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

    Form 10-K
(Mark One)
            [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]

                  For the fiscal year ended: December 31, 1998

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

      For the transition period from December 31, 1997 to December 31, 1998

                           Commission File No.0-27720

                                  EUROMED, INC.
             (Exact name of registrant as specified in its charter)

                            Nevada                    88-031770
                 (State or other jurisdiction  (IRS Employer Identification No.)
               of incorporation or organization)

                  8214 Westchester, Suite 500
                                Dallas, TX 752254
                    (Address of principal executive offices)

                                  214-692-3544
               Registrant's telephone number, including area code

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

 Title of each class              Name of each exchange on which registered
   None                                                    None

Securities registered pursuant to Section 12(g) of the Act:  Common Stock, 
                 par value $.01 per share
                                (Title of Class)

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

      Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.

      The aggregate market value of the voting stock held by  non-affiliates  of
the  registrant  as computed by  reference to the average of the closing bid and
asked  prices of such  stock,  as reported by the  Bulletin  Board,  on December
31,1998 ($0.38). Shares of voting stock held by each officer and director and by
each person who owns 10% or more of the Company's  outstanding voting stock have
been  excluded  in that  such  persons  may be  deemed  to be  affiliates.  This
determination of affiliate status is not necessarily a conclusive  determination
for other purposes.

      The number shares outstanding of the registrant's common stock as of April
14, 1999 was:

                2,007,000 shares of common stock, par value $.01
                                   per share.




<PAGE>




                                  EUROMED, INC.

                      For the Year Ended December 31, 1998

                                Table of Contents
<TABLE>
<CAPTION>

                                                                                                                       Page

Part I
<S>                                                                                                                    <C>

    Item 1:        Business..............................................................................................3

    Item 2:        Properties..............................................................................................

    Item 3:        Legal Proceedings.....................................................................................3

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

Executive Officers of the Registrant.......................................................................................

Part II

    Item 5:        Market for the Registrant's Common Equity and Related Stockholder Matters.............................4

    Item 6:        Selected Financial Data...............................................................................5

    Item 7:        Management's Discussion and Analysis of Financial Condition and Results of Operations.................6

    Item 8:        Financial Statements and Supplementary Data............................................................7

    Item 9:        Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.................25

Part III

    Item 10:       Directors and Executive Officers of EuroMed, Inc.....................................................25

    Item 11:       Executive Compensation.............................................................................. 25

    Item 12:       Security Ownership of Certain Beneficial Owners and Management.......................................29

    Item 13:       Certain Relationships and Related Transactions..........................................................

Part IV

    Item 14:       Exhibits, Financial Statement Schedules, and Reports on Form 8-K.....................................30


</TABLE>










                                                          PART I

Item 1. Business

Swiss  Nassau  Corporation  was  incorporated  on May 17,  1994 in the  state of
Nevada,  United States of America,  with  authorized and issued share capital of
1,000 shares of common stock with no par value (the "Common Stock).  On June 15,
1994,  computer  equipment  with  estimated  value of $4,998 was  contributed in
exchange for all of the shares of Swiss Nassau Corporation. On October 20, 1995,
Swiss Nassau  Corporation  changed its name to EuroMed,  Inc.  ("EuroMed" or the
"Company")  and increased its authorized  shares to 20,000,000  shares of Common
Stock with a new par value of $0.01 per share,  and 5,000,000  preferred  shares
with a par value of $0.01 per share. On October 20, 1995, EuroMed, Inc. effected
a 150 for 1 stock split of its Common Stock.

On November  17,  1995,  all of the shares of  Galenica  B.V.  ("Galenica")  and
Confedera B.V. ("Confedera"),  both based in Oosterhout,  the Netherlands,  were
exchanged by the ultimate shareholder of both companies for all of the shares of
a newly-formed  company,  EuroMed Europe B.V. ("EuroMed Europe").  Prior to this
transaction Galenica and Confedera were owned by B.V. Wisteria  ("Wisteria"),  a
Netherlands limited liability company, which is owned by Pantapharma B.V., which
was owned by A. Francois  Hinnen.  All of the shares of EuroMed Europe were then
exchanged for 1,850,000  shares of Common Stock.  Neither EuroMed Europe nor the
Company  had  any  operations,   and  these   transactions   were  completed  in
contemplation  of an initial public  offering  ("IPO") of shares of EuroMed.  In
March 1996 EuroMed  completed its IPO by selling  1,150,000 shares of its common
stock at $6.50 per share.  The  proceeds  of the IPO and  850,000  shares of its
common stock were used to acquire Mutarestes B.V. and Subsidiary  ("Mutarestes")
in July 1996 (estimated  acquisition price of $11,729,500).  Almost immediately,
upon completion of the acquisition of Mutarestes,  differences developed between
various officers,  directors and shareholders.  Mutarestes was subsequently sold
in July 1997 with a significant  loss being recognized and the 850,000 shares of
common stock being  returned to the Company.  In addition,  A.  Francois  Hinnen
returned 850,000 shares of common stock to the Company to mitigate the effect of
the loss on the Mutarestes transactions.

As a result of the failed  acquisition of Mutarestes and a significant change in
the Dutch law as it related to the wholesale price of pharmaceuticals, the Board
of  Directors  concluded  that it was in the best  interest of EuroMed to divest
itself of its  remaining  Dutch  pharmaceutical  operations.  In November  1997,
EuroMed Europe and its subsidiaries were sold.  EuroMed recognized a substantial
loss on the  disposal  of  EuroMed  Europe;  therefore,  the Board of  Directors
negotiated with A. Francois  Hinnen the return of 1,000,000  shares of EuroMed's
common  stock to lessen the  effects of the loss on disposal  for the  remaining
shareholders of EuroMed.

Effective February 16, 1999,  RedstoneSecurities,  Inc.  ("Redstone") was merged
into a newly organized subsidiary of the Company with Redstone as the survivor (
the "Redstone Merger"). The Company issued 600,000 shares of its Common Stock to
the three principal of Redstone, Thomas Laundrie, Gary Prucell, and Richard belz
(collectively  referred to as the "Redstone  Shareholders")  and is obligated to
issue an additional  500,000 shares (the "Restricted  Shares"),  upon the market
price of the Company's Common Stock reaching certain price levels or the Company
reporting certain levels of net income.  Notwithstanding the price levels of the
Common Stock or net income  performance  levels, the Restricted Shares will vest
on  February  16,  2002.  The  500,000  Restricted  Shares  are  not  considered
outstanding and are not included in any  computations in from 10K.  Redstone has
been a registered broker dealer since 1988 and currently has 70 retail brokers.
Redstone has offices in Plainview, New York, and New York, New York.

Item 3.  Legal Proceedings

    The  Company is still  involved in three  legal  proceedings,  two in Nevada
State  Court  and one in the  United  States  District  Court  for the  Northern
District  of Texas.  There has been no  substantive  activity  in the past three
months in the first Nevada suit filed by the Company  against  former  directors
Gregory Alan Gaylor and Robert Jansonius.

    The second legal  proceeding is a lawsuit filed by the Company in the United
States District Court for the Northern District of Texas against Gaylor in which
a Final Judgment in the total amount of approximately $16 million was awarded in
favor of the Company against Gaylor.  Gaylor has not tendered any payments under
the Final Judgment and it remains wholly unsatisfied.

    The third  legal  proceeding  is a Nevada  lawsuit  filed by Gaylor  and Jan
Bouwman  (another  former  director),  on behalf of themselves and the Company's
minority shareholders, against the Company. A special master was appointed, with
the Company's agreement, to investigate Gaylor and Bouwman's allegations against
the Company.  The special master conducted hearings in December 1997, and issued
his report dated July 30, 1998, in which he reached the conclusion that: (i) the
current  board  of  directors  has   restructured  the  Company  with  competent
management,  new objectives and adequate capital to maximize the Company's value
and the  shareholders'  return  on  investment,  (ii)  further  interference  by
shareholders, former officers, third parties and the court is not warranted, and
(iii) the Company should promptly complete all SEC filings and bring all SEC and
shareholder reports current. The Company completed and filed all such delinquent
reports in December 1998.









<PAGE>



                                     PART II

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

         The  Company's  Common  Stock has been  included  for  quotation of the
Bulletin  Board  National  Market under the symbol "EMED" since  December  1996.
Before this time,  from March 19, 1996 to December 30, 1996 the stock was traded
on the Nasdaq National market under the symbol "EMED".

         The  following  table sets  forth the high and low sales  prices on the
Nasdaq for the Common Stock for fiscal years ended 1997 and 1998.
<TABLE>
<S>                                                  <C>           <C>                <C>       
 
                                      1998
                                                                                    Dividends
    Quarter                                         High             Low           per Share
--------------------------------------------------------------------------------------------
    First Quarter                                  $0.53            $0.23              -
    Second Quarter                                  0.97             0.53              -
    Third Quarter                                   1.58             0.64              -
    Fourth Quarter                                  0.81             0.41              -

                                      1997
                                                                               Dividends
    Quarter                                       High              Low       per Share
    -----------------------------------------------------------------------------------
    First Quarter                                  $2.63             0.63              -
    Second Quarter                                  1.50             0.50              -
    Third Quarter                                   0.75             0.19              -
    Fourth Quarter                                  0.75             0.16              -
</TABLE>


At April 9, 1999 the Company had 50  stockholders  of record of its common stock
and 2,007,000 shares outstanding.

         Dividend Policy

         The  Company has never paid cash  dividends  on its Common  Stock.  The
Company  presently  intends  to  retain  all cash for use in the  operation  and
expansion  of the  Company's  business and does not  anticipate  paying any cash
dividends in the near future.  In addition,  the Company's  existing bank credit
agreement  prohibits the  declaration or payment of cash dividends on its Common
Stock.


         Sales of Unregistered Securities
         In  November  1998 the  Company  agreed to issue  35,000  shares of its
Common  Stock in  settlement  of  professional  fees  related to the sale of the
Company's  subsidiary  in 1997.  At December 31,  1998,  the shares had not been
issued.

         In February  1999, the Company issued 600,000 shares of Common Stock to
the Redstone  Shareholders in connection with the Redstone Merger.  See Item 1 -
Business.


<PAGE>


Item 6:  Selected Financial Data

    The  following  selected  consolidated  financial  data for each of the five
years in the period ended December 31, 1997,  have been derived from the audited
consolidated  financial  statements of the Company included herein. The selected
consolidated  financial data set forth below should be read in conjunction  with
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations" and the consolidated financial statements and notes thereto included
elsewhere in this report.

                         FISCAL YEAR ENDED DECEMBER 31,
<TABLE>
<S>                                                   <C>                <C>          <C>             <C>             <C>  

                                                          1994*          1995*          1996*           1997           1998

Statement of Operations Data:
Sales                                                 $        --    $        --    $        --     $       --    $        --
Gross Profit                                                   --             --             --             --             --
Selling, General and Administrative Expenses                   --             --          590,313        618,198        363,012
Net (Loss) from Continuing Operations                          --             --         (538,798)      (618,198)      (348,259)
Net Income (Loss)                                           637,000        836,000     (7,708,361)    (2,273,879)      (524,404)
Weighted Average Number of Shares Outstanding             2,000,000      2,000,000       3,276,923      2,940,769      1,412,400
Income (Loss) per Share:
         Continuing Operations                                                           $    (.16)     $   (.21)       $    (.25)
                                                                                                   
         Discontinued Operations
                  Income (Loss) on Operations                  $.34           $.42          (2.19)         (0.24)             --
                  Estimated Loss on Disposal
                                                                                                           (0.32)          (0.12)
                                                                                                          -------         ------
Total                                                          $.34         $  .42      $  (2.35)        $  (.77)          $ (.37)
                                                                                                

Balance Sheet Data at Year End:
Total Current Assets                                           $  --        $   -      $  32,347       $ 1,202,170      $  157,883
                                                                                       
Net Assets of  Discontinued Operations                           --             --       5,207,529             --             --
Total Assets                                                     --             --       5,239,876      1,202,170        676,383
Current Liabilities                                              --             --          13,576         88,223         34,376
Stockholders' Equity                                             --             --       5,226,300      1,113,947        642,007
</TABLE>

*There were no operating activities in EuroMed, Inc. in these years.


<PAGE>


Item 7: Management's  Discussion and Analysis of Financial Condition and Results
of Operations

Results of Operations
 .........
Year ended December 31, 1998 Compared to Year ended December 31, 1997

As of  December  31,  1998  the  Company  had no  sales.  Selling,  general  and
administrative  expenses for the year ended  December 31, 1998 were $363,012 and
were comprised  primarily of legal and professional fees incurred as part of the
legal proceeding described in Part I, Item 3, Legal Proceedings.

Selling,  general and  administrative  expenses for the year ended  December 31,
1997 were $618,198 and were comprised  primarily of legal and professional  fees
for the recurring public reporting.

Liquidity and Capital Resources

Cash (used in) continuing  operations was $(441,859) for the year ended December
31, 1998 compared with $(509,524) used by operations for the year ended December
31, 1997. The cash used in operations was offset  partially by advances from the
discontinued operations.

Cash and cash  equivalents  at the end of the year ended  December  31, 1998 was
$118,130  compared  with  $232,170  at the year ended  December  31,  1997.  The
decrease is mainly due to the payment of legal and professional fees.

Management  is of the  opinion  that  proceeds  from  the  sale of  discontinued
operations should be sufficient to finance and sustain operations at the present
level for at least twelve months or until such time as a merger is completed.

Year ended December 31, 1997 Compared to Year ended December 31, 1996

For the  years  ended  December  31,  1996 and 1997 the  Company  had no  sales.
Selling,  general and  administrative  expenses for the year ended  December 31,
1997 were $618,198 and were comprised  primarily of legal and professional  fees
incurred  as part of the legal  proceeding  described  in Part I, Item 3,  Legal
Proceedings.

Selling,  general and  administrative  expenses for the year ended  December 31,
1996 were $590,313 and were comprised primarily of legal and accounting expenses
incurred with the Company's  initial public offering and  professional  fees for
the recurring  public  reporting.  The $69,600  interest was earned on the funds
raised on the initial public  offering prior to the time the funds were expended
for the investment in Mutarestes B.V.

Liquidity and Capital Resources

Cash (used in) continuing  operations was $(509,524) for the year ended December
31, 1997 compared with $(530,811) used by operations for the year ended December
31, 1996. The cash used in operations was offset  partially by advances from the
discontinued operations.

Net cash provided by financing activities was $0 for the year ended December 31,
1997  compared  with  $6,115,250  for the year  ended  December  31,  1996.  The
Company's  initial  public  offering  of  shares  on  March  19,  1996,  was the
significant source of cash for the year ended December 31, 1996.

Cash and cash  equivalents  at the end of the year ended  December  31, 1997 was
$232,170 compared with $26,757 at the year ended December 31, 1996. The increase
is due to collection of amounts due from the disposal of the subsidiary.


ITEM 7-a
Quantitative and Qualitative Disclosures about Market Risks.  Not Applicable.


<PAGE>



Item 8: Financial Statements and Supplementary Data








 .........         TABLE OF CONTENTS

Euromed, Inc.

Auditors' Report                                                     F-2

Balance Sheets as of December 31, 1997 and 1998                      F-3

Statements of Operations for the years ended December
  31, 1996, 1997 and 1998                                           F-4

Statements of Stockholders' Equity and Comprehensive Income (Loss)
 .........for the years ended December 31, 1996, 1997 and 1998      F-5

Statements of Cash Flows for the years ended December 31, 1996,
  1997 and 1998                                                   F-6

Notes to the Financial Statements                                 F-8


Pro Forma Financial Information (Unaudited)

Pro Forma Consolidating Balance Sheet as of December 31, 1998     F-19

Pro Forma Consolidating Statements of Operations for the Year
  Ended December 31, 1998                                         F-20

Notes to Pro Forma Consolidating Financial Statements             F-21


Redstone Securities, Inc.

Independent Auditor's Report                                     F-24

Statements of Financial Condition for the Years Ended December
 31, 1997 and 1998                                             F-25

Statements of Income and Expense for the Years Ended 
December 31, 1996, 1997 and 1998                              F-26

Statements of Cash Flows for the Years Ended December 
31, 1996, 1997 and 1998                                       F-27

Statements of Changes in Stockholders' Equity for the Years Ended
 .........December 31, 1996, 1997 and 1998                        F-28

Notes to Financial Statements                                     F-29





                                                          

                                AUDITOR'S REPORT

Board of Directors and Stockholders
Euromed, Inc.


We have audited the accompanying balance sheets of Euromed,  Inc. as of December
31,  1997 and 1998,  and the related  statements  of  operations,  stockholders'
equity,  and comprehensive  income (loss),  and cash flows for each of the three
years in the period ended December 31, 1998. These financial  statements are the
responsibility  of Company's  management.  Our  responsibility  is to express an
opinion on these financial statements based on our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial  position of Euromed,  Inc. as of December
31, 1997 and 1998, and the results of its operations and its cash flows for each
of the three years in the period ended  December 31, 1998,  in  conformity  with
generally accepted accounting principles.





/s/ KILLMAN, MURRELL & COMPANY, P.C.
KILLMAN, MURRELL & COMPANY, P.C.

Dallas, Texas
March 29, 1999
























                                                            F-2


<PAGE>



                                  EUROMED, INC.

                                 BALANCE SHEETS
                         (IN THOUSANDS OF U.S. DOLLARS)

                           DECEMBER 31, 1997 AND 1998


                                                                 ASSETS
<TABLE>
<CAPTION>
<S>                                                                <C>                     <C>      

                                                                   1997                         1998
                                                             --------------              -----------

Current Assets
   Cash and cash equivalents                                   $   232,170                      $118,130
   Receivables - Note 4
       Proceeds from sale of subsidiary                            670,000                             -
       Due from Euromed Europe, B.V.                               300,000                             -
       Interest                                                          -                        14,753
       Other                                                             -                        25,000
                                                           ---------------                  ------------

       TOTAL CURRENT ASSETS                                      1,202,170                       157,883

Due from Redstone Securities, Inc. - Note 7                              -                       518,500
                                                           ----------------                  -----------

           TOTAL ASSETS                                        $ 1,202,170                   $   676,383
                                                               ===========                   ===========


                      LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable and other accrued liabilities                $     88,223                   $    34,376
                                                              ------------                   -----------

Commitments and contingencies - Notes 2,3 and 7                          -                             -

Stockholders' Equity - Note 3
   Common Stock, par value $.01 per share;
       20,000,000 shares authorized; 1,430,000
       shares issued and outstanding, respectively                  14,300                        14,300
   Additional paid-in capital                                   10,167,138                    10,219,638
   Retained earnings (deficit)                                  (8,935,241)                   (9,459,681)
                                                               -----------                   -----------
                                                                 1,246,197                       774,257
           Less:  23,000 Treasury Shares, at cost                 (132,250)                     (132,250)
                                                              ------------                   -----------

           TOTAL STOCKHOLDERS' EQUITY                            1,113,947                       642,007
                                                               -----------                   -----------

              TOTAL LIABILITIES AND
                STOCKHOLDERS' EQUITY                           $ 1,202,170                   $   676,383
                                                               ===========                   ===========

</TABLE>




                          The accompanying notes are an
                        integral part of these financial
                                   statements.

                                       F-3


<PAGE>




                                  EUROMED, INC.

                            STATEMENTS OF OPERATIONS

                  YEARS ENDED DECEMBER 31, 1996, 1997 AND 1998

<TABLE>
<CAPTION>
<S>                                                                    <C>             <C>              <C>

                                                                         1996           1997              1998
                                                                     -----------------------------------------
Selling, general and administrative expenses                        $  (590,313)     $  (618,198)      $ (363,012)
                                                                    -----------      -----------       ----------

   Operating (loss)                                                    (590,313)        (618,198)        (363,012)

Other Income (Expense)
   Interest income                                                       69,602                -           14,753
   Interest (expense)                                                   (18,087)               -                -
                                                                   ------------  ---------------    -------------

   Loss before income taxes                                            (538,798)        (618,198)        (348,259)

Income taxes - Note                                                           -                -                -
                                                                ---------------  ---------------    -------------

   Net (loss) from continuing operations                            $  (538,798)     $  (618,198)      $ (348,259)

Discontinued operations - Note 4
   Operating income (loss) from discontinued operations              (7,169,563)        (713,695)               -
   Loss on sale of discontinued operations                                    -         (941,986)        (176,181)
                                                                ---------------     ------------       ----------

       Net (loss)                                                   $(7,708,361)     $(2,273,879)      $ (524,440)
                                                                    ===========      ===========       ==========

Weighted average number of shares outstanding                         3,276,923        2,940,769        1,412,400
                                                                      =========      ===========       ==========

Net (loss) per share:
   Continuing operations                                            $      (.16)   $        (.21)    $       (.25)
   Discontinued operations -
       Income (loss) on operations                                        (2.19)            (.24)               -
       Estimated loss on sale of discontinued
           operations                                                         -             (.32)            (.12)
                                                                   ------------   --------------     ------------

              Total                                                  $   ( 2.35)   $        (.77)    $       (.37)
                                                                     ==========    =============     ============

</TABLE>











                          The accompanying notes are an
                        integral part of these financial
                                   statements.

                                       F-4


<PAGE>




                                  EUROMED, INC.

                       STATEMENTS OF STOCKHOLDERS' EQUITY
                         AND COMPREHENSIVE INCOME (LOSS)

                         (IN THOUSANDS OF U.S. DOLLARS)

              FOR THE YEARS ENDED DECEMBER 31, 1996, 1997 AND 1998
<TABLE>
<CAPTION>

                                                    Common                            Cumulative
                                                  Stock    Additional    Retained      currency   Treasury     Total
                                                   Euromed  Paid-in      Earnings/   translation   Share    Shareholders'
                                                   Inc,     Capital     (Deficit)     adjustment   Purchase     Equity
<S>                                                 <C>     <C>          <C>            <C>         <C>           <C>

Balance as of December 31, 1995                    $   20    $      48    $ 1,047       $     2    $      -      $ 1,117
   Sale of Common Stock
       March 1996, net of
           issuing cost of $1,248                      12        6,236          -             -           -        6,248
       Acquisition of Subsidiary
           July 1996 - Note 5                           8        5,729          -            -             -       5,737
       Treasury Stock Purchase                          -          -            -             -        (132)        (132)
   Comprehensive (loss):
       Net Loss                                         -          -       (7,708)            -           -       (7,708)
       Currency Translation
           Adjustment                                   -          -            -           (35)          -          (35)
                                                                                                                --------
              Total comprehensive (loss)                -          -            -             -           -       (7,743)
                                                 -------- ----------    ---------       -------    --------      -------
Balance as of December 31, 1996                         40    12,013       (6,661)          (33)       (132)       5,227
   Shares acquired in the disposal
       of an investment in
       Mutarestes, B.V.                               (17)    (1,683)           -             -           -       (1,700)
   Shares acquired from stockholder
       in settlement of claims                        (10)      (190)           -             -           -         (200)
   Shares issued in exchange for
       services                                         1         27            -             -           -           28
   Comprehensive (loss):
       Net loss                                         -          -       (2,274)            -           -       (2,274)
       Currency translation
           adjustment                                   -          -            -            33           -           33
                                                                                                                --------
              Total comprehensive
                 (loss)                                 -          -            -             -           -       (2,241)
                                                 -------- ----------    ---------       -------    --------      -------

Balance as of December 31, 1997                        14     10,167       (8,935)            -        (132)       1,114
   Shares issued for services                           -         52            -             -           -           52
   Net loss                                             -          -         (524)            -           -         (524)
                                                 -------- ----------     --------       -------    --------      -------

Balance as of December 31, 1998                    $   14    $10,219      $(9,459)      $     -      $ (132)     $   642
                                                   ======    =======      =======       =======      ======      =======

</TABLE>




                          The accompanying notes are an
                        integral part of these financial
                                   statements.

                                       F-5


<PAGE>




                                  EUROMED, INC.

                            STATEMENTS OF CASH FLOWS

                  YEARS ENDED DECEMBER 31, 1996, 1997 AND 1998

<TABLE>
<CAPTION>

                                                                     1996             1997            1998
                                                                   ---------------------------------------
<S>                                                                 <C>            <C>                 <C>         

Cash flows from operating activities:
Net income (loss) from continuing activities                    $ (538,798)       $ (618,198)    $ (348,259)
Adjustments to reconcile net (loss) to cash
   flow from operations:
       Stock issued for services rendered                                -            28,438              -
Changes in operating assets and liabilities:
   Other receivables and prepaid expenses                           (5,590)            5,590        (39,753)
   Accounts payable and other accrued liabilities                   13,577            74,646        (53,847)
                                                               -----------       -----------    -----------

       Net cash (used in) continuing
           operations                                             (530,811)         (509,524)      (441,859)
                                                                ----------        ----------     ----------
       Net cash provided by discontinued operations                434,318           414,937              -
                                                                ----------        ----------  -------------
       Net cash (used) in operating activities                     (96,493)          (94,587)      (441,859)
                                                               -----------       -----------     ----------

Cash flows from investing activities:
   Proceeds from disposal of discontinued operations                     -           300,000        846,319
   Investment in Mutarestes B.V. and Subsidiary                 (5,992,000)                -              -
   Due from Redstone Securities, Inc.                                    -                 -       (518,500)
                                                             -------------     -------------     ----------
Net cash (used in) provided by investing activities             (5,992,000)          300,000        327,819
                                                                ----------        ----------     ----------

Cash flows from financing activities:
   Common stock issued                                           6,247,500                 -              -
   Purchase of Treasury Shares                                    (132,250)                -              -
                                                                ----------     -------------  -------------

       Net cash provided by financing activities                 6,115,250                 -              -
                                                                ----------     -------------  -------------

Net increase (decrease) in cash and cash equivalents                26,757           205,413       (114,040)

Cash and cash equivalents at the beginning of the year                   -            26,757        232,170
                                                             -------------        ----------     ----------

Cash and cash equivalents at the end of the year                $   26,757        $  232,170     $  118,130
                                                                ==========        ==========     ==========

Cash paid during the year:
   Interest                                                     $   18,087  $           -      $           -
                                                                ==========  =============       =============


   Income taxes                                               $          -     $           -  $           -
                                                              ============     =============  =============

</TABLE>




                                   (Continued)

                          The accompanying notes are an
                  integral part of these financial statements.

                                       F-6


<PAGE>




                                  EUROMED, INC.

                            STATEMENTS OF CASH FLOWS
                                   (CONTINUED)

                  YEARS ENDED DECEMBER 31, 1996, 1997 AND 1998
<TABLE>
<CAPTION>


                                                                     1996             1997            1998
                                                                   ---------------------------------------
<S>                                                                  <C>        <C>             <C>    
Supplemental schedule of noncash investing and financing activities:
       Increase in assets                                      $    62,096     $           -    $         -
       Assumption of liabilities                                   (33,403)                -              -
       Reduction in due from affiliated companies in
           connection with acquisition of Galenica
           Belgium S.A.                                            (28,693)                -              -
       Common stock                                                 (8,500)           17,000              -
       Additional paid-in-capital                               (5,729,000)        1,683,000              -
       Investment in Mutarestes                                  5,737,500        (1,700,000)             -
       Reduction in due from Euromed Europe, B.V.                        -                 -        123,681
       Stock issued for services                                         -                 -         52,500
       Loss on sale of discontinued operations                           -                 -       (176,181)
                                                            --------------    --------------       --------
                                                            $            -    $            -    $         -
                                                            ==============    ==============    ===========


</TABLE>














 


                                                            F-7


<PAGE>



                                  EUROMED, INC.

                          NOTES TO FINANCIAL STATEMENTS

   DECEMBER 31, 1996, 1997 AND 1998

NOTE 1:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Company History

Swiss  Nassau  Corporation  was  incorporated  on May 17,  1994 in the  state of
Nevada,  United States of America,  with  authorized and issued share capital of
1,000 shares of common stock with no par value (the "Common Stock"). On June 15,
1994,  computer  equipment  with estimated  value of $ 4,998 was  contributed in
exchange for all of the shares of Swiss Nassau Corporation. On October 20, 1995,
Swiss Nassau  Corporation  changed its name to Euromed,  Inc.  ("Euromed" or the
"Company") and increased its authorized share capital to 20,000,000 common stock
with a par value of $0.01 per share,  and 5,000,000  preferred  stock with a par
value of $ 0.01 per share (no shares of preferred  stock have been  issued).  On
October 20, 1995,  Euromed,  Inc. effected a 150 for 1 stock split of its Common
Stock.

On November  17,  1995,  all of the shares of  Galenica  B.V.  ("Galenica")  and
Confedera B.V. ("Confedera"),  both based in Oosterhout,  the Netherlands,  were
exchanged by the ultimate shareholder of both companies for all of the shares of
a newly-formed  company,  Euromed Europe B.V. ("Euromed Europe").  Prior to this
transaction Galenica and Confedera were owned by B.V. Wisteria  ("Wisteria"),  a
Netherlands limited liability company, which is owned by Pantapharma B.V., which
is owned by A. Francois  Hinnen.  All of the shares of Euromed  Europe were then
exchanged for 1,850,000  shares of Common Stock.  Neither Euromed Europe nor the
Company  had  any  operations,   and  these   transactions   were  completed  in
contemplation  of an initial public  offering  ("IPO") of shares of Euromed.  In
March 1996 Euromed  completed its IPO by selling  1,150,000 shares of its common
stock at $6.50 per share.  The  proceeds  of the IPO and  850,000  shares of its
common stock were used to acquire Mutarestes B.V. and Subsidiary  ("Mutarestes")
in July 1996 (estimated  acquisition price of $11,729,500).  Almost immediately,
upon completion of the acquisition of Mutarestes,  differences developed between
various officers,  directors and shareholders.  Mutarestes was subsequently sold
in July 1997 with a significant  loss being recognized and the 850,000 shares of
common stock being  returned to the Company.  In addition,  A.  Francois  Hinnen
returned 850,000 shares of common stock to the Company to mitigate the effect of
the loss on the Mutarestes transactions.

As a result of the failed  acquisition of Mutarestes and a significant change in
the Dutch law as it related to the wholesale price of pharmaceuticals, the Board
of  Directors  concluded  that it was in the best  interest of Euromed to divest
itself of its  remaining  Dutch  pharmaceutical  operations.  In November  1997,
Euromed Europe and its subsidiaries were sold.  Euromed recognized a substantial
loss on the  disposal  of  Euromed  Europe;  therefore,  the Board of  Directors
negotiated with A. Francois  Hinnen the return of 1,000,000  shares of Euromed's
common  stock to lessen the  effects of the loss on disposal  for the  remaining
shareholders of Euromed.

Euromed currently has no business  operations;  however, its President and Board
of Directors are actively seeking appropriate business acquisitions.

Use of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect certain  reported amounts and  disclosures.  Accordingly,  actual results
could differ from those estimates.







                                       F-8


<PAGE>




                                  EUROMED, INC.

                          NOTES TO FINANCIAL STATEMENTS

   DECEMBER 31, 1996, 1997 AND 1998


NOTE 1:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Taxation

Income taxes are accounted for in accordance with the provisions of Statement of
Financial  Accounting  Standards No. 109 "Accounting for Income Taxes." Deferred
tax assets  and  liabilities  are  recognized  for the  future tax  consequences
attributable to differences  between the financial statement carrying amounts of
existing  assets and liabilities  and their  respective tax bases.  Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to
be recognized or settled.  The effect on tax assets and  liabilities of a change
in tax rates is  recognized  in income in the period that includes the enactment
date.

Euromed has recognized  significant losses from its disposal of subsidiaries and
general  corporate  expenses  incurred in the United States.  Realization of any
portion  of the  deferred  tax  asset  resulting  from  the net  operating  loss
carryforward  is not  considered  more likely than not. No deferred tax asset or
valuation  allowance  has  been  estimated  due to  the  anticipated  change  in
ownership   which  severely   restricts  the  use  of  the  net  operating  loss
carryforward.  At December 31, 1998, Euromed has approximately $6,422,000 of net
operating loss carryforward for federal income tax purposes, which will begin to
expire in 2011.

Pension and Other Post-Retirement and Post-Employment Plans

The Companies have no defined benefit pension plan or other  post-retirement  or
post-employment plans.

Cash Equivalents

All  highly  liquid   investments   purchased   with   original   maturities  of
approximately three months or less are considered to be cash equivalents.

Earnings (Loss) Per Share

Basic (loss) per common  share has been  calculated  using the weighted  average
number of shares of common  stock  outstanding  during  the year.  The  weighted
average  includes  35,000  shares of common  stock  which  were  authorized  for
issuance in November  1998 in  settlement  of  professional  fees related to the
selling of Euromed's foreign subsidiary.  These shares were issued subsequent to
December 31, 1998.  Diluted (loss) per common share is not disclosed because the
effect of the exercise of the common stock warrants would be anti-dilutive.

Concentration of Credit Risk

The Company deposits its cash with high credit quality  financial  institutions.
At times such deposits may be in excess of FDIC  insurance  limits.  At December
31, 1998, the cash deposits exceeding FDIC insurance limits were $21,130.







                                                            F-9


<PAGE>




                                              EUROMED, INC. AND SUBSIDIARIES

                                               NOTES TO FINANCIAL STATEMENTS

   DECEMBER 31, 1996, 1997 AND 1998


NOTE 2:  LONG-TERM INCENTIVE PLAN

The Company  adopted its 1995  Long-Term  Incentive Plan ("Plan") as of November
18, 1995. An aggregate of 300,000 shares of Common Stock has been authorized and
reserved for issuance  under the plan pursuant to the exercise of options or the
grant of restricted  stock awards.  The Plan provides for the grant of incentive
stock options,  non-qualified  stock options,  restricted stock awards and stock
appreciation  rights.  All of the  Company's  and its  subsidiaries'  employees,
independent  directors  and advisors  are  eligible to receive  awards under the
plan, but only employees of Euromed and its subsidiaries are eligible to receive
incentive stock options.  The exercise price for incentive stock options granted
under the Plan may be no less than the fair market  value of the common stock on
the day of the grant.

As of December 31, 1996,  1997 and 1998,  no grants have been awarded under this
plan.


NOTE 3:  RELATED PARTY TRANSACTION

The Board of  Directors  authorized  the  issuance of common  stock to Euromed's
President and to an unaffiliated  individual for services rendered to Euromed in
Europe in  November  and  December  1997.  The  summary  below sets forth  these
transactions:
<TABLE>
<CAPTION>
<S>                                  <C>                           <C>                <C>            <C>      

                                                                    Fair               Number
                                       Month                      Value per            of            Expense
Individual                             Issued                       Share             Shares          Amount
------------------------------------------------------------------------------------------------------------
Elbert Tindell, President      December 1997                     $ .20                100,000       $ 20,000

William Rapaglia               November 1997                      $ .28 1/8            30,000          8,438
                                                                                      -------      ---------
                                                                                      130,000       $ 28,438
--------------------------------------------------------------------------------------======================


</TABLE>

In addition to the $28,438  charge against  fourth (4th) quarter  operations,  a
$23,000 bonus for Elbert Tindell was approved in December 1997.

In December 1997, the Board of Directors authorized the issuance of 100,000 five
year  warrants  to  purchase  common  stock of  Euromed to each of the three (3)
Directors of Euromed at a price of $.30. The fair value of the common shares was
$.20 (Bid Price) at the date the warrants were authorized; therefore, no expense
was recognized in connection  with the warrant  issue.  As of December 31, 1998,
none of these warrants had been exercised.











                                   (Continued)
                                      F-10


<PAGE>




                                  EUROMED, INC.

                          NOTES TO FINANCIAL STATEMENTS

   DECEMBER 31, 1996, 1997 AND 1998

NOTE 3:  RELATED PARTY TRANSACTION (CONTINUED)

In December 1997,  the Board of Directors was  authorized the following  monthly
compensation:
<TABLE>
<S>                                                 <C>                                              <C>    

                                                                                                      Monthly
           Name                                  Position                                            Amounts
           Elbert Tindell                        Chief Executive Officer and
                                                   Chairman of the Board                              $5,000

           Robert A. Shuey, III                  Chief Financial Officer and
                                                    Director                                          $3,000

           Jesse Shelmire, IV                    Director                                             $3,000
</TABLE>

In December 1997, Mr. Shuey and Mr.  Shelmire were each paid $7,000 for services
rendered as Directors of Euromed.

For the year ended  December  31, 1998,  the three (3)  directors of the Company
were paid $200,562 for services rendered to the Company.

Jesse B. Shelmire resigned as a director of Euromed on October 27, 1998.

NOTE 4:  DISCONTINUED OPERATIONS

In the summer of 1997, Euromed's management concluded the sale of its investment
in Mutarestes  B.V. and  Subsidiary  and  determined  that Euromed should divest
itself of the  remaining  operating  subsidiaries.  On November  26,  1997,  the
Company  executed  the  "Purchase  Agreement  by and between  Euromed,  Inc. and
Neopharm B.V." Selected provisions of the agreement are as follows:

       o   80% of capital stock sold to Neopharm B.V. of Euromed Europe B.V.
       o   Sale proceeds $1,000,000
       o   Retainment of $300,000 receivable from Euromed Europe B.V.
       o   Assignment to the Company of $500,000 of the claim against the
            purchaser of Mutarestes B.V.

Management has determined that the remaining 20% interest held in Euromed Europe
B.V. had no realizable  value and the collection of the $500,000  claims against
the purchase of Mutarestes B.V. was not probable;  therefore, no value was given
to these assets at September 30, 1997. Additionally, in connection with the sale
of Euromed Europe V.B., the Company entered into a settlement agreement with Dr.
A. Francois Hinnen and his affiliates which included the following provisions:

           Hinnen's  affiliate to return  1,000,000  shares of Euromed's  common
           stock  Hinnen  to  resign  as  director  of  Euromed  Hinnen  and his
           affiliates resign as the managers of Euromed's operating subsidiaries
           Hinnen to receive  Euromed's  51% interest in Confedera  Philippines,
           Inc. and title to a used automobile and personal  computer Each party
           to the  agreement  to release each other for any claims they may have
           against each other

                                                        (Continued)
                                                           F-11


<PAGE>




                                  EUROMED, INC.

                          NOTES TO FINANCIAL STATEMENTS

                        DECEMBER 31, 1996, 1997 AND 1998


                   NOTE 4: DISCONTINUED OPERATIONS (CONTINUED)

The financial statement of Euromed Europe B.V. as of September 
30, 1997, are as follows:

                              EUROMED EUROPE, B.V.
                                  BALANCE SHEET

                               September 30, 1997

                                     ASSETS
<TABLE>
<CAPTION>
<S>                                                                               <C>

                      Current Assets                                              $6,850,655

                      Vehicles, Furniture and Equipment, net                         399,959

                      Other Assets                                                   510,281

                         Total Assets                                             $7,760,895

                                                  LIABILITIES AND EQUITY

                      Liabilities                                                 $5,963,189

                      Equity                                                       1,797,706

                                                                                  $7,760,895

</TABLE>

 

                                                           F-12


<PAGE>





                                  EUROMED, INC.

                          NOTES TO FINANCIAL STATEMENTS

                        DECEMBER 31, 1996, 1997 AND 1998

                  NOTE 4: DISCONTINUED OPERATIONS (CONTINUED)

                                                   EUROMED EUROPE, B.V.
                                                  STATEMENT OF OPERATIONS
                                           NINE MONTHS ENDED SEPTEMBER 30, 1997
<TABLE>
<CAPTION>
<S>                                                                                 <C>

                                                                               ('000 omitted)

                      Sales                                                      $    26,395

                      Cost of Sales                                                   24,760

                           Gross Profit                                                1,635

                      Selling, general and administrative expenses                     2,349

                           Net (Loss)                                           $       (714)
                                                                                ============

The loss on the disposal of the Subsidiary is as follows:

       Net investment in Euromed Europe, B.V.                                     $2,063,763

       Professional fees incurred in connection
           with sale of Euromed Europe                                                55,223

       Commission paid on sale                                                        23,000

                                                                                   2,141,986

       Proceeds from sale                                                         (1,000,000)

       Fair value of A. Francois Hinnen's affiliate
           stock returned to company (1,000,000 shares @ $.20)                      (200,000)
                                                                                 -----------

                      Net Loss                                                   $   941,986
                                                                                 ===========
</TABLE>

In November 1998, Euromed's Board of Directors authorized the issuance of 35,000
shares of its common stock in  settlement  of  professional  fees related to the
sale of the Company's foreign  subsidiary in 1997. The $1.50 per share value was
determined by taking the average of the bid and asked price for Euromed's common
stock on the date the shares  were  authorized  for  issuance.  The  $52,500 was
recognized as additional loss on disposal of the  discontinued  operation in the
statement of operations for the year ended December 31, 1998.

In 1998, the $300,000 receivable due from Euromed Europe, B.V. was collected net
of  $123,681  of selling  expenses  paid by Euromed  Europe,  B.V.  on behalf of
Euromed,  Inc. The $123,681 has been  recognized  in the statement of operations
for the year ended  December 31,  1998,  as  additional  loss on disposal of the
discontinued operation.


                                                           F-13


<PAGE>




                                                       EUROMED, INC.

                                               NOTES TO FINANCIAL STATEMENTS

   DECEMBER 31, 1996, 1997 AND 1998


NOTE 5:  ACQUISITION AND DISPOSAL OF A SIGNIFICANT ASSET

Euromed, Inc. and Euromed Europe entered into a Stock Purchase Agreement,  dated
as of June 19, 1996 (the "Purchase  Agreement") with Mr. A. Doets, Dr. N. Th. P.
Roozekrans,   Mutarestes  B.V.   ("Mutarestes"),   Pluripharm,   a  wholly-owned
subsidiary of Mutarestes ("Pluripharm"), and Financieringsmaatschappij De Nieuwe
Wereld,  B.V., a  wholly-owned  subsidiary of Pluripharm  ("FDNW"),  pursuant to
which Doets and  Roozekrans  sold to Euromed  Europe all of the capital stock of
Mutarestes,  Pluripharm  and FDNW.  The purchase  price paid by Euromed for such
companies  consisted of: (i)  $5,992,000 (10 million Dutch  guilders);  and (ii)
850,000 shares of Common Stock. The closing of the Purchase  Agreement  occurred
on July 5,  1996.  The  purchase  price paid under the  Purchase  Agreement  was
determined  pursuant to  arms-length  transactions,  and were based upon,  among
other things,  multiples of earnings and potential earnings. The cash portion of
the  purchase  price  was  funded  by the  use of  available  funds  of  Euromed
(8,560,000 Dutch guilders),  which included  proceeds from the Company's initial
public offering  completed on March 19, 1996, with the remaining  portion of the
purchase price  (1,440,000  Dutch  guilders)  being funded through a loan to the
Company from Bank MeesPierson,  N.V. The purchase price was determined by mutual
agreement of the companies'  management and no independent valuation was used to
arrive at the purchase price.  Pluripharm,  the operating company, is engaged in
the  wholesale   distribution  of  branded  and  generic  medicines  within  the
Netherlands.  Prior to the acquisition of Mutarestes B.V. by Euromed Europe, the
only  relationship the two companies had was that each sold  pharmaceuticals  to
the other. These sales between the two companies were as follows:
<TABLE>
<S>                                                                                <C>

                                                                                     Amount
                      Year ended December 31, 1995                                 $2,914,000
                      Six months ended June 30, 1996                               $1,798,000
</TABLE>

The Company divested itself of the capital stock of Pluripharm and other related
assets in the second  quarter of 1997. The Company took this step primarily as a
result of the changing pharmaceutical wholesale market in The Netherlands, which
has resulted in  significantly  lowered  prices and decreased  margins,  and the
Company's inability to consolidate the Pluripharm  operations into the Company's
operations in The  Netherlands.  The operations were not consolidated due to the
objections of the management of Pluripharm  and the problems  resulting from the
litigation  initiated  by the  various  owners/managers  of the  companies.  The
divestiture  includes:  (1,)  Houdstermaatschappij  Singultus  B.V.  ( a private
company with limited liability under the laws of the Netherlands, which is owned
by management of Pluripharm) will acquire all of the capital stock of Pluripharm
for an estimated $3,104,000  (6,100,000 Dutch guilders),  and (ii) the return of
850,000 shares of common stock. The terms of divestiture  agreement included the
provision that Euromed will not be entitled to any of the earnings of Pluripharm
during the time of ownership.













                                                        (Continued)

                                                           F-14


<PAGE>




                                                       EUROMED, INC.

                                               NOTES TO FINANCIAL STATEMENTS

   DECEMBER 31, 1996, 1997 AND 1998


NOTE 5:  ACQUISITION AND DISPOSAL OF A SIGNIFICANT ASSET (CONTINUED)


The following  summarizes the  investment in Mutarestes  B.V. and Subsidiary and
the resulting estimated loss upon disposal:
<TABLE>
<S>                                                                               <C>      

       Acquisition

           Cash                                                                  $ 5,877,000
           Cost of acquisition                                                       115,000
                                                                                ------------
               Total cash advanced                                                 5,992,000

           850,000 shares of common stock issued
               at a fair value of $6.75 per share                                  5,737,500
                    Total investment                                              11,729,500

       Disposal

           Estimated cash proceeds                                                 3,104,000

           Disposal costs                                                           (302,000)
               Net cash provided                                                   2,802,000

           Stock returned to Company:
               850,000 shares of common stock
                  held by the owners of Mutarestes
                  B.V. at a fair value of $1.50
                  (March 1997)                                                      1,275,000
               850,000 shares of common stock
                  held by Francois Hinnen at a
                  fair value of $.50 (September 1997)                                425,000
                                                                                ------------
                                                                                   4,502,000
           Estimated net loss                                                    $ 7,227,500
                                                                           =================
</TABLE>

The fair value of 850,000 shares returned to Euromed by Mr. Francois Hinnen, CEO
of  Euromed,  is  included  in the loss  estimate  since the Board of  Directors
requested  that Mr.  Hinnen  give up  shares  to help  mitigate  the loss on the
disposal for those  shareholders  who purchased  stock in the March 1996 initial
public offering.








                                                        (Continued)

                                                           F-15


<PAGE>




                                  EUROMED, INC.

                          NOTES TO FINANCIAL STATEMENTS

                        DECEMBER 31, 1996, 1997 AND 1998

NOTE 6:  QUARTERLY FINANCIAL DATA (UNAUDITED)
<TABLE>
<S>                                             <C>               <C>                 <C>                  <C>     

                                                                                    Continuing Operations
                                                                   Income
                                                                (Loss) Before          Net Income            Earnings
                                                                                                              (Loss)
                                            Revenues             Income Taxes           (Loss)               Per Share
          1998

           December                       $       -                $(159,212)           $(159,212)             $  (.12)
-----------
           September                              -                  (60,240)             (60,240)                (.04)
           June                                   -                  (50,688)             (50,688)                (.04)
           March                                  -                  (78,119)             (78,119)                (.05)

          1997

           December                       $       -                $ (26,839)           $ (26,839)             $  (.01)
           September                              -                 (147,839)            (147,839)                (.06)
           June                                   -                 (177,408)            (177,408)                (.05)
           March                                  -                 (266,112)            (266,112)                (.07)

          1996

           December                      $        -                $(107,458)           $(107,458)             $  (.03)
           September                              -                  (45,578)             (45,578)                (.01)
           June                                   -                   33,024               33,024                  .01
           March                                  -                 (418,786)            (418,786)                (.08)
</TABLE>

NOTE 7:  SUBSEQUENT EVENTS

In 1998 Euromed advanced monies to Redstone Securities, Inc. as follows:
<TABLE>
<S>                                     <C>                                        <C>        
            Date                            Amount                                 Description
       August 1998                        $ 300,000                               Subordinate Loan
       November 1998                        210,000                               Subordinate Loan
       December 1998                          8,500                              January 1999 Rent
                                        ------------

                                          $ 518,500
</TABLE>

The $510,000 of subordinated loans were subject to certain National  Association
Securities Dealers (NASD) subordination  restrictions and could not be repaid to
Euromed  without  prior  written  approval of the NASD.  In 1999 the $510,000 of
subordinated loans were converted to equity in Redstone Securities, Inc.

On November 6, 1998, the "Agreement and Plan of Reorganization" by and among the
Company, Redstone Acquisition Corp. and Redstone Securities,  Inc. was executed.
As of February 16, 1999, the Company

                                   (Continued)
                                      F-16


<PAGE>




                                  EUROMED, INC.

                          NOTES TO FINANCIAL STATEMENTS

                        DECEMBER 31, 1996, 1997 AND 1998

NOTE 7:  SUBSEQUENT EVENTS (CONTINUED)


acquired a ninety-six percent (96%) ownership  interest in Redstone  Acquisition
Corp. (which owns one hundred percent (100%) of the outstanding common shares of
Redstone  Securities,  Inc.)  by  issuing  one  million,  one  hundred  thousand
(1,100,000)  shares of its common  stock for nine hundred and sixty (960) shares
of Redstone  Acquisition Corp's common stock. Five hundred thousand (500,000) of
the  acquisition  shares were issued  subject to certain  vesting  restrictions.
These restricted shares will vest as follows:


       o Shares will vest if the Company's  stock trades for twenty  consecutive
trading days as follows:
<TABLE>
<S>                                                                                         <C>    

                                           Vesting
                                           Number of                                       Trading
                                           Shares                                           Value
                                            166,667                                         $2.25
                                            166,667                                         $3.75
                                            166,666                                         $5.25

       o All shares will vest if the Company  achieves  the  following  earnings
level:

                                              Net                                     Year Ending
                                             Income                                   December 31,
                                            $200,000                                     1999
                                            $350,000                                     2000
                                            $525,000                                     2001
</TABLE>

       o   Any remaining  restricted  shares will vest in their  entirety on the
           third anniversary of the closing date of the merger transaction.

The transaction will be accounted for as if Redstone  Securities,  Inc. acquired
the Company (a reverse merger) since the Company had no active business.















                                      F-17


<PAGE>







 


                                              PRO FORMA FINANCIAL INFORMATION
                                                        (UNAUDITED)

                                                       EUROMED, INC.

                                                     DECEMBER 31, 1998

 





















                                                           F-18


<PAGE>


                                  EUROMED, INC.
                      PRO FORMA CONSOLIDATING BALANCE SHEET
                                   (UNAUDITED)
                                DECEMBER 31, 1998
<TABLE>
<S>                                                  <C>           <C>             <C>           <C>               <C>    

                                                          ASSETS
                                                                   Redstone
                                                    Euromed,     Securities,                   Consolidating  Consolidated
                                                    Inc.            Inc.          Total           Entries        Total
Current Assets
   Cash                                            $118,130   $           -    $  118,130      $          -      $118,130
   Investments, at market                                 -         464,034       464,034                 -       464,034
   Receivables
       Interest                                      14,753             -       14,753 (E)           (14,753)           -
       Commissions                                        -         465,178       465,178                 -       465,178
       Good faith deposits                                -         100,000       100,000                 -       100,000
       Other                                         25,000         131,555       156,555                 -       156,555
   Prepaid expenses                                       -          21,969        21,969 (A)         8,500        30,469
                                                -----------     -----------   -----------         --------- -------------
              Total Current Assets                  157,883       1,182,736     1,340,619           (6,253)    1,334,366

Due from Redstone Securities, Inc.                   518,500              -       518,500  (A)     (518,500)            -

Furniture and Equipment, net
   of accumulated depreciation                            -         119,231       119,231                 -       119,231

Other Assets                                              -          12,157        12,157                 -        12,157
                                                -----------     -----------   -----------       -----------     ---------
              Total Assets                         $676,383      $1,314,124    $1,990,507         $(524,753)   $1,465,754
                                                   ========      ==========    ==========         =========    ==========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
   Loan payable                              $            -     $   210,000   $   210,000  (A)    $(210,000)$            -
   Due to broker                                          -          86,586        86,586                 -        86,586
   Securities sold, not yet
       purchased                                          -          11,667        11,667                 -        11,667
   Accounts payable and
       accrued liabilities                           34,376         475,427       509,803 (E)       (14,753)      495,050
                                               ------------     -----------  ------------      -------------  -----------
              Total Current Liabilities              34,376         783,680       818,056          (224,753)      593,303

Loans Subordinated to Claims of
   General Creditors
       Officers                                           -         270,000       270,000                 -       270,000
       Others                                             -         545,000       545,000  (A)     (300,000)      245,000
                                             --------------     -----------  ------------       -----------   -----------
              Total Liabilities                      34,376       1,598,680     1,633,056          (524,753)    1,108,303
                                               ------------       ---------     ---------       -----------    ----------
Stockholders' Equity
   Common stock                                      14,300               1        14,301  (B)       10,999        25,300
   Additional paid-in capital                    10,219,638          47,029    10,266,667   (B)  (9,470,680)      795,987

   Retained (deficit)                            (9,459,681)       (331,586)   (9,791,267)   (B)  9,459,681      (331,586)
                                                -----------     -----------   -----------       -----------   -----------
                                                    774,257        (284,556)      489,701                 -       489,701
       Less treasury shares                        (132,250)              -      (132,250)                -      (132,250)
                                                -----------  --------------  ------------    --------------   -----------
              Total Shareholders' Equity            642,007        (284,556)      357,451                 -       357,451
                                                -----------     -----------  ------------    --------------   -----------
              Total Liabilities and
                 Shareholders' Equity           $   676,383      $1,314,124   $ 1,990,507       $  (524,753)   $1,465,754
                                                ===========      ==========   ===========       ===========    ==========
</TABLE>

                        The accompanying notes are an an
                   integral part of these pro forma financial
                                   statements.
                                      F-19


<PAGE>




                                  EUROMED, INC.

                PRO FORMA CONSOLIDATING STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

                          YEAR ENDED DECEMBER 31, 1998
<TABLE>

<CAPTION>

                                                                 Redstone
                                                    Euromed,   Securities,                   Consolidating    Consolidated
                                                    Inc.          Inc.           Total          Entries          Total
<S>                                   <C>    <C>    <C>    <C>    <C>    <C>

Revenues
   Commissions$                                           -     $3,166,704    $3,166,704       $        -       $3,166,704
   Gain on firm securities accounts                       -       883,780        883,780                -         883,780
   Underwriting and syndicate income                      -       225,264        225,264                -         225,264
   Other                                                  -       210,062        210,062                -         210,062
                                               ------------   -----------    -----------       ----------     -----------

           Total Revenue                                  -     4,485,810      4,485,810                -       4,485,810

Costs and expenses
   Commissions paid to other broker-dealers               -       493,754        493,754                -         493,754
   Employee compensation                            200,562     1,866,132      2,066,694                -       2,066,694
   Other general and administrative expenses        162,450     2,662,057      2,824,507                -       2,824,507
                                                  ---------    ----------     ----------       ----------      ----------

           Operating (Loss)                        (363,012)     (536,133)      (899,145)               -        (899,145)

Other income (expense)
   Interest income                                    14,753        8,970         23,723  (E)     (14,753)          8,970
Interest expense                                          -      (104,098)      (104,098) (E)      14,753         (89,345)
                                               ------------   -----------    -----------          -------      ----------

           Net (Loss) From Continuing
              Operations                           (348,259)     (631,261)      (979,520)               -        (979,520)

Minority interest in operating (loss)
   of subsidiary                                          -             -              -     (C)   25,250          25,250

Discontinued operations
   Operating (loss)                                       -             -              -                -               -
   Loss on sale                                    (176,181)             -      (176,181)               -        (176,181)
                                                  --------- --------------   -----------       ----------     -----------

           Net (Loss)                             $(524,440)  $  (631,261)   $(1,155,701)         $25,250     $(1,130,451)
                                                  =========   ===========    ===========          =======     ===========

Pro forma net (loss) per share
   Continuing operations                        $      (.25) $       (.57)                                  $        (.38)
   Discontinued operations
       Loss on sale of discontinued operations         (.12)            -                                            (.07)
                                                ----------- -------------                                   -------------

                                                $      (.37) $       (.57)                                   $       (.45)
                                                ===========  ============                                    ============

Pro forma weighted average number
   of shares of common stock outstanding          1,412,400     1,100,000                                   (D) 2,512,400
                                                  =========     =========                                       =========
</TABLE>

                          The accompanying notes are an
             integral part of these pro forma financial statements.
                                      F-20


<PAGE>



                                  EUROMED, INC.

              NOTES TO PRO FORMA CONSOLIDATING FINANCIAL STATEMENTS
                                   (UNAUDITED)

                      FOR THE YEAR ENDED DECEMBER 31, 1998


NOTE 1:  MERGER

On November 6, 1998,  the "Agreement  and Plan of  Reorganization"  by and among
Euromed,   Inc.  (the  "Company"),   Redstone  Acquisition  Corp.  and  Redstone
Securities, Inc. ("Redstone") was executed. As of February 16, 1999, the Company
acquired a ninety-six percent (96%) ownership  interest in Redstone  Acquisition
Corp. (which owns one hundred percent (100%) of the outstanding common shares of
Redstone  Securities,   Inc.)  by  issuing  one  million  one  hundred  thousand
(1,100,000)  shares of its common  stock for nine hundred and sixty (960) shares
of Redstone Acquisition Corp.'s common stock. Five hundred thousand (500,000) of
the  acquisition  shares were issued  subject to certain  vesting  restrictions.
These restricted shares will vest as follows:

   o Shares  will vest if the  Company's  stock  trades for  twenty  consecutive
trading days as follows:

           Vesting
           Number of                                               Trading
              Shares                                                Value
           166,667                                                  $2.25
           166,667                                                  $3.75
           166,666                                                  $5.25

   o All shares will vest if the Company achieves the following earnings level:

              Net                                             Year Ending
             Income                                           December 31,
           $200,000                                              1999
           $350,000                                              2000
           $525,000                                              2001

   o   Any remaining  restricted shares will vest in their entirety on the third
       anniversary of the closing date of the merger transaction.

The  unaudited  Pro Forma  Consolidating  Balance Sheet as of December 31, 1998,
gives pro forma effect to the  acquisition as if it had occurred on December 31,
1998. The unaudited Pro Forma  Consolidating  Statement of Operations  gives pro
forma effect to the  acquisition  as if it had occurred on January 1, 1998.  The
Pro Forma  Consolidating  Balance Sheet and Statement of Operations are based on
the audited  financial  statements of the  respective  companies.  The Pro Forma
Financial Statements should be read in conjunction with and are qualified by the
historical financial statements of the respective companies.

The Pro Forma Information is intended for informational purposes only and is not
necessarily indicative of the future financial position or results of operations
of the Company after the acquisition of Redstone,  or the financial  position or
the results of operations  of the Company that would have actually  occurred had
the  acquisition  of  Redstone  been  effected  as of the date or for the period
presented.






                                      F-21


<PAGE>




                                  EUROMED, INC.

               NOTES TO PRO FORMA FINANCIAL STATEMENT (CONTINUED)
                                   (UNAUDITED)

                      FOR THE YEAR ENDED DECEMBER 31, 1998


NOTE 2:  ACCOUNTING METHOD

The management and stockholders of Redstone  Securities,  Inc. gained actual and
effective operating control of the Company subsequent to the merger;  therefore,
the merger was accounted for as a reverse acquisition except that no goodwill or
other  intangible  asset was recognized.  This  transaction is equivalent to the
issuance of stock by Redstone  (the  private  company) for the net assets of the
Company, accompanied by a recapitalization.


NOTE 3:  ADJUSTMENTS TO PRO FORMA FINANCIAL STATEMENTS

The  consolidating  entries  to these  pro  forma  financial  statements  are as
follows:

   (A) In 1998 the Company advanced monies to Redstone,  which were reflected in
       the financial statement of Redstone as follows:

              Loan payable                                     $   210,000

              Loans subordinated to claims of
                  general creditors - others                       300,000
                                                               -----------

                                                               $   510,000

           In addition,  in December  1998 the Company paid  Redstone's  January
1999 office rent in the amount of $8,500.

   (B) The merger is treated as if Redstone acquired the Company; therefore, the
       combined  stockholders' equity remains unchanged;  however, the following
       reclassifications are necessary:

o Issuance of 1,100,000  shares of $.01 par value common stock ($11,000)  offset
by reduction in Redstone's common stock ($1).

              o   Reclassification   of  the  Company's   retained   deficit  of
                  $9,459,681  to  additional  paid-in  capital so that  retained
                  deficit reflects only the activity of Redstone.

   (C) The Company owns  ninety-six  percent (96%) of Redstone;  therefore,  the
       loss applicable to the Company's  ownership  interest was reduced by four
       percent (4%).

   (D) Weighted average number of common shares includes 1,100,000 common shares
       applicable  to the merger,  unadjusted  for the 500,000 that will vest at
       some  time  between  the  initial  date  of  the  merger  and  the  third
       anniversary of the merger.

   (E) Eliminate interest on Redstone's Notes Payable to Euromed.






                                      F-22


<PAGE>






 
                                                 REDSTONE SECURITIES, INC.

                                                   FINANCIAL STATEMENTS

                                                     DECEMBER 31, 1998
 
  







                                                           F-23


<PAGE>










                          INDEPENDENT AUDITOR'S REPORT


Board of Directors and Stockholders
Redstone Securities, Inc.


I have audited the  accompanying  statements of financial  condition of Redstone
Securities, Inc. as of December 31, 1997 and 1998, and the related statements of
income and expense,  changes in stockholders' equity, and cash flows for each of
the  three  years  in the  period  ended  December  31,  1998.  These  financial
statements are the responsibility of the Company's management. My responsibility
is to express an opinion on these financial statements based on my audits.

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

In my opinion, the financial statements referred to above present fairly, in all
material respects,  the financial condition of Redstone  Securities,  Inc. as of
December 31, 1997 and 1998, and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 1998, in conformity
with generally accepted accounting principles.




/s/    Arnold G. Greene

February 22, 1999




















                                                           F-24


<PAGE>




                            REDSTONE SECURITIES, INC.

                        STATEMENTS OF FINANCIAL CONDITION

                           DECEMBER 31, 1997 AND 1998
<TABLE>
<S>                                                                         <C>                              <C>

                                                          ASSETS
                                                                                1997                       1998
                                                                            -----------------------------------
Current Assets:
   Cash                                                                    $      8,335            $            -
   Receivables from brokers and dealers:
       Commissions receivable                                                    84,521                   465,178
       Good faith deposit                                                       276,571                   100,000
       Other receivables                                                        176,446                   131,555
   Investments at market                                                      1,070,311                   464,034
   Prepaid expenses                                                              27,622                    21,969
                                                                            -----------               -----------
           Total Current Assets                                               1,643,806                 1,182,736

Property, furniture & equipment
   (less:  accumulated depreciation of $291,850 and
       $288,675, respectively)                                                  153,552                   119,231
Other assets                                                                     11,227                    12,157
                                                                            -----------               -----------
              Total Assets                                                   $1,808,585                $1,314,124
                                                                             ==========                ==========

                                           LIABILITIES AND STOCKHOLDERS' EQUITY

                                                                                 1997                      1998
                                                                              ---------------------------------
Current Liabilities:
   Accrued expenses and taxes payable                                       $   490,169               $   475,427
   Loans payable                                                                 30,807                   210,000
   Due to broker                                                                290,904                    86,586
   Securities sold, not yet purchased                                                 -                    11,667
                                                                         --------------               -----------
       Total Current Liabilities                                                811,880                   783,680

Liabilities subordinated to claims of general creditors:
   Officers                                                                     245,000                   270,000
   Others                                                                       405,000                   545,000
                                                                            -----------               -----------
       Total Liabilities                                                      1,461,880                 1,598,680
                                                                              ---------                 ---------

Stockholders' equity:
   Common Stock, $.01 par value; authorized 1,000
       shares, outstanding 105 shares                                                 1                         1
   Additional paid-in capital                                                    71,029                    47,029
   Treasury stock                                                               (24,000)                        -
   Retained earnings (deficit)                                                  299,675                  (331,586)
                                                                            -----------               -----------
       Total Stockholders' Equity                                               346,705                  (284,556)
                                                                            -----------               -----------

              TOTAL LIABILITIES AND
                 STOCKHOLDERS' EQUITY                                        $1,808,585                $ 1,314,124
                                                                             ==========                ===========
</TABLE>



                                            See notes to financial statements.
                                                           F-25


<PAGE>




                            REDSTONE SECURITIES, INC.

                        STATEMENTS OF INCOME AND EXPENSE

              FOR THE YEARS ENDED DECEMBER 31, 1996, 1997 AND 1998
<TABLE>
<S>                                                                   <C>                   <C>            <C>     

                                                                      1996                1997                1998
                                                                   -----------------------------------------------

Revenues:
   Commission                                                     $2,737,698          $2,569,926          $3,166,704
   Interest income                                                    21,329              24,051               8,970
   Gain on firm securities accounts                                3,553,666           2,552,650             883,780
   Underwriting and syndicate income                                 516,066              33,442             225,264
   Syndicate income                                                   30,415                   -                   -
   Other income                                                      395,034             355,882             210,062
                                                                      -         -----------         -----------

       Total Revenue                                               7,254,208           5,535,951           4,494,780
                                                                  ----------          ----------          ----------

Expenses:
   Compensation of stockholder officers                              405,000             101,500             258,356
   Other employee compensation                                     2,547,950           2,105,225           1,607,776
   Commission paid to other broker-dealers                           746,331             650,419             493,754
   Regulatory fees and expenses                                       81,453              83,052             111,513
   Interest expense                                                  170,793             159,486             104,098
   Other expenses                                                  2,328,392           2,550,544
                                                                   ----------          ----------

       Total Expenses                                              7,203,055           5,428,074           5,126,041
                                                                  ----------          ----------          ----------

Income (loss) before federal income tax                               51,153             107,877            (631,261)

Less:  federal income tax                                                  -                   -                   -
                                                              --------------      --------------      --------------

           Net Income (Loss)                                     $    51,513         $   107,877         $  (631,261)
                                                                 ===========         ===========         ===========

</TABLE>

















                                            See notes to financial statements.

                                                           F-26


<PAGE>




                            REDSTONE SECURITIES, INC.

                            STATEMENTS OF CASH FLOWS

              FOR THE YEARS ENDED DECEMBER 31, 1996, 1997 AND 1998
<TABLE>
<S>                                                                <C>                  <C>                  <C>

                                                                      1996                1997                1998
                                                                   -----------------------------------------------

Resources provided:
   Net income     $   51,153                                        $107,877       $           -
   Decrease in other receivables                                           -                   -              44,891
   Decrease in prepaid expenses                                            -                   -               5,653
   Decrease in investments                                           276,602             889,371             606,277
   Depreciation                                                       53,758              61,996              34,321
   Decrease in receivables from broker dealers                             -             365,663                   -
   Sale of common stock                                                    -               1,000                   -
   Increase in loans payable                                               -                   -             179,193
   Increase in securities sold, not yet purchased                          -                   -              11,667
   Increase in subordinated loans                                    935,000                   -             165,000
   Increase in due to broker                                         110,115                   -                   -
                                                                  ----------       -------------       -------------

       Total Resources Provided                                    1,426,628           1,425,907           1,047,002
                                                                   ---------           ---------           ---------

Resources applied:
   Net loss                                                                -                   -             631,261
   Increase in other assets                                              108                 452                 930
   Decrease in securities sold, net yet purchased                    249,611             261,326                   -
   Decrease in loans payable                                          64,813              57,201                   -
   Increase in prepaid expenses                                        1,649               3,997                   -
   Increase in accounts receivable                                   375,616                   -                   -
   Increase in other receivable                                            -             176,446                   -
   Increase in receivables from broker-dealers                             -                   -             204,086
   Increase in furniture & equipment                                  62,902              24,078                   -
   Decrease in accrued expenses                                       72,754              77,436              14,742
   Decrease in due to broker                                               -               5,137             204,318
   Decrease in subordinated loans payable                                  -             815,000                   -
   Distributions                                                     585,000                   -                   -
                                                                   ----------       -------------       -------------

       Total Resources Applied                                     1,412,453           1,421,073          (1,055,337)
                                                                   ---------           ---------          ----------

Increase (Decrease) in cash                                           14,175               4,834              (8,335)

Balance, beginning of year                                           (10,674)              3,501               8,335
                                                                  ----------         -----------         -----------

Balance, end of year                                              $    3,501         $     8,335       $           -
                                                                  ==========         ===========       =============




</TABLE>



                                            See notes to financial statements.

                                                           F-27


<PAGE>



                            REDSTONE SECURITIES, INC.

                  STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

              FOR THE YEARS ENDED DECEMBER 31, 1996, 1997 AND 1998
<TABLE>
<S>                                                                                   <C>      


Stockholders' equity, December 31, 1995                                               $  771,675
   Net income for the year                                                                51,153
   Distributions                                                                        (585,000)
                                                                                      ----------

Stockholders' equity, December 31, 1996                                                  237,828

   Net income for the year                                                               107,877
   Sale of common stock                                                                    1,000

Stockholders' equity, December 31, 1997                                                  346,705

   Net (loss) for the year                                                              (631,261)

Stockholders' equity, December 31, 1998                                               $ (284,556)
                                                                                      ==========

</TABLE>






















 


                                            See notes to financial statements.

                                                           F-28


<PAGE>



                            REDSTONE SECURITIES, INC.

                          NOTES TO FINANCIAL STATEMENTS

                        DECEMBER 31, 1996, 1997 AND 1998


NOTE 1:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Income Taxes

The Company elected to be taxed as an "S" Corporation as of January 1, 1994. The
net income or loss of the Company is passed through to the shareholders, and tax
is then  incurred by the  individual  shareholders.  As of January 1, 1999,  the
Company will elect to be taxed as a regular "C" Corporation.

Depreciation

Depreciation is calculated  using the Modified  Accelerated Cost Recovery System
(MACRS).


NOTE 2:

The following supplementary information is submitted:

   Exemption from Rule 15c3-3 is claimed under (K) (2) (b):

     All customer transactions are cleared through another broker-dealer,  J. W.
Genesis Clearing Corp. on a fully disclosed basis.

       Net  capital  as  reported  in Form  X-17A-5  indicated  net  capital  of
       $153,941.  In  February  1999,  the  Corporation  filed  Part IIA of form
       X-17A-5 (unaudited) and reported net capital of $154,752.  The difference
       of $811 is  accounted  for by net  accruals  made  during the audit,  and
       various reclassifications.


NOTE 3:

The Company is involved in three  arbitrations  with customers.  All matters are
being vigorously  defended and management  believes it has a meritorious defense
in each case.


NOTE 4:

As of January 6, 1999, Redstone Securities,  Inc. entered into an agreement with
Euromed, Inc., a Nevada corporation, to merge its company into a subsidiary. The
acquiring  company will own 96% of the shares and the existing  shareholders  of
Redstone will retain a 4% interest in the Company.










                                                           F-29


<PAGE>



   PART III

Item 10. Directors and Executive Officers of EuroMed, Inc.
<TABLE>
<S>                                                              <C>    <C>     

   Name                                                         Age       Position
Elbert G. Tindell                                                 52       Chairman of the Board
Robert A. Shuey, III(1)                                           43       Chief Executive Officer and Director
Richard Belz                                                      41       Director
Anthony F. Vaccaro                                                28       Director
Todd M. Cornelius                                                 28       Vice President
W. Michael Mosley                                                 27       Vice President
</TABLE>



   Elbert G.  Tindell,  has served as CEO and a director  of the  Company  since
October 15, 1997.  Mr.  Tindell is involved in the  management  and direction of
public and private  Companies in the United  States,  Asia Pacific,  and Europe,
specializing   in  the   re-engineering   of  corporate   environments   through
implementing capital restructuring and planning strategies.  Prior to graduating
from the  University  of North Texas,  Mr.  Tindell  served in the United States
Marine Corps from January 1967 to December 1970.

   Robert A. Shuey, III, isa director,  CEO and a Managing Director,  Investment
Banking, of EuroMed and Redstone Securities,  Inc. He also serves as a member of
the  Board of  Directors  of  Autobond  Corporation,  Westower  Corporation  and
Transnational Financial Corporation. Mr. Shuey has been associated with Redstone
Securities,  Inc. since January 1, 1999.  Prior thereto,  he was Chief Executive
Officer of Tejas Securities Group, Inc. since September 1997. He has been in the
investment  banking  business for more than the past five years,  with  National
Securities  Corporation  from  September  1996 until August 1997;  with La Jolla
Securities  Corporation  from April 1995 until  August  1996;  with  Dillon Gage
Securities  Corporation  from January 1994 until April 1995 and  Dickinson & Co.
from March 1993 to  December  1993,  Mr.  Shuey is a graduate  of Babson  with a
degree in Economics and Finance.

   Richard Belz,  CPA has been a director of EuroMed since February of 1999. Mr.
Belz has been in the  financial  industry for the past 15 years and has acted as
Chief Financial Officer and Managing Director of Redstone Securities, Inc. since
1998. During this time he managed all investment  banking and trading activities
for Redstone. Mr. Belz has served as an officer or director of many corporations
including  Standard  Funding  Corporation and Apple Homes  Corporation,  both of
which are  publicly  traded  corporations.  He  graduated  from  Illinois  State
University with a Bachelor of Science degree.

Anthony F Vaccaro, Jr. has been a director of EuroMed since February of 1999. He
also is a Vice  President of investment  banking at EuroMed.  Mr. Vaccaro joined
the Company in January of 1999.  Prior thereto,  Mr. Vaccaro was a an investment
banking  generalist  specializing in mergers and acquisitions and initial public
offerings  for Salomon Smith Barney in New York City.  Prior to his  association
with Salomon Smith Barney, Mr. Vaccaro was employed by a private equity group to
specialize in bridge and mezzanine  financing,  private placements,  mergers and
acquisitions,  and initial  public  offerings  in a variety of  industries.  Mr.
Vaccaro is a graduate of Texas A&M University with a degree in Finance.

Todd M. Cornelius is a Vice President,  Investment Banking, of EuroMed, Inc. Mr.
Cornelius joined the company in April of 1999. Prior thereto,  Mr. Cornelius was
a  Financial   Consultant  with  Akzo  Nobel   specializing  in  small  business
expansions,  mergers and general consulting.  Prior to his work with Akzo Nobel,
Mr. Cornelius  performed  underwriting and risk analysis in the energy arena for
American  International  Group.  Mr.  Cornelius  is  a  graduate  of  Texas  A&M
University  with a degree in Chemical  Engineering.  Mr.  Cornelius is currently
matriculating on a Masters of Business  Administration,  with a concentration in
Finance and Accounting, at Southern Methodist University.

William M. Mosley is a Vice  President,  investment  Banking,  of  EuroMed.  Mr.
Mosley has been associated  with EuroMed since November I, 1997.  Prior thereto,
he was a Vice  President of Tejas  Securities  Group,  inc.  since January 1998.
During this time he was responsible for supervising syndicate activities and ail
aspects of the  Underwriting  process.  Previously,  Mr.  Mosley was employed by
Stone Media  Corporation as a Senior Analyst from November 1996 to January 1998.
Mr.  Mosley is a graduate  of  Southern  Methodist  University  with a degree in
Finance.



Meetings and Committees of the Board of Directors
The business of the Company is under the  direction  of the board of  directors.
The board of  directors  meets on  matters  requiring  approval  of the board of
directors.  It also holds  special  meetings when an important  matter  requires
action  by the  board of  directors  between  scheduled  meetings.  The board of
directors held one formal meeting and acted by unanimous written consent 5 times
during 1998. During 1998, each member of the board of directors  participated in
at least 75% of all Board of Directors  meetings  during the period for which he
was a director. Item 11. Executive Compensation.  The following table sets forth
certain  information  regarding  compensation  paid  during the  Company's  last
completed  fiscal year to the Company's Chief Executive  Officer and each of the
Company's  executive  officers  (other than the Chief  Executive  Officer) whose
total annual  salary and bonuses  earned  during the fiscal year ended  December
31,1998, exceeded $100,000:

                    Management Compensation and Transactions

                           Summary Compensation Table
<TABLE>
<CAPTION>
                             Annual Compensation                                                    Long-Term

                                                                                                 Compensation Awards
        Name/Title             Year      Salary($)      Bonus($)            Other           Securities         All Other
<S>                          <C>          <C>                <C>            <C>                 <C>             <C>
                                                                       Compensation($)      Underlying      Compensation($)
                                                                                             Options/
                                                                                             SARs(#)
Elbert G. Tindell(1)           1998       $76,212          --                --                 --                --
                               1997          --          $23,000             --                 --             20,000(2)
                               1996          --            --                --                 --                --
</TABLE>

 (1) Mr.  Tindell  served as  President  from on October 15, 1997 until  October
1998, when he was replaced as Chief Executive  officer by Robert A. Shuey,  III.
(2) All other compensation is comprised of 100,000 shares of Common Stock issued
to Mr. Tindell having a fair market value of $0.20 per share.

Compensation of Directors



<PAGE>



     During 1998 the Company paid Mr.  Shelmire  $78,000,  and Mr. Shuey $46,350
for serving on the board of directors.  Mr. Shelmire  resigned from the Board of
Directors on October 27, 1998.  On February 24, 1999,  Mr. Belz and Mr.  Vaccaro
were elected to serve on the Board of Directors.  As of the date hereof  neither
has received any compensation for services rendered.

 
Section 16 Requirements
         Section 16(a) of the Exchange Act, requires the Company's  officers and
directors,  and  persons  who own  more  than 10% of a  registered  class of the
Company's equity securities, to file initial reports of ownership and reports of
changes in ownership with the Securities  and Exchange  Commission  (the "SEC").
Such persons are required by SEC  regulation  to furnish the Company with copies
of all Section 16(a) forms they file.

           Based solely on its review of the copies of such forms received by it
with respect to fiscal 1998, or written  representations  from certain reporting
persons,  the Company  believes that all filing  requirements  applicable to its
officers,  directors and persons who own more than 10% of a registered  class of
the Company's equity securities have been complied with.


    Item 12. Security Ownership of Certain Beneficial Owners and Management.

                Principal Stockholders and Management Ownership.

The following table sets forth information with respect to beneficial  ownership
of Common Stock as of April 12, 1998 by (i) all persons  known to the Company to
be the beneficial owner of 5% or more of the Common Stock, (ii) each director of
the Company,  (iii) the chief  executive  officer and each of the Company's four
other most highly compensated executive officers whose total annual compensation
for 1998 based on salary and bonus earned  during 1998  exceeded  $100,000  (the
"Named Executive  Officers"),  and (iv) all the Company  directors and executive
officers as a group.
<TABLE>
<S>                                                                                        <C>                         <C>


         Name of Beneficial Owner                                                        Amount and                  Percent
                                                                                           Nature                      of
                                                                                       of Beneficial                  Class
                                                                                          Ownership
Robert A. Shuey, III                                                                      442,500     (1)             21.0%
Elbert G. Tindell                                                                         200,125     (1)              9.5%
Gary Purcell                                                                              196,333     (3)              9.8%
Tom Laundrie                                                                              196,334     (2)              9.8%
Richard Belz                                                                              116,333     (3)              5.8%
Anthony F. Vaccaro                                                                        100,000     (6)              4.7%
All directors and executive officers as a group (4 persons)                               858,958   (4)(5)          37.23 %
</TABLE>

*Less than 1%

(1) Includes  warrants to purchase  100,000  shares of common  stock  granted on
December 29, 1997 exercisable immediately at $0.30. (2) Does not include 166,666
shares  subject to vesting  restrictions  pursuant to the Redstone  Merger.  See
"Item  1-Business"  (3) Does not  include  166,667  shares  subject  to  vesting
restrictions pursuant to the Redstone Merger. See "Item 1-Business" (4) Includes
Mr. Shuey's,  Mr.  Tindell's,  and Mr. Vaccaro's  combined  warrants to purchase
300,000  shares of common stock.  (5) Does not include the right to vote 125,000
shares granted to the Board of Directors by a Federal judge.  In compliance with
the Injunction and Civil Contempt Order of January 6, 1999,  Gregory Alan Gaylor
has signed an irrevocable proxy dated January 21, 1999 appointing EuroMed,  Inc.
as his sole proxy with respect to 125,000  shares of EuroMed  Common Stock.  (6)
Includes warrants to purchase 100,000 shares of Common Stock at a purchase price
of $1.00 per share, exercisable immediately.


<PAGE>


                                     PART IV
<TABLE>
<S>         <C>    <C>    <C>    <C>    <C>    <C>

    Item 14: Exhibits, Financial Statement Schedules, and Reports on Form 8-K

a. Financial Statements:
See table of Contents to Financial Statements. Page F-1 filed herewith.
b. Reports on Form 8-K
c. Exhibit 5

                          Number Description of Exhibit

2.1 Agreement and Plan of Reorganization dated November 6, 1998 by and among Euromed, Inc., Redstone Aquisition
     Corp. And Redstone Securities, Inc.*
3.1 Articles of Incorporation(1)
3.2 Bylaws of the Company(1)
4.1 Specimen of Series A Common Stock Certificate(1)
10.1 Consulting,
     Management and Noncompetition  Agreement,  dated as of July 5, 1996, by and
between Purchaser and Doets.(3)
10.2 Consulting,
     Management and Noncompetition  Agreement,  dated as of July 5, 1996, by and
between Purchaser and Roozekrans.(3)
10.3 Consulting,
     Management and Noncompetition  Agreement,  dated as of July 5, 1996, by and
between Purchaser and Hinnen.(3)
16.1 Letter of the Change of Certified Accountants(2)
21.1 Subsidiaries of the Registrant as revised.*
23.1 Consent of Killman Murrell & Company, P.C., Certified Public Accountants.*
23.2 Consent of Arnold S. Green, CPA *
27.1 Financial Data Schedule*


</TABLE>

*Filed Herewith

(1)Previously  filed as an exhibit to the Company's  Registration  Statement No.
33-80805 on Form S-1 and incorporated herein by reference.
      

(2)Previously  filed as an exhibit to the Company's Current Report on Form 8-K/A
(Amendment No. 1) dated November 19, 1996 and incorporated herein by reference.
    

(3)Previously  filed as an exhibit to the Company's Current Report on Form 8-K/A
(Amendment No. 1) dated July 5, 1996 and incorporated herein by reference.







<PAGE>





                                   SIGNATURES

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


                                  EuroMed, Inc.


Dated: April 14, 1999                      By: /s/ Elbert G. Tindell
                                               ---------------------
                                            Chairman of the Board and President

   Pursuant  to the  requirements  of  Section  13 or  15(d)  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.

<TABLE>
<S>                                                  <C>                              <C>      


                Signature                                    Title                       Date
                ---------                                 --                              ----
/s/ Elbert G. Tindell                                  President and                      April 14, 1999
---------------------------
Elbert G. Tindell         
                                                       Chairman of the Board
/s/ Robert A. Shuey, III                               Chief Executive Officer,           April 14, 1999
---------------------------
Robert A. Shuey, III                                   Chief Financial Officer,
                                                       Treasurer and Director
 

/s/ Anthony F. Vaccaro                                 Sr. Vice President and Director    April 14, 1999
---------------------------
Anthony F. Vaccaro

</TABLE>