SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 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 MARCH 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 0-7349

                                 eNote.com, Inc.
                       (formerly Webcor Electronics, Inc.)
                 (Name of small business issuer in its charter)

Delaware                                                 59-345315
(state or other jurisdiction                  (IRS Employer Identification No.)
of incorporation or organization)

185 Allen Brook Lane, Williston, Vermont                    05495
(Address of principal executive offices)                  (Zip Code)

Issuer's telephone number:                            (802) 288-9000

Securities Registered under Section 12(b) of the Exchange Act:

Title of Classes                      Name of Each Exchange on Which Registered
----------------                      -----------------------------------------

Common Stock, par value $.01 per share.            Not applicable.

Securities Registered under Section
12(g) of the Exchange Act:                         None.

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

    Check if there is no disclosure of delinquent filers pursuant to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the best of Issuer'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.
    [ ]

    The issuer's revenues for its most recent fiscal year were $0.

    As of June 30, 1999, the Issuer had 10,049,481  shares of Common Stock, $.01
par value,  outstanding.  On that date, the aggregate market value of the Common
Stock held by  non-affiliates of the Issuer was $9,680,958 (based on the average
of the reported high and low sales prices on Nasdaq's over-the counter market on
such date). For purposes of determining  this market value,  8,205,489 shares of
Common Stock held by affiliates are excluded.

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

<PAGE>

                                     PART I

Item 1.  Description of Business

Corporate Background Information

    eNote.com, Inc., formerly Webcor Electronics,  Inc. (the "Registrant"),  was
incorporated  on  December  3,  1971,  under the laws of the State of  Delaware.
Except where the context indicates  otherwise,  as used herein,  "Company" means
the Registrant together with any wholly-owned subsidiaries of the Registrant. On
February 1, 1989, the Company filed a voluntary petition under Chapter 11 of the
Bankruptcy Act (Case No. 89-10328) in the U.S.  Bankruptcy Court for the Eastern
District of New York (the  "Court").  On October 16, 1990,  the  Company's  case
under Chapter 11 was  voluntarily  converted  into a case under Chapter 7 of the
Bankruptcy  Act.  As a  result  of the  voluntary  conversion  of the  Company's
bankruptcy case (the  "Bankruptcy"),  all assets of the Company were transferred
to the Trustee in Bankruptcy on the  conversion  date and the Company ceased all
operations.   Subsequently,  the  Trustee  in  Bankruptcy  effected  an  orderly
liquidation  of corporate  assets and used the  proceeds to repay the  Company's
creditors.  On November 13, 1996,  the Company's case under Chapter 7 was closed
by an order of the Court and the  Trustee in  Bankruptcy  was  discharged.  As a
result of the  Bankruptcy,  as of March 31,  1999,  the  Company  had no assets,
liabilities or ongoing operations and had not engaged in any business activities
since February, 1990.

    During the pendency of the Bankruptcy, the management of the Company did not
file  franchise tax returns with,  or pay the required  franchise  taxes to, the
State of Delaware.  As a result, the Company's  corporate charter was revoked by
order of the  Secretary  of State of the  State of  Delaware  on March 1,  1991.
Similarly,  the Company did not file with the SEC either (a) the regular reports
that are required of all companies  that have  securities  registered  under the
Securities  Exchange Act of 1934,  as amended  (the  "Exchange  Act"),  or (b) a
certification on Form 15 terminating its registration under the Exchange Act. As
a result,  the Company  remained a  registrant  under the  Exchange  Act but was
delinquent in its SEC reporting obligations.

    Acting in its capacity as a  stockholder  of the Company,  and without first
receiving any consent,  approval or  authorization  of any officer,  director or
other  stockholder of the Company,  Capston Network Company  ("Capston") filed a
Certificate  for Renewal and Revival of Charter  with the  Secretary of State of
the State of  Delaware  on  December  26,  1996 (such  filing,  the  "Revival").
Thereafter,  Capston  filed a Form 10-K for the fiscal  years  ending  March 31,
1989-1996.  In each of 1997 and 1998,  Capston caused the Company to send to its
stockholders a Notice of Special Meeting and Proxy Statement describing a number
of proposals relating to a plan of reorganization  proposed by Capston. The 1997
Special Meeting failed to achieve a quorum of  stockholders,  but a revised plan
of reorganization was approved on March 23, 1999, after several  adjournments of
the  1998  Special  Meeting.  Detailed  disclosures  respecting  such  plans  of
reorganization are set forth in the Company's Proxy Statements filed January 30,
1997 and April 27, 1998 which are incorporated herein by reference.

    The  revised  plan of  reorganization  contemplated  the  Company  seeking a
suitable business  combination.  As of April 5, 1999, a business combination was
consummated  when the  Company  acquired  Navis  Technologies,  Ltd.  ("Navis").
Details  regarding  such  business  combination  can be found  in the  Company's
Current  Reports on Forms 8-K filed April 5, and April 20, 1999,  any amendments
to such Current Reports and the Company's  Information  Statement to be filed in
accordance with Rule 14f-1 of the Exchange Act, which are incorporated herein by
reference.

    Following  the  combination  with  Navis,  in the  course of  preparing  the
Company's  securities reports,  management was advised by counsel of a number of
potential  irregularities  in the corporate  procedures by which the Revival and
certain  associated  matters were  implemented.  These matters and the manner in
which they were addressed included the following: (i) the procedure by which the
Revival was effected was  corrected by filing a Certificate  of Correction  with
the Secretary of State of Delaware  rendering the earlier  filing by the Company
null and void and filing a new Certificate of Restoration,  Renewal and Revival;
(ii)  the  procedure  by  which  the  Company's  name was  changed  from  Webcor
Electronics,  Inc. was corrected by filing a Corrected  Certificate of Amendment
to the Company's Certificate of Incorporation to render null and void an earlier
amendment relating to such name change and effecting such name change by merging
a newly formed wholly-owned  subsidiary of the Company with and into the Company
with the Company as the  surviving  corporation  in such merger and adopting the
name  "eNote.com,  Inc.";  and (iii) the procedure by which the Company effected
its 1 for  6.75  reverse  stock  split  was  corrected  by  filing  a  Corrected
Certificate of Amendment clarifying that the Company effected a 1 for 12 reverse
stock split followed immediately by a stock distribution of ((12/6.75)-1) shares
of  Common  Stock  for each 1 share of  Common  Stock  theretofore  outstanding,
effectively  producing a 1 for 6.75 reverse split. As described in the Company's
Proxy  Statement  filed  April 27,  1998,  no  fractional  shares were issued in
connection with the reverse split or the stock  distribution and the Company did
not pay cash in lieu of such  shares.  Instead,  the number of shares  issued to
shareholders  entitled to fractional  shares were "rounded up" to the next whole
number.  In addition,  shareholders of record who held at least 100 shares prior
to the 1 for 12 reverse  stock split were issued no fewer than 100 shares  after
the 1 for 12 reverse stock split.  These procedures  resulted in the issuance of
approximately  41,978 additional shares of Common Stock by the Company for which
the  Company  received  payment  of  $419.79  from  Capston,  which the Board of
Directors  has  determined  is adequate  consideration  for the issuance of such
shares.  The Company believes that the actions  described above are an effective
and practical way of addressing these matters.  Ms. Fonner  temporarily  assumed
the role of Chief  Executive  Officer of the Company,  in order to enable her to
take certain actions described above.

                                      - 2 -

<PAGE>

Operations

    The Company,  as of March 31, 1999,  had not been engaged in any  operations
since its bankruptcy.  As of April 5, 1999, the Company  acquired  Navis.  For a
description  of  certain  risks,  readers  are  urged to  carefully  review  the
information  set forth  below  under the caption  "Management's  Discussion  and
Analysis or Plan of Operation--Certain Trends and Uncertainties."

History of Navis and the TVEmail Technology.

    Navis was founded in 1996 for the purpose of developing and  commercializing
communication  appliances,  electronic point of sale devices and infrared ("IR")
subsystems  for network  computer  ("NC") and other "thin client" data retrieval
and storage  systems.  In an NC  environment,  memory and  processing  intensive
computer tasks are performed on a remote computer and the user relies on a small
and  relatively  unsophisticated  data entry and  retrieval  device (a so-called
"thin client") that is connected to the main computer. Navis has sold its remote
controls to three NC  manufacturers,  and such sales accounted for approximately
$32,000 of Navis'  revenue for its fiscal year ended  December 31,  1998.  Navis
receives  royalty  revenues  from third party sales of certain  chips,  advanced
remote  control  units,  and wireless  keyboards,  and such  royalties  totalled
approximately  $26,000 in 1998.  Navis has also derived  revenue  from  contract
engineering  and  consulting  work in the field of NC input devices and wireless
communications, with such revenue amounting to approximately $176,000 in 1998.

    Navis'  management  concluded  that a market  exists  for  simple,  low cost
information appliances that would give users easy access to e-mail and a limited
variety  of  online  services.  Early in 1998,  Navis  discontinued  its  remote
control,  contract  engineering  and  consulting  operations  in  order to focus
exclusively on developing  the concept and  technology of the TVEmail  hardware,
software and related server systems.  The Company is currently seeking to launch
commercial sales of the TVEmail system.

The TVEmail System

    The  TVEmail  system is  comprised  of two  principal  elements:  an in-home
terminal,  including an IR receiver,  IR keyboard and  accessories  (the "Client
Hardware"),   and  the  Company's   proprietary  back-end  server  systems  (the
"ServerSystems").

    The  TVEmail  system is  intended  to give  users  easy  access  to  e-mail,
information gathering, and online shopping services in a format that may be less
expensive  and  complex  than  internet  access  technologies  which  operate on
personal computer ("PC") or NC platforms. The TVEmail system is designed to link
the ServerSystems with inexpensive Client Hardware that is connected directly to
customers' existing televisions.

    While the Company has completed the initial design phase, the technology and
infrastructure  of the TVEmail system has not yet been completed,  and there can
be no  assurance  that it will ever be  distributed  commercially.  The  Company
currently plans to commence initial pilot production of TVEmail in October 1999,
and,  depending  on the  success of the  Company's  field  trials and  financing
efforts,  the Company  may  commence  full scale  commercial  deployment  of the
TVEmail  system as early as the third  quarter of fiscal  2000.  In  addition to
other risks and uncertainties, including those set forth below under the caption
"Management's  Discussion and Analysis or Plan of Operation--Certain  Trends and
Uncertainties,"  before the Company can begin to sell its  TVEmail  system,  the
Company must first complete its design of the graphical user interface  ("GUI"),
complete the engineering of the Client Hardware and the ServerSystems and secure
financing and  arrangements  for the manufacture and  distribution of commercial
quantities of the Client Hardware.

    The Company intends to provide the Client Hardware and its online service to
customers  at  aggressively   competitive  prices.  Such  services  may  include
unlimited e-mail access,  daily news, weather,  sports,  catalog shopping,  fast
food delivery,  as well as other  consumer  services,  however,  there can be no
assurances regarding what services will be offered, if any.

Business Strategy.

    The Company's  business strategy is focused on developing the TVEmail system
and related services. The following may constitute key elements of the Company's
business strategy,  however, the Company's strategy may change at any time. Each
of the  following  will depend  upon the  successful  completion  of the TVEmail
system and setting up  appropriate  manufacturing,  marketing  and  distribution
mechanisms, of each of which there can be no assurance.

    Provide easy to use and cost-effective  e-mail and online service access. To
use  the  TVEmail  system,  a  consumer  will  need  only  his or  her  existing
television, a phone line and the TVEmail Client Hardware.

    Penetrate  global  markets.  The  Company  believes  that the market for the
TVEmail  system  is  global in scope,  and the  Company  may seek to deploy  its
ServerSystems  in the United  States and various  foreign  markets.  The Company
believes that, due to the simplicity and low cost of the TVEmail system,  it may
become popular in less

                                      - 3 -

<PAGE>

developed  countries,  and the Company may develop local content directories and
user  interfaces in multiple  languages for the TVEmail system should the demand
arise.

    Create brand identity. The Company intends to create an identity for its
TVEmail system under the brand name "TVEmail."

    Provide value for advertisers and e-commerce merchants. Due to the nature of
the TVEmail system and the Company's  ability to sort its customers on the basis
of location or other demographic information,  the Company believes it can offer
advertisers, online merchants and other providers of online services the ability
to specifically target their promotions and surveys.

Acquisition of Assets

    Pursuant to a Stock Purchase Agreement (the "SolutioNet  Agreement") entered
into on August 6, 1999 by and among James D. Richards,  III,  Martine  Richards,
the Company and SolutioNet,  Ltd.  ("SolutioNet"),  the Company purchased 55% of
the outstanding  common stock of SolutioNet (the "Purchased  SolutioNet  Stock")
for $250,000. Certain employees of SolutioNet are entitled to receive options to
purchase   non-voting   common  stock  equivalent  to  an  aggregate  of  up  to
approximately 10% of SolutioNet's  common stock at an exercise price of $.01 per
share.  Such series of non-voting  common stock is not  currently  authorized by
SolutioNet's  Certificate of  Incorporation.  Mr. Richards is an employee of the
Company.  SolutioNet's assets include certain proprietary  technology related to
IR devices  that the  Company  may use in its  TVEmail  system.  The  SolutioNet
Agreement  provides that the Company may require the  Richardses to  re-purchase
the  Purchased  SolutioNet  Stock for $250,000,  upon the  occurrence of certain
events.  The  SolutioNet  Agreement  further  provides that, for a period of two
years,  the  Richardses  shall  have the right and  option  to  re-purchase  the
Purchased SolutioNet Stock from the Company for $250,000 if exercised during the
first year or for an amount determined by independent  appraisal of the value of
the Purchased  SolutioNet Stock if exercised during the second year, if: (i) Mr.
Richards'  employment by the Company is terminated  for any reason;  (ii) any of
the terms of Mr.  Richards'  employment  by the  Company  are changed in any way
detrimental to the Richardses; (iii) the Company becomes insolvent, is dissolved
or  liquidated,  takes any action  related to its  dissolution  or winding up or
enters   proceedings   under  any  law  relating  to   bankruptcy,   insolvency,
reorganization or relief from debts; (iv) the Company's market value declines to
less than $15 million;  or (v) Mr.  Richards'  level of equity  ownership in the
Company is diluted by more than thirty percent (30%).

    In  connection  with the  SolutioNet  Agreement,  SolutioNet  entered into a
Consulting Agreement with Mr. Richards (the "SolutioNet Consulting  Agreement"),
whereby  Mr.  Richards  is to provide  Consulting  Services  (as  defined in the
SolutioNet  Consulting  Agreement)  to  SolutioNet  for a  period  of two  years
commencing  on August 6, 1999,  in exchange for $2,083 per month payable only to
the extent that  SolutioNet  has Available  Funds (as defined in the  SolutioNet
Consulting Agreement). Furthermore, in connection with the SolutioNet Agreement,
the  Richardses,  the  Company  and  SolutioNet  entered  into  a  Shareholders'
Agreement  (the  "SolutioNet  Shareholders'  Agreement"),  pursuant to which the
Richardses and the Company agreed to take certain  actions (i) to fix the number
of directors  that  constitute  the entire Board of Directors of  SolutioNet  at
three,  and (ii) to elect as members of the Board of Directors of SolutioNet one
designee of Mr. Richards,  one designee of the Company and one director mutually
acceptable  to the  Richardses  and the Company.  The  SolutioNet  Shareholders'
Agreement  also contains  certain  negative  covenants  with respect to changing
SolutioNet's  business,  Certificate of Incorporation  or Bylaws,  entering into
certain  types  of  transactions  and  terminating  the  SolutioNet   Consulting
Agreement, among other things.

    Pursuant to an Asset Purchase Agreement (the "WebATM  Agreement"),  dated as
of August 13,  1999,  between  WebATM.com,  Inc.,  a  newly-formed  wholly-owned
subsidiary of the Company  ("WebATM.com"),  and Gary Cronin,  an employee of the
Company,  WebATM.com  agreed to purchase certain assets  consisting of a website
with programmed web pages, text and graphics,  the "WEBATM.COM"  domain name and
common law rights in the tradename "WebATM" (collectively, the "WebATM Assets"),
for $100,000.  The WebATM Assets represent  incomplete  technology relating to a
publicly  accessible user interface for certain on-line financial  services.  In
connection with the WebATM Agreement, Mr. Cronin agreed not to engage in certain
activities deemed competitive with those of WebATM.com.

Service Marks, Patents and Proprietary Technology

    The  Company  has  registered  its intent to use the  "TVEmail"  and "eNote"
service marks in the United States.  The Company has also registered a series of
domain  names with  Internic,  Inc.  and  Network  Solutions,  Inc.  The Company
currently  owns the  trademark  "Airmouse"  and nine (9) patents  relating to IR
technology and protocols. The Company is also developing proprietary

                                      - 4 -

<PAGE>

software.  The Company relies primarily on common law to protect its technology,
however there can be no assurance that this protection  will be sufficient.  The
Company also licenses  certain  software to be  incorporated  into the Company's
products and certain  development tools for internal use in product design.  The
Company  believes  that an inability  to  effectively  protect its  intellectual
property  could  have a  material  adverse  effect  on the  Company's  financial
condition and results of operations.  See "Management's  Discussion and Analysis
or Plan of  Operation-Certain  Trends  and  Uncertainties-Uncertainty  Regarding
Patents and Proprietary Technology" and "Management's Discussion and Analysis or
Plan of  Operation-Certain  Trends and  Uncertainties-Technology  Licensed  From
Third Parties."

Competition

    The competitive market for e-mail and online service access may limit demand
or pricing for the TVEmail  system.  The Company  expects to experience  intense
competition  from established  online service  providers such as America Online,
Inc., Prodigy Communications  Corporation and Microsoft Corporation's WebTV(TM).
Many companies  provide  e-mail and online  service  access and other  services,
which provide functionality superior to those included in the TVEmail system. As
a result of this  competition,  demand for the TVEmail  system may  suffer,  the
Company may be  restricted  in the  service  rates it can charge for the TVEmail
system and the Company's business, financial condition and results of operations
may be adversely affected.  Many of the Company's competitors have significantly
greater  financial,  technical,  marketing,  distribution,  customer support and
other  resources  than the  Company  does.  Furthermore,  many of the  Company's
competitors have significantly greater experience, better name recognition, more
compelling  content  and  easier  access to  consumers,  advertisers  and online
service providers than the Company does.

Research and Development

    The Company had not engaged in any research and  development  activities  in
its last two fiscal  years.  Since  acquiring  Navis after the close of the last
fiscal year, the Company has been  incurring,  and expects to continue to incur,
significant research and development expenses. See "Management's  Discussion and
Analysis or Plan of  Operation  -- Plan of  Operation."  Navis had  research and
development  expenses of $185,000 and $0 for the years ending  December 31, 1998
and 1997 respectively.  None of Navis' research and development was sponsored by
Navis' customers.

Employees

    As of June 30, 1999, the Company had 13 full-time  employees  (including its
executive  officers)  and two  part-time  employees.  The Company  also  engages
several consultants who are employed on a full-time basis by others. The Company
is not subject to any collective bargaining agreements and the Company considers
its relations with employees to be good.

Item 2.  Description of Property

    As a result of the  Bankruptcy,  the Company had no assets,  liabilities  or
ongoing operations and had no plants or other property as of March 31, 1999.

    The Company  leases  14,548  square  feet of office and light  manufacturing
space in  Williston  Vermont from  AirMouse  House Ltd.  Partnership,  a Vermont
limited  partnership of which John R. Varsames is the General Partner.  See Item
12,  "Certain  Relationships  and Related  Transactions."  The  Williston  lease
expires on May 31,  2004 and  provides  for annual  payments of  $100,000,  with
annual  adjustments  for  certain  changes  in the  consumer  price  index.  The
Williston  lease  provides  the Company  with the option to extend the lease for
another five year term. The Company has sublet  approximately  2,500 square feet
of office  space in the first  floor of the  Williston  premises  to a subtenant
until  May 31,  2001 at an annual  rent of  $26,125.  The  Company  also  leases
approximately  750 square  feet of office  space in New York City.  The New York
lease  expires on September  30, 2000 and provides for monthly rent  payments of
$1,780.71  until  September  30, 1999,  and  $2,155.92  thereafter.  The Company
believes that its current  properties  are adequate for the Company's  immediate
needs.  However,  if the  Company  were to  manufacture  the Client  Hardware in
commercial   quantities,   it  would  need  to  obtain  substantial   additional
properties.  Also, if the Company were to develop significant in-house marketing
or customer service  departments,  additional  space may be required.  While the
Company  believes  that it could acquire or lease  additional  properties as any
need may arise,  there can be no assurance that any such additional  space could
be obtained by the Company on acceptable terms, or at all.

Item 3.  Legal Proceedings

    Not Applicable.

                                      - 5 -

<PAGE>

Item 4.  Submission of matters to a vote of Security Holders

    No matter was  submitted  to a vote of  security  holders  during the fourth
quarter of the fiscal year ended March 31, 1999.

    The stockholders  approved the plan of reorganization set forth in the Proxy
Statement  filed  April  27,  1998 at a  meeting  held  June 19,  1998  that was
adjourned  and  continued  every 30 days or less through March 23, 1999 at which
time  a  quorum  was  reached.  Detailed  disclosure  respecting  such  plan  of
reorganization is set forth in the Proxy Statement filed April 27, 1998 which is
incorporated herein by reference.

                                     PART II

Item 5.  Market for Company's Common Equity

    As of March 31,  1999,  the Common  Stock had been  thinly and  sporadically
traded for years.  The Company's  trading symbol was WBET during fiscal 1999 and
it  traded  on the NASD Over the  Counter  Bulletin  Board  (the  "OTCBB").  The
following table sets forth the high ask and low bid quotations for the Company's
Common Stock during each quarter  within the last two fiscal years and the first
quarter of fiscal 2000. The amounts represent  inter-dealer  quotations  without
adjustment for retail  markups,  markdowns or commissions and do not necessarily
represent the prices of actual  transactions.  All prices have been adjusted for
the 1 for 12 reverse stock split followed  immediately by the stock distribution
of  ((12/6.75)-1)  shares  of  Common  Stock  for each 1 share of  Common  Stock
theretofore  outstanding,  both  effected  by the  Company  as of April 2,  1999
(collectively, the "Reverse Stock Split").

                                         High Ask             Low Bid
                                         --------             -------

Fiscal year ended March 31, 1998
    First quarter                        $3  3/8              $0  81/256
    Second quarter                       $1  11/16            $0  27/256
    Third quarter                        $1  11/16            $0  81/256
    Fourth quarter                       $1  17/64            $0  27/256

Fiscal year ended March 31, 1999
    First quarter                        $1  61/128           $0  27/256
    Second quarter                       $1  7/128            $0  27/256
    Third quarter                        $0  27/32            $0  27/256
    Fourth quarter                       $1  149/256          $0  27/256

Fiscal year ended March 31, 2000
    First quarter                        $15                  $0  81/256

    At June 30,  1999,  the  Common  Stock was held by 1,004  holders  of record
(including 831 holders who had not yet exchanged their certificates  pursuant to
the Reverse Stock Split).  At June 30, 1999, the high ask and low bid prices for
the Common Stock on the OTCBB were $5 1/2 and $5,  respectively.  As of April 5,
1999 the Company has been trading under the symbol, ENOT, on the OTCBB.

    The Company has not paid,  and  currently  has no intention to pay, any cash
dividends on its Common Stock.  Any decision to declare  dividends in the future
will be made by the  Company's  Board  of  Directors  and will  depend  upon the
Company's future earnings,  capital requirements,  financial condition and other
factors deemed relevant by the Company's Board of Directors.

    On July 14, 1998 and  September  9, 1998,  Navis sold  $200,000 and $250,000
principal amount of 1 Year 18% Convertible  Debentures ("18% Debentures") to Dr.
Peter Stern and Dr. Peter  Swift,  respectively,  for face value.  On January 8,
1999 Navis  sold a $50,000  convertible  promissory  note (the  "Note")  due and
payable  (together with a $10,000 financing fee) immediately upon the receipt by
Navis of any funds from certain enumerated  financing  transactions,  but in any
event no later than July 8, 1999,  for face value to Robert Jones.  On March 23,
1999, Navis sold a $100,000  principal  amount 1 Year 12% Convertible  Debenture
(the "Old 12%  Debenture")  to  Friedlander  Capital  Management,  Inc. for face
value.  Each of the  18%  Debentures,  Note  and 12%  Debentures  was  sold in a
transaction exempt from registration  pursuant to Section 4(2) of the Securities
Act of 1933, as amended.  The 18%  Debentures,  Note and Old 12% Debentures were
each convertible,  upon an equity offering prior to such instrument's  maturity,
into equity securities of Navis or any corporation ultimately formed by Navis or
any of Navis'  owners for the  purpose of  manufacturing  and  distributing  the
TVEmail  technology,  at a conversion  price equal to the offering price of such
equity securities. As of

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<PAGE>

April 6, 1999,  the Company  repaid Dr.  Stern's 18% Debenture and the other 18%
Debenture,  Note and Old 12%  Debentures  were  converted  into shares of Common
Stock at $1.00 per share.

    Between  April 7, 1998 and March 23,  1999,  Navis  issued 15  separate  12%
Promissory  Notes (the  "Varsames  Notes") to John R.  Varsames in an  aggregate
principal  amount of approximately  $223,647.  The Varsames Notes were issued in
transactions exempt from registration pursuant to Section 4(2) of the Securities
Act of 1933, as amended.  The Varsames Notes are payable on demand, and on March
29,  1999,  April  9,  1999 and June 9,  1999,  Navis  repaid  an  aggregate  of
approximately  $250,147  principal  amount of Varsames  Notes and  approximately
$17,081 accrued interest thereon.

Item 6.  Management's Discussion and Analysis or Plan of Operation.

Forward-Looking Statements

    When used in this report,  press  releases and  elsewhere by the Company and
its management from time to time, the words "believes," "anticipates," "intends"
and "expects" and similar  expressions are intended to identify  forward-looking
statements  that  involve  a number of risks  and  uncertainties.  Additionally,
statements   contained  in  this   discussion   that  are  not   historical  are
forward-looking  statements  within the meaning of Section 27A of the Securities
Act of  1933,  as  amended,  and  Section  21E of the  Exchange  Act,  including
statements regarding expectations,  beliefs,  intentions or strategies regarding
the future. The Company intends that all  forward-looking  statements be subject
to the safe-harbor provisions of the Private Securities Litigation Reform Act of
1995.  These  forward-looking  statements  reflect the Company's views as of the
date they are made with respect to future events and financial performance,  but
are  subject  to many  risks and  uncertainties,  which  could  cause the actual
results of the Company to differ materially from any future results expressed or
implied by such  forward-looking  statements.  Factors  that could cause  actual
results to differ  materially  or adversely  include,  without  limitation,  any
inability  or  delay  in  the  development  of  the  Client  Hardware,   GUI  or
ServerSystems  or the  manufacture of Client Hardware as well as the other risks
described  below  under the  caption  "Certain  Trends and  Uncertainties."  The
Company does not undertake to update forward-looking statements.

Plan of Operation

    As a result of the  Bankruptcy,  as of March 31,  1999,  the  Company had no
assets,  liabilities,  or ongoing operations and had not engaged in any business
activities  since February  1990. The Company had no operations  during the year
ended March 31, 1999 and no material assets or liabilities as of March 31, 1999.

    In a transaction  consummated as of April 5, 1999, the Company  acquired all
of the capital stock of Navis in exchange for 8 million  shares of Common Stock.
In a transaction  consummated as of April 6, 1999, the Company raised $5 million
in  gross  proceeds  through  the  sale  of  Preferred  Stock  and  Warrants  to
Friedlander.  Further details  regarding such  transactions  can be found in the
Company's  Current  Reports on Forms 8-K filed April 5, and April 20, 1999,  any
amendments to such Current Reports and the Company's Information Statement to be
filed in accordance with Rule 14f-1 of the Exchange Act, which are  incorporated
herein by reference.

    The  Company  raised $5 million as of April 6, 1999,  and  otherwise  has no
capital  resources.  The Company  intends to use this  capital to  continue  its
development of the Client Hardware,  to install ServerSystems to run the TVEmail
network,  to complete the GUI, to perform  marketing  studies and to produce the
pilot  production  runs for  TVEmail.  The  Company  expects  to  complete  such
endeavors in the third  quarter of fiscal 2000 and believes  that the $5 million
will satisfy its cash  requirements to do so. However,  in order for the Company
to begin  mass  production  of the  Client  Hardware  or to  initiate  sales and
marketing  efforts relating to the TVEmail service,  the Company  anticipates it
will have to raise substantial additional funding through public or private debt
or  equity  financing  in the third  quarter  of  fiscal  2000.  There can be no
assurance that the Company will be able to raise such funds,  and, if it cannot,
its business may be materially and adversely affected.

    The  TVEmail  system is  comprised  of two  principal  elements:  the Client
Hardware;  and the  ServerSystems.  The Company has completed the initial design
phase on both the Client  Hardware and the  ServerSystems  and is now performing
value engineering on the Client Hardware. The Company expects that beta versions
of the Client Hardware may become  available for pilot  deployment  early in the
third quarter of fiscal 2000. The Company  currently  plans to commence  initial
pilot production in October 1999, and, depending on the success of the Company's
field  trials  and  financing  efforts,  the  Company  may  commence  full scale
commercial  deployment  of the TVEmail  system as early as the third  quarter of
fiscal 2000. However,  such schedule is subject to many risks and uncertainties,
including  those  set  forth  below  under  the  caption   "Certain  Trends  and
Uncertainties," and the Company's progress towards commercial  deployment of the
TVEmail system may be made at a  significantly  slower rate,  through  different
avenues, or not at all.

                                      - 7 -

<PAGE>

    During the  fiscal  year  ending  March 31,  2000 the  Company  expects  its
research  and  development  efforts to be focused on the final  development  and
production  of  version  1 of  the  TVEmail  device  and  further  research  and
development  for version 2 of the TVEmail  device.  The Company expects to spend
approximately $1.3 million on research and development in fiscal 2000,  however,
there can be no assurance that unanticipated technical obstacles, lack of funds,
changes  in  strategy  or other  factors  will not  cause  actual  research  and
development expenses to differ materially from the Company's expectations.

    The Company plans to purchase approximately $400,000 to $500,000 in computer
equipment,  lab equipment  and  development  tools over the next twelve  months.
These capital outlays could be substantially  greater, if the Company decides to
handle certain functions,  such as manufacturing,  marketing or customer service
in-house as opposed to contracting them out.

    As of June 30, 1999, the Company had 13 full-time  employees  (including its
executive officers) and two part-time employees.  Within the next twelve months,
the Company expects to hire approximately 10 additional employees in each of its
technology  and  marketing  departments.   The  number  of  hires  may  increase
substantially  if the  Company  decides  to handle  certain  functions,  such as
manufacturing,  marketing or customer service in-house.  The Company has not yet
decided whether it will seek to establish the internal  resources  necessary for
any of such functions, and the necessity for such functions can only be assessed
once the TVEmail system is ready for mass production, if ever.

    While the Company  currently  plans to begin its sales of its TVEmail device
and its internet  service in the third  quarter of fiscal 2000,  there can be no
assurance that  difficulties in research and development,  network  development,
manufacturing  or financing,  or other factors will not delay the launch date or
prevent such launch altogether.

Certain Trends and Uncertainties

    In addition to the other information contained in this Annual Report on Form
10-KSB, the following factors should be considered carefully.

             RISKS RELATING TO THE COMPANY'S CORPORATE STRUCTURE AND
                               FINANCIAL RESOURCES

Need for Additional Funds

    The  Company  raised $5 million as of April 6, 1999,  and  otherwise  has no
capital  resources.  The Company  intends to use this  capital to  finalize  its
development of the Client Hardware,  to install ServerSystems to run the TVEmail
network,  to complete the GUI, to perform  marketing  studies and to produce the
pilot  production  runs for  TVEmail.  The  Company  expects  to  complete  such
endeavors in the third  quarter of fiscal 2000 and believes  that the $5 million
will satisfy its cash  requirements to do so. However,  in order for the Company
to begin  mass  production  of the  Client  Hardware  or to  initiate  sales and
marketing  efforts relating to the TVEmail service,  the Company  anticipates it
will have to raise  substantial  additional  funds.  The Company intends to seek
additional funding through public or private financings,  which may include debt
or  equity  financings.  Adequate  funds for these  purposes,  whether  obtained
through financial markets or collaborative or other  arrangements with corporate
partners or from other  sources,  may not be  available  when needed or on terms
acceptable to the Company. Insufficient funds may require the Company: to delay,
scale back or  eliminate  some or all of its  research  and product  development
programs;  to license third parties to  commercialize  products or  technologies
that the Company would  otherwise  seek to develop  itself;  to sell itself to a
third party; to cease operations; or to declare bankruptcy.

    If the  Company  raises  additional  funds  through  the  issuance  of  debt
securities,  the  holders  of the  debt  securities  will  have a  claim  to the
Company's assets that will be prior to any claim of the  stockholders.  Interest
on any debt securities could increase the Company's costs and negatively  impact
its  operating  results.  If the Company  raises  additional  funds  through the
issuance of preferred  stock, the terms of such preferred stock may provide that
the holders of such  preferred  stock are entitled to receive  dividends  and/or
distributions   upon   liquidation   prior  to  the  holders  of  Common  Stock.
Furthermore,  any such preferred stock may have class voting rights,  conversion
features and/or antidilution protections of which the Common Stock does not have
the benefit.  If the Company  raises  additional  funds  through the issuance of
Common Stock or securities  convertible  into or exchangeable  for Common Stock,
the  percentage  ownership  of the  Company's  then-existing  stockholders  will
decrease. In addition, any such convertible or exchangeable  securities may have
rights,  preferences  and privileges more favorable to the holders than those of
the Common Stock.



                                      - 8 -

<PAGE>

Lack of Operational Continuity

    Because of the Company's Bankruptcy,  the nature of the Revival and the plan
of  reorganization  approved by the Company's  shareholders,  there has not been
continuity in the Company's  operations.  As a result,  relevant  records may be
unavailable to management and this may adversely affect the Company's ability to
document its prior operations and corporate proceedings.

Subordination of Common Stock to Preferred Stock; Risk of Dilution;
Anti-Dilution Adjustments.

    In the event of the  liquidation,  dissolution or winding up of the Company,
the Common Stock is expressly  subordinate to the $5 million preference of the 5
million  outstanding  shares of  Preferred  Stock.  The  conversion  rate of the
Preferred Stock is subject to adjustment,  among other things, upon issuances of
Common Stock or securities  convertible  into Common Stock or rights to purchase
Common Stock that have not been  expressly  approved in writing by a majority in
interest of the holders of Preferred Stock or their elected representatives.  As
of June 30, 1999, each share of Preferred  Stock is convertible  into 1 share of
Common Stock.

Concentration of Ownership and Control.

    Under  the  terms of the  Reorganization  Agreement,  dated  April 5,  1999,
between and among the Company,  Navis and the  stockholders  of Navis,  promptly
after  compliance with Section 14(f) of the Exchange Act, the Board shall have a
meeting  at which all of the  then-directors  shall  resign  and shall  elect as
members of the Company's  Board such  individuals as the former  stockholders of
Navis  shall  designate  to the  Company  in  writing.  The  right of the  Navis
stockholders  to  so  designate  Board  members  is  expressly  subject  to  the
provisions of a Purchase and Sale Agreement between the Company and Friedlander,
dated April 6, 1999 (the  "Friedlander  Agreement"),  which  provides  that: (A)
until the  sooner of (i) the fifth  anniversary  of the date of the  Friedlander
Agreement and (ii) such time as Friedlander is the beneficial owner of less than
10% of the issued and outstanding voting securities of the Company,  Friedlander
shall be entitled to appoint two members of the Board; and (B) the Company shall
promptly  take such  action as may be  required  to amend its By-laws to provide
that,  for so long as  Friedlander  has a right to  appoint  two  members of the
Board,  the total  number of members  constituting  the entire  Board  shall not
exceed seven. Furthermore,  Mr. Varsames and Friedlander each hold a substantial
portion of the  Company's  voting  securities.  Accordingly,  Mr.  Varsames  and
Friedlander  each  have the  ability  to exert  significant  influence  over the
election of the Company's Board of Directors and other matters  submitted to the
Company's  stockholders  for  approval.  These  arrangements  may  discourage or
prevent any proposed  takeover of the Company,  including  transactions in which
stockholders  might  otherwise  receive a premium for their shares over the then
current market prices. See also "Certain Trends and Uncertainties--Anti-Takeover
Provisions  and  Delaware Law May Have Adverse  Effects on the  Company's  Stock
Price" below.

The Company's Anti-Takeover Provisions and Delaware Law May Have Adverse Effects
on the Market Price of the Common Stock.

    There are  provisions in the Company's  certificate  of  incorporation,  its
bylaws and Delaware law that make it more  difficult for a third party to obtain
control of the Company,  even if doing so would be  beneficial to the holders of
Common Stock.  These  anti-takeover  provisions,  which could depress the market
price of the Common Stock,  include:  (a) the division of the Board of Directors
into three classes so that only one-third of our directors are elected each year
and are elected for terms of three years;  and (b) the authority of the Board of
Directors to amend or repeal  bylaws  without the consent or vote of the holders
of Common Stock.

Volatility of Stock Price; Market Overhang from Outstanding Convertible
Securities and Warrants.

    The market  price of the  Company's  Common  Stock,  like that of the common
stock of many other technology companies, has been highly volatile and may be so
in the future.  In the past,  companies that have experienced  volatility in the
market  price of their  stock  have been  subject  to  securities  class  action
litigation. If the Company were subject to a securities class action lawsuit, it
could result in  substantial  costs and a  significant  diversion of  resources,
including management time and attention.


                                      - 9 -

<PAGE>

    No  predictions  can be made of the effect that future  market  sales of the
shares of Common Stock  underlying  the  Preferred  Stock and  Warrants,  or the
availability  of such  securities for sale, will have on the market price of the
Common  Stock  prevailing  from time to time.  Sales of  substantial  amounts of
Common Stock,  or the perception  that such sales might occur,  could  adversely
affect prevailing market prices.

The Market For the Common Stock May Be Illiquid.

    The Common Stock is currently  trading on the NASD Over the Counter Bulletin
Board.  The trading  market for the Common  Stock may be "thin" and  "illiquid",
which can result in increased  volatility  in the trading  prices for the Common
Stock. See "Certain Trends and  Uncertainties--The  Company's Stock Price May Be
Extremely Volatile." There can be no assurance that an active trading market for
the Common Stock will  develop or be  sustained.  If there is no active  trading
market for the Common Stock, holders may not be able to resell their shares at a
satisfactory price, if at all. The prices at which the Common Stock may trade in
the future cannot be predicted and will be determined by the market.

Dividends.

    The Company  does not  anticipate  paying any cash  dividends  on its Common
Stock in the foreseeable  future.  The Company  currently  intends to retain its
earnings, if any, for the development of its business.

Need for and Dependence on Qualified Personnel.

    The Company's success is highly dependent on the hiring and retention of key
personnel  and  technical  staff.  The loss of key  personnel  or the failure to
recruit necessary  additional  personnel or both could impede the achievement of
development objectives.  There is intense competition for qualified personnel in
the areas of the Company's  activities,  and there can be no assurance  that the
Company will be able to attract and retain the qualified personnel necessary for
the  development  of its  business.  Many  of  the  Company's  competitors  have
significantly greater financial and other resources than it does and may be able
to offer more  lucrative  compensation  packages which include stock options and
other stock-based compensation and higher-profile  employment opportunities than
the Company can.

The Company's Certificate of Incorporation Provides Officer and Director
Indemnification and Limits Their Liability.

    The  Company  may  have to  spend  significant  resources  indemnifying  its
officers  and  directors  or paying for  damages  caused by their  conduct.  The
Delaware  General   Corporation  Law  provides  for  broad   indemnification  by
corporations  of their  officers  and  directors  and permits a  corporation  to
exculpate  its  directors  from  liability  for  their  actions.  The  Company's
certificate of incorporation  implements this indemnification and exculpation to
the fullest extent  permitted under this law as it currently exists or as it may
be amended in the future.  Consequently,  except as  otherwise  provided by law,
none of the Company's  officers or directors will be liable to the Company or to
its stockholders for monetary damages resulting from conduct in such capacities.

           RISKS RELATING TO THE COMPANY'S OPERATIONS AND TECHNOLOGIES

Limited Operating History; Recent Shift in Business Strategy.

    Immediately  prior to the Company's  acquisition  of Navis on April 5, 1999,
the Company had no business  operations.  Navis  itself was founded in June 1996
and, since then, has supplied infrared protocol and advanced input devices to NC
manufacturers,  and has provided contract  engineering and consulting  services.
However,  Navis' revenues from operations  never exceeded  $703,000 in any given
year.  In 1998,  Navis  shifted its business  emphasis to focus  entirely on the
development  of  the  TVEmail  service  but  has  yet  to  launch  such  service
commercially  or to receive  any revenue  from such  service.  As a result,  the
Company  has only a limited  operating  history  and there is little  historical
information  on which to evaluate  its  business and  prospects.  The  Company's
revenue,  if any, for the  foreseeable  future is almost  entirely  dependent on
successfully  bringing  its  TVEmail  service  to  market  and on the  number of
customers,  if any,  who  subscribe  to the  TVEmail  service.  There  can be no
assurance  that  the  Company  will be  successful  in  implementing  any of its
business strategies.

    Once the basic TVEmail service is marketed,  if ever, the Company intends to
attempt  to  expand  its   operations  by   developing   and  marketing  new  or
complementary  services or systems.  However, there can be no assurance that the
Company will be able to do so effectively.  Although the Company  believes that,
in the  future,  it will be able to use the  TVEmail  service as a  platform  to
provide  e-mail  and  certain  additional  services,  there can be no  assurance
thereof.

                                     - 10 -

<PAGE>

The Company Depends on its Intellectual Property, Which May Be Difficult and
Costly to Protect.

    The Company's  intellectual property consists of proprietary or confidential
information  that is not  currently  subject  to  patent,  trademark  or similar
protection.  Although the Company has applied for trademark  protection  for the
eNote and  TVEmail  names,  the  Company  may not be able to secure  significant
protection for these trademarks.  If the Company's  competitors or others adopt
product  or  service  names  similar  to eNote or  TVEmail,  it may  impede  the
Company's  ability to build brand  identity  and customer  loyalty.  The Company
relies  primarily  on secrecy to protect  technology,  especially  where  patent
protection is not believed to be appropriate or obtainable.  No assurance can be
given  that  others  will not  independently  develop  substantially  equivalent
proprietary information and techniques or otherwise gain access to the Company's
trade  secrets,  or that the Company can  effectively  protect its rights to its
unpatented trade secrets.

    The validity,  enforceability and scope of protection of certain proprietary
rights in  internet-related  businesses  are  uncertain and still  evolving.  If
unauthorized  third  parties  are  able to copy  the  Company's  service  or its
business  model or to use its  confidential  information  to  develop  competing
services,  the Company may lose  customers and its business  could  suffer.  The
Company may not be able to effectively police unauthorized use of its technology
because such  policing is difficult and  expensive.  In  particular,  the global
nature of the internet makes it difficult to control the ultimate destination or
security of software or other data transmitted.  Furthermore,  the laws of other
countries may not adequately protect the Company's intellectual property.

    The Company's business  activities and the TVEmail service may infringe upon
the  proprietary  rights of  others.  In  addition,  other  parties  may  assert
infringement  claims  against the  Company.  Any such  claims and any  resulting
litigation  could subject the Company to  significant  liability for damages and
could also result in invalidation of its proprietary  rights.  The Company could
be  required  to  enter  into  costly  and  burdensome   royalty  and  licensing
agreements.  These  agreements  may not be available on terms  acceptable to the
Company,  or may not be  available  at all.  The  Company  may also need to file
lawsuits to defend the validity of its  intellectual  property  rights and trade
secrets,  or to determine  the validity and scope of the  proprietary  rights of
others. Litigation is expensive and time-consuming and could divert management's
attention away from the Company's business.

Technology Licensed From Third Parties.

    The Company has entered  into  agreements  with,  and has  licensed  certain
technology from, third parties. The Company has relied on scientific, technical,
commercial  and other data  supplied and  disclosed  by others in entering  into
these agreements and will rely on such data in support of development of certain
products.  Furthermore,  the Company  believes  that it will license  additional
technologies  from third  parties in the  future.  Although  the  Company has no
reason to believe  that this  information  contains  errors of omission or fact,
there can be no  assurance  that  there are no errors of  omission  or fact that
would materially affect the commercial viability of these products.

Rapid Technological Change, Customer Demands and Intense Competition.

    The e-mail service market is characterized  by rapidly changing  technology,
customer demands and intense  competition.  If the Company cannot keep pace with
these changes,  its TVEmail service could become  uncompetitive and its business
could  suffer.  If the Company is not  successful  in  developing  and marketing
enhancements   to  the  TVemail   service  or  new  services   that  respond  to
technological  change  or  customer  demands,  the  Company's  business  may  be
materially and adversely effected.

    The competitive market for e-mail and online service access may limit demand
or pricing for the TVEmail  system.  The Company  expects to experience  intense
competition  from established  online service  providers such as America Online,
Inc., Prodigy Communications  Corporation and Microsoft Corporation's WebTV(TM).
Many companies  provide  e-mail and online  service  access and other  services,
which provide functionality superior to those included in the TVEmail system. As
a result of this  competition,  demand for the TVEmail  system may  suffer,  the
Company may be  restricted  in the  service  rates it can charge for the TVEmail
system and the Company's business, financial condition and results of operations
may be adversely affected.  Many of the Company's competitors have significantly
greater  financial,  technical,  marketing,  distribution,  customer support and
other  resources  than the  Company  does.  Furthermore,  many of the  Company's
competitors have significantly greater experience, better name recognition, more
compelling  content  and  easier  access to  consumers,  advertisers  and online
service providers than the Company does.

                                     - 11 -

<PAGE>

Management of Growth.

    The Company's  ability to implement its business plan  successfully in a new
and   rapidly-evolving   market  will  require  effective  planning  and  growth
management. If the Company cannot manage its anticipated growth effectively, its
business  and  financial  results  may suffer.  The Company  plans to extend its
existing operations substantially, particularly those relating to manufacturing,
sales and marketing and technical support. The Company expects that it will need
to manage and broaden multiple  relationships  with customers,  internet service
providers and other third parties. The Company also expects that it will need to
expand its financial systems,  procedures and controls and will need to augment,
train and manage its workforce,  particularly its information  technology staff.
As a result,  the Company's  management and operating systems may be strained by
any  growth  and  the  Company  may  be  unable  to  timely  complete  necessary
improvements  to its operating  systems,  procedures and controls to support any
future operations.

Capacity Constraints May Impede Revenue Growth and Profitability.

    The  Company  believes  that  satisfactory   performance,   reliability  and
availability of its TVEmail appliances and ServerSystem  infrastructure  will be
critical  to the  Company's  reputation  and  ability to attract  customers  and
maintain adequate customer service levels. Any significant or prolonged capacity
constraints  could delay or prevent  customers from sending or gaining access to
their documents or other data or services.  Such constraints  could decrease the
Company's  ability to acquire and retain  customers and prevent the Company from
achieving  the  necessary  growth in revenue to  achieve  profitability.  If the
amount of traffic increases  substantially and the Company experiences  capacity
constraints,  the  Company may need to spend  significant  amounts to expand and
upgrade its technology and network infrastructure.  Furthermore, the Company may
be unable to  predict  the rate or  timing  of any  increases  in the use of its
services in order to respond in a timely manner.

The Company May Suffer Systems Failures and Business Interruptions Which Would
Harm its Business.

    The  Company's  success  will depend in part on the  efficient  and reliable
operation  of  TVEmail  service  sufficient  to  accommodate  a large  number of
subscribers.  The Company intends to locate its  ServerSystems at multiple sites
with  redundant  functions  in order to  reduce  the  risks of  system  failure,
however,  the  ServerSystems  are  vulnerable  to damage from fire,  power loss,
telecommunications  failures,  break-ins and other events,  which could lead to:
interruptions or delays in the Company's service; loss of data; or the inability
to accept,  transmit and confirm  customer  documents  and data.  The  Company's
business may be  materially  adversely  effected if its service is  interrupted.
Although the Company intends to implement network security measures, its systems
may be vulnerable to computer viruses,  electronic break-ins,  attempts by third
parties  deliberately  to  exceed  the  capacity  of  the  systems  and  similar
disruptions,  any of which could have a material adverse effect on the Company's
business.

Year 2000 Issues Could Impact the Company's Performance.

    Many currently  installed  computer systems and software  products have been
coded to accept or  recognize  only two digit  entries to define the  applicable
year. These systems may erroneously recognize the year 2000 as the year 1900.
This could result in major failures of malfunctions.

    The Company  believes that its  ServerSystems  and Client  Hardware are year
2000 compliant,  and, since the Client Hardware does not interact with any other
systems  controlled  by the customer,  the year 2000  readiness of the Company's
clients should not impact the operation of TVEmail. However, telephony providers
and electronic  bill paying  services with which the TVEmail system may interact
may not become year 2000 compliant in a timely  fashion,  or at all. The failure
of a such  entities  to become year 2000  compliant  could  result in  customers
ceasing use of the TVEmail  service,  the Company  receiving bad  publicity,  or
other factors that may cause material harm to the Company's business.

               RISKS RELATING TO THE INTERNET AND ONLINE COMMERCE

Privacy Concerns May Discourage Customers From Using The Company's Services.

    Concerns over the security of online  transactions  and the privacy of users
may inhibit the growth of the internet as a means of  delivering  documents  and
data.  The Company may need to incur  significant  expenses and use  significant
resources  to protect  against the threat of security  breaches or to  alleviate
problems  caused by such  breaches.  The Company plans to rely on encryption and
authentication   technology  to  provide  secure  transmission  of  confidential
information.  If  the  Company's  security  measures  do  not  prevent  security
breaches,  the Company could suffer operating losses,  damage to its reputation,
litigation  and  possible  liability.  Advances  in computer  capabilities,  new
discoveries in the field of cryptography or other  developments  may result in a
compromise or breach of the Company's encryption

                                     - 12 -

<PAGE>

and  authentication  technology  and  could  enable  an  outside  party to steal
proprietary information or interrupt its operations.

Government Regulation and Legal Uncertainties Relating to the Internet Could
Harm the Company's Business.

    Changes in the regulatory  environment could decrease the Company's revenues
and  increase  its  costs.  The  internet  is largely  unregulated  and the laws
governing the internet remain unsettled, even in areas where there has been some
legislative action. It may take years to determine whether and how existing laws
such as those governing intellectual property, privacy and taxation apply to the
internet. In addition, because of increasing popularity and use of the internet,
any number of laws and  regulations  may be adopted with respect to the internet
or other  online  services  covering  issues  such as: user  privacy;  security;
pricing; content;  copyrights;  distribution;  taxation; and characteristics and
quality  of  services.   Such  regulations  could  impose  additional  costs  or
interdicts  on activities  of the Company,  which could have a material  adverse
effect.

If the Internet Infrastructure Fails, the Company's Business May Suffer.

    The  Company  cannot be certain  that the  infrastructure  or  complementary
services  necessary to maintain the internet as a useful,  convenient  or secure
means of transferring  documents and data will continue to develop. The internet
infrastructure  may not support the demands that growth may place on it, and the
performance  and  reliability  of the internet  may decline,  which could have a
material adverse effect on the Company's business.

The Company Depends on Third-Party Providers of Internet and Telecommunications
Service.

    The Company's  operations  depend on third  parties for internet  access and
telecommunications.  Frequent or prolonged interruptions of these services could
result in significant losses of revenues.  These types of occurrences could also
cause users to perceive the Company's  products as not functioning  properly and
therefore   encourage   them  to  use  other  methods  to  deliver  and  receive
information.  The Company has limited control over these third parties and there
can be no assurance that the Company will be able to maintain relationships with
any of them on acceptable  commercial terms. Nor can there be any assurance that
the quality of services  that they provide  will remain at the levels  needed to
enable the  Company to conduct  its  business  effectively.  Each of these third
parties  has  experienced  outages in the past,  and could  experience  outages,
delays and other  difficulties due to system failures unrelated to the Company's
systems.

Costs of Transmitting Documents and Data Could Increase.

    The  cost of  transmitting  documents  and  data  over  the  internet  could
increase,  and the Company may not be able to increase  its prices to cover such
rising costs. Several  telecommunications  companies have petitioned the Federal
Communications  Commission to regulate internet and on-line service providers in
a manner similar to long distance  telephone  carriers and to impose access fees
on such  providers.  Also,  foreign  laws and  state  tax  laws and  regulations
relating to the provision of services over the internet are still developing. If
individual  states  impose taxes on services  provided  over the  internet,  the
Company's cost of providing our TVEmail services may increase.

Item 7.  Financial Statements.

    See the  financial  statements  and notes related  thereto  included in this
report on pages F-1 through F-9.

Item 8.  Changes in and Disagreements With Accountants on Accounting and
         Financial Disclosure.

    Not Applicable.

<PAGE>

                                    PART III

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

                        EXECUTIVE OFFICERS AND DIRECTORS

        The  following  table  sets  forth  certain  information  regarding  the
directors and executive officers of the Company.
<TABLE>
<CAPTION>

Name                                    Age         Positions
----                                    ---         ---------

<S>                                     <C>         <C>
Sally A. Fonner......................   50          Director
John R. Varsames.....................   48          President and Chief Executive Officer
Michael T. Grennan...................   45          Chief Financial Officer, Treasurer and Secretary
</TABLE>

        There  are  no  family  relationships  among  any of  the  directors  or
executive officers of the Company.

        The  following  information  is furnished  for each of the directors and
executive officers of the Company:

        Sally A. Fonner has served as the sole  director  of the  Company  since
March 23, 1999.  Ms.  Fonner also served as the sole officer of the Company from
March  23,  1999 to April 5,  1999.  Ms.  Fonner  presently  serves  as the sole
director of Fab Global, Inc. and serves as the sole director and sole officer of
Bio-Response,  Inc. Fab Global was, and Bio-Response  is, a publicly-held  shell
that has been  reactivated by Capston and Ms. Fonner in a manner similar to that
in which Ms. Fonner and Capston reactivated the Company.  Ms. Fonner assumed the
office of Chief Executive  Officer for a brief period in September 1999 in order
to take certain remedial actions described in Item 1, above.

        John R. Varsames was appointed  President and Chief Executive Officer of
the Company on April 5, 1999. Mr. Varsames founded Navis in June 1996 and served
as the President and Chief Executive Officer of Navis until the Company acquired
Navis.  From December 1995 to June 1996, Mr. Varsames served as a consultant and
then as Vice President for AirMouse Remote Controls and its affiliate, AirMarket
Interactive System, a company specializing in interactive  television technology
and peripherals.  From August 1984 to December 1995, Mr. Varsames co-founded and
served as the President and Chief Executive Officer of Northshore  Companies,  a
real estate investment firm. Mr. Varsames is a graduate of St. Michael's College
(Business  Administration/Political Science), and was a past Chairman of the St.
Michael's College Associate Board of Trustees.  He has served his community as a
director  of  several  charitable  organizations  and also  served as a national
director for the National Association of Home Builders.

        Michael T. Grennan was appointed Chief Financial Officer,  Treasurer and
Secretary  of the  Company on April 5, 1999.  Before  joining the  Company,  Mr.
Grennan  worked  for  seven  years as a  self-employed  business  and  financial
consultant.  Previously,  Mr. Grennan worked for 14 years in public  accounting,
first on the audit staff of Coopers  and  Lybrand,  and then as a staff  member,
manager and partner of the accounting firm of Urbach,  Kahn, and Werlin, PC. Mr.
Grennan is a 1977 graduate of the University of Florida (BSBA in Accounting with
High Honors),  a Certified Public  Accountant and a former member of the AICPA's
Ethics  Technical  Subcommittee.   In  addition  to  his  experience  in  public
accounting  Mr.  Grennan has extensive  consulting  experience  for a variety of
public and private  corporations  including banks,  manufacturing  and operating
companies.


             SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

<PAGE>

        For the fiscal year ended March 31, 1999,  the  following  persons,  who
were directors,  officers,  or beneficial  owners of more than 10% of the Common
Stock during such fiscal year, failed to file on a timely basis reports required
by Section 16(a) of the Exchange Act during such fiscal year or any prior fiscal
year: Ms. Fonner did not timely file a Form 3 when she was elected a Director on
March 23,  1999,  but filed a Form 3 on May 7, 1999  reporting  her  status as a
Director as well as the securities that she beneficially  owned as of the filing
date.

Item 10.  Executive Compensation.

        Ms. Fonner  served as the sole officer of the Company  during the fiscal
year ended  March 31,  1999.  For the  fiscal  year ended  March 31,  1999,  she
received no  compensation  other than the following:  (i) in connection with the
plan of reorganization approved by the Company's  stockholders,  certain persons
designated  by Capston  received an aggregate of 540,000  shares of Common Stock
for administrative and management  services;  and (ii) the Cash Compensation (as
defined  below).  Ms. Fonner was so designated by Capston to receive  180,600 of
such 540,000 shares of Common Stock.

        The Company's  current Chief  Executive  Officer was the Chief Executive
Officer of Navis prior to the Navis  Transaction on April 5, 1999. The following
table sets forth  compensation  for  services in all  capacities  to Navis,  for
Navis'  fiscal  years ended  December  31,  1996,  1997 and 1998,  of: (i) those
persons who were,  respectively,  Navis'  Chief  Executive  Officer for any time
period  during  fiscal 1998 and up to four of the other most highly  compensated
executive  officers of Navis who were serving as executive  officers at December
31, 1998 whose total annual salary and bonus for the fiscal year ending December
31, 1998 exceeded $100,000;  and (ii) up to two additional individuals who would
have been two of such other four most highly  compensated  executive officers if
such individuals had served as executive officers for the entire fiscal year.
<TABLE>
<CAPTION>

                           SUMMARY COMPENSATION TABLE

                                                                                             Long-Term
                                                                                            Compensation
                                               Annual Compensation                             Awards
                           ----------------------------------------------------------    -----------------
                                                                                             Securities
Name and                                   Salary                     Other Annual           Underlying
Principal Position           Year            ($)        Bonus ($)     Compensation          Options (#)
------------------           ----            ---        ---------     ------------          -----------
<S>                          <C>            <C>           <C>            <C>                     <C>
John R. Varsames,            1998         $127,076        $0             $6,500                  n/a
President and Chief          1997          $77,209        $0             $6,400                  n/a
Executive Officer            1996               $0        $0             $1,736                  n/a
</TABLE>

        The Company's Chief Executive Officer and Chief Financial  Officer,  Mr.
Varsames and Mr. Grennan, respectively, are currently being paid annual salaries
of $150,000 and $125,000, respectively.

                            COMPENSATION OF DIRECTORS

        It is anticipated that  non-employee  Directors will receive initial and
annual grants of stock options, but no such options have been granted to date.

                      PENSION AND LONG-TERM INCENTIVE PLANS

        The Company has no pension or long-term incentive plans.

                                  STOCK OPTIONS

        No stock options were issued to any executive officer or director by the
Company in fiscal 1999.

<PAGE>

Item 11.  Security Ownership of Certain Beneficial Owners and Management

        The following table sets forth certain information  furnished by current
management  concerning  the  beneficial  ownership of Common Stock and Preferred
Stock of the Company as of June 30, 1999, of (i) each person who is known to the
Company to be the  beneficial  owner of more than 5 percent  of either  class of
stock;  (ii) all  directors  and  executive  officers;  and (iii)  directors and
executive officers of the Company as a group:

<TABLE>
<CAPTION>
                                              Common Stock                     Preferred Stock
                                              ------------                     ---------------
                                       Amount and                           Amount and
                                         Nature                             Nature of
Name and Address                      of Beneficial          Percent        Beneficial      Percent
of Beneficial Owner                   Ownership(1)          of Class       Ownership(1)     of Class
-------------------                   ------------          --------       ------------     --------
<S>                                  <C>                      <C>               <C>          <C>
John R. Varsames (2)                 7,350,000(3)(4)          73.1%              --           --

Michael T. Grennan (2)                 250,000(5)              2.5%              --           --

Sally A. Fonner                        181,389(6)              1.8%              --           --
c/o Capston Network Co.
1621 N. Osceola Avenue
Clearwater, FL  33755

Burton G. Friedlander                7,424,100(7)(8)(9)       42.5%       5,000,000          100%
c/o Friedlander Capital
Management Corp.
104 Field Point Road
Greenwich, Connecticut  06830

Executive Officers and Directors     7,781,389                77.4%              --           --
as a Group (3 persons)
</TABLE>

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

(1)     Unless otherwise indicated, this column reflects amounts as to which the
        beneficial owner has sole voting power and sole investment power.
(2)     c/o  eNote.com  Inc.,  185 Allen Brook Lane,  P.O. Box 1138,  Williston,
        Vermont 05495-1138.
(3)     Mr. Varsames shares  beneficial  ownership of 7,080,000 shares of Common
        Stock with his wife,  Heidi A. Varsames.  Mr. Varsames holds sole voting
        power of these 7,080,000 shares pursuant to a proxy from his wife.
(4)     Includes  250,000  shares  of  Common  Stock  held of record by James D.
        Richards  III and  20,000  shares of Common  Stock held of record by the
        adult children of Mr. and Mrs.  Varsames,  Kristen  Varsames and Lori A.
        Varsames.  Mr. Varsames holds sole voting power for these 270,000 shares
        of Common  Stock  pursuant to the proxies  from James D.  Richards  III,
        Kristen Varsames, and Lori A. Varsames. Mr. Richards' proxy expires upon
        the  occurrence of certain events  defined  therein,  and, in any event,
        upon the expiration of one year from April 13, 1999.
(5)     Mr. Grennan's  reported holdings do not include 500 shares that are held
        by his father, as to which he disclaims beneficial ownership.
(6)     In connection with the plan of reorganization  approved by the Company's
        stockholders,   certain  persons   designated  by  Capston  received  an
        aggregate  of  540,000  shares of Common  Stock for  administrative  and
        management services.  Ms. Fonner was so designated by Capston to receive
        180,600 of such 540,000 shares of Common Stock.  Ms.  Fonner's  reported
        holdings  include 50,000 shares that are subject to a letter  agreement,
        dated as of August 26, 1999 among Capston and the Company (the

<PAGE>

        "Capston Pledge Letter"),  which provides that such shares will be given
        to a third party,  as escrow  agent,  pending the  resolution of certain
        obligations of Ms. Fonner and Capston to the Company.
(7)     Includes  5,000,000  shares of Common Stock issuable upon  conversion of
        5,000,000 shares of Preferred Stock and 2,000,000 shares of Common Stock
        issuable upon exercise of immediately exercisable Warrants.
(8)     Mr.  Friedlander  exercises voting and investment control over shares of
        Common  Stock held by  Friedlander  International  Limited  ("FIL")  and
        Friedlander   Limited   Partnership  ("FLP")  through  their  investment
        manager,  Friedlander  Capital Management Corp.  ("FCMC"),  of which Mr.
        Friedlander is the sole shareholder.
(9)     Information  as to Mr.  Friedlander,  FIL,  FLP and  FCMC is  based on a
        Statement  on Schedule  13D filed by Mr.  Friedlander  and FCMC with the
        Commission  on July 15, 1999 and a Form 4 for June 1999  provided by Mr.
        Friedlander and FCMC, and the Company assumes no responsibility for such
        information.


Item 12.  Certain Relationships and Related Transactions

        On April 5, 1999, the Company  acquired  Navis in a transaction  whereby
the  stockholders  of Navis  exchanged  all of their Navis  stock for  8,000,000
shares of newly issued Common Stock (or  approximately 80% of the Company's then
outstanding  Common Stock),  and Navis became a  wholly-owned  subsidiary of the
Company.  Pursuant to the Navis transaction,  Mr. Varsames became the beneficial
owner of approximately  71% of the Company's then outstanding  Common Stock, was
appointed President and Chief Executive Officer of the Company, and acquired the
contractual  right to designate  individuals for  appointment to the Board.  Mr.
Varsames shares  beneficial  ownership of 7,080,000  shares of Common Stock with
his wife, Heidi A. Varsames.  Prior to the Navis  Transaction,  Mr. Varsames was
not a director, officer or shareholder of, or otherwise related to, the Company.

        On April 6, 1999, the Company entered into the Friedlander  Transaction,
pursuant to which Friedlander purchased Preferred Stock and Warrants convertible
into  and  exercisable  for,   respectively,   approximately  41%  of  the  then
outstanding  Common  Stock  and  was  granted  the  contractual  right  (as  yet
unexercised) to designate two individuals for appointment to the Board. Prior to
the  Friedlander  Transaction,  neither  Friedlander  nor Mr.  Friedlander was a
director, officer or shareholder of, or otherwise related to, the Company.

        In connection with the Navis  Transaction  and Friedlander  Transaction,
the  Company  agreed  to issue  1,460,000  shares  of  Common  Stock to  certain
consultants  and advisors,  including  540,000  shares of Common Stock that were
issued to persons  designated  by Capston,  270,000  shares of Common Stock that
were issued to legal counsel for the parties and 650,000  shares of Common Stock
that were issued to certain  financial  consultants as finders' fees. Ms. Fonner
was so designated by Capston to receive 180,600 of such 540,000 shares of Common
Stock.  George W. Schiele received 600,000 of the 650,000 shares of Common Stock
issued as finders' fees. Mr. Schiele  transferred  250,000 of the 600,000 shares
to Mr.  Friedlander.  Mr.  Friedlander  was recruited by Mr.  Schiele to perform
services for the Company and thereby became  entitled to 250,000 shares based on
a Statement on Schedule 13G filed on July 1, 1999 by Mr. Schiele. In addition to
the  above  mentioned  stock  compensation,   upon  the  closing  of  the  Navis
Transaction,  Navis paid $250,000 (the "Cash  Compensation") in cash to Capston,
$100,000 of which Capston,  in turn, paid to Mr. Schiele and another  individual
($50,000  each) who acted as finders in connection  with the Navis  Transaction,
and the remaining $150,000 was retained by Capston. An oral agreement (the "Cash
Condition Agreement") between Capston and Navis provided that Capston's $150,000
portion of the Cash  Compensation  is subject to repayment in the event that the
Common Stock fails to trade at or above $5.00 per share on a national securities
exchange or in the National  Association of Securities  Dealers' SmallCap Market
for at least 45  consecutive  trading  days  within the six  months  immediately
following the closing of the Navis Transaction. The Cash Condition Agreement was
later  modified to provide that the relevant  time period for such trading would
be the four  months  immediately  following  the  filing of this  Report on Form
10-KSB, rather than the six months immediately following the Navis Transaction.

        Between  April 7, 1998 and March 23, 1999,  Navis issued 15 separate 12%
Promissory  Notes  (the  "Varsames  Notes")  to  Mr.  Varsames  in an  aggregate
principal amount of approximately $223,647. The Varsames

<PAGE>

Notes are payable on demand,  and on March 29,  1999,  April 9, 1999 and June 9,
1999,  Navis repaid an aggregate of approximately  $250,147  principal amount of
Varsames Notes and approximately $17,081 accrued interest thereon.
Navis is a wholly-owned subsidiary of the Company.

        Ms.  Fonner and Capston  have agreed to reimburse  the Company  $150,000
(the  "Reimbursement")  for legal fees incurred by the Company  (including funds
advanced by the Company as provided in the next sentence) in connection with the
potential irregularities in corporate procedure described in the fifth paragraph
of the "Corporate Background  Information" section under "Item 1. Description of
Business."  Prior to the  Reimbursement,  the  Company  may fund  certain  legal
expenses of Capston in connection with these matters.  The Capston Pledge Letter
provides that 50,000 shares of Common Stock previously issued to Capston will be
given to a third party, as escrow agent, to be held pending  satisfaction of the
Reimbursement.

        The Company leases  approximately 14,500 square feet of office and light
manufacturing space in Williston,  Vermont from Airmouse House Ltd. Partnership.
This lease expires in 2004 and calls for rent of approximately  $8,333 per month
in 1999, with amounts generally  increasing  annually thereafter to reflect cost
of living related increases. Mr. Varsames is a general partner of Airmouse House
Ltd.  Partnership.  The  terms  of the  lease  were  determined  by  arms-length
negotiation between the parties.

<PAGE>

Item 13.  Exhibits and Reports on form 8-K.

(a) Exhibits:
                             EXHIBIT TABLE

  Exhibit No                 Description
  ----------                 -----------

3(a)       Amended and Restated Certificate of Incorporation.

3(b)       Amended By-laws.

4.1        Certificate of Powers,  Designations,  Preferences  and Rights of the
           Convertible  Preferred  Stock,  par  value  $.01  per  share,  of the
           Company.*

4.2        Common Stock Purchase Warrant dated April 6, 1999 between the Company
           and Friedlander International Limited.*

4.3        1-Year 18 Percent Convertible Debenture due July 14, 1999 of Navis in
           principal amount of $200,000.

4.4        1-Year 18 Percent Convertible Debenture due September 9, 1999 of
           Navis in principal amount of $250,000.

4.5        $50,000 Convertible promissory note of Navis, issued January 8, 1999.

4.6        1-Year 12 Percent Convertible Debenture due March 31, 2000 of Navis
           in principal amount of $100,000.

4.7        12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated April 7, 1998 in principal amount of $50,000, payable on
           demand.

4.8        12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated April 28, 1998 in principal amount of $18,000, payable on
           demand.

4.9        12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated May 4, 1998 in principal amount of $7,500, payable on demand.

4.10       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated May 14, 1998 in principal amount of $28,000, payable on demand.

4.11       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated May 28, 1998 in principal amount of $5,199.40, payable on
           demand.

4.12       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated June 11, 1998 in principal amount of $10,000, payable on
           demand.

                                     - 15 -

<PAGE>

4.13       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated June 25, 1998 in principal amount of $500, payable on demand.

4.14       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated January 27, 1999 in principal amount of $6,000, payable on
           demand.

4.15       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated January 31, 1999 in principal amount of $56,948, payable on
           demand.

4.16       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated February 2, 1999 in principal amount of $5,000, payable on
           demand.

4.17       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated February 5, 1999 in principal amount of $5,000, payable on
           demand.

4.18       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated February 23, 1999 in principal amount of $5,000, payable on
           demand.

4.19       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated March 4, 1999 in principal amount of $20,000, payable on
           demand.

4.20       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           dated March 5, 1999 in principal amount of $1,000, payable on demand.

4.21       12% Promissory Note of Navis Technologies, Ltd. to John R. Varsames,
           March 23, 1999 in principal amount of $5,500, payable on demand.

10.1       Reorganization Agreement,  dated April 5, 1999, between and among the
           Company,  Navis Technologies  Limited,  and the stockholders of Navis
           Technologies Limited.*

10.2       Purchase and Sale Agreement, dated April 6, 1999, between the Company
           and Friedlander International Limited.*

10.3       Plan of Reorganization and Proposed Operations.**

10.4       Lease Agreement by and between Airmouse House, Ltd. Partnership,  and
           the Company with respect to certain premises in Williston, Vermont.

10.5       Sublease  Agreement,  dated June 15,  1999,  between  the Company and
           NYBOR  Corporation  with respect to a portion of the Company's leased
           premises in Williston Vermont.

10.6       Agreement  of Lease  between 866 U.N.  Plaza  Associates  LLC and the
           Company with respect to a portion of the 3rd Floor at 866 U.N. Plaza,
           New York, New York.

10.7       Stock  Purchase  Agreement  by and among James D.  Richards,  III and
           Martine Richards,  the Company and SolutioNet,  Ltd., dated August 6,
           1999

10.8       Consulting Agreement dated as of August 6, 1999 between SolutioNet,
           Ltd. and James D. Richards, III.

10.9       Shareholders'  Agreement,  dated as of August 6,  1999,  by and among
           James  D.  Richards,  III  and  Martine  Richards,  the  Company  and
           SolutioNet, Ltd.

10.10      Asset Purchase Agreement, dated as of August 13, 1999, by and between
           WebATM.com, Inc. and Gary Cronin.

                                     - 16 -

<PAGE>

10.11      Letter Agreement,  dated as of August 26, 1999, among Capston Network
           Company and the Company

20.1       The Company's Current Report on Form 8-K filed April 5, 1999.

20.2       The Company's Current Report on Form 8-K filed April 20, 1999.

20.3       The Company's Proxy Statement filed January 30, 1997.

20.4       The Company's Proxy Statement filed April 27, 1998.

23.1       Consent of Want & Ender, CPA, P.C., Independent Auditors

27         Financial Data Schedule


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

* Previously filed with, and incorporated by reference to, the Company's Current
Report on Form 8-K filed April 20, 1999.

**  Incorporated  by reference to the Company's  Proxy Statement filed April 27,
1998, which is attached hereto as Exhibit 20.4.

     (b) Reports on Form 8-K.

           The  Company  filed no Current  Reports on Form 8-K during the fourth
quarter of the fiscal year ended March 31, 1999.


                                     - 17 -

<PAGE>

                                   SIGNATURES

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



                                               eNOTE.COM, INC.



Date: 9/17/99                                  By: /s/ John R. Varsames
     -----------------                            ------------------------------
                                               John R. Varsames
                                               President and Chief Executive
                                               Officer



    In accordance with the  requirements of the Securities  Exchange Act of 1934
this  report has been  signed  below by the  following  persons on behalf of the
registrant and in the capacities and on the dates indicated.



Date : 9/17/99                   /s/ Michael T. Grennan
     -----------------          ------------------------------
                                Michael T. Grennan
                                Treasurer and Chief Financial Officer



Date : 9/17/99                   /s/ Sally A.  Fonner
     -----------------          ------------------------------
                                 Sally A.  Fonner
                                 Sole Director

<PAGE>

Index to financial statements filed with this report:                      Page

    Report of Want & Ender, Independent Auditors............................F-2

    Balance Sheets at March 31, 1999 and 1998...............................F-3

    Statements of Operations for the years ended
      March 31, 1999 and 1998...............................................F-4

    Statement of Changes in Shareholders' Equity/(Deficit)
           for the years ended March 31, 1999 and 1998......................F-5

    Statement of Cash Flows for the year ended March 31, 1999...............F-6

    Notes to Financial Statements ..........................................F-7

                                       F-1

<PAGE>

WANT & ENDER, CPA, P.C.
CERTIFIED PUBLIC ACCOUNTANTS                          386 Park Avenue South
                                                      Suite 1618
                                                      New York, NY  10016

MARTIN ENDER, CPA                                     Telephone (212) 684-2414
STANLEY Z.  WANT, CPA, CFP                            Fax       (212) 684-5433

Independent Auditor's Report

To the Shareholders and Board of Directors
WEBCOR ELECTRONICS, INC.

We have audited the accompanying  balance sheet of WEBCOR  ELECTRONICS,  INC. (A
Dormant  State  Company)  at March 31,  1999 and March 31,  1998 and the related
statements of operations, shareholders' equity/(deficit), and cash flows for the
years then ended.  These  financial  statements  are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audit.

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

We  believe  our audit  provides  a  reasonable  basis for our  opinion.  In our
opinion,  the  financial  statements  referred to above present  fairly,  in all
material respects, the financial position of WEBCOR ELECTRONICS, INC. (A Dormant
State  Company) at March 31, 1999 and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted  accounting
principles.

/s/

Martin Ender
Want & Ender CPA, P.C.
Certified Public Accountants

New York, NY
September 3, 1999

                                       F-2

<PAGE>

                            WEBCOR ELECTRONICS, INC.
                            (A Dormant State Company)
                                 Balance Sheets
                             March 31, 1999 and 1998

                                                          1999             1998
                                                          ----             ----

ASSETS

Organization Cost                                              0              0

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


Total Assets                                                   0              0
                                                         -------        -------


LIABILITIES AND STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY
Common Stock, par value $.01 per share;
20,000,000 shares authorized;
3,476,670 shares issued and outstanding                        0              0
Additional Paid in Capital                                71,149         32,882
Retained Earnings                                        (32,882)        17,815
Net Profit/(Loss)                                        (38,267)       (15,067)

Total Stockholders' Equity                                     0              0


Total Liabilities and
Stockholders' Equity                                           0              0


                 See accompanying notes to financial statements

                                       F-3

<PAGE>

                            WEBCOR ELECTRONICS, INC.
                            (A Dormant State Company)
                            Statements of Operations
                   For the Year Ended March 31, 1999 and 1998

                                                       1999               1998
                                                       ----               ----

Revenues                                             $      0          $      0

Expenses
Administrative Expenses                                38,267            15,067


Net Income/Loss for the year                         $(38,267)         $(15,067)


See accompanying notes to financial statements

                                       F-4

<PAGE>

                WEBCOR ELECTRONICS, INC.(A Dormant State Company)
                      Statement of Changes in Shareholders'
                                Equity/(Deficit)
                   For the years ended March 31, 1999 and 1998

                                                           1999           1998
                                                           ----           ----

Common Stock
(3,476,670 SHARES ISSUED & OUTSTANDING)                 $      0       $      0
Additional Paid in Capital                                71,149         32,882
Retained Earnings                                        (32,882)       (17,815)
Balance  March, 31                                             0              0

Net Income/(Loss) for the year                           (38,267)       (15,067)

Balance April 1                                                0              0


                 See accompanying notes to financial statements

                                       F-5

<PAGE>

                            WEBCOR ELECTRONICS, INC.
                             Statement of Cash Flows
                       For the Period Ended March 31, 1999

                                                     Current Year     Prior Year

                                                       03-31-99         03-31-98

Cash Flows from Operating Activities

Net Income                                             $(38,267)       $(15,067)
Net Cash Provided (Used)
By Operating Activities                                 (38,267)        (15,067)

Cash Flows from Financing Activities

Proceeds from Capston-Paid in
Capital                                                  38,267          15,067
Net Cash Provided (Used)
By Financing Activities                                  38,267          15,067

Net Increase (Decrease) in Cash                               0               0
Cash at Beginning of Period                                   0               0
Cash at End of Period                                  $      0        $      0

                                       F-6

<PAGE>

                            WEBCOR ELECTRONICS, INC.
                            (A Dormant State Company)

March 31, 1999

Note 1.  History of the Company

    WEBCOR  ELECTRONICS  INC., (A Dormant State  Company),  was  incorporated on
December 3, 1971, under the laws of the State of Delaware. The Company conducted
an initial  public  offering of its common stock,  par value $.01 per share (the
"Common  Stock") in May 1982 and in connection  with an  application to list the
Common Stock on the AMEX system,  the Company also  registered  the Common Stock
pursuant to Section  12(g) of the  Securities  Exchange Act of 1934.  The Common
Stock remained listed on the AMEX system until April 9, 1987.

    On February 1, 1989, the Company filed a voluntary petition under Chapter 11
of the Bankruptcy Act (Case No.  89-10328) in the U.S.  Bankruptcy Court for the
Eastern  District of New York.  On October 16, 1990,  the  Company's  case under
Chapter  11  was  voluntarily  converted  into  a case  under  Chapter  7 of the
Bankruptcy  Act.  As a  result  of the  voluntary  conversion  of the  Company's
bankruptcy  case , all assets of the Company were  transferred to the Trustee in
Bankruptcy  on the  conversion  date  and the  Company  ceased  all  operations.
Subsequently,  the  Trustee in  Bankruptcy  effected an orderly  liquidation  of
corporate  assets and used the  proceeds to repay the  Company's  creditors.  On
November 13, 1996 the  Company's  case under Chapter 7 was closed by an order of
the Court and the  Trustee  in  Bankruptcy  was  discharged.  As a result of the
Bankruptcy,  the  Company  has no  assets,  liabilities,  management  or ongoing
operations and has not engaged in any business activities since February, 1990.

Note 2.  Restoration of Corporate Status

    On  December  26,  1996,  Acting in its  capacity  as a  stockholder  of the
Company,  and without first receiving any consent,  approval or authorization of
any  officer,  director or other  stockholder  of the Company,  Capston  Network
Company  ("Capston") filed a Certificate for Renewal and Revival of Charter with
the Secretary of State of the State of Delaware  (such filing,  the  "Revival").
Thereafter,  Capston  filed a Form 10-K for the fiscal  years  ending  March 31,
1989-1996.  In each of 1997 and 1998,  Capston caused the Company to send to its
stockholders a Notice of Special Meeting and Proxy Statement describing a number
of  proposals  relating to a plan of  reorganization  (the  "Plan")  proposed by
Capston.  The 1997 Special  Meeting failed to achieve a quorum of  stockholders,
but a revised plan of reorganization  (the "Revised Plan"), set forth in a Proxy
Statement  filed April 27, 1998 (the "1998 Proxy  Statement"),  was  approved on
March 23, 1999, after several adjournments of the 1998 Special Meeting.

    The  1998  Proxy  Statement   contemplated   Capston   pursuing  a  business
combination  on behalf of the Company and  provided  that Sally Fonner and other
individuals  designated  by Capston were to be issued  shares of Common Stock as
compensation  for services  rendered in connection  with the  development of the
Plan and the Revised Plan and the management of the Company  pending  completion
of a business  combination.  The 1998 Proxy Statement  further provided that the
Company  would not be  obligated  to  reimburse  Capston  for the  out-of-pocket
expenses  incurred by Capston in  connection  with the filing in Delaware of the
Company's  Certificate  for Renewal and Revival of Charter,  the preparation and
filing of the Company's  reports under the Exchange Act and the investigation of
business  opportunities  on  behalf  of the  Company.  However,  the 1998  Proxy
Statement anticipated that the terms of a business combination transaction might
provide for the reimbursement of such expenses. Because Sally Fonner is both the
President  of WEBCOR  ELECTRONICS,  INC.  and  Capston,  prior Staff  Accounting
Bulletins require under generally accepted  accounting  principles the treatment
of debiting  Capston's  unreimbursed  expenses incurred on behalf of the Company
with  corresponding  credit to paid-in  capital.  Future  expenses of Capston or
others will be treated this way. These expenses are actual cash expenditures and
do not  reflect  any costs  associated  with the  operation  of Capston  nor any
personnel time or cost.

Note 3.  Name Change, Reverse Split and Increase in Authorized Capital

    On March 31, 1999,  the Company  filed an amendment  to its  Certificate  of
Incorporation that (a) changed the name of the Company from "Webcor Electronics,
Inc." to  "eNote.Com,  Inc." (b) effected a reverse  stock split in the ratio of
one  (1)   share  of   post-consolidation   Common   Stock  for  every  six  and
three-quarters (6 3/4) shares of pre-consolidation

                                       F-7

<PAGE>

Common  Stock then issued and  outstanding;  and (c)  increased  its  authorized
capital  stock to 25  million  shares  of Common  Stock and 5 million  shares of
preferred stock.

    The 1998 Proxy  Statement  provided that no fractional  shares of New Common
will be issued in connection  with the reverse split and all  calculations  that
would  result in the  issuance of a  fractional  share will be rounded up to the
nearest whole number.  In addition,  the 1998 Proxy  Statement  provided that no
stockholder who was the beneficial owner of at least 100 shares of Old Common on
the date of the Amendment,  will receive fewer than 100 shares of the New Common
in connection with the  implementation of the reverse split and all calculations
that would result in the issuance of fewer than 100 shares of New Common to such
a stockholder  will be rounded up to 100 shares.  As a result of the  amendment,
the 3,476,370  issued and outstanding  shares of Old Common will be consolidated
into 589,481 shares of New Common.

    The New Common  will be listed on the OTC  Bulletin  Board  under the symbol
"ENOT" and open for trading on Monday,  April 5, 1999. All registered holders of
certificates  for  shares of Old  Common  will be  requested  to  forward  their
certificates to the corporation's  transfer agent, together with a completed and
executed letter of transmittal,  in order to receive the shares of New Common to
which they are entitled.

Note 4.  Subsequent Events

Acquisition of Subsidiary and Financing

    On April 5, 1999, the Company acquired Navis Technologies, Ltd. ("Navis") in
a transaction  whereby the  stockholders  of Navis  exchanged all of their Navis
stock for 8 million  shares of newly  issued  Common  Stock,  and Navis became a
wholly-owned subsidiary of the Company (the "Navis Transaction").  The number of
shares  issued  by the  Company  in the  Navis  Transaction  was  determined  by
arms-length negotiation between the parties.  Before the Navis Transaction,  the
Company  had  no  material  assets,   liabilities  or  business  operations.  No
relationship   existed  between  the  Company  and  Navis  prior  to  the  Navis
Transaction.  In connection  with the Navis  Transaction,  the Company agreed to
issue  approximately  540,000  shares of Common Stock to persons  designated  by
Capston,  270,000  shares of Common  Stock to legal  counsel for the parties and
650,000  shares of Common  Stock to certain  financial  consultants  as finders'
fees.

    At approximately the same time as the Navis Transaction, the Company entered
into a  Purchase  and Sale  Agreement  with  Friedlander  International  Limited
("Friedlander") dated April 6, 1999 (the "Friedlander  Agreement"),  whereby the
Company sold 5 million shares of convertible  preferred  stock,  par value $0.01
per share (the "Preferred Stock"), of the Company, and warrants  ("Warrants") to
purchase 2 million shares of Common Stock to Friedlander  for $5 million in cash
(the  "Friedlander   Transaction").   The  Preferred  Stock  has  a  liquidation
preference of $1 per share,  or $5 million in the aggregate,  and is convertible
into Common Stock on a  share-for-share  basis. The Warrants are exercisable for
five years from the date of issuance at a price of $1 per share, and are subject
to voluntary redemption by the Company at a redemption premium of $1 per Warrant
over the spread  between the exercise  price of the Warrant and the market price
of the Common Stock on the redemption date.

    Taking all of the foregoing into account,  there were  10,049,481  shares of
Common Stock, 5 million shares of Preferred Stock and 2 million  warrants issued
and outstanding  immediately following the Navis Transaction and the Friedlander
Transaction.

    After completion of the Navis  Transaction and the Friedlander  Transaction,
the Company set about to finalize the  development  and  eventually  to commence
commercialization of a proprietary  "TVEmail" technology developed by Navis. The
TVEmail  system is  designed  to serve as a low cost  internet  alternative  for
customers who desire access to e-mail but wish to avoid the cost and  complexity
of a personal  computer or network computer based system.  The TVEmail system is
designed to link client  servers  owned by the Company with  inexpensive  remote
communications  interfaces  that are connected  directly to customers'  existing
televisions.  The in-home  equipment  includes a  communications  interface  and
wireless  keyboard  which are  designed,  in tandem  with the  Company's  server
system,  to give an end-user easy access to e-mail,  news and a limited array of
online  services.  The  Company  expects  the  TVEmail  system  to be a low cost
alternative to e-mail access via personal  computers,  network  computers or Web
TV(TM).

                                       F-8

<PAGE>

Certain Corrective Actions

        Following  the  combination  with Navis,  in the course of preparing the
Company's  securities reports,  management was advised by counsel of a number of
potential  irregularities  in the corporate  procedures by which the Revival and
certain  associated  matters were  implemented.  These matters and the manner in
which they were addressed included the following: (i) the procedure by which the
Revival was effected was  corrected by filing a Certificate  of Correction  with
the Secretary of State of Delaware  rendering the earlier  filing by the Company
null and void and filing a new Certificate of Restoration,  Renewal and Revival;
(ii)  the  procedure  by  which  the  Company's  name was  changed  from  Webcor
Electronics,  Inc. was corrected by filing a Corrected  Certificate of Amendment
to the Company's Certificate of Incorporation to render null and void an earlier
amendment relating to such name change and effecting such name change by merging
a newly formed wholly-owned  subsidiary of the Company with and into the Company
with the Company as the  surviving  corporation  in such merger and adopting the
name "eNote.com Inc."; and (iii) the procedure by which the Company effected its
1 for 6.75 reverse stock split was  corrected by filing a Corrected  Certificate
of Amendment clarifying that the Company effected a 1 for 12 reverse stock split
followed  immediately by a stock distribution of ((12/6.75)-1)  shares of Common
Stock  for each 1 share of Common  Stock  theretofore  outstanding,  effectively
producing a 1 for 6.75 reverse split. As described in the 1998 Proxy  Statement,
no  fractional  shares were issued in  connection  with the reverse split or the
stock  distribution  and the  Company  did not pay cash in lieu of such  shares.
Instead,  the number of shares  issued to  shareholders  entitled to  fractional
shares were "rounded up" to the next whole number. In addition,  shareholders of
record who held at least 100 shares  prior to the 1 for 12 reverse  stock  split
were  issued no fewer than 100 shares  after the 1 for 12 reverse  stock  split.
These  procedures  resulted in the issuance of approximately  41,978  additional
shares of Common Stock by the Company for which the Company  received payment of
$419.79 from Capston,  which the Board of Directors  has  determined is adequate
consideration  for the issuance of such shares.  The Company  believes  that the
actions  described above are an effective and practical way of addressing  these
matters.  Ms. Fonner temporarily  assumed the role of Chief Executive Officer of
the Company, in order to enable her to take certain actions described above.

                                       F-9