  loans from an
affiliate  of  $113,400,  offset by cash used in losses  from  operations.  As a
result of the loss incurred in 1999,  operating activities used $860,932 in cash
during 1999 as compared to $321,001 during 1998.

Subsequent Events

     In March 2001,  we changed our name to  Affinity  International  Marketing,
Inc.

Year 2000 Issue

     We  experienced  no material  failures  and  incurred no material  costs or
losses as a result of the Year 2000 Issue.

Impact of Inflation

     Inflation has not been a major factor in our  businesses  since  inception.
There can be no assurances that this will continue.

Certain Factors Affecting Future Operating Results

     This Form 10-K contains  forward-looking  statements  within the meaning of
Section 27A of the  Securities  Act of 1933 and  Section  21E of the  Securities
Exchange Act of 1934. The Company's actual results could differ  materially from
those set forth in the forward-looking  statements.  We believe that in order to
commence  active  operations,  we must  acquire an  operating  company.  We will
continue to look for  potential  business  opportunities;  however we are solely
dependent upon the efforts of our chief executive  officer in this area. We have
only limited funds available to aid in the search of a business  opportunity and
there can be no assurance that we will raise additional  capital to enable us to
acquire a suitable potential business opportunity,  or that we will ever acquire
such business opportunity.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Not applicable

ITEM 8.  FINANCIAL STATEMENTS  AND SUPPLEMENTARY DATA

     The  consolidated  financial  statements of the Company,  together with the
independent  auditors' report thereon of Malone & Bailey, PLLC, appear beginning
on page F-1 of this report. See Index to Financial Statements.

                                       7
<PAGE>

ITEM 9.  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
         FINANCIAL DISCLOSURE

     On April 10, 2001, the client-auditor  relationship between the Company and
Rachlin, Cohen & Holtz LLP ("RCH") ceased.

     To the knowledge of the Company's current Board of Directors,  RCH's report
of the financial  statements of the  Registrant  for each of the past two fiscal
years did not contain any adverse  opinion or  disclaimer of opinion and was not
qualified or modified as to audit scope or accounting  principles.  However, the
report contained an explanatory paragraph expressing substantial doubt as to the
Company's ability to continue as a going concern.

     During  the  Company's  two most  recent  fiscal  years and the  subsequent
interim period preceding the termination of the  client-auditor  relationship on
April 10, 2001, to the knowledge of the Registrant's current Board of Directors,
there were no disagreements  with RCH on any matter of accounting  principles or
practices, financial statement disclosure, or auditing scope or procedure, which
disagreements, if not resolved to the satisfaction of RCH, would have caused RCH
to make reference to the subject matter of the  disagreements in connection with
their audit report with respect to financial statements of the Company.

     On April 4, 2001, the Company received a letter from RCH regarding a review
of its quarterly statements. The Board of Directors has acted on this matter and
the statements have now been reviewed by an independent accounting firm.

     To the knowledge of the Registrant's current Board of Directors, during the
Registrant's  two  most  recent  fiscal  years  there  was  no  disagreement  or
difference of opinion with RCH regarding any "reportable event," as that term is
defined in Item 304(a)(1)(v) of Regulation S-K.


                                       8
<PAGE>

                                    PART III

ITEM 10.  DIRECTORS,   EXECUTIVE   OFFICERS,   PROMOTERS  AND  CONTROL  PERSONS;
          COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Information Regarding Executive Officers and Directors

     The following  table sets forth the names,  ages and offices of the present
executive  officers and directors of the Company.  The periods during which such
persons  have served in such  capacities  are  indicated in the  description  of
business experience of such persons below.

         Name                   Age              Position
     --------------            ------           --------------
     Kenneth A. De Fillipo       61     Chairman and Chief Executive Officer
     Nick Bollettieri            69     Director

     All officers serve at the  discretion of the Board of Directors.  There are
no family relationships among any of the directors or officers of the Company.

     Kenneth A De  Fillipo.  Mr. De  Fillipo  has served as  Chairman  and Chief
Executive  Officer of the Company since January 2001. Since 1994, Mr. De Fillipo
has served as  Councilman/Vice  Mayor of the City of North Miami  Beach.  Mr. De
Fillipo attended the University of Houston.

     Nick  Bollettieri.  Mr.  Bollettieri  has served as Director of the Company
since February 2001. Mr. Bollettieri  founded and has served as President of the
Nick Bollettieri  Tennis Academy since 1978. The Nick Bollettieri Tennis Academy
is a full-time  tennis  boarding  school  dedicated  to  preparing  students for
college  within an  environment  that combines  intense  tennis  training with a
specially designed academic  curriculum.  Mr. Bollettieri has been listed as one
of the most  influential  people  in tennis by  various  publications  including
Tennis  Magazine,  The Sporting  Life,  and the  Sarasota  Herald  Tribune.  Mr.
Bollettieri  has  received  many awards for his  accomplishments  and  community
service and has been the keynote speaker at a variety of events. Mr. Bollettieri
is world  renowned for his  involvement  with players such as Andre Agassi,  Jim
Courier,  Monica Seles,  Boris Becker,  Martina Hingis,  Anna Kournikova and the
Williams Sisters.

Compliance With Section 16(a) of Exchange Act

     Under the securities  laws of the United States,  the Company's  directors,
its  executive  officers,  and any persons  holding more than ten percent of the
Company's  Common Stock are required to report  their  initial  ownership of the
Company's  Common  Stock and any  subsequent  changes in that  ownership  to the
Securities  and  Exchange  Commission.  All  of  the  filing  requirements  were
satisfied on a timely basis in 2000.  In making these  disclosures,  the Company
has relied solely on written statements of its directors, executive officers and
shareholders and copies of the reports that they filed with the Commission.


                                       9
<PAGE>

ITEM 11.  EXECUTIVE COMPENSATION

     The following  table sets forth  information  concerning  cash and non-cash
compensation  paid or accrued for  services  to the  Company is Chief  Executive
Officer  during the three years ended December 31, 2000 of each of the Company's
most highly compensated executive officers.
<TABLE>


                                                                                       Long Term
                                         Annual Compensation                         Compensation
                                                                  Other Annual          Stock
Name and Principal Position     Year    Salary ($)   Bonus ($)   Compensation ($)   Options (#)(1)
----------------------------   ------   ----------  -----------  ----------------   ---------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>

Lee Summers.................    1999        0           0              (1)                 (1)
  Chief Executive Officer...    1998        0           0              (1)                 (1)

</TABLE>

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

(1)  The  Company and Mr. Summer entered into a three year  employment  contract
     commencing January 4, 1999 providing for annual  compensation  ranging from
     $100,000 to $150,000; immediate issuance of 100,000 shares of the Company's
     common stock and stock options at $.23  exercisable  during the term of the
     employment  contract.  On June 4, 1999 Mr.  Summers left the Company and in
     the fourth quarter of 1999,  filed a law suit in the state circuit court of
     Palm Beach County,  Florida claiming alleged back wages of $40,000.  He has
     verbally  agreed to accept 150,000 shares of the Company's  common stock as
     settlement  of his  claims;  however  the  settlement  is  subject to final
     documentation.

Compensation of Directors

     No additional compensation of any nature is paid to any directors.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table is furnished as of May 15, 2001, to indicate beneficial
ownership of shares of the Company's Common Stock by (1) each shareholder of the
Company who is known by the Company to be a beneficial  owner of more than 5% of
the Company's Common Stock, (2) each director, and named officer of the Company,
individually,  and (3) all officers and directors of the Company as a group. The
information in the following table was provided by such persons.
<TABLE>

 Name and Address                          Amount and Nature of
 of Beneficial Owner                      Beneficial Ownership (1)   Percent of Class
 --------------------                     ------------------------   -----------------
<S>                                       <C>                        <C>

Kenneth A. De Fillipo (2)................                 -                    *
Nick Bollettieri (2).....................                 -                    *
Larry Schwartz (2)(3)....................     4,154,824 (2)                14.3%
Seahawk Deep Ocean Technology, Inc.(4)...         2,802,084                 9.7%
All executive officers and directors.....
         as a group (2 persons)..........                 -                    *
</TABLE>
---------------
*     Less than one percent

(1)  The persons named in the table have sole voting and  investment  power with
     respect to all shares of Common Stock shown as  beneficially  owned by them
     subject to community  property laws, where applicable,  and the information
     contained in the footnotes to the table.
(2)  Business address is 2300 Glades Road, Boca Raton, Florida 33431
(3)  Includes  2,174,824  shares owned by First  Consolidated  Financial  Corp.,
     which is owned and controlled by Mr. Schwartz.
(4)  Address is 5102 S. Westshore Blvd., Tampa, Florida 33611.


                                       10
<PAGE>

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The  Company has  secured  financing  for its  operations  primarily  from First
Capital Services,  Inc. and First Consolidated Financial Corp. which are related
to the Company by means of a common controlling stockholder.

First Capital has provided primary financing with total outstanding loan amounts
of approximately $2,135,000.  First Capital loaned funds to the Company pursuant
to a master loan  agreement  for a maximum of  $2,000,000,  which  provided  for
interest payable monthly at 12% and principal repayment on December 1, 2000. The
loan was secured by all of the  Company's  assets  including the  artifacts.  In
addition, the Company accepted assignment of a loan in the amount of $750,000 in
connection  with the  purchase  of the adult  gaming  complex.  This note earned
interest at 12%,  payable  monthly,  with the principal due on February 16, 2000
and was owed to First  Capital.  This note was  secured by all the assets of the
adult gaming complex.

Both of these  notes  were  satisfied  in full,  including  unpaid  interest  of
approximately  $350,000 in December  1999,  with the  surrender of collateral in
lieu of foreclosure.

First Consolidated  provided  financing in the amount of approximately  $501,000
through  December 31, 2000.  First  Consolidated  is a major  stockholder and is
owned by Larry Schwartz. The loan is due on demand, bears interest at 12% and is
uncollateralized.

The Company  entered into  transactions  with various  entities and  individuals
affiliated by virtue of their position with the Company or stock ownership which
resulted in expenses to the Company as follows: consulting and professional fees
of $227,500 during 1999 and $30,000 during 1998;  interest expense of $60,000 in
2000,  $323,109 in 1999 and $98,692 during 1998; and management  fees of $80,000
during 1999.

                                     PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a)  The following documents are filed as a part of this Report:

     (1)  Financial Statements:

          (i)  Report of Independent Auditors
          (ii) Consolidated  Balance  sheet as of December 31, 2000 and December
               31, 1999
          (iii)Consolidated  Statement of Operations  for the three years ending
               December 31, 2000, 1999 and 1998
          (iv) Consolidated Statement of Shareholders equity for the three years
               ended December 31, 2000, 1999 and 1998
          (v)  Consolidated  Statement  of Cash Flows for the three  years ended
               December 31, 2000, 1999 and 1998
          (vi) Notes to Consolidated Financial Statements

     (2)  Financial Statement Schedules

         None

     (3)  Exhibits

         None.

     (b)  Reports on Form 8-K

     None

                                       11
<PAGE>

                                   SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                     AFFINITY INTERNATIONAL MARKETING, INC.


                                By: /s/ Kenneth De Fillipo
                                    --------------------------------------------
                                    Kenneth De Fillipo
                                    Chairman and Chief Executive Officer


Dated: May 17, 2001

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

    Signature                 Title                                  Date

/s/ Kenneth De Fillipo      Chairman and Chief Executive Officer   May 17, 2001
-----------------------
Kenneth De Fillipo


/s/ Nick Bollettieri        Director                               May 17, 2001
-----------------------
Nick Bollettieri

                                       12
<PAGE>


                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors
Affinity International Marketing, Inc.

We have  audited  the  accompanying  balance  sheet  of  Affinity  International
Marketing,  Inc.  (formerly  Treasure  and Exhibits  International,  Inc.) as of
December 31,  2000,  and the related  statements  of  operations,  stockholders'
deficit,  and cash flows for the year 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 audit.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  financial  position  of  Affinity  International
Marketing,  Inc.  (formerly  Treasure  and Exhibits  International,  Inc.) as of
December 31, 2000,  and the results of its operations and its cash flows for the
year then ended, in conformity with accounting  principles generally accepted in
the United States.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As described in Note 2 to the
financial  statements,  the Company is subject to certain  significant risks and
uncertainties,  which  conditions  raise  substantial  doubt about the Company's
ability to continue as a going concern.  Management's plans with regard to these
matters are also described in Note 2 to the financial statements.  The financial
statements do not include any adjustments  that might result from the outcome of
these significant risks and uncertainties.


/s/ Malone & Bailey, PLLC
Houston, Texas

May 15,  2001


<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders
Treasure and Exhibits International, Inc.
Boca Raton, Florida


We have audited the  accompanying  consolidated  balance  sheets of Treasure and
Exhibits  International,  Inc. as of December 31, 1999 and 1998, and the related
consolidated statements of operations,  stockholders'  deficiency and cash flows
for the years  then  ended.  These  consolidated  financial  statements  are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated financial statements based on our audit.

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

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all  material  respects,  the  consolidated  financial  position  of
Treasure and Exhibits International,  Inc. as of December 31, 1999 and 1998, and
the results of their operations and their cash flows for the years then ended in
conformity with generally accepted accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As described in Note 2 to the
consolidated financial statements, the Company is subject to certain significant
risks and  uncertainties,  which  conditions raise  substantial  doubt about the
Company's ability to continue as a going concern. Management's plans with regard
to these  matters are also  described  in Note 2 to the  consolidated  financial
statements. The consolidated financial statements do not include any adjustments
that might result from the outcome of these significant risks and uncertainties.


                                                 RACHLIN COHEN & HOLTZ LLP

Fort Lauderdale, Florida
April 18, 2000

                                      F-2
<PAGE>


                     AFFINITY INTERNATIONAL MARKETING, INC.
              (formerly Treasure and Exhibits International, Inc.)
                                  BALANCE SHEET
                                December 31, 2000

                                                  December 31,     December 31,
                                                     2000             1999
                                               ----------------  ---------------
ASSETS

Current assets:
  Cash                                         $       11,264         $ 4,095
  Investments                                               -           9,544
                                               ----------------  --------------
       Total current assets                            11,264          13,639

Other                                                   7,622           7,622
                                               ----------------  --------------
                                                      $18,886         $21,261
                                               ================  ==============


LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
  Accounts payable and accrued expenses            $ 384,145        $ 369,645
  Notes payable - shareholder                        580,384          523,549
  Put option liability                             1,044,407        1,044,407
                                              ---------------- ----------------
       Total current liabilities                   2,008,936        1,937,601
                                              ---------------- ----------------

Commitments and contingencies                              -                -

Stockholders' Deficit:
    Common stock, $.0001 par value;
    50,000,000 shares authorized: 28,990,756
    shares issued and outstanding                      2,899            2,899
  Additional paid-in capital                       2,111,706        2,111,706
    Accumulated deficit                          (4,104,655)      (4,030,945)
                                              ---------------- ----------------
       Stockholders' Deficit                     (1,990,050)      (1,916,340)
                                              ---------------- ----------------
                                                     $18,886          $21,261
                                              ================ ================




     See accompanying summary of accounting policies and notes to financial
                                   statements

                                      F-3
<PAGE>

                     AFFINITY INTERNATIONAL MARKETING, INC.
              (formerly Treasure and Exhibits International, Inc.)
                            STATEMENTS OF OPERATIONS
<TABLE>



                                                                For the Years Ended
                                                                    December 31,
                                                   ------------------------------------------------
                                                      2000             1999              1998
                                                   -------------    -------------    --------------
<S>                                                <C>             <C>               <C>

Revenues                                        $             -  $             -  $              -
Costs of revenue                                              -                -                 -
                                                   -------------    -------------    --------------
Gross margin                                                  -                -                 -
                                                   -------------    -------------    --------------

General and administrative                               73,710          598,723           218,899
                                                                                     --------------
                                                   -------------    -------------
Loss from continuing operations
                                                       (73,710)        (598,723)         (218,899)
Other income (expense):
  Realized and unrealized
  Gain (loss) on investments                                  -         (10,009)             3,410
  Interest and dividend
  Income                                                      -              556             1,935
                                                   -------------    -------------    --------------
Loss before discontinued operations
                                                       (73,710)        (608,176)         (213,554)
                                                   -------------    -------------    --------------
Discontinued operations:
Loss on disposal of discontinued operations
                                                              -        (181,483)                 -
Loss from operations of discontinued
operations                                                    -      (1,281,983)         (785,592)
                                                   -------------    -------------    --------------
                                                              -      (1,463,466)         (785,592)
                                                   -------------    -------------    --------------

Net Loss                                        $      (73,710)  $   (2,071,642)  $      (999,146)
                                                   =============    =============    ==============

Loss per share:
  Continuing operations                                $ (0.00)         $ (0.02)          $ (0.01)
  Discontinued operations                                     -           (0.05)            (0.03)
                                                   -------------    -------------    --------------
                                                       $ (0.00)         $ (0.07)          $ (0.04)
                                                   =============    =============    ==============

Weighted average shares outstanding:
                                                   28,990,756       28,990,756        23,648,920
</TABLE>



     See accompanying summary of accounting policies and notes to financial
                                   statements
                                      F-4
<PAGE>


                     AFFINITY INTERNATIONAL MARKETING, INC.
              (formerly Treasure and Exhibits International, Inc.)
                       STATEMENTS OF STOCKHOLDERS' DEFCIT

<TABLE>


                                       Common stock

                              ----------------------------    Additional       Accumulated
                                 Shares          Amount     paid-in capital     Deficit            Total
                              -------------- ------------- ----------------- -----------------   -----------
<S>                           <C>            <C>           <C>               <C>                 <C>

Balance at December 31, 1997
                               16,490,756        $1,649       $ 1,137,363        $(960,157)        $ 178,855
Stock issued for artifacts,
net of put option
                                9,500,000           950             (950)                 -                -
Stock issued for business
                                1,500,000           150           202,350                 -          202,500
Stock issued for services
                                1,500,000           150           202,350                 -          202,500
Net loss                                -             -                 -         (999,146)        (999,146)
                              ------------ ------------- ----------------- -----------------   -------------
Balance at December 31, 1998
                               28,990,756         2,899         1,541,113       (1,959,303)        (415,291)
Put option waived                       -             -           570,593                 -          570,593
Net loss                                -             -                 -       (2,071,642)      (2,071,642)
                              ------------ ------------- ----------------- -----------------   -------------
Balance at December 31, 1999
                               28,990,756         2,899         2,111,706       (4,030,945)      (1,916,340)
Net loss                                -             -                 -          (73,710)         (73,710)
                              ------------ ------------- ----------------- -----------------   -------------
Balance at December 31, 2000                                                                    $(1,990,050)
                               28,990,756       $ 2,899       $ 2,111,706      $(4,104,655)
                              ============ ============= ================= =================   =============
</TABLE>


      See accompanying summary of accounting polices and notes to financial
                                   statements
                                      F-5
<PAGE>


                     AFFINITY INTERNATIONAL MARKETING, INC.
              (formerly Treasure and Exhibits International, Inc.)
                            STATEMENTS OF CASH FLOWS
<TABLE>

                                                                 For the Years Ended
                                                                    December 31,
                                                    -----------------------------------------
                                                       2000           1999           1998
                                                    ----------    -------------    ----------
<S>                                                <C>            <C>              <C>

CASH FLOWS FROM OPERATING ACTIVITIES
  Net loss                                           $ (73,710)   $(2,071,642)      $(999,146)
    Adjustments to reconcile net loss to net cash
    used in operating activities:
    Expenses paid by affiliate                               -        887,510         395,804
    Depreciation and amortization                            -         51,502               -
    Stock issued for services                                -              -         202,500
    Realized and unrealized (gain) loss on sale
    of marketable securities
                                                         9,544         10,009         (3,410)
    Changes in assets and liabilities:
    Other assets                                             -        (7,122)           (500)
    Accounts payable and accrued expenses
                                                        14,500        268,811          83,751
                                                    ------------  -------------   -------------
NET CASH USED IN OPERATING ACTIVITIES
                                                       (49,666)      (860,932)       (321,001)
                                                    ------------  -------------   -------------
CASH FLOWS FROM INVESTING ACTIVITES
    Principal payments received                              -        750,000
    Principal payments received affiliates
                                                             -              -         125,000
    Loans and advances to
    Affiliates                                               -              -       (125,000)
                                                    ------------  -------------   -------------
NET CASH PROVIDED BY INVESTING ACTIVITIES
                                                             -        750,000               -
                                                    ------------  -------------   -------------
CASH FLOWS FROM FINANCING ACTIVITES
    Proceeds from notes payable - affiliates
                                                        56,835        113,483         142,750
                                                    ------------  -------------   -------------

NET INCREASE (DECREASE) IN CASH                          7,169          2,551       (178,251)
Cash, beginning of period                                4,095          1,544         179,795
                                                    ------------  -------------   -------------
Cash, end of period                                   $ 11,264        $ 4,095          $1,544
                                                    ============  =============   =============

Supplemental disclosure of cash flow information:
  Cash paid for interest                              $      -        $     -          $3,333
</TABLE>


     See accompanying summary of accounting policies and notes to financial
                                   statements
                                      F-6
<PAGE>


                     AFFINITY INTERNATIONAL MARKETING, INC.
              (formerly Treasure and Exhibits International, Inc.)
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1 - SUMMARY OF ACCOUNTING POLICIES

The Company was  organized as  Vanderbuilt  Square  Corp.  under the laws of the
State of Florida on January 16,  1985.  On February  10,  1998,  the name of the
Company was changed to Treasure and Exhibits International,  Inc. In March 2001,
the Company changed its name to Affinity International Marketing, Inc.

The Company  currently  has no operations  and plans to locate and  consummate a
reverse merger or reverse  acquisition with an unidentified  private entity. The
Company's  ability to  commence  operations  is  contingent  upon its ability to
identify a prospective target business.

Reclassifications

Certain items  presented  during the year ended  December 31, 1999 and 1998 have
been  reclassified to conform with the  presentation for the year ended December
31, 2000.

Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and  assumptions  that affect the reported  amounts of assets and liabilities at
the date of the balance sheet. Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original  maturities of
three months or less to be cash equivalents.

Property and Equipment

Property and equipment are stated at cost.  Depreciation  is computed  using the
straight-line method over their estimated useful lives of the assets.

Impairment of long-lived assets

The Company records  impairment  losses on long-lived  assets used in operations
when  indicators  of  impairment  are  present and the  undiscounted  cash flows
estimated to be  generated  by those  assets are less than the assets'  carrying
amount.
                                      F-7
<PAGE>

Income taxes

Income  taxes are  accounted  for using an asset and  liability  approach  which
requires the recognition of taxes payable or refundable for the current year and
deferred tax  liabilities  and assets for the future tax  consequences of events
that have been recognized in the Company's financial  statements or tax returns.
The  measurement of current and deferred tax assets and liabilities are based on
provisions of the enacted tax law; the effects of future  changes in tax laws or
rates are  anticipated.  The  measurement of deferred tax assets is reduced,  if
necessary,  by the amount of any tax benefits that, based on available evidence,
are not expected to be realized.

Basic Loss Per Share

Basic loss per share has been calculated based on the weighted average number of
shares of common stock outstanding during the period.

Diluted net loss per common share is computed by dividing  the net loss,  by the
weighted  average number of common shares  outstanding  plus potential  dilutive
securities.  The potential dilutive  securities had an anti-dilutive  effect for
all years shown.

Recent Accounting Pronouncements

The  Company  does  not  expect  the  adoption  of  recently  issued  accounting
pronouncements  to  have a  significant  impact  on  the  Company's  results  of
operations, financial position or cash flow.

NOTE 2 - GOING CONCERN

Going Concern Considerations

The  accompanying  consolidated  financial  statements  have been  presented  in
accordance  with  generally  accepted  accounting  principles,  which assume the
continuity of the Company as a going concern.

As reflected in the consolidated financial statements,  the Company incurred net
losses of approximately $73,000, $2,071,000 and $999,000 in 2000, 1999 and 1998,
and the financial position reflects a stockholders'  deficiency of approximately
$1,990,000 as of December 31, 2000.

Currently the Company has no operations.  During 1999, the Company  discontinued
all of its business  operations and surrendered  all of its remaining  assets to
First  Capital  Services,  Inc.,  (First  Capital)  an entity  related by common
control and ownership,  in settlement of outstanding  loans payable,  in lieu of
foreclosure.

As discussed  below,  the Company is the defendant in several matters of pending
litigation resulting from various components of the discontinued operations, the
ultimate outcome of which is not presently susceptible to reasonable measurement
or estimation.

Management's plans with regard to these matters include:

Management   plans  to  locate  and  consummate  a  reverse  merger  or  reverse
acquisition  with an  unidentified  private  entity.  The  Company's  ability to
commence  operations  is  contingent  upon its ability to identify a prospective
target business.
                                      F-8
<PAGE>

The Company is involved in several matters of pending litigation as follows:

In October 1999, Odyssey Marine Exploration, Inc. ("Odyssey") obtained a default
judgment against the Company in the approximate amount of $340,000 in connection
with its claims  that the  Company  allegedly  had failed to  recognize  the put
options set forth in the Artifact purchase  agreement (see Note 3).  Thereafter,
the former  president  ("President")  of the Company  negotiated  and personally
guaranteed a forbearance agreement which provided that Odyssey would not execute
on the  judgment  and would  transfer  their  common stock of the Company to the
President provided that the President and/or the Company made weekly payments of
$25,000. After the President paid approximately  $100,000, the Company defaulted
on the remainder of the weekly payments, and the President and Odyssey reached a
subsequent  oral agreement which provided that Odyssey keep all of its shares of
the  Company's  common  stock,   provided  such  shares  are  free  trading,  in
consideration of the sum of $45,000. The President had agreed to pay this amount
personally as he had already  received  480,000  shares of the Company's  common
stock from Odyssey pursuant to the first forbearance agreement.

The lessor of the casino  cruise ship filed a claim to enforce the full terms of
the lease,  including payment of late fees and costs, alleging damages in excess
of $1,000,000.  The Company  intends to defend the claim to its full ability and
pursue all counterclaims against the lessor that are available.

In 1999,  the lessor of the berth filed a claim to enforce the full terms of the
lease  including fees and costs.  The lessor has received a default  judgment in
the amount of $130,000.

In March 2000,  the Company was named as a defendant in  litigation  filed by an
entity which  performed  services on the casino cruise ship.  The  litigation is
seeking  payment in full of all  charges as yet unpaid,  approximately  $20,000,
plus costs. The Company is attempting to negotiate a settlement.

Summary

The  conditions  described  above  regarding  going concern  considerations  and
pending  litigation raise  substantial doubt as to the ability of the Company to
continue as a going concern. The accompanying  consolidated financial statements
do not  include  any  adjustments  that might  result  from the outcome of these
significant risks and uncertainties.

NOTE 3 - DISCONTINUED OPERATIONS

Acquisition and Partial Sale of Artifacts

On October 1, 1997, the Company entered into a one year Lease/Purchase Agreement
with Seahawk Deep Ocean Technology,  Inc. (Lessor) and Michael's (Co-Lessee) for
the  "Dry  Tortugas  Treasure"  (the  Treasure).  The  Lease/Purchase  Agreement
obligated  Seahawk to lease the  Treasure  to the  Co-Lessees  for a term of one
year. The lease provided for quarterly lease payments of $67,500.

It was the Company's  intention to display these artifacts at Michael's flagship
store in Key West, Florida.

On March 19, 1998,  the Company  exercised  its option to purchase the Treasure.
Consideration  named in the  agreement  amounted  to  $2,497,500,  comprised  of
$682,500 cash, a $200,000  promissory note and 9,500,000 shares of the Company's
restricted common stock valued at $1,615,000.  The Company retained the right to
repurchase  up to  8,000,000  shares of the  restricted  common  stock at prices
ranging from $.135 to $.15 per share.  The  repurchase  option  expired June 10,
1998.
                                      F-9
<PAGE>

(when?) The Company  granted the artifacts  seller a one year right,  commencing
March 19, 1999, to put all or any of the 9,500,000  shares of restricted  common
stock to the Company at per share prices ranging from $.085 to $.17 per share.

Subsequent to March 19, 1999,  substantially all the outstanding shares pursuant
to this  agreement  were put to the  Company at a per share  cost of $.17.  As a
result of this action,  the amount related to this put option  ($1,615,000)  has
been  reflected  in  the  accompanying   financial  statements  as  a  liability
(estimated  liability related to put option) in 1998. In 2000, the put option in
connection with 3,356,429 common shares has been waived.  As a result,  $570,593
has been removed from the liability and reflected in equity in 1999.

Substantially  all cash  required to purchase the  artifacts  was borrowed  from
entities affiliated by common control and ownership.  The artifacts were pledged
as collateral for the resulting notes payable.


On December 31, 1998,  the Company sold a portion of the artifact  collection to
an unrelated third party ("the  Purchaser") in consideration for a $750,000 note
receivable. The note bore interest at 12% and was due June 30, 1999. On December
31, 1998, the Purchaser entered into a credit arrangement with First Capital, an
entity related to the Company by common control.  First Capital, which is in the
business of  asset-based  lending and  factoring,  agreed to lend the  Purchaser
$750,000 and accept the artifacts  purchased as  collateral.  First Capital then
paid  the  Company  pursuant  to the  terms  of the  note  receivable  with  the
Purchaser.  The  Purchaser  subsequently  defaulted on its  obligation  to First
Capital and First Capital accepted the artifacts in lieu of foreclosure.

Due to  the  fact  that  the  cost  of  the  artifacts  sold  was  not  reliably
determinable,  this  transaction  has been  accounted  for on the cost  recovery
method,  whereby the cost has been  reduced by the amount of the selling  price,
and no gain or loss has been recognized in the accompanying financial statements
in connection with the partial sale of the artifact collection.

During 1999,  the Company  defaulted on its  obligation to First Capital and, on
December 31, 1999,  entered into an agreement with First Capital,  whereby First
Capital accepted the remaining artifact collection in lieu of foreclosure.

Gaming Operations

Lease of Casino Cruise Ship

On October 30, 1998, the Company entered into a one-year  lease/purchase  option
for a casino  cruise ship.  The lease  payments  were $80,000  monthly,  payable
quarterly,  in advance.  At the lease signing, a maintenance  reserve of $50,000
was to be established by the Company. In addition,  the Company was to reimburse
the lessor for monthly insurance,  taxes, crew costs and other running expenses.
The lease/purchase option contained an option to purchase the vessel at any time
prior to the end of the lease term for  $6,000,000.  Fifty  percent of all lease
payments paid would be credited to the purchase price.  The lease was personally
guaranteed by the Chief Executive  Officer and major stockholder of the Company.
The Company  intended to operate the casino  cruise ship as a floating  gambling
casino and restaurant, sailing from Miami, Florida.
                                      F-10
<PAGE>

The Company  funded the entry into  casino  cruise  ship  operations,  including
initial  payments  pursuant  to  the  lease  purchase  option,  with  additional
borrowings from entities affiliated by common control and ownership.

The ship had its maiden voyage with customers in January 1999.  During 1999, the
Company was not able to operate the casino facility with positive cash flow and,
as a result, was not able to comply with the terms of the lease, therefore;  the
lessor took possession of the boat.

In October 1999, the lessor  instituted  litigation  seeking full payment of all
unpaid  amounts plus damages  pursuant to the lease purchase  option,  which the
litigation alleges is in excess of $1,000,000.

Berth and Lease Agreement

On December 7, 1998, the Company  entered into a berth and lease agreement for a
term of twelve  months.  The lease  provided  berth space for the casino  cruise
ship, together with office space, to be used for ticketing and reservations. The
monthly rent was $12,000, plus $1.00 per passenger in excess of 7,500 passengers
per month.

In June 1999, the lessor instituted  litigation  seeking payment under the lease
of all unpaid amounts plus damages.  The Company has not made the lease payments
called for in the lease  commencing  with April 1999.  The  Company  vacated the
space May 1,  1999.  The  lessor,  pursuant  to  litigation,  received a default
judgment in the amount of $130,000.

Acquisition of Adult Gaming Complex

In December 1998,  the Company  acquired the assets of a newly  constructed,  at
that time  unopened,  adult  gaming  complex in exchange for the  assumption  of
$750,000 of debt and the issuance of 1,500,000  shares of Company  common stock.
The debt that was assumed was owed to First Capital,  a related  party,  and was
collateralized by all assets of the adult gaming complex.

The  Company  entered  into a verbal  management  agreement  with the  seller to
operate the adult gaming facility on the Company's behalf in exchange for a fee.
In 1999,  the Company  entered into a settlement  agreement  with the management
company,  whereby  the  Company  was to pay  $80,000 in full  settlement  of all
obligations under the previous verbal agreement,  and the management company was
to vacate the premises.  In September 1999, the Company paid $25,000 pursuant to
this agreement; $55,000 remained unpaid.

In December 1999, the Company  determined that the adult gaming facility was not
a viable business operation and closed the facility permanently.

On December 15, 1999, the Company  surrendered all remaining assets of the adult
gaming  facility to First Capital in settlement  in lieu of  foreclosure  of all
amounts due under the note payable assigned to the Company in the purchase.
                                      F-11
<PAGE>

Lease Assignment - Adult Gaming Complex

In connection  with the  acquisition  of the adult gaming  complex,  the Company
accepted assignment of the lease for the facility which the adult gaming complex
occupied. The lease was for a term of 2 years and provided for a monthly rent of
$6,500.  In October  1999,  the Company  vacated the premises and ceased  making
lease payments. The landlord has made no claim for unpaid rent.

Summary

During 1999,  the Company  surrendered,  in lieu of  foreclosure,  all assets in
connection with the gaming operations, and the artifacts acquired, in settlement
of outstanding principal and interest due to First Capital, an affiliate.

                             Principal                   $ 2,134,874
                             Interest                        349,760
                                                     ----------------
                                                         $ 2,484,634
                                                     ================

Consequently, the results of operations and estimated operating loss through the
date  of  disposal   relating  to  these   operations  have  been  presented  as
discontinued operations in the accompanying statements of operations.

The  following   represents  the   summarized   results  of  operations  of  the
discontinued operations for the year ended December 31:
<TABLE>

                                                                1999               1998
                                                           --------------    --------------
       <S>                                                 <C>               <C>

       Revenues                                             $    292,920         $ 750,000
       Expenses                                                1,574,903         1,535,592
                                                           --------------    --------------
                                                            $(1,281,983)       $ (785,592)
                                                           ==============    ==============
       The following represents the loss on disposition:
       Debt distinguished                                   $  2,484,634
       Net assets surrendered                                  2,666,117
                                                           --------------
       Loss on disposal                                     $   (181,483)
                                                           ==============
</TABLE>


NOTE 4 - RELATED PARTY TRANSACTIONS

The Company has the following related party loans and advances outstanding as of
December 31, 2000 and 1999:
<TABLE>

                                                                             2000            1999
                                                                         -------------    -----------
      <S>                                                                <C>              <C>

       Note payable to entity  related to common  stockholder,
       due February 15, 2000, interest at 12% due monthly
                                                                              $22,750        $22,750
       Note payable - stockholder, due February 15, 2000, interest at
       12% due monthly                                                          2,000          2,000
       Loan due to stockholder, pursuant to settlement agreement
                                                                               55,000         55,000
                                                                         -------------    -----------
                                                                               79,750         79,750
       First Consolidated Financial Corp.                                     500,634        443,799
                                                                         -------------    -----------
                                                                            $ 580,384      $ 523,549
                                                                         =============    ===========
</TABLE>


The  Company  has  secured  financing  for its  operations  primarily  from  the
following  two  parties  who are  related  to the  Company  by means of a common
controlling stockholder:
                                      F-12
<PAGE>

First Capital Services, Inc. (First Capital)
First Consolidated Financial Corp. (First Consolidated)

First Capital has provided primary financing with total outstanding loan amounts
of approximately $2,135,000.  First Capital loaned funds to the Company pursuant
to a master loan  agreement  for a maximum of  $2,000,000,  which  provided  for
interest payable monthly at 12% and principal repayment on December 1, 2000. The
loan was  secured  by all the  Company's  assets  including  the  artifacts.  In
addition, the Company accepted assignment of a loan in the amount of $750,000 in
connection  with the  purchase  of the adult  gaming  complex.  This note earned
interest at 12%,  payable  monthly,  with the principal due on February 16, 2000
and was owed to First  Capital.  This note was  secured by all the assets of the
adult gaming complex.

Both of these  notes  were  satisfied  in full,  including  unpaid  interest  of
approximately  $350,000 in December  1999,  with the  surrender of collateral in
lieu of foreclosure.

First Consolidated  provided  financing in the amount of approximately  $501,000
through  December 31, 2000.  First  Consolidated  is a major  stockholder and is
owned by the Company Chief Executive Officer.  The loan is due on demand,  bears
interest at 12% and is uncollateralized.

Related Party Transactions
The Company entered into the following  transactions  with various  entities and
individuals affiliated by virtue of common management or stock ownership:

                                            2000           1999         1998
                                          ------------  -----------  -----------
     Consulting and professional fees
                                           $      -      $ 227,500     $ 30,000
     Interest expense                      $ 60,000      $ 327,109     $ 98,692
     Management fee                        $      -      $  80,000     $      -

NOTE 5 - COMMITMENTS

Facilities Lease

In February 1999, the Company  entered into a lease for office  facilities for a
term of three years. In August 1999, the Company vacated the space.

Employment Agreement

On January 4, 1999,  the Company  entered into an employment  agreement with the
Chief Executive Officer who also served as President/director. The agreement was
for a three-year term, and provided for, among other things, annual compensation
ranging from $100,000 to $150,000, employee benefits and twelve months severance
upon  termination.  In  addition,  the  agreement  provides  for the issuance of
200,000 shares of common stock and immediately vesting stock options to purchase
common stock at $.23 per share.  In June 1999,  this  employment  agreement  was
terminated. The employee has filed litigation and is seeking damages.

NOTE 6 - MARKETABLE SECURITIES


                                                    2000           1999
                                                 ------------    ----------
       Cost                                         $40,180       $40,180
       Unrealized loss                              (40,180)      (30,636)
                                                 -----------     ----------
       Market value                                 $     -       $ 9,544
                                                 ===========     ==========
                                      F-13
<PAGE>

NOTE 7 PROPERTY AND EQUIPMENT

The  Company  had  Artifacts  with a cost of  $1,747,500  and the  adult  gaming
facility with a cost of $952,500 in 1998. No  depreciation  was provided in 1998
as these assets were not placed in service until 1999.  Depreciation  expense in
1999 was  $51,502.  All assets were  surrendered  in lieu of  foreclosure  as of
December 31, 1999 in settlement of amounts owed to First Capital.

NOTE 8 - INCOME TAXES

No provision for federal income taxes has been recorded as the Company  incurred
net  operating  losses  through  December  31, 2000.  At December 31, 2000,  the
Company had net operating loss  carryforwards of approximately  $3,130,000.  The
federal net operating loss carryforwards expire in various amounts through 2020,
subject to certain limitations.

No deferred taxes have been recorded and a 100% valuation  allowance is required
because of the uncertainty regarding the realization of the deferred tax assets.