FORM 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                        For Quarter Ended March 31, 2001

                                       OR

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

                For the transition period from _______ to _______

                      Commission file number: 33-131110-NY

                               4net Software, Inc.
              -----------------------------------------------------
             (Exact Name of Registrant as Specified in its Charter)

           DELAWARE                                   22-1895668
 ------------------------------                   ------------------
 State or other jurisdiction of                    (I.R.S. Employer
 incorporation or organization                    Identification No.)

            10 South Street, Suite 202, Ridgefield, Connecticut 06877
           ----------------------------------------------------------
               (Address of Principal Executive Office) (Zip Code)

                                 (203) 894-9755
               --------------------------------------------------
               (Registrant's telephone number including area code)

                               4networld.com, Inc.
           -----------------------------------------------------------
          (Former Name or Former Address, if Changed Since Last Report)

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

As of May 17, 2001, there were issued and outstanding 8,057,018 shares of the
registrant's common stock, par value $.00001 per share.

Transitional Small Business Disclosure Format (check one):
Yes           No  X
   -----        -----

<PAGE>

                               4net Software, Inc

                                TABLE OF CONTENTS



                                                                        Page No.
                                                                        --------
PART I - FINANCIAL INFORMATION............................................  3

Item 1.  Financial Statements.............................................  3

Condensed Balance Sheets..................................................  3

Condensed Statements of Operations........................................  4

Condensed Statements of Cash Flows .......................................  5

Notes to Financial Statements.............................................  6

Item 2.  Management's Discussion And Analysis Of
             Financial Condition And Results Of Operations................  9

PART II - OTHER INFORMATION............................................... 12

Item 1.  Legal Proceedings................................................ 12

Item 2.  Changes in Securities............................................ 13

Item 5.  Other Information................................................ 14

Item 6.  Exhibits & Reports on Form 8-K................................... 15

SIGNATURES................................................................ 16



                                        2
<PAGE>

                         PART I - FINANCIAL INFORMATION

Item 1.        Financial Statements

<TABLE>
<CAPTION>
4net Software, Inc.
CONDENSED BALANCE SHEET
MARCH 31, 2001 (UNAUDITED)
----------------------------------------------------------------------------------------------------------

ASSETS
----------------------------------------------------------------------------------------------------------
<S>                                                                                       <C>
CURRENT ASSETS
  Cash and cash equivalents                                                               $      216,798
  Accounts receivable, net                                                                        38,286
----------------------------------------------------------------------------------------------------------
    Total current assets                                                                         255,084

PROPERTY AND EQUIPMENT, NET                                                                       44,612

GOODWILL, NET                                                                                    744,178

OTHER ASSETS                                                                                       5,795
----------------------------------------------------------------------------------------------------------

    TOTAL ASSETS                                                                          $    1,049,669
----------------------------------------------------------------------------------------------------------

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

CURRENT LIABILITIES
  Accounts payable and accrued expenses                                                   $       37,018
  Current portion of long-term debt                                                               23,602
----------------------------------------------------------------------------------------------------------
    Total current liabilities                                                                     60,620

LONG-TERM DEBT                                                                                    72,628
----------------------------------------------------------------------------------------------------------

    TOTAL LIABILITIES                                                                            133,248
----------------------------------------------------------------------------------------------------------

STOCKHOLDERS' EQUITY
  Common stock, $.00001 par value; 100,000,000 shares                                                 80
  Capital in excess of par value                                                               2,740,053
  Accumulated deficit                                                                   (      1,823,712)
----------------------------------------------------------------------------------------------------------
    Total stockholders' equity                                                                   916,421
----------------------------------------------------------------------------------------------------------

    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                            $    1,049,669
----------------------------------------------------------------------------------------------------------
</TABLE>

                             See accompanying notes.
                                        3
<PAGE>

<TABLE>
<CAPTION>
4net Software, Inc.
CONDENSED STATEMENTS OF OPERATIONS
FOR THE THREE AND SIX MONTH PERIODS ENDED MARCH 31, 2001 AND 2000 (UNAUDITED)
----------------------------------------------------------------------------------------------------------

                                           Three Months Ended March 31,     Six Months Ended March 31,
                                          ------------------------------- --------------------------------
                                               2001            2000            2001            2000
----------------------------------------------------------------------------------------------------------
<S>                                         <C>            <C>             <C>             <C>
REVENUE                                     $   67,574     $       131     $   148,138     $       587
----------------------------------------------------------------------------------------------------------

EXPENSES
   Advertising                                   3,262               -          28,502               -
   Payroll                                      45,083               -         125,989               -
   Professional fees                            31,245          25,580          68,270          28,471
   General and administrative                   80,435           1,399         139,038           2,450
----------------------------------------------------------------------------------------------------------
      Total expenses                           160,025          26,979         361,799          30,921
----------------------------------------------------------------------------------------------------------

LOSS FROM OPERATIONS                      (     92,451)  (      26,848)  (     213,661)  (      30,334)
----------------------------------------------------------------------------------------------------------

OTHER INCOME
   Bad debt recovery                            30,450               -          97,450               -
   Other income, net                             1,286               -           2,988               -
----------------------------------------------------------------------------------------------------------
      Total other income                        31,736               -         100,438               -
----------------------------------------------------------------------------------------------------------

NET LOSS                                  ( $   60,715)  ( $    26,848)  ( $   113,223)  ( $    30,334)
----------------------------------------------------------------------------------------------------------

WEIGHTED AVERAGE NUMBER OF   SHARES
OUTSTANDING                                  8,031,852     281,400,000       8,021,320     281,400,000
----------------------------------------------------------------------------------------------------------

NET LOSS PER COMMON SHARE
   Basic and diluted                      ( $     0.01)        NIL       ( $      0.01)        NIL
----------------------------------------------------------------------------------------------------------
</TABLE>

                             See accompanying notes.
                                        4
<PAGE>

<TABLE>
<CAPTION>
4net Software, Inc.
CONDENSED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTH PERIODS ENDED MARCH 31, 2001 AND 2000 (UNAUDITED)
----------------------------------------------------------------------------------------------------------

                                                                             2001                2000
----------------------------------------------------------------------------------------------------------
<S>                                                                  <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                                          ( $     113,223)    ( $      30,334)
----------------------------------------------------------------------------------------------------------
   Adjustments to reconcile net loss to net cash used in operating activities:
      Depreciation and amortization                                           46,965                   -
      Stock issued for professional fees                                       6,563                   -
      Changes in operating assets and liabilities:
         Accounts receivable                                         (        23,072)                  -
         Accounts payable and accrued expenses                       (        74,109)    (        14,962)
         Other assets                                                (         5,795)                  -
----------------------------------------------------------------------------------------------------------
           Total adjustments                                         (        49,448)    (        14,962)
----------------------------------------------------------------------------------------------------------
             Net cash used in operating activities                   (       162,671)    (        45,296)

CASH FLOWS FROM INVESTING ACTIVITIES:
   Purchases of property and equipment                               (         3,300)                  -

CASH FLOWS FROM FINANCING ACTIVITIES:
   Principal payments on long-term debt                              (        11,137)                  -
----------------------------------------------------------------------------------------------------------

NET DECREASE IN CASH AND CASH EQUIVALENTS                            (       177,108)    (        45,296)

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD                              393,906              47,677
----------------------------------------------------------------------------------------------------------

CASH AND CASH EQUIVALENTS - END OF PERIOD                              $     216,798       $       2,381
----------------------------------------------------------------------------------------------------------
</TABLE>

                             See accompanying notes.
                                        5
<PAGE>



4net Software, Inc.
NOTES TO CONDENSED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION
--------------------------------------------------------------------------------

          Consolidation

          In February 2001, 4net Software, Inc. was merged into 4networld.com,
          Inc. and the corporation changed its name from 4networld.com, Inc. to
          4net Software, Inc.

          The condensed financial statements for all periods presented include
          the accounts of 4networld.com, Inc. and 4net Software, Inc. All
          significant intercompany balances and transactions have been
          eliminated in consolidation.

          Basis of Presentation

          The accompanying unaudited condensed financial statements have been
          prepared in accordance with accounting principles generally accepted
          in the United States for interim financial information and with the
          instructions to Form 10-QSB. Accordingly, they do not include all of
          the information and footnotes required by accounting principles
          generally accepted in the United States for complete financial
          statements. In the opinion of management, all adjustments considered
          necessary for a fair presentation have been included and such
          adjustments are of a normal recurring nature. Operating results for
          the six month period ended March 31, 2001 are not necessarily
          indicative of the results that may be expected for the year ending
          September 30, 2001.

          The audited financial statements at September 30, 2000 which are
          included in the Company's Annual Report on Form 10-KSB should be read
          in conjunction with these condensed financial statements.

--------------------------------------------------------------------------------
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------------------------------------

          Use of Estimates

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

                                       6
<PAGE>

--------------------------------------------------------------------------------
NOTE 3. COMMITMENTS AND CONTINGENCIES
--------------------------------------------------------------------------------

          Net Income (Loss) Per Share

          The Company applies Statement of Financial Accounting Standards No.
          128, "Earnings Per Share" (FAS 128) which requires dual presentation
          of net income per share: basic and diluted. Basic earnings (loss) per
          share is computed using the weighted average number of common shares
          outstanding during the period. Diluted earnings (loss) per share is
          computed using the weighted average number of common shares
          outstanding during the period adjusted for incremental shares
          attributed to outstanding options to purchase shares of common stock.
          Outstanding stock equivalents were not considered in the calculation
          for periods in which the Company sustained a loss as their effect
          would have been anti-dilutive.

          Abtech Industries, Inc. Settlement

          During the year ended September 30, 1999, the Company made two
          advances, evidenced by a loan receivable, totaling $170,000 to Abtech
          Industries, Inc. ("Abtech"), an intended merger target. The merger
          agreement was cancelled and Abtech defaulted under the loan agreement.
          Due to the Company's inability to estimate the amount ultimately
          recoverable from Abtech, the Company reduced the carrying value of the
          receivable to $1,000 as of September 30, 1999.

          Pursuant to a final agreement in September 2000, the Company and
          Abtech agreed to a full settlement aggregating $170,000. As of March
          31, 2001, the Company had received $170,000 in principal payments,
          $19,450 in interest payments and $15,000 in fees to extend payment
          dates.

--------------------------------------------------------------------------------
NOTE 4. MAJOR CUSTOMERS
--------------------------------------------------------------------------------

          Revenue from individual unaffiliated customers in excess of 10% of
          revenue during the six month period ended March 31, 2001 was
          approximately as follows:

                                      Amount         % of Revenue
          --------------------------------------------------------

          Customer A               $    58,000             39%
          Customer B               $    25,000             17%
          Customer C               $    16,000             11%

          Individual accounts receivable balances at March 31, 2001, in excess
          of 10% of total accounts receivable were approximately as follows:

                                                    % of Accounts
                                      Amount          Receivable
          --------------------------------------------------------

          Customer A               $     21,000            50%
          Customer B               $     12,000            29%

                                       7
<PAGE>

--------------------------------------------------------------------------------
NOTE 5. RELATED PARTY TRANSACTIONS
--------------------------------------------------------------------------------

          Office Rent

          Effective February 2001, the Company entered into a three-year
          sub-lease for office space with an entity controlled by the President
          of the Company. The lease provides for monthly rent of $2,000.

          Employment Agreement

          Effective January 31, 2001, the President of the Company agreed to
          waive his annual salary under his employment agreement dated August 1,
          2000. All other terms and conditions of that employment agreement
          remain in full force and effect; accordingly, the President continues
          to be eligible to receive bonus compensation and stock option grants
          at the discretion of the Board of Directors.

          Management Consulting Agreement

          Effective February 1, 2001, the Company entered into a one-year
          management consulting agreement with an entity controlled by the
          President of the Company (Catalyst) which provides for, among other
          things, the Company to pay the consultant $10,000 per month for
          management consulting services.

          Mergers and Acquisitions Advisory Agreement

          In March 2001, the Company entered into a three-year mergers and
          acquisitions advisory agreement with Catalyst. The agreement provides
          for, among other things, the Company to pay Catalyst a fee in the
          event that the Company completes a merger, business combination or
          similar transaction as a result of an introduction made by Catalyst.
          The agreement may be cancelled by either party with 30 days written
          notice.

--------------------------------------------------------------------------------
NOTE 6. LETTER OF INTENT
--------------------------------------------------------------------------------

          In March 2001, the Company executed a letter of intent with two
          unrelated entities whereby, among other things, the Company proposes
          to acquire all of the issued and outstanding shares or assets of the
          entities for approximately $2,080,000.

--------------------------------------------------------------------------------
NOTE 7. SUBSEQUENT EVENTS
--------------------------------------------------------------------------------

          Preferred Stock

          In April 2001, the Company designated 550,000 shares of preferred
          stock as Series A Convertible Preferred Stock (Preferred Stock). The
          Preferred Stock provides for, among other things, cumulative dividends
          at 8% per annum, certain liquidation rights and no voting rights, and
          is convertible to 5 shares of common stock at the option of the holder
          or mandatorily converted upon the occurrence of certain events, as
          defined.


          Placement Agent Agreement

          In April 2001, the Company entered into a Placement Agent Agreement
          with Catalyst whereby, among other things, Catalyst will act as
          placement agent in an attempt to raise up to $1,600,000 through an
          offer to sell up to 400,000 shares of Preferred Stock. The placement
          agent will receive a selling commission of 10% of the gross offering
          proceeds, a non-accountable expense allowance of 3% of the gross
          offering proceeds and five-year warrants to purchase the number of
          shares of Preferred Stock equal to 10% of the number of shares of
          Preferred Stock sold in the offering at an exercise price of $4.00 per
          share.

                                       8
<PAGE>

Item 2. Management's Discussion and Analysis or Plan Of Operations

Forward Looking Statements Disclosure
-------------------------------------

     This report on Form 10-QSB contains, in addition to historical information,
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You can
identify these forward-looking statements when you see words such as "expect,"
"anticipate," "estimate," "may," "plans," "believe," and other similar
expressions. These statements are not guarantees of future performance and are
subject to certain risks, uncertainties and assumptions that are difficult to
predict. Actual results could differ materially from those projected in the
forward-looking statements. Factors that could cause such a difference include,
but are not limited to, those discussed in the section entitled "Factors
Affecting Operating Results and Market Price of Stock," contained in the
Company's Annual Report on Form 10-KSB for the year ended September 30, 2000,
which is incorporated herein by reference. Readers are cautioned not to place
undo reliance on these forward-looking statements, which speak only as of the
date hereof. We undertake no obligation to update any forward-looking
statements.

     The following discussion and analysis provides information which management
of 4net Software, Inc. (the "Company" or "4net Software") believes to be
relevant to an assessment and understanding of the Company's results of
operations and financial condition. This discussion should be read together with
the Company's financial statements and the notes to financial statements, which
are included in this report as well as the Company's Annual Report on Form
10-KSB for the year ended September 30, 2000, which is incorporated herein by
reference.

Background
----------

     4net Software was incorporated in 1986 and ceased all operations in 1991.
Between 1991 and March 2000, the Company had no operations, except for necessary
administrative matters, and was not engaged in operating a business. During that
period, the Company utilized its resources to remain in compliance with the
periodic reporting requirements of the federal securities laws while management
attempted to arrange for a merger, acquisition or other transaction by and
between the Company and a viable operating entity.

     In March 2000, the Company adopted a new plan of operation. The Company's
plan of operation is to make acquisitions and strategic investments in companies
that have developed unique niche software and/or Internet related products and
services. 4net Software's objective is to acquire profitable software and/or
Internet solution companies that enable businesses to streamline key business
processes and increase operating efficiency. Following an acquisition the
Company plans to develop, manage and operate the acquired business through,
among other things, providing management and financial support, as well as
assisting the acquired businesses in marketing, sales, and accounting functions.

     Pursuant to its business plan, on April 28, 2000, the Company acquired all
of the issued and outstanding capital stock of DelOtto Systems, Inc., a
Pennsylvania corporation ("DelOtto Systems"). DelOtto Systems developed
Web-based software applications focusing on content management and information
exchange and designed business-critical Web sites.

     Following the acquisition of DelOtto Systems, the Company changed the name
of DelOtto Systems to 4net Software, Inc. and operated it as a wholly owned
subsidiary. On February 20, 2001, the Board of Directors of the Company
authorized and approved the upstream merger of 4net Software, Inc., the
Company's wholly owned subsidiary, with and into the Company pursuant to Section
253 of the General Corporation Law of the State of Delaware (the "Merger"). In
connection with the Merger the Company also changed its name to 4net Software,
Inc. The Merger and name change became effective on March 2, 2001, when the
Company filed a Certificate of Ownership and Merger with the Delaware Secretary
of State.

                                       9
<PAGE>

     Currently, the Company is engaged in managing and developing the content
management and web site design business, and searching for and evaluating
acquisition candidates that have developed proven software solutions or unique
proprietary technology intended to help businesses increase operating
efficiency. The Company expects to expand its offerings of products and services
and increase its client base through its acquisition strategy. We believe that
the successful implementation of the Company's acquisition strategy will allow
4net Software to increase revenues and earnings and achieve profitability.
However, there can be no assurances that 4net Software will successfully
complete any additional acquisitions.

The Content Management and Web-Design Business
----------------------------------------------

     4net Software is a full service provider of content management and content
syndication software and is a developer of business-critical web sites. 4net
Software develops web-based software applications, focusing on content
management and information exchange. 4net Software's flagship product,
4netManager(TM) bridges the gap between content creation and content delivery by
giving non-technical users the ability to update and maintain their own web
site. This functionality reduces the cost of web site maintenance, and improves
the process of sustaining a dynamic online presence.

     To date, 4net Software has operated primarily as a web site development
company with a proprietary content management application. Over the past year,
4net Software has designed and deployed web sites for over 100 small businesses.
Each web site developed by 4net Software is integrated with its content
management system, 4netManager(TM), which allows individuals to update content
in real time regardless of their technical background.

     4net Software markets its services along with its proprietary technology
through relationships and customer referrals. 4net Software is in the process of
pursuing pricing and marketing strategies to increase the sales of
4netManager(TM) to companies that have a web site, but do not have a content
management system. 4net Software is also in the process of enhancing its
proprietary content management solution into a robust enterprise application to
be marketed to large businesses in various industries. Additionally, 4net
Software is aggressively pursuing strategic business relationships with entities
that will permit 4net Software to utilize their existing distribution channels.
The Company is interested in seeking additional capital to fund a comprehensive
sales and marketing effort to promote the products and services of 4net
Software. However, there can be no assurances that 4net Software will be able
secure additional capital to fund a comprehensive sales and marketing effort to
promote the products and services of 4net Software.

     In growing its content management and web development business, 4net
Software plans to enhance the effectiveness of its client's Web sites by
establishing key relationships with traditional media companies to develop and
promote local Web-based business directories. Management believes that
traditional media such as television and radio are effective ways to gain
exposure for e-businesses and to draw customers to Web sites.

     Recently, 4net Software entered into a co-marketing relationship with
KYW-TV3 (a CBS owned and operated television station and a Viacom, Inc.
subsidiary) to develop, produce, and promote a Web-based business directory for
the Philadelphia, Pennsylvania market place. KYW-TV3 has committed twenty
segments of on-air promotion per week for the business directory and will
conduct the direct sales effort to sign up local businesses. The business
directory promotions will allow local businesses to tap into traditional on-air
advertising and drive traffic to their Web sites. Pursuant to the agreement with
KYW-TV3, 4net Software will be paid a percentage of all revenues generated from
sales of business directory listings and advertising space.

                                       10
<PAGE>

4net Software's Acquisition Strategy
------------------------------------

     As part of the Company's ongoing business strategy, 4net Software is
engaged in identifying, investigating and, if investigation warrants, acquiring
software companies within targeted industries, which have proven technology and
report revenues and earnings. 4net Software's acquisition strategy is focused on
helping businesses manage the Internet and increase operating efficiency by
streamlining key business processes with proprietary software. We are pursuing a
strategy of growth by acquiring businesses and assets that complement our
existing operations. The Company utilizes several criteria to evaluate
prospective acquisitions including whether the business to be acquired (1)
broadens the scope of the services or products we offer or the geographic areas
we serve, (2) expands our client base or distribution network, (3) increases
blended margins, (4) is accretive to earnings, and (5) offers the opportunity to
enhance profitability by improving the efficiency of our operations.

     Currently, the Company has identified for acquisition two software
companies; Target Company 1 and Target Company 2 (collectively referred to as
the "Acquisitions"), that management believes will provide synergies to the
Company and further its growth strategy. The Company has entered in to a Letter
of Intent in connection with the Acquisitions, however, there can be no
assurance that the Company will be able to successfully complete the
Acquisitions. The anticipated cost of the Acquisitions is approximately
$2,080,000. Management believes that the completion of the Acquisitions will
enable 4net Software to expand its product and service line and achieve
profitability. The Company has designated 550,000 shares of Series A Convertible
Preferred Stock for issuance by the Company in a private offering to help
finance the Acquisitions. The Company may also obtain debt financing to complete
the Acquisitions. There can be no assurances that the Company will be able to
successfully complete the private offering or obtain debt financing necessary to
complete the Acquisitions.

Results of Operations
---------------------

     For the three-month period ended March 31, 2001, the Company had revenues
of $67,574 compared to revenues of $131 for the same period a year earlier,
representing an increase of $67,443. The increase in revenue for the three-month
period ended March 31, 2001 is attributable to the income earned by 4net
Software through the content management and web design business. Other than
interest income the Company did not earn any revenue for the corresponding
period a year earlier given the virtual suspension of the Company's operations
during that period.

     For the six-month period ended March 31, 2001, the Company had revenue of
$148,138 compared to revenues of $587 for the same period a year earlier,
representing an increase of $147,441. The increase in revenue for the six-month
period ended March 31, 2001 is attributable to the income earned by 4net
Software through the content management and web design business. Other than
interest income the Company did not earn any revenue for the corresponding
period a year earlier given the virtual suspension of the Company's operations
during that period.

     Expenses for the three-month period ended March 31, 2001 were $160,025
compared to expenses of $26,979 for the same period a year earlier, representing
an increase of $133,046. The increase in expenses for the three-months ended
March 31, 2001 was due primarily to payroll, increased professional fees and
administrative expenses associated with the operation of 4net Software's content
management and web design business, as well as Company's efforts to locate
suitable merger targets and negotiate acquisitions.

     Expenses for the six-month period ended March 31, 2001 were $361,799
compared to expenses of $30,921 for the same period a year earlier, representing
an increase of $330,878. The increase in expenses for the six-months ended March
31, 2001 was due primarily to payroll, increased professional fees and
administrative expenses associated with the operation of 4net Software's content
management and web design business, as well as Company's efforts to locate
suitable merger targets and negotiate acquisitions.

     For the three-month period ended March 31, 2001, the Company had operating
losses of $92,451 compared to operating losses of $26,848 for the same period a
year earlier, representing an increase of $65,603. The increase in losses
incurred by the Company in the three-month period ended March 31, 2001 were due
primarily to expenses associated with the operation of 4net Software's content
management and web design business as well as the Company's efforts to locate
suitable merger targets and negotiate acquisitions, in accordance with the
Company's business plan.

                                       11
<PAGE>

     For the six-month month period ended March 31, 2001, the Company had
operating losses of $213,661 compared to operating losses of $30,334 for the
same period a year earlier, representing an increase of $183,327. The increase
in losses incurred by the Company in the six-month period ended March 31, 2001
were due primarily to expenses associated with the operation of 4net Software's
content management and web design business as well as the Company's efforts to
locate suitable merger targets and negotiate acquisitions, in accordance with
the Company's business plan.

Liquidity and Capital Resources
-------------------------------

     During the three-month period ended March 31, 2001, the Company satisfied
its working capital needs from cash on hand at the beginning of the period,
revenues generated through the operation of 4net Software's content management
and web design business, cash generated from interest income during the year,
and payments received from Abtech Industries, Inc. in connection with a
litigation. See Part II. Item 1. (Legal Proceedings), below. As of March 31,
2001, the Company had cash on hand in the amount of $216,798. Management
anticipates that the Company will need additional funds in order to further
develop and grow 4net Software's content management and web design business and
to effectuate 4net Software' acquisition strategy, including but not limited the
acquisition of Target Company 1 and Target Company 2 discussed above. There can
be no assurance that the Company will be able to obtain such additional funds,
when needed. Even if the Company is able to obtain additional funds there is no
assurance that the Company will be able to successfully develop and grow 4net
Software's content management and web design business or to complete any
additional acquisitions.


                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings

     On or about August 3, 1999, in connection with an agreement with a third
party who was a potential merger candidate, the Company made unsecured loans to
the third party totaling $170,000, which accrued interest at the rate of 10% per
annum. The merger negotiations between the Company and the third-party ended
without a merger agreement and the third party failed to repay the loans as
required by the loan agreements between the parties. On or about November 22,
1999, the Company commenced a lawsuit to recover the $170,000 loaned to the
third party. The action is entitled: MedTech Diagnostics, Inc. v. Abtech
Industries, Inc. and is pending in the New York State Supreme Court, New York
County and has been assigned Index No. 99-605288. The Company entered into a
settlement agreement whereby Abtech Industries, Inc. ("Abtech") agreed to pay
the Company $170,000, plus interest at a rate of 10% on that sum from August 3,
1999, on or before May 15, 2000. The settlement agreement was secured by a
confession of judgment executed by Abtech.

     On May 15, 2000, the Company entered into a forbearance agreement with
Abtech, whereby the Company agreed not to file the judgment against Abtech for a
period of two weeks in exchange for a payment of $15,000 representing the
interest on the principal amount of the loan through June 15, 2000. On June 1,
the Company entered into a second forbearance agreement with Abtech, whereby the
Company agreed not to file the judgment against Abtech for a period of two weeks
in exchange for a payment of $15,000 towards the principal amount of the loan.

     On June 15, 2000 the Company entered into a third forbearance agreement
with Abtech whereby the Company agreed not to file the judgment against Abtech
for a period of 45 days in exchange for a payment of $10,000 towards the
principal amount of the loan on or before June 16, 2000, a payment of $10,000
towards the principal amount of the loan on or before July 5, 2000, a payment of
$6,000 representing interest on the remaining principal balance of the loan from
June 15, 2000 through July 31, 2000, and a bonus payment for the forbearance
agreement on or before July 20, 2000.

                                       12
<PAGE>

     On August 1, 2000, the Company entered into a further agreement with Abtech
whereby Abtech agreed to payoff the remaining principal with interest on the
loan on or before December 1, 2000 (the "August 1st Agreement"). Pursuant to the
August 1st Agreement, Abtech agreed to make the following payments of principal
and interest: (1) a payment of $10,000 by August 5, 2000 representing principal;
(2) a payment of $10,000 by August 15, 2000 representing $5,000 of principal
with the remaining $5,000 for interest and a bonus payment for the extension;
(3) a payment of $31,000 by September 1, 2000 representing principal and
interest; (4) a payment of $30,750 by October 1, 2000 representing principal and
interest; (5) a payment of $30,500 by November 1, 2000 representing principal
and interest; and (6) a final payment of $30,250 by December 1, 2000
representing principal and interest. On September 27, 2000, the Company agreed
to extend the payment terms of the August 1st Agreement by one month in exchange
for an interest payment of $750 for the month of September 2000, and an
extension payment of $5,000. Pursuant to the September 27, 2000 amendment to the
August 1st Agreement the remaining payments from Abtech were due as follows: (a)
a payment of $30,750 by November 1, 2000 representing principal and interest;
(b) a payment of $30,500 by December 1, 2000 representing principal and
interest; and (6) a final payment of $30,250 by January 1, 2001 representing
principal and interest.

     Abtech did not make the final payment of $30,250 on January 1, 2001, in
accordance with the August 1st Agreement, as amended, however on January 16,
2001, Abtech did make the final payment of $30,250 for principal and interest
plus an additional payment of $200 to cover the interest for the period January
1, 2001 through January 16, 2001. Accordingly, the Company will discontinue the
lawsuit entitled: MedTech Diagnostics, Inc. v. Abtech Industries, Inc.

     The Company is not a party to any other material legal proceedings.


Item 2. Changes in Securities

Subsequent Events
-----------------

     On April 9, 2001, the Board of Directors of the Company designated 550,000
shares of the 5,000,000 shares of preferred stock authorized for issuance as
Series A Convertible Preferred Stock (the "Preferred Shares"). Each Preferred
Share will earn a cumulative dividend at the rate of eight percent (8%) per
year, which will be paid, out of assets at the time legally available therefore,
to holders of the Preferred Shares on a semi-annual basis. In the event assets
are not legally available to pay earned dividends to holders of the Preferred
Shares, such earned dividends will cumulate and be paid to holders of the
Preferred Shares prior to any distribution being paid to any other class of
preferred stock or the common stock of the Company. Additionally, each Preferred
Share is convertible into five (5) shares of the Company's common stock, $.00001
par value, either: (i) at the option of the holder at any time prior to the
fifth anniversary of the date of issuance of the Preferred Shares, at which time
the Preferred Shares shall automatically convert into common stock; or (ii)
automatically if the Company's common stock, which currently trades on the
National Association of Securities Dealer's Over-the-Counter Bulletin Board
under the trading symbol "FNSI," closes at or above $1.20 for twenty (20)
consecutive trading days and the shares of common stock underlying the Preferred
Shares are covered by a currently effective registration statement filed under
the Securities Act of 1933. A copy of the Company's Amended Certificate of
Designation of Series A Convertible Preferred Stock is attached hereto as an
exhibit and is incorporated herein by reference.

     On April 9, 2001, the Company authorized the issuance of 11,000 shares of
common stock to James A. Prestiano, Esq. as consideration for legal services
rendered to the Company. The shares issued to Mr. Prestiano are restricted
shares and were issued pursuant to Section 4 (2) of the Securities Act of 1933.

                                       13
<PAGE>

Item 5. Other Information

     Effective February 1, 2001, the Company relocated its principal offices
from 900 Third Avenue, Suite 201, New York, New York 10022 to 10 South Street,
Suite 202, Ridgefield, Connecticut 06877. The Company executed a three (3) year
sublease with Catalyst Operations, Inc., a corporation wholly owned by Steven N.
Bronson, the Chairman, President and Chief Executive Officer of the Company.
Pursuant to the sublease, the Company pays rent of $2,000 per month to Catalyst
Operations, Inc.

     Effective January 31, 2001 Steven N. Bronson agreed to waive his annual
salary, as described in the Employment Agreement, dated as of August 1, 2000 by
and between the Company and Steven N. Bronson. All other terms and conditions of
that employment agreement remain in full force and effect, accordingly, Mr.
Bronson continues to be eligible to receive bonus compensation and stock option
grants under the Company's 2000 Stock Incentive Plan, each at the discretion of
the Board of Directors.

     The Company entered into a management consulting agreement, effective
February 1, 2001 with Catalyst Financial LLC ("Catalyst Financial"), a limited
liability company, owned and controlled by Steven N. Bronson. Catalyst Financial
is a full service licensed securities brokerage firm, investment banking and
consulting firm. Pursuant to the management agreement, Catalyst Financial will
provide management consulting services, strategic business planning and certain
other management advisory services to the Company in exchange for a monthly fee
of ten thousand dollars ($10,000). A copy of the management agreement between
Catalyst Financial and the Company is attached hereto as an Exhibit and is
incorporated herein by reference.

     On February 20, 2001, the Board of Directors of the Company authorized and
approved the upstream merger of 4net Software, Inc., the Company's wholly owned
subsidiary, with and into the Company pursuant to Section 253 of the General
Corporation Law of the State of Delaware (the "Merger"). In connection with the
Merger the Company also changed its name to 4net Software, Inc. The Merger and
name change became effective on March 2, 2001, when the Company filed a
Certificate of Ownership and Merger with the Delaware Secretary of State. A copy
of the Certificate of Ownership and Merger is attached as an Exhibit hereto and
is incorporated herein by reference.

     The Company entered into a Mergers and Acquisitions Advisory Agreement,
dated as of March 27, 2001, with Catalyst Financial LLC ("Catalyst Financial"),
a limited liability company, owned and controlled by Steven N. Bronson (the "M&A
Advisory Agreement"). Pursuant to the M&A Advisory Agreement, Catalyst Financial
agreed to provide consulting services to 4net Software in connection with 4net
Software's identifying and investigating prospective target companies for
mergers, acquisitions, business combinations and similar transactions, and, if
investigation warrants, advising 4net Software concerning the negotiation of
terms and the financial structure of such transactions. For the services
rendered pursuant to the M&A Advisory Agreement, Catalyst Financial is entitled
to receive a fee based upon the total consideration of the specific transaction,
calculated as follows: 5% of the consideration from $1 up to $1,000,000; 4% of
the consideration in excess of $1,000,000 and up to $2,000,000; plus 3% of the
consideration in excess of $2,000,000 and up to $3,000,000, plus; 2% of the
consideration in excess of $3,000,000 and up to $4,000,000, plus; 1% of the
consideration in excess of $5,000,000. The term of the Mergers and Acquisitions
Advisory Agreement is three years. A copy of the M&A Advisory Agreement is
attached hereto as an Exhibit and is incorporated herein by reference.

     Pursuant to the M&A Advisory Agreement, Catalyst Financial is entitled to
receive a fee based upon the above formula in the event that 4net Software
successfully completes the acquisition of Target Company 1 and Target Company 2.
Catalyst Financial has agreed to accept a flat fee equal to $70,000 upon the
closing of the acquisition of Target Company 1 and Target Company 2. This fee to
Catalyst Financial has been approved by the Board of Directors of the Company.

                                       14
<PAGE>

Subsequent Event
----------------

     On April 30, 2001, the Company entered into a Placement Agent Agreement
with Catalyst Financial, pursuant to which Catalyst Financial has agreed to act
as the Placement Agent for some or all of the Preferred Stock offered by the
Company in a private offering, pursuant to Section 4(2) of the Securities Act of
1933 and Rule 506 of Regulation D, promulgated thereunder. Pursuant to the terms
of the Placement Agent Agreement, the Company has agreed to pay Catalyst
Financial a selling commission equal to 10% of the gross proceeds of this
Offering. The Company has also agreed to pay Catalyst Financial a
non-accountable expense allowance of 3% of the gross proceeds from the sale of
all Preferred Shares sold in the Offering. To the extent that the expenses of
Catalyst Financial are less than the non-accountable expense allowance, the
excess shall be paid to Catalyst Financial. The Company shall issue to Catalyst
Financial warrants to purchase an amount of Preferred Shares equal to ten
percent (10%) of the total number of Preferred Shares sold in the Offering at a
purchase price of $4.00 per share of Preferred Stock ("Placement Agent
Warrants"). The Placement Agent Warrants shall be exercisable for a period of
five years commencing on the date of completion of the Offering.

Item 6. Exhibits And Reports On Form 8-K

     a. Exhibits

     The following exhibits are hereby filed as part of this Quarterly Report on
Form 10-QSB or incorporated herein by reference.

Exhibit
Number  Description of Document
----------------------------------------------------------------------------
2.1#           Stock Purchase Agreement by and between Michael Park, Andrew
               Patros and Robert Park and MedTech Diagnostics, Inc. dated April
               24, 2000. (Incorporated by reference to Exhibit 2.1 to the
               Current Report on Form 8-K filed by the Company on May 3, 2000.)

3.1#           Certificate of Incorporation of the Company. (Incorporated by
               reference to Exhibit 3.1 to the Annual Report on Form 10-KSB
               filed by the Company on January 20, 2000.)

3.2#           By-Laws of the Company. (Incorporated by reference to Exhibit
               3.2 to the Annual Report on Form 10-KSB filed by the Company on
               January 20, 2000.)

3.3#           Certificate of Amendment to the Certificate of Incorporation of
               the Company. (Incorporated by reference to Exhibit 3.3 to the
               Quarterly Report on Form 10-QSB filed by the Company on August
               14, 2000.)

3.4#           Amended and Restated By-Laws of the Company. (Incorporated by
               reference to Exhibit 3.4 to the Quarterly Report on Form 10-QSB
               filed by the Company on August 14, 2000.)

3.5*           Certificate of Merger between the Company and its wholly owned
               subsidiary 4net Software, Inc.

3.6*           Amended Certificate of Designation of the Series A Convertible
               Preferred Stock of 4net Software, Inc.

                                       15
<PAGE>

10.3#@         Employment Agreement dated as of August 1, 2000 by and between
               the Company and Steven N. Bronson. (Incorporated by reference to
               Exhibit 10.3 to the Quarterly Report on Form 10-QSB filed by the
               Company on August 14, 2000.)

10.4#@         Employment Agreement dated as of August 1, 2000 by and
               between the Company and Robert Park. (Incorporated by
               reference to Exhibit 10.4 to the Quarterly Report on Form
               10-QSB filed by the Company on August 14, 2000.)

10.5#          Sublease dated as of February 1, 2001 by and between the
               Company and Catalyst Operations, Inc.

10.6#          Management Consulting Agreement, dated as of February 1, 2001 by
               and between the Company and Catalyst Financial LLC.

10.7*          Mergers and Acquisitions Advisory Agreement, dated as of March
               27, 2001 by and between the Company and Catalyst Financial LLC.

10.8*          Placement Agent Agreement, dated as of April 30, 2001, by and
               between the Company and Catalyst Financial LLC.
--------------------------------
*    Filed herewith
#    Incorporated herein by reference
@    Represents a management contract


     b. Reports on Form 8-K.

     On March 13, 2001, the Company filed a current report on Form 8-K,
disclosing the upstream merger of 4net Software, Inc., the Company's wholly
owned subsidiary, with and into the Company pursuant to Section 253 of the
General Corporation Law of the State of Delaware (the "Merger"). In connection
with the Merger the Company also changed its name to 4net Software, Inc. The
Merger and name change became effective on March 2, 2001, when the Company filed
a Certificate of Ownership and Merger with the Delaware Secretary of State.


                                   SIGNATURES

Pursuant to the requirements 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.

May 18, 2001

                                   4net Software, Inc.

                                   By: /s/ Steven N. Bronson
                                       -----------------------------------
                                       Steven N. Bronson, President
                                       Principle Executive Officer
                                       as Registrant's duly authorized
                                       officer


                                       16
<PAGE>

                                  EXHIBIT INDEX


Exhibit
Number         Description of Document
--------------------------------------------------------------------------------
3.5            Certificate of Merger between the Company and its wholly owned
               subsidiary 4net Software, Inc.

3.6            Amended Certificate of Designation of the Series A Convertible
               Preferred Stock of 4net Software, Inc.

10.7           Mergers and Acquisitions Advisory Agreement, dated as of March
               27, 2001 by and between the Company and Catalyst Financial LLC.

10.8           Placement Agent Agreement, dated as of April 30, 2001, by and
               between the Company and Catalyst Financial LLC.