<PAGE>

                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                  FORM 10-KSB

     [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, 2000

                                      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 _____________ to ____________

Commission File Number:  1-12536
--------------------------------

                        STRATEGIC SOLUTIONS GROUP, INC.
                        -------------------------------
            (Exact name of Registrant as specified in its charter)

         Delaware                                   11-2964894
--------------------------------              ----------------------
(State or other jurisdiction of                     (I.R.S. Employer
incorporation or organization)                  Identification  No.)

1598 Whitehall Road, Ste. E
Annapolis, Maryland                                          21401
----------------------------                                 -----
(Address of principal executive offices)                  (Zip Code)

Registrant's telephone number,
including area code:                                  (410) 757-2728
                                                      --------------

Securities registered pursuant to Section 12(b) of the Act:  Common Stock,
--------------------------------------------------------------------------
$.0001 par value
----------------
Securities registered pursuant to Section 12(g) of the Act:  None
-----------------------------------------------------------------
                               (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  X   No ___.
                                               ---

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulations S-K ((S)229.405 of this chapter) 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-KSB or any amendment to this Form 10-KSB. [_]

     As of February 28, 2001 the aggregate market value of the voting stock held
by non-affiliates, 6,356,405 shares of Common Stock, $.0001 par value, was
approximately $993,000 based on the closing price of $0.1562. The number of
shares outstanding of our Common Stock, as of February 28, 2001 was 8,256,690.

     Documents incorporated by reference:  None
<PAGE>

                                    PART I

Item 1. Description of Business.

General

During 2000, Strategic Solutions Group, Inc. ("the Company") provided custom
interactive multimedia software. The Company designs, develops, and markets
custom multimedia software used to deliver computer-based and web-based
training, electronic performance support systems, multimedia manuals, sales and
marketing presentations, and corporate communications.

Custom Multimedia Software

The Company provides technical consulting services that include analysis,
design, and development of technology-based solutions and specializes in
providing training solutions. Technology-based training encompasses a wide range
of emerging technologies in the area of employee training, and can come in the
form of computer-based training, web-based training, electronic performance
support systems, and multimedia manuals. In addition, the Company also designs
and develops software for sales and marketing applications and corporate
communications.

Depending on a customer's needs, the Company can produce multimedia software
that includes interactive computer animation, full motion video, audio, high-end
color graphics, text and hypertext providing vivid and effective instruction and
information. The software developed by the Company can be distributed over
multiple platforms including MS Windows and DOS and can be delivered on
diskette, CD-ROM, or the Internet. The Company has adapted its services using
new and emerging technologies, such as internal corporate intranets or the
Internet using the World Wide Web ("Web"). In addition, the incorporation of
Web-Based training ("WBT") allows users to have access from anywhere in the
world.The Company believes that the Internet and intranets will become
increasingly important delivery methods in the future.

According to a March 2000 industry research report on e-learning conducted by WR
Hambrecht & Co., corporate e-learning is one of the fastest growing markets in
the education industry. The report indicated that the online training market is
expected to nearly double in size every year through 2003, when it will reach
approximately $11.5 billion. Within the e-learning market segments, the research
report noted that the services segment of the e-learning market was the fastest
growing segment, with a Compounded Annual Growth Rate (CAGR) of 111%.

Computer-Based Training ("CBT"). The Company designs and develops custom
computer-based training software, which provides an interactive learning
experience to instruct employees how to use complex equipment or to understand
complicated industrial processes by simulating operation and production
procedures. The Company's software typically replaces or supplements technical
manuals and operating documentation and provides interactive self-paced
training. It also often incorporates cut-away views of equipment that would be
difficult or impossible to display in a real-world setting and enables users to
learn complex processes by viewing them in real or lapsed time or in slow
motion. Based on studies conducted and published by the American Society for
Training and Development, management believes that CBT enables users to master
skills and retains information more effectively than traditional instructor-led
training.

                                       1
<PAGE>

Web-Based Training. Recent technological developments and advances in computer
network technology enable the Company to deliver computer-based training over
corporate intranets or the Internet via the Web. Web-based materials can be
text-based (such as, lecture notes, case studies, and assignments) or they may
be much like sophisticated CBT courseware. As a result of rapidly advancing Web
browsers, high-speed communications, and innovative instructional design, it is
possible that real-time animation, video, audio, and conferencing could be
features included in a WBT solution. In addition, the incorporation of WBT
allows users to have access from anywhere in the world. The Company believes
that the Internet and intranets will become increasingly important delivery
methods in the future.

Electronic Performance Support Systems ("EPSS"). The goal of an EPSS is to
provide whatever information is necessary to accelerate performance and learning
at the moment of need - commonly referred to as Help Systems. The Company
designs and develops custom EPSS software to enable users to perform better at
their jobs. This software provides computer-based support that is integrated
into a workstation or work environment, and acts as a combination
coach/trainer/job aid/reference. The Company believes that EPSS increases
employee productivity by providing needed information and training when and
where it is needed - and in an amount and format that is the most useful to the
user.

Multimedia Manuals. The Company provides turn-key multimedia manual services,
using internally developed and off-the-shelf software tools. These tools enable
the division to convert customer manuals, reference guides, or other technical
materials into interactive multimedia software, including full-motion video,
audio, animation and interaction. The Company believes that these services
enable customers to obtain a technology-based solution in less time and at a
relatively low cost as compared to traditional custom software services.

Sales and Marketing. The Company designs and develops custom sales and marketing
software which enables manufacturers and distributors to demonstrate their
products to potential customers at trade shows or in kiosks. This software can
enhance sales and marketing presentations by encouraging customer participation
through the use of interactive product demonstrations.

Corporate Communications. The Company designs and develops custom multimedia
software for internal and external corporate communications. Examples include
software used to disseminate corporate policies and procedures and information
about a company's products and services. The Company believes that its custom
multimedia development services can be used to create a technology-based
solution, including web-based, that is comprehensive and cost-effective and
delivers lively and compelling messages to large groups of employees in
disparate locations.

Development and Services. The Company's custom multimedia services for the above
technology-based solutions include needs analysis, design specification and
product development. Needs analysis typically takes from three to four weeks and
the charges for such services can range from $10,000 to $20,000. The design
phase lasts from four to ten weeks and the charges for such services can range
from $20,000 to $100,000. Depending upon a project's scope and features, the
time required to complete software development can typically range anywhere from
one month to two years and the charges for such services have ranged from
$10,000 to $650,000.

At the outset of each project, the Company provides the customer with a
statement of work that details the services that the Company will provide, sets
forth the amount that the Company will charge, and provides a work and payment
schedule. Any changes to the project that will result in additional charges are
submitted to the customer for approval prior to providing the services. The

                                       2
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payment schedule varies from customer to customer, but usually includes some
form of up-front payment and progress payments based upon the completion of
phases of the project. To date, the Company has not experienced any significant
difficulties in delivering its custom software products to customers in
accordance with its schedules. Post-development support services are available
and are negotiated under a separate contract and typically billed on an hourly
basis.

Customers and Backlog

The Company's multimedia customers traditionally have been comprised primarily
of large manufacturers who must train employees to use complex equipment or
understand complicated industrial processes. To date, such customers have
represented a broad range of industries, including the automotive, packaging,
electronics, pharmaceutical, beverage bottling, and fitness and food
manufacturing industries, as well as government agencies located throughout the
United States. As part of its strategy to grow revenues, the Company has
identified strategic vertical markets with business-critical needs that can be
addressed by its technology-based solutions. The Company has implemented a sales
and marketing strategy that targets its efforts on the manufacturing and
transportation industries. The Company intends to leverage its existing
relationships and expand its sales and marketing efforts to increase market
share in these industries.

During 2000, approximately $1,281,000, or 98%, of the Company's revenue was
earned from two customers, an automotive manufacturer and Varsity Heavy Duty.
The Company holds a 10% equity interest in Varsity Heavy Duty. In addition, the
major shareholder of Varsity Heavy Duty is also a shareholder of the Company's.
During 1999, $922,888 or 94% of the Company's revenues were earned from two
customers, an automotive manufacturer and a government division.

As of December 31, 2000, backlog (i.e., the difference between the fees payable
to the Company set forth in existing contracts and the amount of such fees that
had been recognized as revenue on the Company's financial statements) of its
custom multimedia software services totaled approximately $406,000, all of which
is expected to be earned during 2001. There can be no assurance that contracts
reflected in backlog will not be cancelled or delayed. Accordingly, the Company
believes that backlog is not a reliable measure of future revenue.

Research and Development

For the years ended December 31, 2000 and 1999, costs associated with research
and development activities totaled approximately $3,400 and $67,000,
respectively. Historically, research and development activities included the
development of a library of reusable applications, codes, utilities, and tools
that the Company can utilize in the early stages of development of many of its
software applications. There were no software development costs capitalized for
any periods presented, as the costs incurred between technological feasibility
and general availability were not significant. The Company believes that costs
for research and development will be moderately higher in the future as the
Company plans to continue improving its existing reusable applications, codes,
utilities, and tools, as well as the development of new reusable applications,
codes, utilities, and tools. In addition, future research and development
efforts may include the development of products to be sold on a stand-alone
basis. However, the Company has not yet developed any products to be sold on a
stand-alone basis, and, accordingly, has not generated any revenue from the sale
of software licenses.

                                       3
<PAGE>

Sales and Marketing

As of December 31, 2000, the Company employed three people involved in sales who
receive a combination of salary and commission. The direct sales force focuses
on large customers and leverages its industry experience to access target
organizations within particular vertical markets. These markets are
characterized by business areas to which the Company's services and technology
are particularly well suited, and by participants who possess the financial
resources and scale of operations necessary to support the types of services
provided by the Company. The Company also employs other business development and
marketing techniques to communicate directly with current and prospective
clients.

In order to increase revenues, the Company focuses its sales and marketing
strategy and targets its efforts to providing technology-based training
solutions to the manufacturing and transportation industries.

Existing clients are also an important component of the Company's marketing
strategy. Follow-on projects leverage sales and marketing resources and
strengthen the Company's client relationships. The Company believes that it has
good relationships with its existing customer base and expects that these
contacts will enable it to successfully pursue this strategy.

Competition

The information technology consulting, software development, and business
solution markets include a large number of participants, are subject to rapid
change, and are highly competitive. The Company competes with and faces
potential competition for clients and experienced personnel from a number of
companies that have substantially greater financial, technical, sales,
marketing, and other resources, generate greater revenues, and have greater name
recognition than the Company. These markets are highly fragmented and served by
numerous firms, many of which serve only their respective local markets. In
addition, clients may elect to use their internal information systems resources
to satisfy their needs for software and application development and consulting
services, rather than using those offered by the Company.

The Company's custom multimedia software business competes with companies that
produce interactive training software (custom and off-the-shelf) and other
third-party suppliers of training and marketing materials, as well as internal
training and information systems resources of potential customers.

The Company's clients primarily consist of large organizations, including
agencies of the federal government, and there are an increasing number of
professional services firms seeking information technology consulting and
software development engagements from that client base. The Company believes
that the principal competitive factors in the information technology consulting
and software development industry include responsiveness to client needs,
project completion time, quality of service, price, project management
capability, and technical expertise. The Company believes that it presently
competes favorably with respect to each of these factors. However, the Company's
markets are still evolving and there can be no assurance that the Company will
be able to compete successfully against current and future competitors and the
failure to do so successfully will have a material adverse effect upon the
Company's business, operating results, and financial condition. The Company
believes that its ability to compete also depends in part on a number of
competitive factors outside its control, including, the ability of its
competitors to hire, retain and motivate personnel; the development by others of
software that is

                                       4
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competitive with the Company's services; the price at which others offer
comparable services; and the extent of its competitor's responsiveness to
customer needs.

Intellectual Property

Most of the Company's contracts state that its software is proprietary and that
title to and ownership of its software generally reside with the Company. The
Company grants nonexclusive licenses to customers for software developed by the
Company for such customers. Like many software firms, the Company has no
patents. The Company attempts to protect its rights with a combination of
copyright, trade secret laws, and employee and third-party nondisclosure
agreements. Despite these precautions, it may be possible for unauthorized third
parties to copy certain portions of the Company's products or obtain and use
information that the Company regards as proprietary, such as source codes or
programming techniques.

As the number of software products increases and their functionality further
overlaps, the Company acknowledges that software programs could increasingly
become the subject of infringement claims. Although the Company's products have
never been the subject of an infringement claim, there can be no assurance that
third parties will not assert infringement claims against the Company in the
future or that any such assertion may not require the Company to enter into
royalty arrangements or result in costly litigation.

Product Liability Insurance

The Company does not currently carry product liability insurance and there can
be no assurance that such coverage, if obtainable, would be adequate in terms
and scope to protect the Company against material adverse effects in the event
of a successful product liability claim. Although the Company has not been
subject to any product liability claims, such claims could arise in the future.
There can be no assurance that the Company would have sufficient resources to
satisfy any liability resulting from these claims or would be able to have its
customers indemnify the Company against such claims.

Employees

As of December 31, 2000, the Company had thirteen full-time employees, two of
whom were in administration, three of whom were in sales and marketing, and
eight of who held professional technical positions. None of the Company's
employees are represented by unions. Management believes the Company's employee
relations are good.

The Company's success will depend upon its ability to attract, retain, and
motivate highly-skilled employees, particularly project managers and other
senior technical personnel. Qualified personnel are in particularly great demand
and are likely to remain a limited resource for the foreseeable future. However,
the Company believes that it has been successful in its efforts to attract and
retain the number and quality of professionals needed to support present
operations and future growth. Although the Company expects to continue to
attract sufficient numbers of highly skilled employees and to retain its
existing technical personnel for the foreseeable future, there can be no
assurance that the Company will be able to do so.

                                       5
<PAGE>

Item 2.  Description of Property.

The Company leases office space in Annapolis, Maryland and Ypsilanti, Michigan
(approximately 6,800 sq. ft. and 1,000 sq. ft., respectively). These leases
require the Company to pay monthly rent of approximately $6,300 and expire on
February 1, 2005 and March 17, 2001, respectively. Management believes that its
current office facilities are adequate and suitable for the Company's current
operations.


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

The Company has previously disclosed a prior legal proceeding with the holder of
a Subordinated Convertible Debenture. On March 1, 2000, the Company settled all
outstanding issues with the holder of the Debenture, the terms of which have
been previously disclosed in the Company's Quarterly Report for the quarter
ended March 31, 2000.

The Company is not subject to any other legal proceedings other than claims that
arise in the ordinary course of its business.

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

None.


                                    PART II

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

The Company's Common Stock have been quoted on the OTC Bulletin Board, a service
provided by the Nasdaq Stock Market, Inc. under the symbol "SSGI."

The following table shows the high and low sale prices for the Company's Common
Stock, for the periods indicated, based upon information supplied to the Company
by Nasdaq. The prices are inter-dealer prices, and do not include retail mark
up, mark down or commission and not necessarily represent actual transactions.


                  Year                             High          Low
                  ----                             -----        -----
            2000
            ----
            1/st/ Quarter                          $0.97        $0.06
            2/nd/ Quarter                          $0.61        $0.16
            3/rd/ Quarter                          $0.52        $0.22
            4/th/ Quarter                          $0.30        $0.08

            1999
            ----
            1/st/ Quarter                          $0.13        $0.05
            2/nd/ Quarter                          $0.16        $0.06
            3/rd/ Quarter                          $0.30        $0.08
            4/th/ Quarter                          $0.16        $0.08


                                       6
<PAGE>

The closing bid price for the Company's Common Stock on February 28, 2001, was
$0.16.

The Company had 178 holders of record of Common Stock as of December 31, 2000.
Approximately 75% of our 8,256,690 shares of common stock outstanding were held
in street name by an unknown number of beneficial owners.

No cash dividends have been paid by the Company on its Common Stock and no such
payment is anticipated in the foreseeable future.


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

The following paragraphs contain certain forward looking statements, which are
within the meaning of and made pursuant to the Safe Harbor provisions of the
Private Securities Litigation Reform Act of 1995. The forward looking statements
include, without limitation, those regarding the prospects for and factors
affecting future revenues and profitability, likelihood of additional financing,
marketing, and cash requirements for future operations. Readers are cautioned
that forward looking statements involve risks, uncertainties, and factors that
may affect the Company's business and prospects, including without limitation
those described below as well as the risks associated with the nature of
competition; technological developments; and effective marketing; all as
discussed in the Company's filings with the U.S. Securities and Exchange
Commission.

Overview
--------

The Company's revenues are comprised of service fees, product sales, and
royalties. Service fees are generated from the development of custom multimedia
software. Product sales are not considered significant by the Company and
consist principally of third-party software and hardware products sold as part
of our multimedia software solution. Royalties are paid to the Company by
customers who resell copies of software developed by the Company for such
customers. See note 2 to the consolidated financial statements for an overview
of U.S. Technologies, Inc. ("UST").

Fiscal 2000 Compared to Fiscal 1999
-----------------------------------

Total revenues for the year ended December 31, 2000 was $1,312,613 as compared
to $992,331 for the same period of 1999, an increase of approximately $320,000
or 32%. The increase is primarily attributed to an increase in both the size and
volume of new contracts and the timing of completion of existing contracts with
existing customers.

During the year ended December 31, 2000, revenue from custom multimedia software
development services was $1,293,008, as compared to $952,050, for the prior
year, an increase of approximately $341,000 or 36%. This includes $283,125 in
revenue we recognized for services from Varsity Heavy Duty, a related party. The
increase was primarily a result of an increase in both the size and volume of
new contracts and the timing of completion of the Company's contracts. The
Company's strategy, put in place in 1999, is to continue to increase revenues
from custom multimedia software development services targeting its sales and
marketing efforts of technology-based training solutions to the manufacturing
and transportation industries. Management believes revenues from multimedia
software will continue to increase in 2001 and beyond.

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During the year ended December 31, 2000, revenue from sales of products was
$5,827, as compared to $18,238, in the prior year, a decrease of approximately
$12,000. In 2000, this represents sales of computer hardware products by the
Company. The Company does not consider the sale of computer hardware to be part
of its core business, and only engages in such sales as a courtesy to its
customers when requested. The Company does not anticipate a significant volume
of computer hardware sales in the future.

The Company has entered into agreements that allow certain customers to resell
copies of the Company's software products in exchange for royalty payments.
Royalties were $13,778 during the year ended December 31, 2000 as compared to
$22,043 for the prior year, a decrease of approximately $8,300 or 37%. The
decrease is due primarily to a decrease in the number of marketing and
development partners during 2000. The Company continually explores additional
marketing and development partners to increase revenues generated from royalty
arrangements. Royalties are not expected to be significant in the future.

During the year ended December 31, 2000, the cost of service fees for custom
multimedia software services was $579,562 as compared to $505,532 in the prior
year, resulting in gross margins of approximately 55% and 48%, respectively. We
anticipate margins to remain consistent at this level in the future.

Our loss from operations from the year ended December 31, 2000 of $361,403 was
$53,776, or 13%, less than our loss from operations of $415,179 for the year
ended December 31, 1999. The reduction in our operating loss was due primarily
to an increase in revenue combined with an increase in gross margin. The
improvement in our gross margin was due to several factors including reuse of
previously developed utilities, higher caliber work force, and a streamlining of
the production process.

While our operating income improved, our net income deteriorated by $191,761,
from $216,195 for the year ended December 31, 1999 to a net income of $24,434
for the year ended December 31, 2000. This is due primarily to activity that we
do not expect to reoccur in the future as detailed below.


<TABLE>
                                                                                2000                  1999
                                                                                ----                  ----
     <S>                                                                        <C>                   <C>
     Operating loss                                                            $(361,403)            $(415,179)
     Recovery of previously written-off investment in UST                            ---               600,000
     Extraordinary gain on the extinguishment of debt                            418,255                   ---
     Other                                                                       (32,418)               31,374
                                                                               ---------             ---------
     Net income (loss)                                                         $  24,434             $ 216,195
                                                                               =========             =========
</TABLE>

During the year ended December 31, 2000, research and development expenses were
$3,425 as compared to $66,815 for the prior year. The variability in the amount
of research and development expenses is directly related to the timing of the
Company's product development initiatives. Research and development expenses
included improvements on existing tools and the development of software tools
and applications to be sold. As the Company expands to provide more services
directed towards the internet, and as our development tools become more
powerful, the Company anticipates a moderate increase in research and
development expenses in the future.

During the year ended December 31, 2000, selling, general and administrative
expenses were $1,086,969 as compared to $817,313 in the prior year, an increase
of approximately $270,000, or 33%. This increase is primarily due to the
inclusion of compensation expense for certain officers

                                       8
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based on the intrinsic value of stock options granted, professional fees
associated with private placements of our stock and debt and the conversion and
cancellation of previously issued debt.

Fiscal 1999 Compared to Fiscal 1998
-----------------------------------

Total revenues for the year ended December 31, 1999 were $992,331 as compared to
$1,658,596 for the same period of 1998, a decrease of approximately $666,000.
The decrease is primarily attributed to the inclusion of UST revenues of
approximately $435,000 in 1998 and timing of completion of the Company's
contracts with customers.

During the year ended December 31, 1999, revenue from custom multimedia software
development services was $952,050, as compared to $1,171,648, for the prior
year, a decrease of approximately $220,000 or 18%. The decrease was primarily a
result of the timing of completion of the Company's contracts with customers.
The Company's strategy to increase revenues prospectively from custom multimedia
software development services includes targeting its sales and marketing efforts
of technology-based training solutions to the manufacturing and transportation
industries.

During the year ended December 31, 1999, revenue from sales of products was
$18,238, as compared to $73,328, in the prior year, a decrease of approximately
$55,000. In 1999, this represents sales of computer hardware products by the
Company, as compared to sales of computer hardware and software products by UST
as part of their systems integration services in 1998. The Company does not
anticipate a significant volume of computer hardware sales in the future.

The Company has entered into agreements that allow certain customers to resell
copies of the Company's software products in exchange for royalty payments.
Royalties were $22,043 during the year ended December 31, 1999 as compared to
$51,916 for the prior year, a decrease of approximately $30,000 or 58%. The
decrease is due primarily to a decrease in the number of marketing and
development partners during 1999. The Company continually explores additional
marketing and development partners to increase revenues generated from royalty
arrangements.

During the year ended December 31, 1999, the cost of service fees for custom
multimedia software services was $505,532 as compared to $562,137 in the prior
year, resulting in gross margins of approximately 48% and 52%, respectively. We
anticipate margins to remain consistent with this level.

Cost of product sales was $17,850 for the year ended December 31, 1999, as
compared to $44,493 in the prior year, resulting in gross margins of
approximately 2% and 39%, respectively. As discussed above, the Company does not
expect significant growth in revenue and costs from the sale of third party
products during 2000.

During the year ended December 31, 1999, total operating expenses were $884,128
as compared to $3,327,090 in the prior year, a decrease of approximately
$2,443,000 or 73%. This decrease is primarily due to the inclusion of UST
operating expenses of approximately $811,000, for the first three months of
1998, the write-off of the carrying amount of an asset related to a consulting
services contract entered during 1997 and the Company's general cost cutting
efforts.

During the year ended December 31, 1999, research and development expenses were
$66,815 as compared to $55,455 for the prior year. The variability in the amount
of research and development

                                       9
<PAGE>

expenses is directly related to the timing of the Company's product development
initiatives. Research and development expenses included improvements on existing
tools and the development of software tools and applications to be sold.

During the year ended December 31, 1999, selling, general and administrative
expenses were $817,313 as compared to $2,361,634 in the prior year, a decrease
of approximately $1,544,000, or 65%. For the year ended December 31, 1999,
approximately $484,000 of the decrease is the direct result of the divestiture
of UST in April 1998. The remaining decrease is primarily the result of
professional fees incurred during 1998 related to the debenture litigation and
the divestiture of UST as well as the Company's general cost cutting efforts in
1999.

During the year ended December 31, 1999, other income increased by approximately
$829,000. The increase is the result of the recovery of $600,000 in payments
made by UST that had previously been reserved ($100,000 in May 1999 and $500,000
in August 1999) and the recognition of $229,000 of deferred gain from the
divestiture of UST in the third quarter of 1999 (see Note 2). Interest expense
and other decreased by $180,000 related primarily to a decrease in interest
expense and a penalty of $105,800 related to the Convertible Subordinated
Debenture which was recorded during 1998.

Cash Flow, Liquidity and Capital Resources

The Company implemented a Strategy to Achieve Profitable Operation in 1999, and
made significant strides in achieving its objectives under this plan during
2000. The Company completed 2000 with a small net income of $24,434, including
an extraordinary gain of $418,255, experienced a loss from operations of
$361,403 and net cash used in operations of $99,907. The Company experienced
significant growth in revenue, which is expected to continue during 2001. As was
previously discussed, this is an improvement over our year ended December 31,
1999, in which our loss from operations was $415,179 and net cash used in
operations of $366,254. While it is important to point out that the Company has,
since its incorporation, accumulated a deficit of $16,217,046, management
believes that by implementing it's Strategy to Achieve Profitable Operations,
the Company's operations should continue to improve into 2001 and beyond.
However, there can be no assurance that such actions will generate sufficient
cash flow to allow us to continue operations in the future without additional
investment capital or borrowings.

For the year ended December 31, 1999, the Company used cash of approximately
$366,000 in operations. Included in net income of approximately $216,000 is the
receipt of $600,000 as payment on the Company's promissory note with UST. In
addition, the Company experienced decreases in accounts receivable, other
assets, accounts payable and accrued liabilities, and other liabilities. Net
cash of approximately $5,600 was used for the purchase of equipment. Net cash of
approximately $300,000 was used to make a principal payment on the outstanding
convertible subordinated debenture. During 2001, the Company does not anticipate
making any significant capital expenditure or having to repay any debt, with the
exception of draws on its line of credit.

On March 27, 2001, the Company executed Subscription Agreements with certain
existing shareholders and members of executive management for the purchase of
fourteen units for a total of $350,000. Each unit consists of 50,000 shares of
Company common stock and a $25,000 convertible subordinated debenture, bearing
interest at 10%, due in 2004. The convertible subordinated debentures are
convertible at the holder's option, at any time, into shares of the Company's
common stock at a conversion price of $0.10 per share (the Company's market
price

                                       10
<PAGE>

on March 27, 2001). The Company received $150,000 of the subscribed amount in
March 2001, an additional $150,000 will be received during April 2001, and
$50,000 during May 2001 per the contractual agreements. The Company plans to use
these funds to repay amounts drawn under its line of credit and to fund
operations and future growth.

In addition, as described in Note 2 to the Company's financial statements, the
Company is holding approximately 65,000 shares of common stock of High Speed
Access Corporation, a company listed on the Nasdaq stock market under the symbol
HSAC. The market value of these shares of common stock as of February 28, 2001
was approximately $88,000.

Existing cash and cash equivalent, including the proceeds raised in March 2001,
together with funds to be generated from our operations are expected to provide
sufficient liquidity to meet anticipated cash needs on both a short-term or
long-term basis. Management does not anticipate that it will require additional
financing in the foreseeable future and that it will be able to generate
positive cash flow from operations in the next twelve months.

Other Factors Affecting Future Results

The Company has historically incurred operating losses.

The Company incurred a net operating loss during the year ended December 31,
2000 of approximately $360,000 and had an accumulated deficit of approximately
$16,200,000. The Company also experienced a net cash outflow from operations of
$99,907 for the year ended December 31, 2000.

While the Company believes that is taking the necessary steps to achieve
profitable, cash flow positive operations, there can be no assurance that it
will be able to do so, or that should the Company achieve profitability, that it
will sustain such profitability in the future. Should the Company not be able to
implement its plans, and begin generating positive cash flow from its
operations, the Company will be required to obtain additional sources of
financing in the future or to reduce operating expenses

While the Company's sales continue to increase during 2001, the Company cannot
assure you that it will continue to experience such growth. Future prospects
must be considered in light of the risks, expenses and difficulties frequently
encountered by companies in new and rapidly evolving industries. To address
these risks and achieve profitability and increased sales levels, the Company
must, among other things, continue to establish and increase market acceptance
of its products and systems, respond effectively to competitive pressures, offer
high quality customer service and support, and introduce, on a timely basis,
advanced versions and enhancements of its products and successfully market and
support such advanced versions and enhancements.

The Company anticipates, based on its present plans and assumptions, that it's
current cash balances, proceeds from additional financing and projected level of
2001 operations will be sufficient to enable us to sustain our current and
planned operations for at least the next 12 months, and it will not need to
raise additional funding. However, the Company cannot assure you that this will
hold true.

We currently rely on a small number of customers for our revenue.

                                       11
<PAGE>

The majority of our sales is generated from a limited number of customers, two
during 2000. For the year ended December 31, 2000, one customer was responsible
for 78% of recurring revenue. This customer continues to be our largest and most
important customer. While we hope to increase the number of customers for our
products, similar or greater concentration of our net sales among a limited
number of customers may occur in the future. In this event, any material
decrease in net sales to any one of our largest customers that is not matched by
corresponding increases in net sales to new or existing customers could have a
material adverse effect on our financial condition and results of operations. We
cannot assure you that we will receive orders from any existing customers or
from new customers.

Technology Company related stock prices are especially volatile and this
volatility may depress our stock price.

Technology related companies like us, quoted on the Nasdaq stock market have
recently, and are continuing to experience a downward trend in their stock
prices, and significant volatility. Based on the lack of indications to the
contrary, we expect that the current market condition will continue into the
future, and that the Company's stock could experience significant price
fluctuations, when measured on a percentage basis, and volume fluctuations.
These fluctuations may be unrelated to our operating performance. Broad market
and industry volatility may reduce the value of our common stock, regardless of
our operating performance. Due to this volatility, we believe that the value of
the Company's common stock could adversely affected.

Strategy to Achieve Profitable Operations

During 1998, management laid out its Strategy to Achieve Profitable Operations,
which included intensified development of its technology-based training
software, greater penetration of the needs of existing, major customers, and
initial exploitation of the Internet applications for the Company's expertise.
Coupled with careful management, the Company believes in 2000 it began to
stabilize its business. While it has been successful to date, there are no
assurances that the Company will continue to achieve its strategy.

The Company entered year 2001 with a record backlog for its multimedia products,
and with indications that market demand is increasing. Without the financial
impediment formerly imposed by an outstanding convertible debenture issue, and
with the net proceeds from $350,000 in new operating funding discussed above,
management believes it can address this growing market appropriately.

During year 2000, the Company achieved higher revenues and positive financial
results by expanding its presence in the fast-growing field of web-based
training. The Company was an early entrant in this market, and our experience
and reputation provide advantages over our competitors. The Company has also
taken initial steps to participate in the joint-venture development of a related
product line, VarsityHeavyDuty.com, by working closely with one of the Company's
principal investors.

The Company's Profit Strategy for 2001 focuses on maintaining and increasing
profitability.  Achievement of this goal will be accomplished by meeting
production deadlines of the increased backlog the Company has generated in the
last year.

Item 7.  Financial Statements
The information required by Item 7 begins at page F-1 that appears after page
13.

                                       12
<PAGE>

Item 8.  Changes In and Disagreements with Accountants on Accounting and
         Financial Disclosure.

On May 15, 2000, Strategic Solutions Group, Inc. filed a Form 8-K, "Changes in
Registrant's Certifying Public Accountant" in which it noted that the Company
dismissed the accounting firm of PricewaterhouseCoopers LLP ("PwC") and
appointed the accounting firm of Grant Thornton LLP to succeed PwC as its
certifying public accountant and to act as its auditors for the fiscal year
ended December 31,2000. The description of the change in auditors is qualified
in its entirety by reference to the Company's Form 8-K dated May 15, 2000 and
the exhibits filed therewith.

                                       13
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY



                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                  Page No.
<S>                                                               <C>

Reports of Independent Accountants                                F-2

Consolidated Balance Sheets, December 31, 2000 and 1999           F-4

Consolidated Statements of Operations for the years ended
     December 31, 2000 and 1999                                   F-5

Consolidated Statements of Stockholders' Deficit for the years
     ended December 31, 2000 and 1999                             F-6

Consolidated Statements of Cash Flows for the years
     ended December 31, 2000 and 1999                             F-7

Notes to Consolidated Financial Statements                        F-8 - F-17
</TABLE>

                                      F-1

<PAGE>

              Report of Independent Certified Public Accountants


To the Stockholders and Board of Directors of
   Strategic Solutions Group, Inc. and subsidiary


We have audited the accompanying consolidated balance sheet of Strategic
Solutions Group, Inc. and its subsidiary (the Company) as of December 31, 2000,
and the related consolidated statements of operations, stockholders' deficit,
and cash flows for the year then ended.  These consolidated financial statements
are the responsibility of the Company's management.  Our responsibility is to
express an opinion on these consolidated financial statements based on our
audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America.  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 audit provides a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above, present fairly, in
all material respects, the financial position of Strategic Solutions Group, Inc.
and subsidiary as of December 31, 2000, and the results of its operations and
its cash flows for the year then ended in conformity with accounting principles
generally accepted in the United States of America.


/s/ Grant Thornton LLP
----------------------
Grant Thornton LLP

Vienna, Virginia
January 24. 2001 (Except for Note 16, as to which the date is April 3, 2001)

                                      F-2
<PAGE>

                       Report of Independent Accountants



To the Board of Directors and Stockholders of
Strategic Solutions Group, Inc.

In our opinion, the accompanying consolidated balance sheet and the related
consolidated statement of operations, changes in stockholders' deficit and cash
flows present fairly, in all material respects, the financial position, results
of operations and cash flows of Strategic Solutions Group, Inc. and its
subsidiaries at December 31, 1999, and for the year then ended, in conformity
with accounting principles generally accepted in the United States of America.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements based
on our audit. We conducted our audit of these statements in accordance with
auditing standards generally accepted in the United States of America, which
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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion. We have not audited the financial statements
of Strategic Solutions Group, Inc. for any period subsequent to December 31,
1999.

The financial statements referred to above have been prepared assuming the
Company will continue as a going concern.  As shown in these financial
statements during 1999, the Company incurred losses from operations of $415,179,
had an accumulated deficit of $16,241,480 at December 31, 1999, and its existing
cash resources were insufficient to fund its planned operations.  These facts
raise substantial doubt about the Company's ability to continue as a going
concern. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.


                                    /s/ PricewaterhouseCoopers LLP


McLean, Virginia
March 17, 2000

                                      F-3
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                          CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                    December 31,     December 31,
                                                                                        2000             1999
                                                                               -----------------------------------
<S>                                                                            <S>                  <C>
                                        ASSETS
                                        ------
Current assets:
    Cash and cash equivalents                                                     $    219,537       $    146,107
    Accounts receivable, net of allowance for doubtful accounts
      of $25,000 and $35,000, respectively                                              61,244            190,653
    Prepaid expenses and other current assets                                           23,930             22,085
                                                                               ----------------------------------
      Total current assets                                                             304,711            358,845

Property and equipment, net                                                             41,293             50,980
Restricted Investment                                                                   69,269                 --
Other assets                                                                            13,506             13,591
                                                                               ----------------------------------
                                                                                  $    428,779       $    423,416
                                                                               ==================================
                         LIABILITIES AND STOCKHOLDERS' DEFICIT
                         -------------------------------------
Current liabilities
    Accounts payable and accrued liabilities                                      $    239,861       $    369,643
    Convertible subordinated debenture                                                      --            779,650
    Deferred revenue                                                                    78,725                 --
    Other current liabilities                                                               --            183,000
                                                                               ----------------------------------
      Total current liabilities                                                        318,586          1,332,293

Convertible subordinated debenture                                                     204,592                 --
                                                                               ----------------------------------

      Total liabilities                                                                523,178          1,332,293
                                                                               ----------------------------------

Commitments and contingencies                                                               --                 --

Stockholders' deficit

    Common stock, $.0001 par value. Authorized 25,000,000
      and 10,000,000 shares; issued and outstanding 8,256,690
      and 5,356,690 shares as of December 31, 2000 and 1999                                826                536
    Additional paid-in capital                                                      16,052,552         15,370,848
    Accumulated deficit                                                            (16,217,046)       (16,241,480)
    Accumulated other comprehensive income                                              69,269                 --
    Deferred compensation                                                                   --            (38,781)
                                                                               ----------------------------------
      Total stockholders' deficit                                                      (94,399)          (908,877)
                                                                               ----------------------------------

                                                                                  $    428,779       $    423,416
                                                                               ==================================
</TABLE>

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

                                      F-4
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                     CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                                     Year ended December 31,
                                                                --------------------------------
                                                                      2000                1999
                                                                --------------------------------
<S>                                                            <C>                 <C>
Revenues

  Service                                                      $ 1,293,008         $   952,050
  Product                                                            5,827              18,238
  Royalty                                                           13,778              22,043
                                                               -------------------------------
          Total revenue                                          1,312,613             992,331
                                                               -------------------------------
Cost of revenues
  Cost of service                                                  579,562             505,532
  Cost of product                                                    4,060              17,850
                                                               -------------------------------
          Total cost of revenue                                    583,622             523,382
                                                               -------------------------------
  Gross profit                                                     728,991             468,949
                                                               -------------------------------
Operating expenses
  Research and development                                           3,425              66,815
  Selling, general and administrative                            1,086,969             817,313
                                                               -------------------------------
          Total operating expenses                               1,090,394             884,128
                                                               -------------------------------
Loss from operations                                              (361,403)           (415,179)

Other income (see Note 2)                                               --             828,967
Interest expense and other, net                                    (32,418)           (197,593)
                                                               -------------------------------
                                                                   (32,418)            631,374
                                                               -------------------------------
Income (loss) before extraordinary item                           (393,821)            216,195
  Extraordinary gain on the extinquishment of debt                 418,255                  --
                                                               -------------------------------
Net income                                                     $    24,434         $   216,195
                                                               ===============================
Earnings per common share - Basic

  Income before extraordinary item                             $     (0.05)        $      0.05
  Extraordinary item                                           $      0.06         $        --
                                                               -------------------------------
  Net income per common share                                  $      0.01         $      0.05
                                                               ===============================
Weighted average number of common shares outstanding - basic     7,383,732           4,300,048
                                                               ===============================

Earnings per common share - Diluted
  Income (loss) before extraordinary item                      $     (0.04)        $      0.05
  Extraordinary item                                           $      0.05         $        --
                                                               -------------------------------
Net income per common share - diluted                          $      0.01         $      0.05
                                                               ===============================
Weighted average number of common shares outstanding -
diluted                                                          8,452,976           5,459,730
                                                               ===============================
</TABLE>

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

                                      F-5
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
               CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT

<TABLE>
<CAPTION>
                                                                                            Accumulated
                                           Common Stock       Additional                       Other
                                           ------------        Paid-in       Accumulated    Comprehensive     Deferred
                                       Shares        Amount    Capital         Deficit        Income        Compensation   Total
                                   -------------------------------------------------------------------------------------------------
<S>                                <C>               <C>      <C>            <C>            <C>             <C>          <C>
Balance, January 1, 1999              3,399,670    $  340    $15,230,243    $(16,457,675)   $     --       $ (77,562)  $ (1,304,654)

   Shares of common stock issued
    upon conversion of
    subordinated debenture            1,957,020       196        140,605              --          --              --        140,801
   Amortization of deferred
    compensation                             --        --             --              --          --          38,781         38,781
   Net income                                --        --             --         216,195          --              --        216,195
                                   ------------------------------------------------------------------------------------------------
Balance, December 31, 1999            5,356,690       536    $15,370,848    $(16,241,480)         --         (38,781)      (908,877)

   Shares of common stock issued
    upon conversion of
    subordinated debenture            1,000,000       100        249,900              --          --              --        250,000
   Issuance of common stock, net
    of issuance costs                 1,250,000       125        245,790              --          --              --        245,915
   Amortization of deferred
    compensation                             --        --             --              --          --          38,781         38,781
   Common stock issued to an
    officer for compensation
    in lieu of cash                     200,000        20         19,980              --          --              --         20,000
   Stock options granted to
    nonemployees for services                --        --         53,101              --          --              --         53,101
   Stock issued to debenture
    holder                              250,000        25         35,131              --          --              --         35,156
   Exercise of stock options            200,000        20         18,740              --          --              --         18,760
   Detachable warrants issued in
    connection with debt.                    --        --         22,500              --          --              --         22,500
   Unrealized appreciation in the
    value of restricted investment           --        --             --              --      69,269              --         69,269
   Stock options granted to
    employees                                --        --         36,562              --          --              --         36,562
   Net income                                --        --             --          24,434          --              --         24,434
                                   ------------------------------------------------------------------------------------------------
Balance, December 31, 2000            8,256,690    $  826    $16,052,552    $(16,217,046)   $ 69,269       $      --   $    (94,399)
                                   ================================================================================================
</TABLE>

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

                                      F-6
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                     CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                     Year ended December 31,
                                                                                      2000              1999
                                                                                  ----------------------------
<S>                                                                               <C>                <C>
Cash flows from operating activities
  Net income                                                                      $  24,434          $ 216,195
  Adjustments to reconcile net loss to net cash used in
      operating activities
    Depreciation and amortization                                                    58,273            200,805
    Stock options issued as a payment for services                                    3,000                 --
    Stock options granted to employees                                               36,562                 --
    Common stock issued for compensation in lieu of cash                             20,000                 --
    Recovery of promissory note related to divestiture of UST                            --           (600,000)
    Realization of deferred gain on divestiture of UST                                   --           (228,967)
    Reduction of allowance for doubtful accounts                                    (10,000)           (10,000)
    Conversion of interest expense into common shares                                    --             12,351
    Gain on debt extingishment                                                     (418,255)                --
    Amortization of deferred compensation                                            38,781             38,781
    Increase (decrease) in cash from changes in assets and liabilities:
      Accounts receivable                                                           139,409              8,977
      Prepaid expenses and other current assets                                      (1,845)             2,412
      Other assets                                                                       85            (11,063)
      Accounts payable and accrued liabilities                                       32,911              4,255
      Other liabilities                                                            (101,987)                --
      Deferred revenue                                                               78,725                 --
                                                                                  ----------------------------
  Net cash used in operating activities                                             (99,907)          (366,254)
                                                                                  ============================
Cash flows from investing activities
  Cash received related to promissory note from divestiture of UST                       --            600,000
  Capital expenditures                                                              (36,337)            (5,630)
                                                                                  ============================
  Net cash provided by (used in) investing activities                               (36,337)           594,370
                                                                                  ----------------------------
Cash flows from financing activities
  Proceeds from issuance of convertible subordinated debenture                      250,000                 --
  Proceeds from the sale of common stock, net                                       245,915                 --
  Proceeds from exercise of stock options and warrants                               18,760                 --
  Payments on financing debt and promissory note                                    (90,001)          (150,000)
  Redemption of convertible debt                                                   (215,000)                --
                                                                                  ----------------------------
  Net cash (used in) provided by financing activities                               209,674           (150,000)
                                                                                  ----------------------------
Net increase in cash and cash equivalents                                            73,430             78,116

Cash and cash equivalents, beginning of year                                        146,107             67,991
                                                                                  ----------------------------
Cash and cash equivalents, end of year                                            $ 219,537          $ 146,107
                                                                                  ============================
Supplemental disclosures of cash paid:
  Interest                                                                        $   3,572          $     195
  Income Taxes                                                                           --                 --

Supplemental schedule of noncash investing and financing activities:
  Stock issued as payment for professional services                               $  50,000          $      --
  Detachable warrants issued in connection with debt                                 22,500                 --
  Stock issued upon conversion of convertible debentures and
    accrued interest                                                                250,000            140,800
  Stock issued in connection with the sale of convertible
    subordinated debenture                                                           35,156                 --
</TABLE>

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

                                      F-7
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             ____________________



1.   THE BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business. Strategic Solutions Group, Inc. and its subsidiary
(the "Company") are full-service providers of technology based software
solutions. The Company specializes in the development of custom interactive
multimedia software for use in the areas of process enhancement, technical
documentation, training, and performance support for a variety of commercial and
industrial end-users.

The Company currently operates in only one segment.

Principles of Consolidation. The consolidated financial statements include the
accounts of Strategic Solutions Group, Inc. and its wholly owned subsidiary, an
inactive corporation.  All significant intercompany accounts and transactions
have been eliminated.

Revenue Recognition. Revenues from software development, consulting and training
services are recognized as services are performed. Revenues from custom
multimedia software products are recognized using the percentage of completion
method due to the significant customization involved in their development.
Provisions for anticipated contract losses are recognized in the period that
they become evident. Revenues from the sale of third party hardware and software
products are recognized when products are shipped. Revenues from royalties are
recognized in the period for which the royalties are earned. Software products
generally are delivered without post sale vendor obligations and without a
significant obligation to the customer. Deferred revenue represents amounts
advanced by customers and is recognized as revenue upon delivery of the products
or services and is adjusted on a quarterly basis to reflect the status of
projects.

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

Cash and Cash Equivalents. The Company considers all highly liquid investments
with an original maturity of three months or less to be cash equivalents.

Property and Equipment. Property and equipment are stated at cost.
Depreciation is computed using the straight-line method over the estimated
useful lives of the related assets.   The Company has estimated the useful lives
of computer hardware and software to be three years and furniture and fixtures
to be seven years.  Amortization of leasehold improvements is computed using the
straight-line method over the shorter of the estimated useful life of the
improvements or the remaining lease term.

Per Share Data. Basic earnings (loss) per share is computed using the weighted-
average number of shares of common stock outstanding during the year. Diluted
earnings per share is computed using the weighted-average number of shares of
common stock and the effect of potential common shares.  Potential common shares
include stock options, warrants, and other convertible securities that could be
exercised or converted into common stock and are not included in the computation
of dilutive earnings per share if they are anti-dilutive.  Common shares
relating to stock options and warrants are calculated using the treasury stock
method and common shares relating to convertible securities are calculated using
the if-converted method.

Research and Development Expenses and Software Development Costs. Statement of
Financial Accounting Standards No. 86, "Accounting for the Cost of Computer
Software to be Sold, Leased or Otherwise Marketed" requires the capitalization
of certain software development costs once technological feasibility is
established, which the Company generally defines as the completion of a working
model. Capitalization ceases when the products are available for general
release to customers, at which time amortization of the capitalized costs begins
on a straight-line basis over the estimated product life, or on the ratio of
current revenues to total projected product revenues, whichever is greater.
There were no software development costs capitalized for any periods presented
as the costs incurred between technological feasibility and general availability
were not

                                      F-8
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             ____________________


significant. In addition, research and development costs including software
development costs prior to technological feasibility are expensed in the period
in which they are incurred.

Concentration of Credit Risk. Financial instruments that potentially subject the
Company to concentrations of credit risk consist principally of cash and cash
equivalents. The Company provides hardware and software products, develops
software, and performs services for its customers located throughout the United
States. The Company provides credit in the normal course of business and, to
date, has not experienced significant losses related to receivables from
individual customers or groups of customers in a particular industry or
geographic area. In addition, for certain orders for custom multimedia software
development projects, the Company requires advances or deposits of at least
one-third of the price of the custom software with additional amounts due at
certain milestones during the custom software development process. Due to these
factors, management believes no additional credit risk beyond amounts provided
for in the doubtful account allowance is inherent in the Company's accounts
receivable.

For the year ended December 31, 2000, one customer, an automotive manufacturer,
accounted for 78% of the Company's revenue.  Additionally sales to Varsity Heavy
Duty, , a related party, accounted for 22% in 2000. For the year ended December
31, 1999, two customers, an automotive manufacturer and a government division,
accounted for 83% and 10%, respectively, of the Company's revenue.  At December
31, 2000, two customers accounted for 78% of accounts receivable.  At December
31, 1999, three customers accounted for 91% of accounts receivable.

Recoverability of Long-Lived Assets. The Company evaluates the recoverability of
the carrying value of property and equipment and intangible assets in accordance
with the provisions of Statement of Accounting Standards No. 121, "Accounting
for the Impairment of Long-Lived Assets to be Disposed Of". The Company
considers historical performance and anticipated future results in its
evaluation of potential impairment. Accordingly, when indicators of impairment
are present, the Company evaluates the carrying value of these assets in
relation to the operating performance of the business and future and
undiscounted cash flows expected to result from the use of these assets.
Impairment losses are recognized when the sum of expected future cash flows are
less than the assets' carrying value.

Income Taxes. Deferred income taxes are recognized for the tax consequences in
future years of differences between the tax basis of assets and liabilities and
their financial reporting amounts at each year end based on enacted tax laws and
statutory tax rates applicable to the periods in which the differences are
expected to affect taxable income. Valuation allowances are established when
necessary to reduce deferred tax assets to the amount expected to be realized.
Income tax expense is the tax payable for the period and the change during the
period in deferred tax assets and liabilities.

New Accounting Pronouncements. In June 1998, the Financial Accounting Standards
Board issued Statement of Financial Accounting Standards No. 133, "Accounting
for Derivative Instruments and Hedging Activities". This Statement requires
companies to recognize all derivatives as either assets or liabilities, with the
instruments measured at fair value. The accounting for changes in fair value and
gains and losses depends on the intended use of the derivative and its resulting
designation. The statement was originally effective for fiscal years beginning
after June 15, 1999. In July 1999, FASB delayed implementation of this standard
for one year, to June 30, 2000. The Company will adopt SFAS 133 in the first
quarter of 2001. Historically, the Company has not entered into derivative
contracts either to hedge existing risks or for speculative purposes, as such,
it believes that the implementation of SFAS 133 will have no effect on its
financial statements.

Reclassifications. Certain prior year amounts have been reclassified to
correspond to the current year presentation.

2.  RESTRICTED INVESTMENT

U.S. Technologies, Inc. ("UST") was acquired by the Company in 1996 and was
divested of in April 1998. As a result of the Company's divestiture of UST and
the subsequent merger of UST with and into a subsidiary of Digital Chainsaw,
Inc. ("Digital Chainsaw") in 1999, the Company held 641,045 shares of Digital
Chainsaw common stock. At December 31, 1999, the Company had established a
reserve for the full value of the Digital Chainsaw common stock it held.

                                      F-9
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             ____________________


In connection with the revised divestiture agreement, the Company received the
partial payment against the fully reserved promissory note of $100,000 along
with 100,000 shares from UST in May 1999 and the final payment of $500,000 along
with 200,000 shares in August 1999. The Company recorded the receipt of the
payments as other income in the accompanying consolidated statements of
operations. As a result of UST's compliance with the revised agreement and
settlement of its debts to the Company, in September 1999, the Company
recognized the deferred gain recorded upon the divestiture of UST, of $228,967
in other income in the accompanying consolidated statements of operations.

In August 2000, Digital Chainsaw was acquired by High Speed Access Corporation
("High Speed Access"), (Nasdaq: HSAC), in a share exchange where each share of
Digital Chainsaw was exchanged for 0.1017 shares of High Speed Access.  The
Company received 65,194 shares of restricted common stock of High Speed Access
in exchange for the shares of Digital Chainsaw it held.

The Company has recorded the shares of High Speed Access it holds at their fair
value, which is based on the quoted market price at December 31, 2000 as a
restricted investment and accumulated other comprehensive income.  Any future
adjustments to fair value of the restricted investment, which has been
classified as available-for-sale, will be recorded as an increase or decrease in
accumulated other comprehensive income, a stockholders' equity account.

The Company's investment in High Speed Access is contractually restricted, with
fifty percent of the shares held by the Company transferable beginning 180 days
after the closing date of the acquisition, with the remaining fifty percent
transferable in six equal installments beginning on the last day of the month of
each of the six months immediately following May 2001.  This investment is also
pledged to secure an outstanding promissory note, as described in Note 7,
herein.

3.   ACCOUNTS RECEIVABLE

Accounts receivable as of December 31, 2000 and 1999 consists of the following:

                                                        2000             1999
                                                        ----             ----
         Accounts receivable, billed                  $ 32,062        $ 117,121
         Accounts receivable, unbilled                  54,182          108,532
                                                      --------        ---------
                                                        86,244          225,653

         Less allowance for doubtful accounts          (25,000)         (35,000)
                                                      --------        ---------

         Accounts receivable, net                     $ 61,244        $ 190,653
                                                      ========        =========



4.   PROPERTY AND EQUIPMENT

Property and equipment as of December 31, 2000 and 1999 consists of the
following:

                                                        2000             1999
                                                        ----             ----
         Computer equipment and software              $ 252,875       $ 221,824
         Office equipment                                62,470          58,565
         Furniture and fixtures                         137,594         136,213
                                                      ---------       ---------
                                                        452,939         416,602
         Less accumulated depreciation                 (411,646)       (365,622)
                                                      ---------       ---------
         Property and equipment, net                  $  41,293       $  50,980
                                                      =========       =========

For the years ended December 31, 2000 and 1999, depreciation expense of $46,024
and $39,967 was charged to operations.


5.   ACCOUNTS PAYABLE AND ACCRUED LIABILITIES AND OTHER CURRENT LIABILITIES

Accounts payable and accrued liabilities as of December 31, 2000 and 1999
consist of the following:

                                     F-10
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             ____________________

                                                    2000                 1999
                                                    ----                 ----
         Accounts payable                        $  82,078            $ 144,448
         Accrued interest expense                   21,243              112,592
         Payroll and related expenses               52,344               35,295
         Other                                      84,196               77,308
                                                 ---------            ---------
                                                 $ 239,861            $ 369,643
                                                 =========            =========

Other current liabilities as of December 31, 1999 consisted of the following:

         Penalties on Debentures                                      $  81,013
         Other                                                          101,987
                                                                      ---------
                                                                      $ 183,000
                                                                      =========

6.   LINE OF CREDIT

On August 30, 2000, the Company secured a bank line of credit allowing for
borrowings up to $100,000 for working capital.  The line is secured by the
assets of the Company.  Interest on the outstanding principal balance is the
Prime Rate (9.5% at December 31, 2000) plus 1.0%.  Accrued interest is payable
monthly with any outstanding principal and accrued interest due August 30, 2001.
At December 31, 2000, there were no outstanding borrowings on the line of
credit.

7.   CONVERTIBLE DEBT

In January 1998, the Company issued a notice of redemption of its Subordinated
Convertible Debenture (the "Debenture") based on management's interpretation of
the contract and issued 1,052,624 shares of its common stock in payment of the
redemption amount. The holder of the Debenture refused to accept the shares
tendered, delivered a notice of partial conversion of the Debenture, and filed
suit against the Company in the Delaware Chancery Court alleging that the terms
of the Debenture permitted cash redemption only, that the redemption was
therefore invalid, and that the Company was required to honor the holder's
conversion notice.  On April 23, 1998, the Court ruled in favor of the Debenture
holder, declaring the redemption invalid and imposing a penalty of $106,000
against the Company for delay in delivering the shares issuable in accordance
with the holder's conversion notice.

The $106,000 penalty was expensed in the second quarter of 1998.  In addition,
the Company executed a judgment note payable with the Debenture holder to pay
the $106,000 in monthly payments of $7,500 until paid in full with interest at
10% per annum and acceleration upon the Company's receipt of payments from UST.
The Company received final payment from UST in August 1999 and at December 31,
1999 was in default on its payment of the penalty.  Subsequently, the Debenture
holder requested payment of an additional penalty of $160,000, claiming that the
Company did not register the common stock issuable upon conversion of the
Debenture under the Securities Act of 1933 within the time required by a
registration rights agreement between the Company and the Debenture holder.

On March 1, 2000, the Company settled all outstanding issues with the holder of
this Debenture.  Under the terms of the Settlement Agreement with Releases, the
Company paid the holder of the Debenture $200,000 cash, issued a $100,000 non-
interest bearing promissory note secured by certain assets of the Company,
payable in installments of $10,000 per month beginning in March 2000, issued
1,000,000 shares of the Company's common stock, and transferred to the holder
certain other assets owned by the Company which had a negligible book value.
The Company also incurred legal fees totaling $15,000 related to this
transaction.

The Company recognized a gain on the cancellation and extinguishments of this
debt and the related accrued interest and penalties as an extraordinary item in
the operating statement of $408,255.

                                     F-11
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             ____________________


On February 24, 2000 ("Issuance Date"), the Company issued a convertible
subordinated debenture for $250,000.  This debenture bears interest at 10%,
matures February 24, 2004 and is convertible into common stock, beginning the
earlier of 180 days after the Issuance Date or the effective date of the
Registration Statement filed pursuant to a Registration Rights Agreement, at a
conversion price of $0.28 (the "Conversion Price").

The Company has the right to redeem this debenture at redemption prices
increasing from 125% of the principal amount of the debenture, if redeemed
before the first anniversary of the Issuance Date, to 200% of the principal
amount of the debenture after the third anniversary date of the Issuance Date.
Upon notice of redemption, the holder of the debenture has the right to convert
the redemption proceeds into common stock at the above Conversion Price.

The Company granted the holder of this debenture a security interest in 641,045
shares of common stock that the Company owned in Digital Chainsaw, which shares
have since been exchanged for 65,194 shares of High Speed Access as previously
described in Note 2.

In connection with the issuance of this debenture, the Company issued a stock
purchase warrant for the purchase of up to 250,000 shares of the Company's
common stock at $0.75 per share.  This stock purchase warrant expires on
February 24, 2004.  Based on the relative fair value of the debenture and stock
purchase warrant, the stock purchase warrant has been assigned a value of
$22,500, which represents a debenture discount and will be amortized to interest
expense over the life of the debenture.

As part of the debenture, the Company also issued 250,000 shares of its common
stock to the investor.  The Company recorded the market value of these shares as
an additional debenture discount and as common stock and additional paid in
capital. The discount is being amortized over the holding period of the note.

In connection with these investments, the Company entered into a registration
rights agreement with this investor that required the Company to file a
registration statement with the SEC registering the shares of common stock
related to these investments or incur penalties.

8.  STOCKHOLDERS' EQUITY

During the year ended December 31, 2000, the Company sold 1,250,000 shares of
common stock in a private placement of $250,000.  In connection with this
investment, the Company entered into a registration rights agreement with this
investor that required the Company to file a registration statement with the SEC
to register the shares of common stock by May 5, 2000  The Company has not met
this filing deadline and as such has incurred approximately $38,000 in penalties
as of December 31, 2000.

As described in Note 7 above, the Company issued 250,000 shares of common stock
to an individual in connection with a convertible subordinated debenture.

On December 29, 2000, the Company issued 200,000 shares of its common stock to
an officer and director in lieu of cash consideration accrued by the Company at
$20,000, which approximated market value on the date of issue.

9.  STOCK OPTION PLANS

Incentive Stock Option Plans

Since 1992, the shareholders have approved several incentive stock option plans
authorizing the issuance of options for employees.

The Company has granted options under these incentive stock option plans which
are detailed below.

                                     F-12
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENT

                               _________________


<TABLE>
<CAPTION>
                                               Date Plan        Shares Reserved
                                               Approved            for Grant
                                             ----------------------------------
     <S>                                     <C>                <C>
     Incentive Stock Option Plan                 1992                39,222
     Incentive Stock Option Plan No. 2           1994                28,571
     Incentive Stock Option Plan No. 3           1997                80,000
     Incentive Stock Option Plan No. 4           1998                85,000
     Incentive Stock Option Plan No. 5           1999               150,000
</TABLE>

For options granted under the above Incentive Stock Option Plans, the option
price per share may not be less than the fair market value of the stock on the
date of the grant, the terms of the options are ten years from the date of
grant, and options vest over a five-year period beginning on the date of grant.
If immediately before a grant an employee owns more than 10% of the total
combined voting stock of the Company, the exercise price shall be at least 110%
of the fair market value of the stock on the date of the grant and the options
expire five years from the date of grant.

A summary of option activity for the years ended December 31, 2000 and 1999
under the above Incentive Stock Option Plans are as follows:

<TABLE>
<CAPTION>
                                                     Number of       Weighted Average
                                                      Options          Option Prices
                                                      -------          -------------
     <S>                                             <C>             <C>
     Options Outstanding at January 1, 1999            79,826              $ 1.02
        Granted                                        26,000              $ 0.12
        Expired                                       (22,755)             $ 0.67
                                                      -------
     Options Outstanding at December 31, 1999          83,071              $ 0.30
        Granted                                        35,000              $ 0.34
        Expired                                       (22,000)             $ 0.11
                                                      -------
     Options Outstanding at December 31, 2000          96,071              $ 0.36
                                                      =======
</TABLE>

No incentive stock options were exercised during the years ended December 31,
2000 or 1999.

Nonqualified Stock Option Plans

Since 1992, the shareholders have approved several Nonqualified Stock Option
Plans authorizing the issuance of options to employees and consultants.

The Company has granted options under these non-qualified stock option plans
which are detailed below.

<TABLE>
<CAPTION>
                                                               Date Plan      Shares Reserved
                                                                Approved         for Grant
                                                        ----------------------------------------
     <S>                                                 <C>                  <C>
     Nonqualified Stock Option Plan                              1992                8,571
     Nonqualified Stock Option Plan No. 2                        1994               71,428
     Nonqualified Stock Option Plan No. 3                        1995               13,571
     Nonqualified Stock Option Plan No. 4, 5 and 6               1996              282,500
     Nonqualified Stock Option Plan No. 7                        1997              100,000
     Nonqualified Stock Option Plan No. 8 and 9                  1998               50,000
     Nonqualified Stock Option Plan No. 10 and 11                1999            1,160,000
     Nonqualified Stock Option Plan No. 12                       2000              407,675
</TABLE>

Options granted under the Nonqualified Stock Option Plans are accounted for
based upon their fair value at the date of their issuance.  The option price per
share under these plans may be greater than or less than the fair market value
of the stock on the date of the grant.  Both the option price and the terms of
the options are

                                     F-13
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                               _________________

determined by the Board of Directors or a committee of the Board as of the date
of the grant. Generally, the terms of the options are ten years from the date of
grant, and options vest 100% on the date of grant.

A summary of option activity for the years ended December 31, 2000 and 1999
under the above Nonqualified Stock Option Plans are as follows:

<TABLE>
<CAPTION>
                                                         Number of          Weighted Average
                                                          Options             Option Price
                                                          -------             ------------
<S>                                                     <C>                 <C>
     Options Outstanding at January 1, 1999               357,656                $ 4.20
        Granted                                         1,160,000                $ 0.09
        Expired                                           (21,882)               $ 4.44
                                                        ---------
     Options Outstanding at December 31, 1999           1,495,774                $ 0.17
        Granted                                           407,675                $ 0.16
        Exercised                                        (200,000)               $ 0.09
                                                        ---------
     Options Outstanding at December 31, 2000           1,703,449                $ 0.16
                                                        =========
</TABLE>

The weighted average fair value per share of options (both incentive and
nonqualified) granted during 2000 and 1999 was $0.17 and $0.09, respectively.
The following table summarizes additional information about the stock options
outstanding under the Company's stock option plans at December 31, 2000:

<TABLE>
<CAPTION>
                            OPTIONS OUTSTANDING                                                OPTIONS EXERCISABLE
                            -------------------                                                -------------------
  Actual Range of         Options        Weighted-Average Remaining       Weighted          Options        Weighted Average
  Exercise Prices     Outstanding at      Contractual Life (years)        Average         Exercisable       Exercise Price
                         12/31/00                                      Exercise Price     at 12/31/00
<S>                   <C>                <C>                           <C>                <C>              <C>
 $ 0.09 - $ 0.15         1,364,875                8.74                     $ 0.11          1,174,275            $ 0.11
 $ 0.18 - $ 0.35            63,000                8.68                     $ 0.32             56,600            $ 0.33
 $ 0.38 - $ 0.40           339,685                6.43                     $ 0.38            336,685            $ 0.38
 $ 0.40 - $ 0.53            32,000                7.87                     $ 0.42             31,200            $ 0.42
                         ---------                                                         ---------
                         1,799,520                8.28                     $ 0.17          1,598,520            $ 0.18
                         =========                                                         =========
</TABLE>

The Company applies Accounting Principles Board Opinion No. 25 (APB 25),
"Accounting for Stock Issued to Employees", and related interpretations in
accounting for its equity participation programs.  Accordingly, no compensation
cost has been recognized for its incentive and nonqualified stock option plans
related to stock options granted to employees as the exercise price of the stock
options was the same as the fair market value of the underlying common stock on
the date of the grant.   However, the Company has adopted the disclosure-only
provisions of Statements of Financial Accounting Standards No. 123, "Accounting
for Stock-based Compensation" ("SFAS 123") as they pertain to the recognition of
compensation expense attributable to option grants.  If the Company had elected
to recognize compensation cost for the Company's incentive and nonqualified
stock option plans consistent with the method of accounting under SFAS 123, the
Company's net income (loss) and net income (loss) per share on a pro forma basis
would be:

                                                           2000      1999
                                                           ----      ----
Net income - as reported                                  24,434    216,195
Net income (loss) - pro forma                           (232,001)   168,562
Net income per share (basic) - as reported             $    0.01   $   0.05
Net income (loss) per share (basic) - pro forma        $   (0.03)  $   0.04
Net income per share (diluted) - as reported           $    0.01   $   0.05
Net income (loss) per share (diluted) - pro forma      $   (0.03)  $   0.03

The fair value of each option grant was estimated on the date of grant using the
Black-Scholes option-pricing model with the following weighted average
assumptions for each year:

                                     F-14
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                _______________

                                    2000   1999
                                    ----   ----
Risk-free interest rate             6.48%  5.71%
Expected life of options - years     5.0    5.0
Expected stock price volatility      125%   125%
Expected dividend yield                0%     0%

10.  INCOME TAXES

The tax effects of the temporary differences and carryforwards which give rise
to net deferred tax assets are as follows as of December 31, 2000 and 1999:

                                               2000             1999
                                            -----------      -----------
       Net operating loss carryforwards     $ 5,807,000      $ 4,815,000
       Impairment of deferred services              ---          351,000
       Other                                     17,000           84,000
                                            -----------      -----------
                                              5,824,000        5,250,000
       Valuation allowance                   (5,824,000)      (5,250,000)
                                            -----------      -----------
                                            $        --      $        --
                                            ===========      ===========

Realization of deferred tax assets at the balance sheet date are dependent on
the Company's ability to generate future taxable income which is uncertain.
Accordingly, management has provided a full valuation allowance against the
Company's deferred tax assets as of December 31, 2000 and 1999.

The Company has not recorded a provision or benefit for income taxes for the
years ended December 31, 2000 and 1999.  As of December 31, 2000, net operating
loss carryforwards total approximately $5,807,000 which begin to expire in 2008.
As a result of certain changes in ownership, the use of these carryforwards to
offset future taxable income may be limited.

A reconciliation between the statutory federal income tax rate and the effective
rate of income tax expense is as follows:

                                             Year Ended December 31,
                                             2000             1999
                                             ------------     -------------
       Statutory federal income tax rate       34%              34%
       State income taxes                     (88%)            (10%)
       True-up of deferred taxes             (702%)              0%
       Change in valuation allowance          733%              80%
       Dissolution of UST                       0%            (107%)
       Other                                   23%               3%
                                             ------------     -------------
                                                0%               0%
                                             ============     =============

The deferred tax asset related to net operating loss carryforwards has increased
because of an adjustment of the prior year net operating loss carryforward to
the actual tax return amount.  The valuation allowance associated with the net
operating loss carryforward has been adjusted accordingly.

11.  EARNINGS PER SHARE

Basic earnings per share for each period presented is computed by dividing net
income by the weighted average number of shares of common stock outstanding
during the period.  Diluted earnings per share reflects the dilutive effect of
additional shares of common stock that could be issued upon the exercise of
outstanding stock options and the conversion of the convertible subordinated
debenture.

                                      F-15
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                _______________

The following shows the determination of income for the purpose of the earnings
(loss) per share computations:

<TABLE>
<CAPTION>
                                                                                2000               1999
                                                                            ------------       ------------
<S>                                                                         <C>                <C>
Net income (loss) before extraordinary item                                 $   (393,821)      $    216,195
Extraordinary item                                                               418,255                 --
                                                                            ------------       ------------
Income available for common stockholders, for basic earnings
  per share                                                                       24,434            216,195
Plus interest on convertible subordinated debentures, net of
  income taxes                                                                    24,430             36,910
                                                                            ------------       ------------
Income available for common stockholders, used for diluted
  earnings per share                                                        $     48,864       $    253,105
                                                                            ============       ============
</TABLE>

The following shows the determination of the number of shares used in the
earnings per share computions:

<TABLE>
<CAPTION>
                                                                            ------------       ------------
                                                                                2000               1999
                                                                                ----               ----
                                                                            ------------       ------------
<S>                                                                         <C>                <C>
Weighted average number of shares outstanding                                  7,383,732         4,300,048

Net number of shares issued on the assumed exercise of stock options             819,244           209,833
Shares issued on the assumed conversion of convertible subordinated
 debenture                                                                       250,000           949,849
                                                                            ------------       -----------
Number of shares used in the computation of diluted earnings per
 share                                                                         8,452,976         5,459,730
                                                                            ============       ===========
</TABLE>

12.  LEASES

The Company leases office space under non-cancelable operating leases, which
expire at various dates through 2005. The future annual minimum rental payments,
under these leases at December 31, 2000 are as follows:

                          2001             70,000
                          2002             70,000
                          2003             73,000
                          2004             77,000
                          2005              6,000

Rental expense for the years ended December 31, 2000 and 1999, was approximately
$65,000 and $48,000, respectively.

13.  RETIREMENT AND OTHER BENEFIT PLANS

Effective January 1, 1994, the Company established a defined contribution
retirement plan covering eligible full-time employees.  Under this plan,
participants can contribute up to the lesser of 15% of their compensation or the
maximum allowable by IRS regulations, currently $10,500.  Employees may direct
the investment of their contributions among several mutual fund options. The
Company may make discretionary contributions out of current or accumulated net
profit. No contributions for the years ended December 31, 2000 and 1999 were
made.

During 1994, the Company entered into split dollar agreements with two officers
whereby the Company pays the premiums on split dollar life insurance policies
held by these individuals.  Under the agreements, the

                                      F-16
<PAGE>

                STRATEGIC SOLUTIONS GROUP, INC. AND SUBSIDIARY
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                _______________

Company has an interest in the policy equal to the cumulative value of all
premiums paid by the Company and will be reimbursed for these premiums upon
death, termination of the agreement, or termination of employment. However,
since it is possible that the Company at its discretion may waive this
requirement, no asset for the premium has been recorded. Through the value of
the agreements the Company paid approximately $12,000 in premiums for each of
the years ended December 31, 2000, 1999, and 1998. Effective June 14, 1995, this
plan was terminated with respect to one officer in connection with his
resignation from the Company.

14.  RELATED PARTY TRANSACTIONS

During the year ended December 31, 2000, the Company converted approximately
$53,000 of amounts due to its non-employee directors into options to purchase
approximately 385,000 shares of the Company's common stock at $0.14 per share,
which represents the market price per share on the date of grant, and the fair
value of the accrued liability.

The Company also entered into an agreement during the year ended December 31,
2000 under which it provided services to Varsity Heavy Duty, a company which is
held in the majority by a shareholder.  The Company provided Varsity Heavy Duty
these services at a discount from its standard rates in exchange for a 10%
equity interest.  The discount approximated $48,000 on sales totaling $332,244.
The Company is accounting for this investment using the cost method and has
assigned no value to it.

15.  COMPREHENSIVE INCOME

The components of comprehensive income for the years ended December 31, 2000 and
1999 are as follows:

                                                      December 31,
                                                   2000          1999
                                                   ----          ----
Net income                                      $  24,434    $  216,195
Unrealized gain on marketable securities           69,269           ---
                                                ---------    ----------
Comprehensive income                            $  93,703    $  216,195
                                                =========    ==========

The components of accumulated other comprehensive income, net of related tax, at
December 31, 2000 and December 31, 1999 are as follows:

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

Unrealized gain on marketable securities        $  69,269    $      ---
                                                =========    ==========

16.  SUBSEQUENT EVENT

On March 27, 2001, the Company executed Subscription Agreements with certain
existing shareholders and members of executive management for the purchase of
fourteen units for a total of $350,000.  Each unit consists of 50,000 shares of
Company common stock and a $25,000 convertible subordinated debenture, bearing
interest at 10%, due in 2004.  The convertible subordinated debentures are
convertible at the holder's option, at any time, into shares of the Company's
common stock at a conversion price of $0.10 per share (the Company's market
price on March 27, 2001).  The Company received $150,000 of the subscribed
amount in March and early April 2001.  Management believes that an additional
$150,000 will be received during April 2001, and $50,000 during May 2001 per the
contractual agreements.

                                      F-17
<PAGE>

                                   PART III

Item 9.  Directors and Executive Officers of the Registrant; Compliance With
Section 16(a) of the Exchange Act.

The following table sets forth certain information concerning the directors and
executive officers of the Company:

Name                                Age     Position
----                                ---     --------

John J. Cadigan                      70     Chairman of the Board

Ernest A. Wagner                     40     President, Treasurer, Chief
                                            Operating Officer, and Director

Kevin E. Idso                        37     Vice President, Director

Barbara A. Seubott                   52     Secretary

A. David Rossin, Ph.D./(1)/          69     Director

Nagesh S. Mhatre, Ph.D./(1)/         68     Director

John C. Morgenstern/(1)/             67     Director


     (1)  Directors of the Company throughout the year ended December 31, 2000
          and until their resignations in March 2001 for personal reasons. No
          biographical information is provided due to their retirement from the
          Board.

John J. Cadigan has been Chairman of the Board and a director of the Company
since February 1991. He was Chief Executive Officer, Secretary, and Treasurer
until his retirement in October 2000.  He was President from July 1995 to
January 2000.  Prior to joining the Company, Mr. Cadigan served as Chairman of
PAI from its inception in 1989 until it was merged into the Company in February
1991.

Ernest A. Wagner was named President, Chief Operating Officer, and a director of
the Company in January 2000.  He has been with the Company since February 1994.
In 1998, Mr. Wagner was promoted to President of the Company's Multimedia
Division.  From 1985 to February 1994, Mr. Wagner served in various engineering
and management positions with SuperFlow Corporation, a manufacturer of
computerized engine and vehicle testing equipment.

Kevin E. Idso was named Vice President of the Company in January 2001 and a
director of the Company in March 2001.  Mr. Idso has been with the Company since
after graduating from Western Washington University with a Bachelors degree in
Computer Sciences in 1985.  Mr. Idso is the original developer of our technology
and developed the Company's first Computer-Based Training course.  In 1997, Mr.
Idso was promoted to Vice President, R&D of the Company's Multimedia Division.

Barbara A. Seubott was named Secretary of the Company in January 2001.  Ms.
Seubott has been with the Company since March 1999 as Accounting and Human
Resources Manager.  From 1981 to March 1999, Ms. Seubott held various accounting
and management positions in both private industry and public accounting.  Ms.
Seubott is a Certified Public Accountant.

                                       14
<PAGE>

Board of Directors

The Company's Certificate of Incorporation and Bylaws, as amended, divide the
Company's directors into three classes designated as Class I, Class II and Class
III, that serve staggered three-year terms that expire at the annual meeting of
the Stockholders in the final year of the term.  Each class consists, as nearly
as may be possible, of one-third of the total number of directors constituting
the entire Board of Directors.  Directors serve for their term and until their
successors are duly elected, or until their earlier resignation, removal from
office, or death.  The remaining directors may fill any vacancy in the Board of
Directors for an unexpired term.

The Company had five directors throughout the year 2000 and until March 2001,
when three directors resigned.  Kevin Idso was elected to fill one of the
vacancies.

There are presently three directors serving on the Board.  Kevin Idso has been
designated as a Class I director and his term expires in 2002.  Ernest Wagner is
designated as a Class II director and his term expires in 2003.  John J. Cadigan
is designated as a Class III director and his term expires in 2001.

The Company has two standing committees, the Executive Compensation and Stock
Option Committee and the Audit Committee.  John J. Cadigan is chairman of the
Executive Compensation and Stock Option Committee and a vacancy on that
committee has not yet been filled by the Board.  Members serve until the next
annual election and until their successors are duly elected and shall qualify
until their earlier death resignation or removal.  Both of the positions on the
Audit Committee are currently vacant.  When appointed, members of the Audit
Committee will serve until the next annual election and until their successors
are duly elected and shall qualify or until their earlier death, resignation or
removal:  The Executive Compensation and Stock Option Committee has the power
and authority to designate, recommend and/or review compensation of the
Company's executive officers and other employees, including salaries, bonuses,
fringe benefits and the grant of stock options.  The Audit Committee has the
power and authority to recommend the engagement of independent accountants,
review external and internal auditing procedures and policies, review
compensation paid to auditors and make recommendations and/or implement changes
with respect to the foregoing.

Officers are elected by the Board of Directors at the annual meeting of
directors following the annual shareholders meeting and serve until their
successors are duly elected, subject to earlier removal by the Board of
Directors.

Item 10.  Executive Compensation

Executive Compensation

The following table shows the compensation paid or accrued by the Company for
the years ended December 31, 2000 and 1999 to or for the account of the Chief
Executive Officer and Chief Operating Officer. No other executive officer of the
Company received an annual salary and bonus in excess of $100,000 or more.

                                       15
<PAGE>

<TABLE>
<CAPTION>
                                   Annual Compensation                          Long-Term
                                                                              Compensation
     Name and                                               Other Annual
Principal Position     Year       Salary          Bonus     Compensation      Options/ SARs  All other Compensation
-------------------------------------------------------------------------------------------------------------------
<S>                    <C>      <C>               <C>       <C>               <C>            <C>

John Cadigan,          2000     $ 82,376/(1)/        $0           $     0                 0                      $0
Chief Executive
Officer &
Chairman of the        1999     $100,000             $0           $17,798/(2)/      575,000                      $0
Board

Ernest A. Wagner,      2000     $129,355/(3)/        $0           $     0                 0                      $0
Chief Operating
Officer &
Director               1999     $ 91,921             $0           $     0           200,000                      $0

</TABLE>


     /(1)/  Mr. Cadigan retired as chief executive offer in October 2000.
     /(2)/  Includes $15,000 contribution towards a Split Dollar Plan Agreement
            under which the Company made payments on a whole life insurance
            policy on the life of Mr. Cadigan.
     /(3)/  Includes $20,000, earned in 2000, of compensation that was satisfied
            by the issuance of 200,000 shares of our common stock to Mr. Wagner.


Option Grants in 2000

No options or SARs were granted to the above named executive officers of the
Company during the year ended December 31, 2000.

Option Exercises and Fiscal Year End Values

The following table provides information as to the unexercised options to
purchase the Company's Common Stock granted in fiscal year 2000 and prior fiscal
years to the named officers and the value of said options held by them as of the
end of the year.

              AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
                         AND FY-END OPTION/SAR VALUES

<TABLE>
<CAPTION>
                       Shares
                     Acquired on                        Number of Securities Underlying       Value of Unexercised In-The-Money
Name                  Exercise      Value Realized     Unexercised Options/SARs at FY-End         Options/SARs at FY-End/(1)/
----                  --------      --------------                                    ---                            ---
                                                      Exercisable       Unexercisable       Exercisable       Unexercisable
                                                      -----------       -------------       -----------       -------------
<S>                 <C>            <C>                <C>               <C>                 <C>               <C>
John Cadigan             ---             ---            755,240                   0         $         0       $           0
Ernie Wagner             ---             ---            111,428             120,000         $         0       $           0
</TABLE>

/(1)/  Computed based on the difference between aggregate fair market value and
       aggregate exercise price. The fair market value of the Company's Common
       Stock on December 31, 2000 was $0.08, based on the closing sales price on
       the NASD OTC Bulletin Board on December 31, 2000.

Employment Agreements

No officers are currently covered by employment agreements.

                                       16
<PAGE>

Directors' Compensation

A director who is an employee of the Company receives no additional compensation
for services as director or for attendance at or participation in meetings.  A
director who is not an employee of the Company is paid $1,000 for each board or
committee meeting that the director attends in person, or $500 for each board
meeting that the director attends telephonically.  An outside director is also
reimbursed for out-of-pocket expenditures incurred in attending or otherwise
participating in board or committee meetings.

The Company has certain nonqualified stock option plans (the "NQSOPs") that may
be used to grant options to directors.  While such NQSOPs do not provide for an
automatic annual grant to the directors, our directors are typically granted
options annually pursuant to these plans.  The Company anticipates future grants
to the directors.  No options were granted to the directors under the NQSOPs
during the year ended December 31, 2000.

The Company has no other arrangements regarding compensation for services as a
director.

Item 11.  Security Ownership of Certain Beneficial Owners and Management

The following table presents certain information regarding the beneficial
ownership of the Company's Common Stock as of December 31, 2000 by (i) each
person who is known by the Company to own beneficially more than five percent of
the outstanding shares of Common Stock, (ii) each director of the Company (one
of whom is also the chief executive officer and the only named executive officer
of the Company) and (iii) all directors and executive officers as a group.
Except as described below, each of the persons listed in the table has sole
voting and investment power with respect to the shares listed.

<TABLE>
<CAPTION>
                                              Amount and Nature of Beneficial
    Name of Beneficial Owner                          Ownership/(1)/               Percent of Class/(2)/
    ------------------------                          ---------                    ----------------
<S>                                           <C>                                  <C>
Michael Damas                                           1,250,000                           15%
  1A Chester Plaza
  Chester, Maryland 21619
Thomas Stone                                            1,362,069/(3)/                      14%
  181-2 Ascot Lane
  Yonahlossee Resort
  Boone, North Carolina 28607
John J. Cadigan                                           755,525/(4)/                       8%
Ernest A. Wagner                                          311,428/(5)/                       4%
A. David Rossin                                           185,393/(6)(7)/                    2%
Nagesh Mhatre                                             186,904/(7)(8)/                    2%
John Morgenstern                                          348,428/(7)(9)/                    8%
All directors and executive officers as a
group (5 persons)                                       1,787,678                           19%
</TABLE>

/(1)/  Unless otherwise noted, the Company believes that all persons named in
       the table have sole voting and investment power with respect to all
       shares of Common Stock beneficially owned by such persons.
/(2)/  In accordance with the rules of the SEC, each beneficial owner's
       percentage ownership assumes the exercise or conversion of all options,
       warrants, other convertible securities and

                                       17
<PAGE>

       other rights that are (i) held by such person and (ii) exercisable or
       convertible within 60 days after December 31, 2000.
/(3)/  Includes (i) 862,069 shares issuable upon conversion of debentures owned
       by Mr. Stone and (ii) 250,000 shares issuable upon exercise of a warrant.
/(4)/  Includes (i) 285 shares owned by Mr. Cadigan's wife and (ii) 755,240
       shares of Common Stock issuable upon exercise of options.
/(5)/  Includes (i)200,000 shares owned by Mr. Wagner and (ii)111,428 shares of
       Common Stock issuable upon exercise of options.
/(6)/  Includes (i)100,000 shares owned by Mr. Rossin and (ii)85,393 shares of
       Common Stock issuable upon exercise of options.
/(7)/  Resigned as director in March 2001
/(8)/  Includes (i)100,000 shares owned by Mr. Mhatre and (ii)86,904 shares of
       Common Stock issuable upon exercise of options.
/(9)/  Includes 348,428 shares of Common Stock issuable upon exercise of
       options.


       Item 12. Certain Relationships and Related Transactions

       Not applicable.

                                      18
<PAGE>

                                    PART IV

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

Exhibits
--------
    3     Certificate of Incorporation and Amendment thereto (1)
    3.1   By-Laws (1)
    3.2   Form of Amendments to Certificate of Incorporation and Bylaws dated
          October 20, 1995 (5)
   10     Form of Indemnification Agreement executed in favor of each officer
          and director of the Company (1)
   10.1   Form of Indemnification Agreement Amendment executed in favor of
          certain officers and directors of the Company (6)
   10.2   Form of Indemnification Agreement executed in favor of each officer
          and director of the Company (6)
   10.3   Securities Purchase Agreement, for 6% Convertible Subordinated
          Debentures (10)
   10.4   Form of Debenture (10)
   10.5   Registration Rights Agreement (10)
   10.6   Form of Common Stock Purchase Warrant (10)
   10.7   Employment Agreement with John J. Cadigan dated September 1, 1995 (5)
   10.8   Amendment to Employment Agreement with John J. Cadigan (11)
   10.9   Employment Agreement (7/15/96) - Peter S. Steele (9)
   10.10  Loan Renewal and Modification Agreement (9)
   10.11  Form of Debenture (18)
   10.12  Securities Purchase Agreement, for 10% Convertible Debenture (19)
   10.13  Registration Rights Agreement (19)
   10.14  Stock Purchase Warrant (19)
   10.15  Securities Purchase Agreement, Sale of common stock (19)
   10.16  Registration Rights Agreement (19)
   10.17  Settlement Agreement (19)
   10.18  Promissory Note (19)
   10.19  Subscription Agreement to Purchase Common Stock (21)
   10.20  Registration Rights Agreement (21)
   10.21  Convertible Subordinated Debenture (21)
   10.22  Subscription Agreement to Purchase Common Stock (21)
   10.23  Registration Rights Agreement (21)
   10.24  Convertible Subordinated Debenture (21)
   10.25  Subscription Agreement to Purchase Common Stock (21)
   10.26  Registration Rights Agreement (21)
   10.27  Convertible Subordinated Debenture (21)
   16.1   Change in its Independent Accountants (20)
   21     Subsidiaries of Registrant (2)
   99     Incentive Stock Option Plan No. 1 (4)
   99.1   Nonqualified Stock Option Plan No. 1(4)
   99.2   Incentive Stock Option Plan No. 2 (5)
   99.3   Phantom Stock Performance Stock Plan (3)
   99.4   Nonqualified Stock Option Plan No. 2 (5)
   99.5   Nonqualified Stock Option Plan No. 3 (5)
   99.6   Split Dollar Plan Agreement (11/21/94) - John J. Cadigan (3)
   99.7   Nonqualified Stock Option Plan No. 4 (6)
   99.8   Nonqualified Stock Option Plan No. 5 (9)

                                       19
<PAGE>

   99.9   Nonqualified Stock Option Plan No. 6 (9)
   99.10  Nonqualified Stock Option Plan No. 7 (8)
   99.11  Incentive Stock Option Plan No. 3 (11)
   99.12  Incentive Stock Option Plan No. 4 (12)
   99.13  Nonqualified Stock Option Plan No. 8 (13)
   99.14  Nonqualified Stock Option Plan No. 9 (14)
   99.15  Incentive Stock Option Plan No. 5 (15)
   99.16  Nonqualified Stock Option Plan No. 10 (16)
   99.17  Nonqualified Stock Option Plan No. 11 (17)

   ___________________
   (1)  Incorporated by reference to Form S-1 Registration Statement, File No.
        33-68826
   (2)  JMC Company, Inc. and Forsight, Inc., are wholly owned subsidiaries of
        the Company incorporated under the laws of the State of Maryland.
   (3)  Incorporated by reference to December 31, 1994 Form 10-K.
   (4)  Incorporated by reference to Form S-8 Registration Statement, File No.
        33-53536.
   (5)  Incorporated by reference to Original Form SB-2, File No. 33-97776.
   (6)  Incorporated by reference to December 31, 1995 Form 10-K.
   (7)  Incorporated by reference to Form 8-K, dated July 19, 1996.
   (8)  Incorporated by reference to Form S-8 Registration Statement, File No.
        333-23777.
   (9)  Incorporated by reference to December 31, 1996 Form 10-KSB.
   (10) Incorporated by reference to Form 8-K, dated October 31, 1997
   (11) Incorporated by reference to December 31, 1997 Form 10-KSB.
   (12) Incorporated by reference to December 31, 1998 Form 10-KSB.
   (13) Incorporated by reference to December 31, 1998 Form 10-KSB.
   (14) Incorporated by reference to December 31, 1998 Form 10-KSB.
   (15) Incorporated by reference to December 31, 1999 Form 10-KSB.
   (16) Incorporated by reference to December 31, 1999 Form 10-KSB.
   (17) Incorporated by reference to December 31, 1999 Form 10-KSB.
   (18) Incorporated by reference to March 31, 2000 Form 10-QSB.
   (19) Incorporated by reference to June 30, 2000 Form 10-QSB
   (20) Incorporated by reference to Form 8-K, dated May 15, 2000.
   (21) Filed herewith.


   (b)  Reports on Form 8-K
        -------------------

   No reports on Form 8-K was filed by the Company during the three months ended
   December 31, 2000:

                                       20
<PAGE>

                                  SIGNATURES

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

Strategic Solutions Group, Inc.



By:  /s/ Ernest A. Wagner                              Dated:    April 12, 2001
     --------------------
     Ernest A. Wagner
     President, Chief Operating Officer, Director


Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and dates indicated:

Signature                        Title                           Date
---------                        -----                           ----



/s/ John J. Cadigan           Chairmen of the Board              April 12, 2001
-------------------
John J. Cadigan



/s/ Kevin E. Idso             Director                           April 12, 2001
-----------------
Kevin E. Idso


/s/ Ernest A. Wagner          President, Chief Operating         April 12, 2001
--------------------
Ernest A. Wagner              Officer, Director, Treasurer

                                       21