UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

[X]   ANNUAL  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934
                   For the fiscal year ended December 31, 1999
                                             -----------------

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

                   For the transition period from _________ to  ____________

                         Commission File Number 0-11808

                             MB SOFTWARE CORPORATION
             (Exact name of Registrant as specified in its charter)

           COLORADO                                              59-2219994
  (State or other jurisdiction of                           (I.R.S. Employer
  incorporation or organization)                             Identification No.)

2225 E. Randol Mill Road Suite 305                                76011-6306
Arlington, Texas                                                  (Zip Code)
(Address of principal executive offices)

       Registrant's telephone number, including area code: (817) 633-9400

           Securities registered pursuant to Section 12(b) of the Act:

                                                      Name of Each Exchange
       Title of Each Class                             on Which Registered
       -------------------                            ---------------------
             Common                                NASDAQ -  OTC BULLETIN BOARD

           Securities registered pursuant to Section 12(g) of the Act:
                          Common Stock $ .001 par value
                          -----------------------------
                                (Title of Class)

Check  whether  the issuer  (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
90 days.
                                 [X] Yes [ ] No

Indicate by check mark 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.
                                 [X] Yes [ ] No

Issuer's revenues for its most recent fiscal year:  $2,250,511


<PAGE>

The  aggregate  market value of the voting stock held by  non-affiliates  of the
registrant as of May 10, 2000 was approximately $1,168,767.

         Check whether the issuer has filed all  documents and reports  required
to be  filed  by  Section  12,  13 or  15(d)  of  the  Exchange  Act  after  the
distribution of Securities under a plan confirmed by a court.

                                 Yes [X ] No [ ]

As of December  31,  1999,  69,200,000  shares of the  Issuer's  $.001 par value
common stock were outstanding.

Transitional Small Business Disclosure Format:

                                Yes [ ] No [ X ]






                                       2

<PAGE>



                             MB SOFTWARE CORPORATION

                                   Form 10-KSB
                      For the Year Ended December 31, 1999

                                                                     Page of
                                                                     Form 10 KSB
                                                                     -----------
 ITEM 1.  BUSINESS  ...........................................................4

 ITEM 2.  PROPERTIES...........................................................6

 ITEM 3.  LEGAL PROCEEDINGS....................................................6

 ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS..................7

 ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
          SHAREHOLDER MATTERS..................................................7

 ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
          AND RESULTS OF OPERATIONS ...........................................7

 ITEM 7.  FINANCIAL STATEMENTS ...............................................10

 ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
          AND FINANCIAL DISCLOSURE............................................10

 ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS........10

 ITEM 10. EXECUTIVE  COMPENSATION.............................................11

 ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT..........................................................12

 ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS......................13

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







                                       3

<PAGE>

                                     PART 1

Item 1.  Business

         MB Software  Corporation  (the  "Company")  was  incorporated  in 1982.
During the last five years, the focus of the Company has been twofold: First, to
provide  practice  and  cash  management   services  to  physicians,   dentists,
chiropractors  and medical  billing  centers;  and  second,  to develop and sell
medical  software.  In 1997, the Company began expanding its scope of operations
by acquiring  and managing  additional  healthcare  facilities  and utilizing in
those facilities the software  products  developed by the Company.  In 1998, the
Company  continued  to  acquire  medical  clinics,  expand the  revenue  base of
existing clinics, divest itself of unprofitable operations,  advance its medical
software to comply with all regulations and industry standards and integrate the
software with new products and  services.  In 1999,  the Company  focused on the
process of restructuring its remaining entities in an effort to maximize profits
and reduce administrative expenses. Significantly, in 1999, the Company divested
itself of MB Software Solutions, Inc. ("MBSSI"), the software division.

Healthcare / Practice Management Business

         Effective  June 30,  1999,  the Company  sold Mr.  Mulligan,  LLC d/b/a
Nevada  Multicare  ("Nevada  Multicare"),  a  wholly  owned  Company  subsidiary
consisting of a chiropractic  facility.  The Company determined that the revenue
generated  by Nevada  Multicare  was  insufficient  to justify  the  significant
administrative costs associated with operating the clinic.

         The Company's  Florida  operations,  conducted under the N.F.P.M.,  LLC
("NFPM") subsidiary,  are continuing to expand. In July 1999, the Company opened
N.F.P.M.,  LLC d/b/a South Florida  Medical Center  ("SFMC"),  a start-up clinic
located in Lauderhill, Florida.

         The Company now owns a total of four clinics,  all of which are located
in Florida.  Florida  law permits  corporations  to own medical  clinics  unlike
several  other  states in which a  corporation  cannot own a clinic that employs
medical doctors. Therefore, the Company continues to focus on the Florida market
where the Company has traditionally  been successful.  The Company believes that
growth and expansion of NFPM will likely continue in 2000.

         The Company's healthcare acquisition strategy is to target for purchase
those clinics that specialize in physical  medicine,  pain management,  physical
therapy and  rehabilitation,  and employ medical doctors,  osteopathic  doctors,
physical   therapists  and  chiropractors.   Acquisition   targets  are  usually
distressed   businesses   having  a  strong  medical  practice  with  concurrent
difficulties  in the  areas of cash  management  (particularly  collections)  or
practice   management.   The  Company  believes  that  its  experience  in  cash
management,  particularly  collecting receivables from providers,  together with
utilization  of certain  software,  will  enable the  Company to operate  target
acquisitions more efficiently and therefore more profitably.

The Software Division

         The software and internet  businesses  require a significant  amount of
capital.  The Company attempted to raise sufficient capital for the software and
internet  businesses,  but was not  successful  in doing so.  As a  result,  the
Company determined that the most feasible plan was to divest itself of MBSSI and
focus on the medical clinics. Therefore, effective November 1, 1999, the Company
divested itself of its interest in MBSSI.  The Company  conveyed all outstanding
shares of MBSSI to MedEWay.com,  Inc. ("MEW"). All issued and outstanding shares
of MEW were then sold to Consolidated  National Corporation ("CNC") and Scott A.
Haire, Company  shareholders.  The divestment of MBSSI was approved at a meeting
of the board of directors of the Company.

                                       4

<PAGE>

         The  terms of the  transaction  included  payment  of  $250,000  to the
Company and the  cancellation  of Company debt in the total amount of $1,250,000
owed to CNC and Mr.  Haire.  In  addition,  the  Company  received  a warrant to
purchase  five  percent  of the stock of MEW.  As part of the  transaction,  the
Company  retained a license to use the OneClaim(R)  Plus 32 bit Windows 95/98/NT
Medical Practice Management Software Package (the "Software").  The Company also
will receive related technical support and development services.

         Historically,  the medical clinics have generated  approximately ninety
percent  of the  Company's  revenue.  Given the  significant  contribution  from
medical  revenue and  relatively  minimal  software  revenue  contribution,  the
Company believes that the divestment of the software  division should not have a
significantly adverse impact upon Company revenue.

Healthcare Industry Overview

         The  Health  Care  Financing  Administration  has  estimated  that  the
nation's  total  spending for  healthcare  is  projected  to increase  from $1.0
trillion in 1996 to $2.1  trillion in 2007,  averaging  annual  increases of 6.8
percent.  Over this period, health spending as a share of gross domestic product
(GDP) is estimated to increase from 13.6 percent to 16.6 percent.  In an attempt
to reduce  healthcare  expenditures,  governmental and other payors have adopted
certain cost-containment  initiatives.  These encompass a shift from traditional
fee-for-service   provider   reimbursement   to  a  variety  of   managed   care
arrangements,     including    prospective    payment    systems,     discounted
fees-for-services  and  fully  capitated  plans  whereby  providers  assume  the
financial  risks related to service  utilization  for a defined group of covered
members and services.

         The  cost-containment  initiatives have resulted in decreased physician
practice profitability while demands for clinical documentation, including cost,
quality and utilization data, have increased physicians  administrative  duties.
Over seven hundred thousand physicians are responsible for filing  approximately
five  billion  insurance  claims  annually  to more than two  hundred  different
payors.  Payors require utilization of more than forty different claim-forms and
communication  with more than ten thousand different  locations.  In response to
the reduction in reimbursements, individual physicians and small group practices
are consolidating,  either by affiliating with physician practice managements or
by forming physician networks or independent practice associations. Despite this
industry  consolidation,  numerous physician practice  management  companies are
experiencing significant financial difficulties.

         These distressed companies form the pool of target acquisitions for the
Company.  The Company believes that its cash management  expertise together with
utilization  of  the  Software,  will  enable  the  Company  to  operate  target
acquisitions  more efficiently and therefore more profitably.  While maintaining
and  streamlining  billing and accounting  functions,  the Software  utilizes an
integrated  approach  to  electronic  claims  filing  and  electronic  statement
processing. This feature enables the user of the Software to effectively address
the demands of the payors concerning claim forms and communication issues.

Employees

         The Company currently employs a total of approximately  thirty-six full
and part time  employees.  The Company has no labor union contracts and believes
its relationship with its employees is good.

Healthcare Facilities

         Following  is  a  description  of  each  of  the  Company's  healthcare
facilities:

         JACKSONVILLE,  FLORIDA:  The  three  clinics  located  in  Jacksonville
provide state of the art pain management,  physical therapy, and related medical
services. The clinics are equipped with physical rehabilitation equipment.

                                       5

<PAGE>

         LAUDERHILL,  FLORIDA:  This  Clinic  provides  general  family  medical
services,  primary care,  wellness  programs,  medical  rehabilitation  and pain
management therapy.

Combined,  the Florida clinics have two medical doctors,  an osteopathic doctor,
physical therapists and a staff of approximately thirty-three.

Item 2.  Properties

         All premises  occupied by the Company and subsidiaries are leased.  The
Company's principal  executive office is located at Arlington,  Texas at 2225 E.
Randol  Mill  Road,  Suite  305,  Arlington,  TX 76011.  NFPM is located at 9143
Philips Highway,  Suite 495,  Jacksonville,  Florida,  with a second location at
1950  Miller  Street,  Orange  Park,  Florida,  a third  location at 233 N. 10th
Street, Jacksonville Beach, Florida, and a fourth location, SFPM, at: 2589 North
State Road 7, Lauderhill, Florida.

Item 3.  Legal Proceedings

         On November 6, 1998,  the Company and one of its  subsidiaries  filed a
lawsuit  in the  District  Court  of  Tarrant  County,  Texas  against  a former
employee.  The  lawsuit  asserted a right to damages  based upon the  employee's
breach of a  Confidentiality  Agreement entered into between the former employee
and  subsidiary.  This  matter is still  pending.  In January  1999,  the former
employee  filed an  action  against a Company  subsidiary  asserting  a right to
unpaid wages. The action was filed with the Department of Industrial  Relations,
Division  of Labor  Standards  Enforcement  in Santa  Ana,  California.  After a
hearing on the action,  an order was  entered  June 25,  1999  finding  that the
employee  was not  entitled  to any  payment  from  either  the  Company  or its
subsidiaries.

         Effective  July 28,  1999,  the Company  settled  California  and Texas
litigation  involving a former Company stockholder and employee.  The California
litigation was dismissed November 4, 1999 and the Texas litigation was dismissed
March 1, 2000.

         NFPM  entered  into a settlement  agreement  dated  October 21, 1999 to
resolve litigation filed in 1997 by an equipment leasing/finance company.

         In November  1999, the Company and NFPM filed suit against Danka Office
Imaging Co. d/b/a Danka,  Danka Financial  Services and American Business Credit
Corporation.  The lawsuit is pending in District Court,  Tarrant County,  Texas.
The  Company  and NFPM  have  asserted  a right to  monetary  damages  and other
remedies based upon the nonperformance of the various Danka entities.

         On February 18, 2000,  Southwestern Bell Yellow Pages,  Inc.  ("SWBYP")
filed suit against the Company, MB Practice  Solutions,  Inc. ("MBPS") a Company
subsidiary, and Scott A. Haire for damages in the approximate amount of $61,000.
The damages sought are based upon advertising  services alleged by SWBYP to have
been provided to a company to which MBPS had provided management  services.  The
Company  believes that the allegations  against the Company,  MBPS and Mr. Haire
are  without  merit.  The Company  further  believes  that the  lawsuit  will be
resolved within the next twelve months.

         Effective April 2, 2000, the Company settled  litigation  pertaining to
MB Healthcare Management,  Inc. ("MBHM"), a Company subsidiary,  the Company and
Scott A. Haire.  MBHM  merged with a  corporation,  and in  connection  with the
transaction,  MBHM filed suit against the corporation  and related  individuals.
The corporation and related  individuals filed a counterclaim  against MBHM, the
Company,  and Scott A. Haire. As part of the settlement,  all outstanding shares
of MBHM were  conveyed  to one of the  related  individuals.  In  exchange,  the
Company received a cash payment and return of Company stock that had been issued
at the time the transaction was entered into.

                                       6

<PAGE>

         The Company is aggressively defending the claims asserted against it in
the various pending  lawsuits.  The Company believes it has adequate reserves in
connection with losses or settlements pertaining to any pending litigation.

Item 4.  Submission of Matters to a Vote of Security Holders

         For the year 1999, the Company did not conduct an annual  shareholder's
meeting.

                                     PART II

Item 5.  Market for the Registrant's Common Equity and Related Stockholder
         Matters

         The  Company's  common  stock is  traded  under  the  symbol  "MBSC" on
NASDAQ's OTC Electronic Bulletin Board. The following table sets forth the range
of high and low bid prices of the Company's common stock:

                                                   BID PRICE
BY QUARTER ENDED:                           HIGH               LOW
----------------                            ----              ----
Year Ended 12/31/99
March, 1999                                 $.08              $.07
June, 1999                                   .14               .14
September, 1999                              .07               .06
December, 1999                               .02               .02


Year Ended 12/31/98
March, 1998                                 $.39              $.34
June, 1998                                   .24               .15
September, 1998                              .17               .12
December, 1998                               .09               .07

The Company had approximately  7,643 holders of record of its common stock as of
December  31,  1999.  No  dividends  have been paid on common stock and none are
anticipated in the foreseeable  future.  The Company has determined that it will
utilize any earnings in the expansion of its business.

ITEM 6.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations

       The  following  is a  listing  of  the  Company  and  its  operating  and
discontinued subsidiaries as of December 31, 1999:

                                        Operating at                Discontinued
Name of Company/Subsidiary         Location     December 31, 1999      in 1999
--------------------------    ----------------  -----------------      -------
MB Software Corporation       Arlington, TX                   Yes           No
(Parent)

MB Software Solutions, Inc.   Arlington, TX                    No          Yes


Healthcare Innovations, LLC   Arlington, TX                   Yes           No

N.F.P.M., LLC                 Jacksonville, FL                Yes           No

Nevada Multicare, Inc.        Las Vegas, NV                    No          Yes

MB Practice Solutions, Inc.   Arlington, TX                   Yes           No


                                       7

<PAGE>

       In the  fourth  quarter  of 1999,  the  Company  divested  itself  of its
interest in MBSSI.  The Company  attempted to raise  sufficient  capital but was
unable to do so and was therefore unable to continue financing the venture.

       The Company has  determined  to devote its  resources  to the  healthcare
division of the Company.  In furtherance of this decision,  the Company  focused
primarily on  operations  of its existing  healthcare  businesses  and to target
future acquisitions.

       The Company  continues in its belief that it is not profitable to operate
healthcare  businesses pursuant to practice management  agreements.  Rather, the
Company  must own the practice  and thus the  profits,  and directly  employ the
physicians and other necessary staff.  However, many state corporate practice of
medicine laws, other than those in Florida,  prohibit  corporations  such as the
Company from owning physician practices and employing  physicians.  As a result,
the Company will in the future focus on  healthcare  businesses  in the state of
Florida such as rehabilitation  clinics,  chiropractic  practices and healthcare
businesses.  This will enable the Company to operate  its  businesses  directly,
thereby retaining profits and employ physicians and staff.

           In 1999, the Company  discontinued the operations of Nevada Multicare
and MBSSI. The Company recognized income from discontinued operations of $59,581
for the 12 months ended December 31, 1999. From these  discontinued  operations,
the  Company  had a gain on  disposal,  net of a tax  effect  for the year ended
December 31, 1999, of $902,662.

       The Company's remaining healthcare businesses consist of three clinics in
and  around  Jacksonville,  Florida  and a clinic in  Lauderhill,  Florida.  The
Florida clinics account for approximately  ninety-five  percent of gross medical
revenues.

 The following  summarizes the results of operations for the twelve months ended
December 31, 1999 and December 31, 1998:

                                                     --------------------------
Medical Activities:                                      1999           1998
                                                     --------------------------
      Gross Revenue                                  $ 3,431,817    $ 4,007,662
      Contractual Allowance                            1,327,170      1,638,844
                                                     -----------    -----------
               Net Revenues                            2,104,647      2,368,818


      Cost of Revenue                                  1,422,464      1,933,707
                                                     -----------    -----------
               Gross Profit                          $   682,183    $   435,111
                                                     -----------    -----------

      Service Fees and Broker Income                     105,278        455,661
      Other                                               40,586           --
                                                     -----------    -----------
               Gross Profit                              145,864        455,661
                                                     -----------    -----------

 Operating Expenses:
    Selling, General and administrative                1,600,827      2,580,951
    Depreciation and Amortization                         65,411      1,014,941
    Interest Expense and other Income and Expenses      (142,169)      (256,520)

    Loss before benefit income tax                      (980,360)    (2,961,640)
   Benefit for income tax                               (495,701)          --
Loss from Continuing Operations                         (484,659)    (2,961,640)
Minority Interest in Loss                                   --          548,623
                                                     -----------    -----------
                                                     $  (484,659)   $(2,413,017)
                                                     ===========    ===========


                                       8

<PAGE>


Twelve Months Ended  December 31, 1999 Compared to Twelve Months Ended  December
31, 1998

       Gross medical  revenues  decreased  14.37% to  $3,431,817  for the twelve
months ended  December 31, 1999, as compared to $4,007,662 for the twelve months
ended December 31, 1998. This decrease is primarily  attributable to the sale of
the Nevada  Multicare  clinic and the divestment of certain  healthcare  clinics
acquired in 1998.

       The  contractual  allowance as a percentage of gross medical  revenue was
38.6%  and  40.9% for the  twelve  months  ending  December  31,  1999 and 1998,
respectively.  The  contractual  allowance  includes  write-offs  for  insurance
adjustments and  uncollectible  receivables.  The consistency in the percentages
from 1998 to 1999  reflects the success of the Company's  receivables  plan that
includes systematic  collection efforts in conjunction with writing off balances
where necessary.

       The  Company  experienced  an  increase  in  gross  profit  from  medical
activities of 56.8% to $682,183 for the twelve months ended December 31, 1999 as
compared to a gross profit of $435,111 for the twelve months ended  December 31,
1998.  The  increase  is  primarily  attributable  to the  divestment  of Nevada
Multicare and a streamlining of the  administrative  divisions of the healthcare
clinics. Additionally, the administrative costs associated with Nevada Multicare
were significant in proportion to the clinic's amount of gross profit.

       The selling,  general and  administrative  expenses  decreased  37.97% to
$1,600,827  for the  twelve  months  ended  December  31,  1999 as  compared  to
$2,580,951  for the twelve  months  ended  December  31,  1998.  The decrease is
primarily due to the discontinuation of Nevada Multicare and MBSSI.

       The net loss from  continuing  operations  decreased  to $484,659 for the
twelve month period ended  December  31,1999,  as compared to $2,413,017 for the
twelve months ended  December 31, 1998. The decrease in the net loss is directly
attributable to the divestment of the software division.

Liquidity and Capital Resources

       The Company's  operations  used cash of $601,314 during the twelve months
ended December 31, 1999 and  $1,210,670  during the twelve months ended December
31, 1998.  In 1999,  the net cash amount  provided by financing  activities  was
$56,017.

       At  December  31, 1999 and  December  31,  1998,  the Company had working
capital  deficits  of  $552,851  and  $52,001,   respectively.  The  Company  is
concentrating  its  efforts  to expand  the  Florida  clinics  in an  attempt to
decrease the working capital deficit. At December 31, 1999, the Company had cash
deposits of $26,078.  The net cash provided by investing activities for 1999 was
$393,940.

       The  Independent  Auditor's  Report for the year ending December 31, 1999
("Report"), states that the uncertainty of certain conditions raises substantial
doubt  about the  ability of the  Company to  continue  as a going  concern.  In
raising the going  concern  issue,  the Report  cites past  losses,  the working
capital  deficit  and whether  the  Company  will be able to achieve  profitable
operations.  The Company  believes  that it will achieve  profitable  operations
through private placement or the conversion of Series A preferred stock.

       In the twelve months ended December 31, 1999,  the Company  expended cash
of $29,627 to purchase  equipment.  The Company  does not  anticipate  any major
equipment purchases for the twelve months of 2000.

                                       9

<PAGE>

       The  Company  did not  have an  annual  stockholder'  meeting  for  1999.
However,  on November 11, 1999,  the board of directors  held the annual meeting
and approved the divestment of MBSSI (see Item One / The Software Division).

Item 7.  Financial Statements

          Filed as exhibits  hereto are the following  statements of the Company
and its subsidiaries:
                                                                            Page
                                                                            ----
         Report of Independent Certified Public Accounts
            Weaver and Tidwell, L.L.P.                                       F-2

         Financial Statements

            Consolidated Balance Sheets as of December 31, 1999 and 1998     F-4

            Consolidated Statements of Operations for the years ended
            December 31, 1999 and 1998                                       F-6

            Consolidated Statements of Changes in Shareholders' Deficit
            for the years ended December 31, 1999 and 1998                   F-8

            Consolidated Statements of Cash Flows for the
            years ended December 31, 1999 and 1998                           F-9

            Notes to Consolidated Financial Statements                      F-11

Item 8.  None

                                    PART III

Item 9.  Directors,  Executive  Officers,   Promoters   and   Control   Persons;
         Compliance with Section  16(a) of the Exchange Act.

         The  following  table  sets forth  certain  information  regarding  the
directors and executive officers of the Company:
                                                               Year First
     Name               Age           Position                  Elected
     ----               ---           --------                  -------

Scott A. Haire          35       President, Director              1993

Gilbert A. Valdez       56       Chief Operating Officer          1996

Araldo A. Cossutta      75       Director                         1994

Steven W. Evans         49       Director                         1994

Robert E. Gross         55       Director                         1994

Thomas J. Kirchhofer    59       Director                         1994

Lucy J. Singleton       62       Secretary                        1995

         Executive  Officers of the  Company are elected on an annual  basis and
serve at the discretion of the Board of Directors.  Directors of the Company are
elected on an annual basis.

                                       10

<PAGE>

Scott A. Haire  Chairman,  President and Director.  Mr. Haire is Chief Executive
Officer of MB Software Corporation and has been with the Company since 1992. Mr.
Haire is additionally the chairman of the board of MEW.

Gilbert A. Valdez Chief Operating  Officer and Director.  Mr. Valdez is a former
president and Chief  Executive  Officer of the National  Electronic  Information
Corporation,  Medaphis  Corporation,  Datix Corporation and Hospital Billing and
Collection Services Corporation.

Araldo  A.  Cossutta  Director.  Mr.  Cossutta  is  president  of  Cossutta  and
Associates,  an architectural firm based in New York City. He is also a director
of Computer Integration Corporation of Boca Raton, Florida.

Steven W. Evans Director.  Mr. Evans is a certified public account and president
of Evans, Mills & Warriner, PLLC, an accounting firm. He is a founder and active
in PTRL,  which  operates  contract  research  laboratories  in Kentucky,  North
Carolina,  California and Germany. He is active in environmental management, and
financial and hotel corporations in Kentucky and Tennessee.

Robert E. Gross  Director.  Mr. Gross is president of R. E. Gross &  Associates,
which provides consulting, and system projects for clients in the multi-location
service, banking and healthcare industries. Mr. Gross is president of MEW.

Thomas J. Kirchhofer  Director.  Mr. Kirchhofer is president of Synergy Wellness
Centers of Georgia,  Inc.,  and a past  president  of the  Georgia  Chiropractic
Association.

Lucy Singleton   Secretary.    Ms. Singleton has been secretary since 1995.

Item 10. Executive Compensation

         The Company  provides  health benefits to its employees and may provide
additional  benefits  in the  future,  as  may be  authorized  by the  Board  of
Directors.  The Company has adopted no  retirement,  pension,  profit sharing or
other similar program.

         The Company may offer stock bonuses,  stock options,  profit sharing or
pension  plans to key  employees  or  executive  officers of the Company in such
amounts  and upon such  conditions  as the Board of  Directors  may, in its sole
discretion, determine.

Summary Compensation Table

         The following sets forth information concerning the compensation of the
Company's Chief Executive Officer for the fiscal years shown. No other Executive
Officer was paid a salary in excess of $100,00 during such period.



--------------------------------------------------------------------------------
                                                    Long Term Compensation
   Name and                                         ----------------------
   Principal            Annual Compensation    Restricted  Options        All
   Position             -------------------      Stock      /SARS        Other
                Year  Salary($)  Bonus  Other    Awards    # shares(2)  Comp.($)
--------------------------------------------------------------------------------


Scott A. Haire  1999   140,500    -0-    -0-       -0-        -0-         -0-
   President    1998   141,000    -0-    -0-       -0-        -0-         -0-
                1997   120,000    -0-    -0-       -0-        -0-         -0-

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

                                       11

<PAGE>

<TABLE>

<CAPTION>

              Aggregated Options/SAR Exercises in Last Fiscal Year
                          and FY-End Options/SAR Values

         The following table provides information concerning option exercises in
fiscal  1999 and the  value of  unexercised  options  held by each of the  named
Executive Officers at December 31, 1999.

----------------------------------------------------------------------------------------------------
     Name       Shares Acquired     Value          No. of unexercised        Value of unexercised
                on Exercise (#)  Realized ($)       options /SARs at         in-the-money options/
                                                      at FY-End (#)            SARs at FY-end($)
                                                exercisable/unexercisable  exercisable/unexercisable
----------------------------------------------------------------------------------------------------
<S>             <C>              <C>            <C>                        <C>
Scott A. Haire        -0-            N/A                 2,400,000                  $240,000
----------------------------------------------------------------------------------------------------

</TABLE>


Item 11. Security Ownership of Certain Beneficial Owners and Management

         The  following  table sets forth  information  as of December 31, 1999,
regarding the beneficial  ownership of capital stock of the Company by: (i) Each
person known by the Company to beneficially  own more than 5% of the outstanding
shares of Common Stock;  (ii) each director of the Company;  (iii) the Company's
Chief Executive  Officer;  and (iv) the directors and executive  officers of the
Company  as a group.  The  persons  named in the  table  have  sole  voting  and
investment  power with  respect to all  shares of capital  stock  owned by them,
unless otherwise noted.

                              Amount and Nature
Name of Beneficial              of Beneficial                Percent
Owner of Group(1)                Ownership                  of Class
------------------            -----------------             --------
Scott A. Haire                    29,321,297 (2)               42.0%

Araldo A. Cossutta                 2,982,025                    4.0%

Steven W. Evans                    1,700,000 (3)                2.0%

Gilbert Valdez                       900,000 (4)                  *

Robert E. Gross                      200,000 (5)                  *

Thomas J. Kirchhofer                 150,000 (6)                  *

R-M-S Investments, LTD.           11,000,000                   16.0%

Cazenove                           7,500,000                   10.0%

All Directors and Executive
Officers as a group               41,303,332                   60.8%
(six in number)

----------
*        Less than 1%.

(1)  The address for each person or entity  listed  above is 2225 E. Randol Mill
     Road, Suite 305, Arlington, Texas, 76011.
(2)  Includes  2,400,000  shares and  600,000  shares  subject to options  and a
     warrant, respectively, that are presently exercisable.
(3)  Consists  of  200,000   shares   subject  to  options  that  are  presently
     exercisable by Mr. Evans.
(4)  Consists  of  900,000   shares   subject  to  options  that  are  presently
     exercisable by Mr. Valdez.
(5)  Consists  of  200,000   shares   subject  to  options  that  are  presently
     exercisable by Mr. Gross.
(6)  Consists  of  150,000   shares   subject  to  options  that  are  presently
     exercisable by Mr. Kirchhofer.

                                       12

<PAGE>

Item 12. Certain Relationships and Related Transactions

         Effective November 1, 1999, the Company divested itself of its interest
in MBSSI.  The Company  conveyed  all  outstanding  shares of MBSSI to MEW.  All
issued and  outstanding  shares of MEW were then sold to CNC and Scott A. Haire,
Company  shareholders.  The divestment of MBSSI was approved at a meeting of the
board of directors of the Company. The terms of the transaction included payment
of $250,000 to the Company  and the  cancellation  of Company  debt in the total
amount  of  $1,250,000  owed to CNC and Mr.  Haire.  In  addition,  the  Company
received a warrant to purchase five percent of the stock of MEW.

         Effective June, 1999, SFMC commenced  business in Lauderhill,  Florida.
The premises leased by SFMC are owned by Pro-Act  Management,  L.L.C.,  of which
Scott A. Haire and Steven W. Evans are members.

         Mr. Haire is the chairman of the board of MEW. Robert E. Gross,  Steven
W. Evans and Araldo A.  Cossutta,  directors of the Company,  hold the following
positions  with  MEW:  President,   Chief  Financial  Officer  and  shareholder,
respectively.

Item 13. Exhibits Reports on Form 8-K

                  1.  Reports on Form 8-K - None.

                  2. Exhibits -  None.

All other  exhibits  incorporated  by  reference  from  prior  filings  with the
Commission.

                                    SIGNATURE

         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.

                                  MB SOFTWARE CORPORATION

                                  By: /s/ Scott A. Haire
                                      ------------------------------------------
                                          Scott A. Haire, Chairman of the Board,
                                          Chief Executive Officer and President
                                          (Principal Financial Officer)

Date:  May 15, 2000




                                       13

<PAGE>






                             MB SOFTWARE CORPORATION
                                AND SUBSIDIARIES

                                FINANCIAL REPORT

                                DECEMBER 31, 1999




<PAGE>


                                    CONTENTS


                                                                           Page


INDEPENDENT AUDITOR'S REPORT                                                F-2


REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                          F-3


FINANCIAL STATEMENTS

     Consolidated Balance Sheets                                            F-4

     Consolidated Statements of Operations                                  F-6

     Consolidated Statements of Shareholders' Deficit                       F-8

     Consolidated Statements of Cash Flows                                  F-9

     Notes to Consolidated Financial Statements                             F-11



<PAGE>

                          INDEPENDENT AUDITOR'S REPORT


Board of Directors and Shareholders
MB Software Corporation and Subsidiaries
2225 E. Randol Mill Road, Suite 305
Arlington, Texas  76011


We have  audited  the  accompanying  consolidated  balance  sheet of MB Software
Corporation (a Colorado  corporation)  and Subsidiaries as of December 31, 1999,
and the related consolidated  statements of operations,  shareholders'  deficit,
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 audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance  about  whether  the  consolidated  financial  statements  are free of
material  misstatement.  An audit includes examining,  on a test basis, evidence
supporting the amounts and disclosures in the consolidated 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 audit provides 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 MB
Software  Corporation and  Subsidiaries as of December 31, 1999, and the results
of their  operations and their cash flows for the year 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 discussed in Note 1 to the
financial  statements,  the Company has  continuously  incurred losses and has a
working  capital  deficit,  all of  which  raise  substantial  doubt  about  the
company's ability to continue as a going concern.  Management's  plans in regard
to these matters are also  discussed in Note 1. The financial  statements do not
include any adjustments that might result from the outcome of this uncertainty.





Fort Worth, Texas
May 9, 2000

3434

                                      F-2


<PAGE>


               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors and Shareholders
MB Software Corporation and Subsidiaries
2225 E. Randol Mill Road, Suite 305
Arlington, Texas  76011


We have  audited the  accompanying  consolidated  balance  sheets of MB Software
Corporation (a Colorado  corporation)  and Subsidiaries as of December 31, 1998,
and the related consolidated  statements of operations,  shareholders'  deficit,
and cash flows for the year 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 audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance  about  whether  the  consolidated  financial  statements  are free of
material  misstatement.  An audit includes examining,  on a test basis, evidence
supporting the amounts and disclosures in the consolidated 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 audit provides 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 MB
Software  Corporation and  Subsidiaries as of December 31, 1998, and the results
of their  operations and their cash flows for the year then ended, in conformity
with generally accepted accounting principles.

KILLMAN, MURRELL & COMPANY, P.C.
Dallas, Texas
April 9, 1999

                                       F-3


<PAGE>


<TABLE>

<CAPTION>





                             MB SOFTWARE CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 1999 AND 1998



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

                               ASSETS

CURRENT ASSETS
      Cash                                                           $             26,078      $          203,977

      Medical receivables, net of allowance
           for doubtful accounts and contractual
           allowances of $822,692 and $1,810,887 in
           1999 and 1998, respectively                                            713,625                  875,284

      Note receivable                                                             177,721                   51,288


      Prepaid expenses and other                                                    4,131                    2,500
                                                                     ---------------------     --------------------

                Total current assets                                              921,555                1,133,049
                                                                     ---------------------     --------------------




PROPERTY AND EQUIPMENT, NET                                                       178,525                  286,056



NOTE RECEIVABLE - SHAREHOLDER                                                     350,000                        -



DEPOSITS AND OTHER ASSETS                                                               -                   57,493


NET ASSETS OF DISCONTINUED OPERATIONS                                                   -                  300,692
                                                                     ---------------------     --------------------



TOTAL ASSETS                                                                  $ 1,450,080              $ 1,777,290
                                                                     =====================     ====================

</TABLE>



                                      F-4

<PAGE>

<TABLE>

<CAPTION>

                             MB SOFTWARE CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 1999 AND 1998

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

                 LIABILITIES AND SHAREHOLDERS' DEFICIT

CURRENT LIABILITIES
       Current maturities of notes payable                               $         1,057,925   $            17,735
       Current maturities of capital leases                                           17,434                37,230
       Accounts payable                                                              402,409               346,790
       Accrued liabilities                                                           346,639               311,315
                                                                        ---------------------  --------------------

               Total current liabilities                                           1,824,407               713,070

LONG-TERM DEBT

       Notes payable                                                                       -             1,887,734
       Capital leases                                                                  3,050                33,447
                                                                        ---------------------  --------------------

               Total liabilities                                                   1,827,457             2,634,251
                                                                        ---------------------  --------------------

SHAREHOLDERS' DEFICIT
       Series A senior cumulative convertible
       participating preferred stock; $10 par value;
       340,000 shares issued and outstanding in
       1999 and 1998; dividends in arrears
       1999 $385,644, 1998 $45,644                                                 3,400,000             3,400,000
       Undesignated preferred stock; $10 par value;
            660,000 shares authorized; none issued                                         -                     -
       Common stock;  $.001 par value; 150,000,000
            shares authorized; 69,200,000 and 69,100,000
            shares issued, in 1999 and 1998, respectively                             69,200                69,100
       Additional paid-in capital                                                  1,103,005             1,101,105
       Accumulated deficit                                                       ( 4,937,543)          ( 5,415,127)
                                                                        ---------------------  --------------------

                                                                                   ( 365,338)            ( 844,922)

       Treasury stock, at cost; 408,029 shares                                      ( 12,039)             ( 12,039)
                                                                        ---------------------  --------------------

               Total shareholders' deficit                                         ( 377,377)            ( 856,961)
                                                                        ---------------------  --------------------

TOTAL LIABILITIES AND
      SHAREHOLDERS' DEFICIT                                              $         1,450,080   $         1,777,290
                                                                        =====================  ====================

</TABLE>




                                      F-5


<PAGE>

<TABLE>

<CAPTION>


                             MB SOFTWARE CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                     YEARS ENDED DECEMBER 31, 1999 AND 1998

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

 REVENUES

      Medical fees - net of contractual adjustments
            of $1,327,170 and $1,638,844, in
            1999 and 1998, respectively                                      $         2,104,647    $         2,368,818
      Service fees and broker income                                                     105,278                455,661
      Other                                                                               40,586                      -
                                                                             --------------------   --------------------

            Total revenues                                                             2,250,511              2,824,479

COST OF REVENUES
      Cost of medical clinic fees                                                      1,422,464              1,933,707
                                                                             --------------------   --------------------

            Gross profit                                                                 828,047                890,772
                                                                             --------------------   --------------------
OPERATING EXPENSES
      Selling, general & administrative                                                1,600,827              2,580,951
      Depreciation and amortization                                                       65,411              1,014,941
                                                                             --------------------   --------------------

            Total operating expenses                                                   1,666,238              3,595,892
                                                                             --------------------   --------------------

                      Loss from operations                                             ( 838,191)           ( 2,705,120)

OTHER INCOME (EXPENSE)
      Loss on sale of assets                                                             ( 5,171)              ( 25,409)
      Interest expense                                                                 ( 143,984)             ( 299,201)
      Interest income                                                                      6,986                 68,090
                                                                             --------------------   --------------------

                      Total other income (expense)                                     ( 142,169)             ( 256,520)

            Loss before benefit for
                 income taxes                                                          ( 980,360)            ( 2,961,640)

BENEFIT FOR INCOME TAXES                                                               ( 495,701)                      -
                                                                             --------------------   --------------------

            Loss from continuing operations
                 before minority interest                                              ( 484,659)           ( 2,961,640)

</TABLE>


                                      F-6

<PAGE>

<TABLE>

<CAPTION>


                             MB SOFTWARE CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                     YEARS ENDED DECEMBER 31, 1999 AND 1998

                                   (continued)

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

MINORITY INTEREST IN LOSS                                                                      -                548,623
                                                                             --------------------   --------------------

            Loss from continuing operations                                            ( 484,659)           ( 2,413,017)

PREFERRED STOCK DIVIDENDS                                                                      -               ( 45,644)
                                                                             --------------------   --------------------

                                                                                       ( 484,659)            ( 2,458,661)

DISCONTINUED OPERATIONS

            Income (loss) from operations, net of tax
                 effect 1999 of $30,694                                                   59,581            ( 1,173,705)
            Gain (loss) on disposal, net of tax
                 effect 1999 of $465,007                                                 902,662              ( 218,856)
                                                                             --------------------   --------------------

                                                                                         962,243            ( 1,392,561)
                                                                             --------------------   --------------------

                      Net income (loss)                                      $           477,584            ($3,851,222)
                                                                             ====================   ====================

Loss from continuing operations                                                       ($ 484,659)           ($2,458,661)

Plus:  Cumulative preferred stock dividends                                            ( 340,000)                     -
                                                                             --------------------   --------------------

            Loss available to common shareholders                                     ($ 824,659)           ($2,458,661)
                                                                             ====================   ====================

BASIC AND DILUTED EARNINGS (LOSS)
      PER SHARE

      Continuing operations                                                              ($ 0.01)               ($ 0.04)
      Discontinued operations                                                               0.01                 ( 0.02)
                                                                             --------------------   --------------------

                                                                                          $ 0.00                ($ 0.06)
                                                                             ====================   ====================

WEIGHTED AVERAGE COMMON SHARES
      OUTSTANDING                                                                     69,116,667             68,470,433
                                                                             ====================   ====================
</TABLE>



                                      F-7

<PAGE>

<TABLE>

<CAPTION>

                             MB SOFTWARE CORPORATION
           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' DEFICIT
                     YEARS ENDED DECEMBER 31, 1999 AND 1998



                                             Series A                                       Additional
                                          Preferred Stock       Common Stock                Paid-in      Accumulated    Treasury
                                      ------------------------  ------------------------
                                        Shares       Amount         Shares      Amount       Capital        Deficit       Stock
                                      ---------- -------------  ------------- ----------  ------------- -------------- -----------
<S>                                   <C>          <C>            <C>          <C>         <C>           <C>           <C>

Balance, December 31, 1997                    -    $        -     68,580,000   $ 68,580    $ 1,035,625   ($ 1,563,905)  ($ 12,039)

   Stock options exercised                    -             -        120,000        120          5,880              -           -
   Common stock issued for
    services                                  -             -        400,000        400         59,600              -           -
   Conversion of $1,400,000
    promissory note to
    preferred stock                     140,000     1,400,000              -          -              -              -           -
   Issuance of preferred stock in
    connection with acquisition
    of minority interest in
    Healthcare Innovations              200,000     2,000,000              -          -              -              -           -

   Net loss                                   -             -              -          -              -    ( 3,851,222)          -
                                      ---------- -------------  ------------- ----------  ------------- -------------- -----------

Balance, December 31, 1998              340,000     3,400,000     69,100,000     69,100      1,101,105    ( 5,415,127)   ( 12,039)

   Common stock issued                        -             -        100,000        100          1,900              -           -

   Net income                                 -             -              -          -              -        477,584           -
                                      ---------- -------------  ------------- ----------  ------------- -------------- -----------

Balance, December 31, 1999              340,000   $ 3,400,000     69,200,000   $ 69,200    $ 1,103,005   ($ 4,937,543)  ($ 12,039)
                                      ========== =============  ============= ==========  ============= ============== ===========
</TABLE>



                                      F-8


<PAGE>

<TABLE>

<CAPTION>

                             MB SOFTWARE CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                     YEARS ENDED DECEMBER 31, 1999 AND 1998

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

CASH FLOWS FROM
OPERATING ACTIVITIES:
     Loss from continuing operations                                                    ($ 484,659)         ($2,413,017)

     Adjustments to reconcile loss from
         continuing  operations to net cash used
         in operating activities:
            Deferred taxes                                                                (495,701)                   -
            Depreciation and amortization                                                   65,411            1,014,941
            Loss on sale of assets                                                           5,171               25,409
            Common stock issued for services                                                     -               60,000
            Minority interest in loss                                                            -             (548,623)
     Changes in assets and liabilities:
            Accounts receivable                                                            161,659              471,703
            Notes receivable                                                                     -             ( 51,288)
            Prepaid expenses and other                                                      (1,632)               4,548
            Accounts payable and
                accrued liabilities                                                         90,944              195,605
            Deposits and other assets                                                       57,493               30,052
                                                                                 ------------------   ------------------
                Net cash used in
                    continuing operations                                                 (601,314)         ( 1,210,670)

                Net cash used in discontinued
                    operations                                                            ( 26,542)           ( 242,104)
                                                                                 ------------------   ------------------

                Net cash used in operating
                    activities                                                           ( 627,856)         ( 1,452,774)

CASH FLOWS FROM
INVESTING ACTIVITIES:
     Loans made on notes receivable                                                      ( 126,433)                   -
     Capital expenditures                                                                 ( 29,627)           ( 111,945)
     Proceeds from sale of subsidiary                                                      550,000                    -
     Proceeds from sale of equipment                                                             -                  750
                                                                                 ------------------   ------------------

            Net cash provided by
                (used in) investing activities                                             393,940            ( 111,195)

</TABLE>


                                      F-9

<PAGE>

<TABLE>

<CAPTION>
                             MB SOFTWARE CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                     YEARS ENDED DECEMBER 31, 1999 AND 1998
                                   (continued)


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

CASH FLOWS FROM
FINANCING ACTIVITIES:
     Principal payments on borrowings                                                    ($ 92,254)         ($1,062,930)
     Proceeds from loans                                                                   146,271            2,138,826
     Proceeds from issuance
         of common stock                                                                     2,000                6,000
                                                                                  -----------------   ------------------

            Net cash provided by
                financing activities                                                        56,017            1,081,896
                                                                                  -----------------   ------------------

Net decrease in cash                                                                     ( 177,899)           ( 482,073)

Cash and cash equivalents, beginning of year                                               203,977              686,050
                                                                                  -----------------   ------------------

Cash and cash equivalents, end of year                                            $         26,078    $         203,977
                                                                                  =================   ==================
SUPPLEMENTAL DISCLOSURES OF
CASH FLOWS INFORMATION:

     Cash paid during the year for:

         Interest                                                                 $        143,984    $         299,201
                                                                                  =================   ==================

         Taxes                                                                    $              -    $               -
                                                                                  =================   ==================


SUPPLEMENTAL SCHEDULE OF NONCASH
INVESTING AND FINANCING ACTIVITIES:

     Preferred stock issued for minority interest                                 $              -    $       2,000,000
     Minority interest acquired                                                                  -          ( 1,083,079)
     Preferred stock issued to satisfy note payable                                              -            1,400,000
     Conversion of note payable to preferred
         stock - related party                                                                   -          ( 1,400,000)
     Goodwill on acquisition of minority interest                                                -            ( 916,921)
     Sale of software for note receivable                                                        -              230,982
     Note receivable from software sale                                                          -            ( 230,982)
     Note receivable from sale of subsidiary                                               350,000                    -
     Notes payable settled in sale of subsidiary                                         ( 900,000)                   -
     Assets disposed in settlement of debt                                                  66,972                    -
     Debt settled by disposal of assets                                                   ( 53,579)                   -



</TABLE>




                                      F-10

<PAGE>


                    MB SOFTWARE CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1.   ORGANIZATION AND SUMMARY OF
          SIGNIFICANT ACCOUNTING POLICIES

     Principles of Consolidation and Presentation

         The  consolidated  financial  statements  include  the  accounts of the
         Company and its wholly-owned subsidiaries,  Healthcare Innovations, LLC
         (HI) and its subsidiary  Nevada  Multicare,  LLC (NVMC),  North Florida
         Physical Medicine, LLC (NFPM), MB Practice Solutions,  LLC. (MBPS), and
         MB Software Solutions, Inc. (MBSSI).

         All  intercompany  transactions  and balances have been eliminated upon
         consolidation.

     Nature of Operations

         MB Software  Corporation  (the "Company") was incorporated in 1982. The
         focus of the Company has been to provide  practice and cash  management
         services to physicians,  dentists and  chiropractors.  The Company sold
         its business opportunity  marketing program in January 1998, which used
         third parties to sell the OneClaim Plus program.

         In April 1998 and  February  1999,  the  Company  sold both of its Utah
         facilities. Net assets from discontinued operations, income (loss) from
         discontinued  operations,  and loss on sale of subsidiaries  report the
         results of these two sales. The Company closed its chiropractic  clinic
         in   Arlington,   Texas,   as  well  as  the   physical   medicine  and
         rehabilitation  facility  located in Fort Worth.  These  closures  were
         immaterial  to the  financial  statements  taken as a whole and the net
         assets and results of operations  were absorbed by its parent  company,
         HI.

         On November 12, 1998, the Company issued 200,000 shares of its Series A
         Senior Cumulative Convertible Participating Preferred Stock in exchange
         for  the  minority   ownership   interest  in  Healthcare   Innovations
         consisting  of 49,000  Class A units  and  151,000  Class B units.  The
         Company also issued 140,000  shares of the Series A Preferred  Stock to
         the  minority  interest  owners  as  payment  of  the  principal  of  a
         $1,400,000 note payable.

         In June 1999,  the Company  discontinued  and sold NVMC which  operated
         healthcare  facilities.  In December 1999, the Company discontinued and
         sold MBSSI which developed and sold practice management  software.  The
         Company now focuses on operating healthcare facilities currently in the
         state of Florida.

                                      F-11

<PAGE>

                    MB SOFTWARE CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1.   ORGANIZATION AND SUMMARY OF
          SIGNIFICANT ACCOUNTING POLICIES - continued

     Going Concern Basis

         The financial  statements  have been prepared on a going concern basis,
         which contemplates realization of assets and liquidation of liabilities
         in the  ordinary  course of  business.  The  Company  has  continuously
         incurred losses from operations and has a working capital deficit.  The
         appropriateness  of using the going concern basis is dependent upon the
         Company's ability to obtain additional financing or equity capital and,
         ultimately,  to achieve profitable  operations.  These conditions raise
         substantial doubt about its ability to continue as a going concern. The
         financial  statements do not include any adjustments  that might result
         from the outcome of this uncertainty.

         Management plans to raise capital by obtaining  financing  through debt
         private  placement  or  conversion  of Series A  preferred  stock.  The
         company believes that these actions will enable the Company to continue
         until its operations become profitable.

     Use of Estimates and Assumptions

         Management  uses  estimates  and  assumptions  in  preparing  financial
         statements in accordance with generally accepted accounting principles.
         Those estimates and assumptions  affect the reported  amounts of assets
         and liabilities,  the disclosure of contingent  assets and liabilities,
         and the reported revenues and expenses.  Actual results could vary from
         the estimates that were used.

     Revenue Recognition

         Revenue  consists  primarily  of  sales  of  the  Company's  healthcare
         services,  which  are  recognized  at the  time  medical  services  are
         rendered.

     Contractual Adjustments and Contractual Allowances

         Medical  clinic  fees  are  reported  net of  contractual  adjustments.
         Contractual  adjustments are  adjustments  made to gross medical clinic
         fees for the amounts  contractually  not billable to third party payors
         and/or adjustments for uncollectible charges.  Management  periodically
         analyzes  these  adjustments  and adjusts the  allowances  for doubtful
         accounts and contractual allowances accordingly.

                                      F-12

<PAGE>

                    MB SOFTWARE CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1.   ORGANIZATION AND SUMMARY OF
          SIGNIFICANT ACCOUNTING POLICIES - continued

     Contractual Adjustments and Contractual Allowances - continued

         Management's  adjustments  for  allowance  for  doubtful  accounts  and
         contractual  adjustments  require  significant  estimates  and it is at
         least  reasonably  possible that these  estimates  could "change in the
         near term".

     Property and Equipment

         Property and equipment are stated at cost.  Depreciation  for financial
         statement purposes is computed  principally on the straight-line method
         over the  estimated  useful  lives of the related  assets  ranging from
         three to ten years.  Maintenance  and repairs are expensed as incurred.
         Replacements and betterments are capitalized.

     Earnings (Loss) Per Common Share and Common Share Equivalents

         Basic  earnings  per share is based on the weighted  average  number of
         shares of common stock outstanding during the period.  Potential common
         stock consists of  convertible  preferred  stock and stock options.  In
         1999 and 1998, the potential common stock was considered  anti-dilutive
         due to the loss from continuing operations.

     Cash and Cash Equivalents

         The Company  considers  all cash on hand and in banks,  demand and time
         deposits,  and all  other  highly  liquid  investments  purchased  with
         maturities of three months or less to be cash equivalents.

     Stock Based Compensation

         The  Company  has  elected  under  the  provisions  of  FASB  No.  123,
         Accounting for Stock Compensation to account for its compensatory stock
         option plan using the intrinsic method as prescribed by APB Opinion No.
         25, Accounting for Stock Issued to Employees.

                                      F-13

<PAGE>

                    MB SOFTWARE CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1.   ORGANIZATION AND SUMMARY OF
          SIGNIFICANT ACCOUNTING POLICIES - continued

     Business and Credit Risk Concentrations

         The Company's  medical clinics provide  services to patients located in
         Florida.  These patients are billed at the time services are performed.
         None of the patients are individually significant.

         The  majority of service fee and broker  income with respect to medical
         receivables  are  received  in cash at the time of  completion  of each
         transaction. Clients are located throughout the United States.

         Management  evaluates accounts  receivable balances on an ongoing basis
         and  provides   allowances  as  necessary  for  amounts   estimated  to
         eventually  become  uncollectible  or amounts  that are not  subject to
         payment  by  third  party  payors  such  as  insurance  companies.  The
         allowance for  uncollectible  accounts  receivable at December 31, 1999
         and 1998 was $822,692 and $1,810,887, respectively.

         The Company maintains its cash in bank deposit accounts at high quality
         financial  institutions.  The balances at times,  may exceed  Federally
         insured limits.

     Income Taxes

         The Company  accounts for income taxes in accordance with the asset and
         liability  method.  Deferred  income  tax assets  and  liabilities  are
         computed annually for differences  between the financial  statement and
         tax bases of assets  and  liabilities  that will  result in  taxable or
         deductible  amounts in the future  based on enacted  tax laws and rates
         applicable  to the  periods in which the  differences  are  expected to
         affect  taxable  income.  Valuation  allowances  are  established  when
         necessary to reduce  deferred  tax assets to the amount  expected to be
         realized.  Income tax expense is the tax payable or refundable  for the
         period  plus or minus the  change  during the  period in  deferred  tax
         assets and liabilities.

     Software Development

         The company was previously  involved in developing  frequency  software
         and hardware to be sold as an integrated system.  After the acquisition
         of Santiago  assets and  liabilities in 1995,  the Company  capitalizes
         software  development  costs after  technological  feasibility has been
         established in accordance  with Financial  Accounting  Standards  Board
         Statement Number 86,  Accounting for the Costs of Computer  Software to
         be Sold,  Leased or Otherwise  Marketed.  Software  costs are amortized
         over the  estimated  economic  life of the  software  from  time that a
         particular product is completed.

                                      F-14

<PAGE>

                    MB SOFTWARE CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1.   ORGANIZATION AND SUMMARY OF
          SIGNIFICANT ACCOUNTING POLICIES - continued

     Software Development - continued

         Software  development  costs incurred in development of medical billing
         software of $193,160 were  capitalized in 1998.  Amortization  of these
         costs  amounted  to  $174,504  and  $181,434   during  1999  and  1998,
         respectively.  Capitalized  software development costs were disposed by
         the Company in 1999 as part of the sale of MBSSI.

     Reclassification

         Certain prior year amounts have been  reclassified  to conform with the
         1999 presentation.

     New Accounting Standards

         The Financial  Accounting  Standards Board (FASB) has issued  Financial
         Accounting  Standards (SFAS) No. 130, Reporting  Comprehensive  Income.
         This  statement  requires an  enterprise  display  total  comprehensive
         income  (total  nonowner  changes in equity) in a full set of financial
         statements. Currently the Company has no items to be reported as "other
         comprehensive income".

         In addition,  FASB has issued SFAS No. 131,  Disclosures about Segments
         of an Enterprise and Related  Information.  This  statement  requires a
         "management  approach"  as opposed to an industry  approach in defining
         operations to be shown as separate segments.  The Company's  continuing
         operations are in one industry segment.

         In February  1999,  the FASB issued  Statement of Financial  Accounting
         Standards No. 132 (Statement  No. 132),  Employers'  Disclosures  about
         Pensions  and  Postretirement  Benefits.   Statement  No.  132  revises
         employers'  disclosures about pensions and other postretirement benefit
         plans. The adoption of Statement No. 132 did not have a material impact
         on the Company's consolidated financial statements.

                                      F-15

<PAGE>

                    MB SOFTWARE CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1.   ORGANIZATION AND SUMMARY OF
          SIGNIFICANT ACCOUNTING POLICIES - continued

     New Accounting Standards - continued

         In June  1999,  the  FASB  issued  Statement  of  Financial  Accounting
         Standards  No. 133  (Statement  No.  133),  Accounting  for  Derivative
         Instruments  and  Hedging  Activities.  Statement  No. 133  establishes
         accounting and reporting standards for derivative  instruments embedded
         in  other  contracts,  and for  hedging  activities.  The  adoption  of
         Statement  No.  133 did not have a  material  impact  on the  Company's
         consolidated financial statements.

         In 1999, the FASB issued  Emerging  Issues Task Force Abstract No. 97-2
         (EITF 97-2).  EITF 97-2 addresses the application of FASB Statement No.
         94,  Consolidation of All  Majority-Owned  Subsidiaries and APB Opinion
         No. 16, Business  Conventions to Physician Practice Management Entities
         and Certain Other Entities with Contractual Management Arrangements.

         At December 31, 1999 and 1998, the Company did not have any contractual
         management  arrangements as defined by EITF 97-2; therefore,  EITF 97-2
         is not applicable to the Company.

     Long-lived Assets

         Long-lived assets and certain  identifiable  intangibles to be held and
         used by the Company are  reviewed  for  impairment  whenever  events or
         changes in circumstances  indicate that the carrying amount of an asset
         may  not  be  recoverable.   The  Company  continuously  evaluates  the
         recoverability  of its long-lived assets based on estimated future cash
         flows and the estimated  liquidation  value of such long-lived  assets,
         and  provides  for  impairment  if such  undiscounted  cash  flows  are
         insufficient to recover the carrying amount of the long-lived assets.

     Financial Instruments

         Financial   instruments  of  the  Company  consist  of  cash,  accounts
         receivable,  notes  receivable,  accounts payable,  notes payable,  and
         other  liabilities.  Recorded values of cash,  receivables and payables
         are carried at amounts that approximate fair values.

                                      F-16


<PAGE>

                    MB SOFTWARE CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 2.   PROPERTY AND EQUIPMENT

     Property and  equipment  consists of the following at December 31, 1999 and
     1998:

                                                           1999         1998
                                                          --------     --------

         Clinic and office equipment                      $297,663     $354,761
         Computer equipment                                 33,976       60,835
         Furniture and fixtures                                747        8,277
                                                          --------     --------

                                                           332,386      423,873
         Less accumulated depreciation and amortization    153,861      137,817
                                                          --------     --------

                                                          $178,525     $286,056
                                                          ========     ========

     Depreciation  expense was $65,411 and $108,698 for the years ended December
     31, 1999 and 1998, respectively.


NOTE 3.   NOTES PAYABLE AND LONG-TERM DEBT

     Notes  payable and  long-term  debt consist of the following as of December
     31:

                                                              1999       1998
                                                             --------   --------
         Prime plus 1% line of credit with a bank,  due on
         demand, secured by accounts receivable, see below   $140,070   $120,070

         8% note payable to a shareholder, due on
         demand, unsecured                                      2,000      2,000

         7.6%  note  payable  to a bank,  due in  monthly
         installments of $11,000, including principal and
         interest through June 25, 1999, retired                    -     75,945

         10% note payable to an individual, due on
         demand, unsecured                                    100,000          -

         7.15% note payable due to a bank, due
         October 10, 2000, unsecured                            3,855          -


                                      F-17

<PAGE>


NOTE 3.   NOTES PAYABLE AND LONG-TERM DEBT - continued

                                                            1999         1998
                                                        -----------  -----------

         8% note payable to a shareholder, retired      $         -  $   455,000

         8% note payable to an employee, shareholder,
         and officer, retired                                     -      434,808

         8% note payable to a shareholder, due
         August 1, 2000, unsecured - related party          300,000      300,000

         10.25% note payable to a bank,  monthly
         payments of $236 including interest, retired             -        5,646

         8% note payable to a shareholder, due
         August 1, 2000, unsecured                           12,000       12,000

         10% note payable to an investor, due
         August 1, 2000 - related party                     500,000      500,000
                                                        -----------  -----------

                                                          1,057,925  $ 1,905,469
         Less current portion of long-term debt
         and notes payable                                1,057,925       17,735
                                                        -----------  -----------

                                                        $         -  $ 1,887,734
                                                        ===========  ===========

     The Company maintains a $140,000  revolving  line-of-credit for which there
     was an  outstanding  advance as of December  31,1999 of  $140,070,  bearing
     interest at the bank's variable rate plus 1.00% (8.5% at December  31,1999)
     due on demand, secured by accounts receivable.


                                      F-18

<PAGE>


NOTE 4.   CAPITAL LEASES

     The following is a schedule by year of future  minimum lease payments under
     capital  lease  obligations  together  with  the  present  value of the net
     minimum lease payments as of December 31, 1999:

         Year Ending
         December 31,

              2000                                               $18,421
              2001                                                 2,765
              2002                                                   376
                                                              ----------

         Net minimum lease payments                               21,562
         Less amount representing interest                         1,078
                                                              ----------

         Present value of net minimum lease payments              20,484
         Current maturities of capital lease obligations          17,434
                                                              ----------

         Capital lease obligations, less current maturities   $    3,050
                                                              ==========


NOTE 5.   PREFERRED STOCK

     The Series A Senior Cumulative  Convertible  Participating  Preferred Stock
     ("Series A Stock") is entitled to receive  cash  dividends  of $1 per share
     per annum accruing from the date of issuance. Such dividends are cumulative
     and must be paid before any dividends can be paid on the common stock.  The
     Series A Stock is  convertible  into  common  stock,  at the  option of the
     holders,  into a maximum of 29,267,324 shares of common stock upon: (a) the
     sale of  substantially  all of the assets of the  Company;  (b) a change in
     control of the Company;  (c) the dissolution of the Company; or (d) October
     1, 2000.  If the Series A Stock is not  converted  into  common  stock,  it
     becomes  redeemable  at the option of the holder any time after  October 1,
     2000 at a  redemption  price of $10 per share.  Should the Company  fail to
     redeem  any share of the Series A Stock  after a  redemption  request,  the
     Series A  stockholders  shall  have the  right to elect a  majority  of the
     Company's  board of  directors  and the Company  shall pay  interest on the
     redemption price at the rate of prime plus 5% until actually  redeemed.  At
     December 31, 1999 and 1998,  dividends  in arrears on  preferred  stock was
     $385,644 and $45,644, respectively.


                                      F-19

<PAGE>

<TABLE>

<CAPTION>


NOTE 6.   INCOME TAXES

     The components of tax expense are as follows:
                                                                1999          1998
                                                            -----------   -----------
<S>                                                         <C>           <C>
       Current                                              $         -   $         -
       Deferred                                               ( 495,701)            -
                                                            -----------   -----------

                                                            $   495,701   $         -
                                                            ===========   ===========

     A reconciliation of the expected federal income tax expense (benefit) based
     on the U.S.  Corporate  income tax rate of 34% to actual expense  (benefit)
     for 1999 and 1998 is as follows:

                                                                1999          1998
                                                            -----------   -----------

       Expected federal income tax provision (benefit)      ($  333,322)  ($1,208,545)
       State income taxes                                             -             -
       Valuation allowance and other                                  -     1,208,545
       Utilization of net operating loss                    (   162,379)            -
                                                            -----------   -----------

                                                            ($  495,701)  $         -
                                                            ===========   ===========

Deferred  tax assets and  liabilities  as of  December  31, 1999 and 1998 are as
follows:

                                                                1999          1998
                                                            -----------   -----------

       Current deferred tax asset                           $   279,715   $   635,225
       Current deferred tax liability                                 -             -
       Valuation allowance for current deferred tax asset   (   279,715)  (   635,225)
                                                            -----------   -----------

       Net current deferred tax asset                       $         -   $         -
                                                            ===========   ===========

       Non-current deferred tax asset                       $ 1,509,316   $ 1,831,339
       Non-current deferred tax liability                             -   (    93,079)
       Valuation allowance for
            non-current deferred tax asset                  ( 1,509,316)  ( 1,738,260)
                                                            -----------   -----------

       Net non-current deferred tax asset                   $         -   $         -
                                                            ===========   ===========

</TABLE>

                                      F-20

<PAGE>


NOTE 6.   INCOME TAXES - Continued

     At December 31, 1999,  the current  deferred tax asset results from reserve
     for accounts  receivable  which is not  deductible  for tax purposes  until
     actually  written off. The non-current  deferred tax asset results from the
     deferred  tax  benefit  of  net  operating  losses.  The  net  current  and
     non-current  deferred tax assets have a 100%  valuation  allowance,  as the
     ability of the Company to generate  sufficient taxable income in the future
     is not certain. The beginning valuation allowance was adjusted $162,379 for
     the benefit of net operating losses utilized in 1999.

     MB generated  net  operating  losses for  financial  reporting  and Federal
     income tax reporting  prior to its  reorganization  in 1993. As of December
     31,  1999,  subject to  limitations  under  Internal  Revenue  Code ss.382,
     approximately  $469,000 of these net operating losses are available for use
     after the reorganization.  These net operating losses expire in 2008 if not
     previously  utilized.  The net operating loss carry forward at December 31,
     1999 in  approximately  $4,440,000  and will begin to expire in 2008 if not
     previously utilized.


NOTE 7.   LEASE COMMITMENTS

     The  Company  has  non-cancelable  leases for office  space and  equipment.
     Future minimum  payments under these leases and other  equipment  operating
     leases are payable as follows:

           Year Ended
           December 31,
           ------------

              2000                                       $   454,278
              2001                                           463,375
              2002                                           428,913
              2003                                           258,428
              2004                                            98,712
                                                         -----------
                                                         $ 1,703,706
                                                         ===========

     Lease and rent expense under  non-cancelable  operating leases for 1999 and
     1998 are $423,923 and $349,550, respectively.


                                      F-21

<PAGE>


NOTE 8.   LEGAL PROCEEDINGS

     On  November  6, 1998,  the  Company  and one of its  subsidiaries  filed a
     lawsuit in the District  Court of Tarrant  County,  Texas  against a former
     employee. The lawsuit asserted a right to damages based upon the employee's
     breach of a  Confidentiality  Agreement  entered  into  between  the former
     employee and subsidiary. This matter is still pending. In January 1999, the
     former  employee filed an action against a Company  subsidiary  asserting a
     right to  unpaid  wages.  The  action  was  filed  with the  Department  of
     Industrial Relations, Division of Labor Standards Enforcement in Santa Ana,
     California.  After a hearing on the action,  an order was entered  June 25,
     1999  finding that the employee was not entitled to any payment from either
     the Company or its subsidiaries.

     Effective April 2, 2000, the Company settled  litigation  pertaining to the
     Company,  Scott A. Haire and MB Healthcare  Management,  Inc.  ("MBHM"),  a
     former  Company  subsidiary.  MBHM  merged  with  a  corporation,   and  in
     connection  with the  transaction,  MBHM filed suit against the corporation
     and related  individuals.  The corporation and related  individuals filed a
     counterclaim  against MBHM, the Company, and Scott A. Haire. As part of the
     settlement,  all  outstanding  shares of MBHM were  conveyed  to one of the
     related individuals.  In exchange,  the Company received a cash payment and
     return of Company  stock that had been  issued at the time the  transaction
     was entered into.

     In addition, the Company is involved in various lawsuits and claims arising
     in the normal course of business. Management believes it has valid defenses
     in these  cases and is  defending  them  vigorously.  While the  results of
     litigation cannot be predicted with certainty, management believes adequate
     reserves  have been  provided  for claims  that have at least a  reasonable
     possibility  for loss and has not  provided a reserve on those for which an
     adverse outcome is remote.


NOTE 9.   STOCK OPTIONS

     Effective May 5, 1994, the Board of Directors  approved an Incentive  Stock
     Option Plan ("Plan") for key executives and employees.

                                      F-22

<PAGE>

<TABLE>

<CAPTION>

NOTE 9.   STOCK OPTIONS - continued

     A summary of changes in the Company's  incentive stock options issued under
     the Plan and other compensatory options follows:

                                                                             Other
                                             Plan Options                          Compensatory Options
Combined Total
                                                     Weighted                  Weighted
                                                      Average                   Average
                                                     Exercise                  Exercise
                                         Options       Price       Options       Price       Options
                                       ----------   ----------   ----------   ----------   ----------
<S>                                    <C>          <C>          <C>          <C>          <C>
         Outstanding at 12/31/97          795,000   $      .05    4,500,000   $      .24    5,295,000

         Granted                        1,075,000          .13            -            -    1,075,000
         Exercised                     (  120,000)         .05            -            -   (  120,000)
         Forfeited                     (  200,000)         .05   (1,050,000)         .16   (1,250,000)
                                       ----------   ----------   ----------   ----------   ----------

         Outstanding at 12/31/98        1,550,000          .09    3,450,000          .22    5,000,000

         Granted                                -            -            -            -            -
         Exercised                              -            -            -            -            -
         Forfeited                              -            -            -            -            -
                                       ----------   ----------   ----------   ----------   ----------

         Outstanding at 12/31/99        1,550,000   $      .09    3,450,000   $      .22    5,000,000
                                       ==========   ==========   ==========   ==========   ==========

</TABLE>

     The fair  value  of plan  options  issued  during  1998  was  approximately
     $137,750. There were no plan options issued during 1999.

<TABLE>

<CAPTION>

     The following table  summarizes  information  about options  outstanding at
     December 31, 1999 under the Plan:

                                         Weighted
                                         Average              Weighted                                Weighted
    Range 0f            Number          Remaining             Average            Number              Average
Exercise Prices      Outstanding     Contractual Life      Exercise Price      Exercisable       Exercisable Price
---------------      -----------     ----------------      --------------      -----------       -----------------
<S>                  <C>             <C>                   <C>                 <C>               <C>
   $.02 - $.19         1,550,000          .56                  $.09              1,550,000            $.09




                                      F-23

<PAGE>


NOTE 9.   STOCK OPTIONS - continued

     The following table  summarizes  information  about the other  compensatory
     stock options outstanding at December 31, 1999:

                                        Weighted
                                         Average              Weighted                                Weighted
    Range 0f            Number           Remaining             Average            Number              Average
Exercise Prices      Outstanding     Contractual Life      Exercise Price      Exercisable       Exercisable Price
---------------      -----------     ----------------      --------------      -----------       -----------------

   $.03 - $.65         3,450,000          .56                  $.22              3,450,000            $.22


</TABLE>

     The options granted during 1998 have exercise prices which approximate fair
     value,  and accordingly,  no compensation  cost has been recognized for its
     incentive or other compensatory stock options in the consolidated financial
     statements.  Had  compensation  cost for the  Company's  stock options been
     determined  consistent  with FASB  statement No. 123,  Accounting for Stock
     Based  Compensation,  the Company's net income (loss) and net income (loss)
     per share would have been changed to the pro forma amounts indicated below:

                                                              Year Ended
                                                             December 31,
                                                                  1998
                                                             ------------

         Net income (loss)              As reported          ($ 3,851,222)
         Pro forma                                           ($ 3,851,222)

         Net income (loss) per share    As reported          ($       .06)
         Pro forma                                           ($       .06)

     All of the 5,000,000  outstanding  incentive stock options are fully vested
     at December 31, 1999.

     The fair value of each option grant is estimated on the date of grant using
     the Black-Scholes option pricing model with the following  assumptions used
     for grants in both 1999 and 1998: dividend yield of 0%, expected volatility
     of 29.55%,  risk free  interest  rates ranging from 5.77% to 6.41% over a 5
     year period, and an expected life of .5 years.

                                      F-24

<PAGE>


NOTE 10.  DISCONTINUED OPERATIONS

     On June 30, 1999 and October 31, 1999, the Company  entered into agreements
     to  sell  its   ownerships  in  Nevada   Multicare,   LLC(NVMC)  (a  Nevada
     corporation)   and  MB   Software   Solutions,   Inc.   (MBSSI)  (a  Nevada
     corporation),  respectively. Accordingly, the operating results of NVMC and
     MBSSI have been  segregated  from  continuing  operations and reported as a
     separate line item on the statement of operations.

     The Company has  restated  its prior  financial  statements  to present the
     operating results of NVMC and MBSSI as discontinued operations.  The assets
     and  liabilities  of such  operations  at  December  31,  1998,  have  been
     reflected as a net non-current  asset based  substantially  on the original
     classification of such assets and liabilities.

     Operating results from discontinued operations are as follows:

                                                           1999         1998
                                                        ----------   ----------
         Revenues:
           Medical fees                                 $   80,284   $1,341,941
           Software and maintenance fees                   230,407      345,620
                                                        ----------   ----------

                                                           310,691    1,687,561
           Cost of medical                              (   53,755)  (1,568,916)
           Costs of software and maintenance fees       (   40,520)  (   43,360)
           Selling, general and administrative          (  124,257)  (1,239,725)
                                                        ----------   ----------

           Income (loss) from operations                    92,159   (1,164,440)
           Other expense                                     1,884        9,265
                                                        ----------   ----------

         Income (loss) from discontinued operations     $   90,275  ($1,173,705)
                                                        ==========   ==========

     Proceeds  on the  disposal  NVMC and MBSSI were  $300,000  and  $1,500,000,
respectively.


NOTE 11.  BUSINESS SEGMENT INFORMATION

     As  result  of the  discontinued  operations  of MB  Nevada  (NVMC)  and MB
     Software Solutions (MBSSI) the Company's  continuing  operations are in one
     business segment.

                                      F-25

<PAGE>


NOTE 12.  RELATED PARTY TRANSACTIONS

     In November 1999, the Company entered into an exchange agreement between
     Scott A.  Haire,  chairman,  president,  and  director  of the  Company and
     Consolidated National Corp. (CNC).  Pursuant to the agreement,  the Company
     transferred  all of the common  stock of its wholly  owned  subsidiary,  MB
     Software  Solutions  Inc.  (MBSSI) in exchange  for all of the  outstanding
     common  stock  of  MedEWay.com,  Inc.  (MedEWay).  Simultaneous  with  this
     transfer, the Company transferred all of the common stock of MedEWay to Mr.
     Haire and CNC in exchange for  consideration  of $1,500,000.  Additionally,
     MedEWay  issued the Company  warrants  to  purchase  5% of the  outstanding
     common  stock of MedEWay  for $0.001  per share  exercisable  only upon the
     initial public  offering or sale of MedEWay.  No value has been assigned or
     recorded  by the Company for the  MedEWay  stock  warrants.  As part of the
     exchange agreement, the Company has agreed to provide use of facilities and
     other  resources for which MedEWay and MBSSI will  reimburse the Company at
     cost. The Company  provided no significant  resources during the year ended
     December 31, 1999.

     Note  receivable  shareholder  consists of a note from Scott A. Haire dated
     November  1, 1999 for the  original  principal  sum of  $350,000.  Interest
     accrues at an annual rate of 8%.

     The Company has various  notes  payable to  shareholders  and other related
     parties.  The  notes  and  various  terms are  identified  in Note  3-Notes
     Payable.  Interest  expense  incurred under related party notes payable for
     the years ended  December  31, 1999 and 1998 were  $122,777  and  $195,913,
     respectively.  Accrued interest at December 31, 1999 and 1998, was $175,816
     and $165,164, respectively.

     In  addition,  the  Company  leases  a  building  for  one of  its  Florida
     facilities  from a company related  through common  ownership.  Included in
     rent  expense for 1999 is  approximately  $90,200 and  included in accounts
     payable is approximately $22,000 at December 31, 1999.




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