U.S. Securities and Exchange Commission

                             Washington, D.C. 20549

                                   Form 10-KSB

(Mark One)

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

     For the fiscal year ended December 31, 2000

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

For the transition period from _______________ to _____________

Commission file no.        0-24921

                         Surgical Safety Products, Inc.
                  --------------------------------------------
                 (Name of small business issuer in its charter)

          New York                                              65-0565144
-------------------------------                             -------------------
(State or other jurisdiction of                                (I.R.S. Employer
incorporation or organization)                               Identification No.)


3665 Bee Ridge Road, Suite 300
          Sarasota, Florida                                         34233
- ------------------------------                                  ----------
(Address of principal executive offices)                          (Zip Code)

Issuer's telephone number (941) 927-7874

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

                                                      Name of each exchange on
      Title of each class                             which registered

            None
-----------------------------                        -------------------------

Securities registered under Section 12(g) of the Exchange Act:

                          Common Stock, $.001 par value
                       -----------------------------------
                                (Title of class)

Copies of Communications sent to:

                              Mercedes Travis, Esq.
                              Mintmire & Associates
                              265 Sunrise Avenue, Suite 204
                              Palm Beach, FL 33480
                              Tel: (561) 832-5696 - Fax: (561) 659-5371


<PAGE>



     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days.

       Yes   X             No
           -----              -----

     Check if there is no disclosure  of  delinquent  filers in response to Item
405 of  Regulation  S-B  contained  in  this  form,  and no  disclosure  will be
contained,  to the  best of  registrant's  knowledge,  in  definitive  proxy  or
information  statements  incorporated  by reference in Part III of this Form 10-
KSB or any amendment to this Form 10-KSB. [X]

     State issuer's revenues for its most recent fiscal year. $600,927.

     Of the 13,500,492  shares  (14,865,373  shares are issued and  outstanding;
however,  1,364,881  shares were held in escrow by Thomson  Kernaghan & Co, Ltd.
but had no voting rights)  shares of voting stock of the  registrant  issued and
outstanding   as  of  December   31,  2000,   10,347,729   shares  are  held  by
non-affiliates  without  considering the shares in escrow. The Company is quoted
on the OTC under the symbol  "SSPD".  On May 23,  2001,  the  closing  price was
$0.025.  Accordingly,  the  aggregate  market  value based of the  non-affiliate
shares based upon this closing price as of May 23, 2001 was $258,693.




<PAGE>




                                TABLE OF CONTENTS


<TABLE>
<S>                                                                             <C>

PART I

Item 1. Description of Business                                                  1

Item 2. Description of Property                                                 25

Item 3. Legal Proceedings                                                       25

Item 4. Submission of Matters to a Vote of Security Holders                     26

PART II

Item 5. Market for Common Equity and Related Shareholder Matters                27

Item 6. Management's Discussion and Analysis or Plan of Operation               29

Item 7. Financial Statements - Commencing on                                    36

Item 8. Changes and  Disagreements  with Accountants on Accounting And Financial
        Disclosure                                                              37

PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
        with Section 16(a) of the Exchange Act                                  37

Item 10. Executive Compensation                                                 43

Item 11. Security Ownership of Certain Beneficial Owners and Management         57

Item 12. Certain Relationships and Related Transactions                         58

Item 13. Exhibits and Reports on Form 8K                                        62
</TABLE>





<PAGE>



                                     PART I

Item 1. Description of Business.

     (a) Business Development

     Surgical   Safety   Products,   Inc.  (the   "Company"  or  "Surgical")  is
incorporated  in the State of New York and qualified to do business as a foreign
corporation in the State of Florida.  Surgical Safety Products,  Inc. originally
was  incorporated  under the laws of the State of  Florida on May 15,  1992.  On
November 28, 1994 the Company  merged into Sheffeld Acres Inc., a New York shell
corporation which had approximately 1,100 shareholders,  but had never commenced
operations.  Although Sheffeld Acres, Inc. was technically the surviving entity,
the Company changed its name after the merger to Surgical Safety Products,  Inc.
Articles  of Merger were filed with the State of Florida on October 12, 1994 and
a  Certificate  of Merger  was filed with the State of New York on  February  8,
1995.  The Company  filed to do business as a foreign  corporation  on April 11,
1995 in the State of Florida.  The  Company's  Common Stock is quoted on the OTC
Bulletin  Board under the symbol  "SSPD".  The Company's  executive  offices are
presently  located at 3665 Bee Ridge Road, Suite 300,  Sarasota,  Florida 34233,
its  telephone  number  is (941)  927-7874  and its  facsimile  number  is (941)
925-0515.

           General

     The Company's overall mission is the research, development,  production and
distribution of innovative  products and services for healthcare.  Consisting of
both traditional products and innovative  business-to-business  e-solutions, the
common goal is a safer and more efficient  environment  for healthcare  workers,
manufacturers  and  patients.  Originally  formed as a medical  device  company,
Surgical  shifted  focus to being an  e-company  when the  Company's  management
recognized  an  untapped  market  niche:  responding  to the  critical  need for
immediate communication and access to information in healthcare.

     Now, the Company operates two divisions  providing products and services to
the medical industry. The Information Systems Division,  formerly referred to as
Oasis@work,  through  its  Oasis  Information  Exchange  product  line  provides
business-to-business  on-demand  safety and  efficiency  driven  e-business  and
information for healthcare  workers.  The Medical Products and Services Division
develops, manufactures and distributes medical devices.

           Corporate Developments

     The Company  entered into an agreement with IBM Global  Services  effective
January 3, 2000 which included an IBM Customer Agreement and a Statement of Work
(the "IBM Global  Agreement").  Under the terms of the IBM Global  Agreement IBM
agreed to provide  complete  implementation  and support  service  solutions for
1,200 OASiS terminals in an estimated 400 end user locations during the 12 month
period commencing

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December  1, 1999.  On  February 3, 2000,  IBM Global  Services  and the Company
finalized the Statement of Work. The services to be provided under the agreement
included project planning,  site surveys,  product acquisition,  network design,
web-site hosting services, premises wiring, OASiS TouchPort Implementation, help
desk support and consulting services. The estimated cost for performing the work
was approximately $10 million.  In addition,  IBM Global Services agreed to bill
the  Company a monthly  service  charge  for pre and post  installation  support
services,  including  24-7  support,  and for  labor,  travel  and out of pocket
expenses.  The Company was to provide  technical  resources  and oversee the IBM
Global's  activities.  Due to the new Internet focus,  the Company has chosen to
pursue  for the  delivery  of its  product,  there is no longer any need for the
services to be provided by IBM.  Effective  July 14,  2000,  this  contract  was
terminated.  In March 2001,  IBM brought suit  against the Company.  See Item 3.
"Legal Proceedings."

     In February  2000,  the Company  executed an  Investment  Banking  Services
Agreement  with  Dunwoody  Brokerage  Services Inc.  d/b/a Swartz  Institutional
Finance ("Swartz").  Under the agreement, Swartz agreed to introduce entities to
the  Company  for  potential  strategic  partnerships,  licensing  arrangements,
mergers, acquisitions,  investments or funding. For such services, Swartz was to
receive a scaled fee based upon the value of any completed transaction. Said fee
was payable in cash or stock at Swartz's option and by the issuance of warrants,
the number of which were to be based upon the fee divided by the market price of
the Company's  Common Stock.  There was no obligation on the part of the Company
to accept any transaction offered by the Swartz to the Company. Since no funding
was provided,  pursuant to the terms of the contract, the Company sent notice of
cancellation effective July 31, 2000.

     In February 2000, the Company  executed a Consulting  Agreement with Global
Development  Advisors,  Inc.  ("GDA");  however,  shortly  thereafter,   further
negotiations  ensued  and  the  agreement  never  became  effective.  Under  the
agreement, GDA was to provide business and marketing consulting services, assist
in the implementation of a strategic plan and assist, coordinate and monitor the
Company's investor  relations  program.  The agreement was for a term of six (6)
months and could have been extended by the Company. In lieu of cash payments for
services, GDA agreed to accept 50,000 shares of the Company's Common Stock under
the Company's 2000 Stock Plan approved by its  shareholders on February 28, 2000
and options to  purchase an  additional  50,000  shares at an exercise  price of
$1.09. Due to the further negotiations, the issuance was never made. The parties
have canceled this Agreement.

     On February 29, 2000, the Company  entered into a contract with Steel Beach
Productions,  Inc.  ("Steel Beach") to design,  develop,  implement and test the
OASiS Version 3.0 web based application. The contract is for a total of $160,100
and is to be paid $80,500 in cash and $80,500 in stock options. The Company paid
a deposit  of  $20,012.50  and the  balance is to be paid upon  delivery  of the
prototype, preliminary

                                                                  2

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product  and final  product.  The options are due at the time of delivery of the
final  product.  The common stock option number will be calculated  based on the
average closing share price ("ACSP") in the twenty (20) days of trading prior to
deliver of the final product.  The exercise price will be 50% of the twenty (20)
day average  closing price as quoted on the OTC BB. The number of options issued
will be  calculated  by  multiplying  $80,050  times two (2) and dividing by the
ACSP.  The  options  are to have a term of five (5) years and are to  conform to
Company's consultant option policy as far as additional terms and details.  This
agreement with Steel Beach replaces two earlier  agreements;  specifically,  one
agreement  for Version 2.0 dated  December  30, 1999 in the amount of $37,800 in
cash and  $37,800 in stock  options,  and one  agreement  for  Version 3.0 dated
December 30, 1999 in the amount of $42,250 in cash and $42,250 in stock options.
All  efforts  expended  by Steel  Beach  Productions  under  these  two  earlier
contracts are compensated under the terms of this agreement. The Company retains
all propriety rights in the application.  Steel Beach is responsible for its own
costs and expenses. The agreement may be canceled by either party on thirty (30)
days written notice.  The Company did not consider the final product  acceptable
and no further payments were made.

     On May 16, 2000, the Company entered into a contract with Horizon Marketing
Group ("Horizon") for the strategic  planning,  design and development for sales
and marketing  presentations by the Company and for the Company's  website.  The
contract  was amended on June 30,  2000.  The initial  contract  was for $18,300
which was increased in the amendment by $14,405,  for a total  contract price of
$32,705  of which  the  Company  has thus far paid  approximately  $14,000.  The
contract is for a designated schedule of work which is paid under a fee schedule
and by a reward  bonus.  Under  the  reward  bonus,  Horizon  will,  as the last
payment,  receive the greater of 2% of the value of each contract with a partner
secured by virtue of the work performed or $17,705 by December 1, 2000. Further,
Horizon can be engaged to provide  ongoing  development  services at the rate of
$1000 per month.  The contract  was  terminated  by the mutual  agreement of the
parties in December 2000.

     On May 25, 2000,  the Company  entered a staff leasing  agreement with EPIX
IV, Inc. ("EPIX") as a replacement for comparable  services  previously provided
by Staff  Leasing.  Like the  Staff  Leasing  arrangement,  the EPIX  arrangment
creates a co-employment  relationship  between EPIX and the Company  relative to
the employees who work at the Company.

     Effective June 7, 2000, the Company's line of credit with SouthTrust in the
amount of $100,000 was renewed through August 12, 2000, with an option to extend
the maturity  until  October 15, 2000 if the Company  pledged a  certificate  of
deposit in the amount of $25,000.  The interest  rate is prime plus 1.5% and the
line is secured by the Company's equipment,  receivables and inventory. The line
is guaranteed  personally by Dr. Swor. The line of credit was renewed on October
15, 2000 and the maturity date is December 31, 2000. The outstanding  balance at
such time was $100,000. The Company

                                                                  3

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pledged an additional  $25,000  certificate of deposit to secure the line. As of
December 31, 2000, the  outstanding  balance was $100,000.  In 2001, the Company
paid down the line of credit with the two (2) pledged  certificates  of deposit.
As of this date a balance of $50,945  remains  outstanding and the Company is in
default on the terms of the agreement.

     Effective  June 28, 2000,  the Company  negotiated  a new contract  with US
Surgical.  This agreement  supercedes all prior agreements  between the parties.
Under the terms of the new agreement,  US Surgical paid the Company through June
30, 2000 the sum of $300,000 in  settlement  for all amounts owed to the Company
under the  previous  agreements  and an  additional  sum of $200,000  for future
services under the OasisOR.com  initiative.  This new arrangement is principally
due to the ineffective  introduction by US Surgical of OASiS into the healthcare
environment  through  hardware  installations.  Both companies  realize that the
value of  OASiS  is the  content  and  product  it  delivers.  This new  content
agreement  emphasizes US Surgical's continued belief in the information exchange
network which the Company now had embarked upon as its focus.

     Effective  July 1, 2000,  the Company  entered into an agreement  with AORN
under  which  AORN  will  provide  certain  of  its  proprietary  content  on  a
non-exclusive  license  basis to the  Company.  Under the  agreement,  AORN will
deliver to the Company  certain of its content for which it grants the Company a
non-exclusive  license to market and promote. The Company receives a substantial
credit toward advertising in the AORN Journal and other AORN  publications.  The
Company is required to provide the  software  and hardware to promote and market
the AORN  content.  The Company is required to pay AORN  $117,000 as the license
fee and contact  hours fee for the first year of the  agreement.  The Company is
required to pay one-half of the license fee by December 15, 2000.  To date,  the
Company has made payments  related to the license fee in the amount of $25,0000.
AORN will reimburse the Company for certain conversion costs and to pay the cost
of web enabling  Home Study  Courses  sponsored by AORN.  The agreement is for a
term of three  (3)  years and it may be  terminated  by either  party on 180 day
notice. If terminated  without cause, the Company is entitled to a refund of any
unused  license  and user  fees.  AORN  retains  ownership  of its  intellectual
property  while the Company  retains  the  ownership  of its OASiS  intellectual
property.  As of December 31, 2000, the Company still owes AORN $33,000  related
to the first  payment of  $58,500  that was paid as of  December  15,  2000.  In
January  2001,  AORN gave the  Company  notice  of  termination.  The  agreement
requires 180 days notice and provides for refund,  but the Company  continues to
negotiate  with  AORN on this and  further  business  such as  on-line  products
directories.

     On July 6, 2000,  the Company  entered into an agreement  with Carver Cross
Securities Corp.  ("CCSC") for investment banking services,  including financial
advisory  services and efforts to secure equity or debt financing.  TK has given
verbal approval for this arrangement, subject to final approval of any financing
package. The

                                                                  4

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CCSC  agreement  was exclusive  for a term of 120 days  commencing  the later of
September 6, 2000 or the date a placement  memorandum is ready for distribution.
Under the  agreement,  CCSC  received  a retainer  of $6,000,  plus a warrant to
purchase 40,000 shares of the Company's  common stock for a period of 5 years at
an  exercise  price of $0.625  per share and  monthly  payments  of $2,500  plus
warrants for 40,000 shares of common stock.  In any case,  under the  agreement,
CCSC would not receive  warrants to purchase more than 120,000 shares.  CCSC was
to receive  compensation  for equity  financing  arranged  by CCSC,  the sale of
assets  or a  public  offering  placement.  In the  case  equity  financing  was
arranged,  CCSC was to receive complete  warrants  exercisable for 5 years at an
exercise price equal to 101% of the amount paid by the  investors.  In addition,
CCSC  receives  approved  expenses.  This  agreement  was  terminated  effective
September 2000. No warrants have been issued related to this agreement; however,
the Company made payments to CCSC totaling $11,000.

     On August 16, 2000, the Company finalized a consulting  agreement with GDA.
Under the  agreement,  GDA was to  provide  business  and  marketing  consulting
services,  assist  in  the  implementation  of  a  strategic  plan  and  assist,
coordinate and monitor the Company's investor  relations program.  The agreement
was for a term of three (3) months,  which term can be extended by the  Company.
In lieu of cash payments for services,  GDA agreed to accept  200,000  shares of
the Company's  Common Stock under the Company's  2000 Stock Plan approved by its
Shareholders  on February 28, 2000. On October 25, 2000, the Company  executed a
second  agreement with GDA which,  effectively,  extended its initial  agreement
with GDA for another term of three (3) months. In lieu of cash payments, for its
services,  GDA agreed to accept an  additional  150,000  shares of the Company's
Common  Stock  under the  Company's  2000  Stock  Plan.  There  were no  further
renewals.

     In  September   2000,  the  Company  entered  into  agreements  with  three
healthcare  companies  as sponsors  for its  AORN/OasisOR.com  CD-ROM  launch in
December  2000.  Sponsorships  range  from  $15,000 - $50,000  and  provide  the
companies  with  advertising  on the CD-ROM and AORN Journal ads, as well as the
production of in-service  Trainlets to be hosted on  OasisOR.com.  The companies
are  Haemacure  Corporation,   Imagyn  Medical  Technologies,   and  Karl  Storz
Corporation. In addition, the Company has entered into an agreement with Stryker
Corporation, another healthcare company, to produce in-service Trainlets for its
products.  The Trainlets will be hosted on OasisOR.com with links to the Stryker
website.  This  contract  is for  $32,500.  Each of  these  contracts  are for a
one-year period.

     On October 6, 2000,  the Company  entered into an agreement  with  Quantumm
Internet  Services,  Inc.,("Quantumm"),  an Internet access provider.  Under the
terms of this agreement,  Quantumm provides the Company with customized Internet
services  that  enable the  Company to be a virtual  Internet  service  provider
("ISP").  Also,  Quantumm  has  contracted  to design the  Company's  CD-ROM for
OasisOR.com that will be mailed out

                                                                  5

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to AORN members in December  2000.  The CD-ROM will provide  users the option to
sign up for  Internet  access  branded  as  OasisOR.com.  The total  cost of the
contract was $15,995 which the Company has paid.

     Effective  October 13, 2000, the Company moved its corporate office to 3665
Bee Ridge Road, Suite 300,  Sarasota,  Florida 34233. The Company entered into a
six (6) month lease with two (2)  renewal  options of six (6) months  each.  The
monthly rent is $3700,  inclusive of common area maintenance.  The Company is in
the process of moving in anticipation of its merger with Emagisoft  Technologies
Inc. ("Emagisoft") discussed below.


     In  December  1999,  the Company  executed a Loan  Agreement  with  Thomson
Kernaghan & Co.,  Ltd.  ("TK"),  as Agent and Lender,  whereby TK agreed to make
loans to the Company of up to $5,000,000 in installments for a period commencing
with the date of the  agreement  and ending on  November  30, 2002 (the "TK Loan
Commitment").  The Company may request additional draws of no less than $500,000
provided its Common  Stock has traded for a minimum of $1.00 for 20  consecutive
days and the stock has had an average  trading  volume of 25,000  shares for the
same period.  Due to the Company's  current share price, it does not qualify for
additional draws at this time.  Under the terms of the TK Loan Commitment,  each
installment  is supported by a convertible  note and security  agreement and the
Agent and Lender are granted warrants to purchase shares of the Company's Common
Stock.  Further,  2,700,000  shares are held by TK in escrow  for the  potential
conversion  under the notes or exercise of the warrants.  Under the terms of the
TK Loan Agreement, an initial loan of $650,000 was made on December 30, 1999. On
March 31, 2000 the Company received a second installment under the TK Commitment
in the amount of $650,000.  On April 28, 2000, TK elected to convert $100,000 of
outstanding  principal and $2,630 of the accrued  interest into shares of Common
Stock at a price of $0.5625 per share which represents  182,453 shares.  On June
9, 2000, TK elected to convert  $120,000 of outstanding  principal and $4,129 of
the accrued  interest into shares of Common Stock at a price of $0.375 per share
which represents 331,010 shares. On July 11, 2000, TK elected to convert $40,000
of  outstanding  principal and $1,683.13 of the accrued  interest into shares of
Common Stock at a price of $0.375 per share which represents  111,155 shares. On
October 24, 2000, TK elected to convert  $250,000 of  outstanding  principal and
$16,219 of the accrued interest into shares of Common Stock at a price of $0.375
per share which represents  709,918 shares.  The Company granted TK registration
rights  and was  obligated  to file a Form S-3  within  sixty  (60)  days of the
agreement.  The Company filed a  registration  statement on Form S-3 on March 2,
2000 covering  initially  20,038,097 shares of its Common Stock. The issuance of
the  securities  was made  pursuant  to  Regulation  S of the Act.  The Form S-3
registration  statement  was declared  effective  on April 11,  2000.  Since the
Company did not meet  financial  projections  which were an integral part of the
transaction,  TK and the Company  re-negotiated the arrangement which terminated
the Loan Commitment and settled all matters between the parties.

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     Pursuant to a loan cancellation and settlement agreement effective February
7, 2001 (the "Cancellation Agreement"),  TK agreed to convert the balance of the
December 1999 debt in the amount of $140,000 plus accrued and unpaid interest in
the amount of $12,395 and to convert $90,000 on the  installment  given on March
31, 2000 under the Loan  Commitment  plus accrued and unpaid  interest of $6,175
into a total of 662,854  shares of the Common Stock  registered  by the Form S-3
registration,  thereby leaving an outstanding  principal balance dating to March
31, 2000 of $560,000  plus accrued and unpaid  interest  (the "March  Balance").
Interest  on the March  Balance  shall  continue  to accrue at the rate of eight
percent (8%) per annum;  however, all future interest payments, at the option of
the  Company,  may be made in cash or by  delivery  of  registered  shares  at a
conversion  price  equal per share  equal to the  amount of  accrued  and unpaid
interest as of the  conversion  or  repayment  date  divided by the five (5) day
average closing bid price prior to the conversion or repayment date. Further, TK
committed,  subject to not exceeding  ownership of 4.99%,  to convert as soon as
possible the March Balance. The Company may continue to repay all or any part of
the March  Balance in cash.  TK agreed to return  all shares  held in escrow and
agreed to a triangular merger contemplated by the Company.  Provided such merger
occurred  before May 15, 2001,  TK agreed not to sell,  directly or  indirectly,
more than twenty-five  percent (25%) of the Company's volume in any trading day.
Such anticipated merger, to be discuss below, did not occur before May 15, 2001.
In consideration of the  Cancellation  Agreement and the accelerated  conversion
into the Company's  shares,  the Company  agreed to issue 682,108  shares of its
restricted  Common  Stock in relation to the balance of the  December  1999 debt
which was  converted  and  3,109,487  shares of its  restricted  Common Stock in
relation to the March 31, 2000  installment as bonus shares (the "Bonus Shares")
Additionally,  the Company granted,  for a period of two years,  both the Lender
and the  Agent  each  warrants  to  purchase  380,000  shares  of the  Company's
restricted Common Stock at $0.1846 per share (the "Bonus Warrants"). Until fully
converted,  TK was given the option to place an  independent  third party on the
Company's Board of Directors.  Of the 20,038,097  shares registered on Form S-3,
only those shares issued pursuant to the earlier conversions and pursuant to the
agreement and original  Lender and Agent Warrants  would be registered  with the
balance  deemed  null and void.  Accordingly,  the  registration  of  13,255,946
potentially  issuable  registered  shares would be null and void and such shares
would not be issued .

     Following  execution  of  the  Cancellation   Agreement,  TK  converted  an
additional  $243,665 of  principal  on the March  Balance and accrued and unpaid
interest  in the  amount  of  $19,601  into  a  total  of  702,043  shares.  The
certificate  for shares held in escrow was cancelled and there are no longer any
escrowed shares in relation to the arrangements  between the parties.  As of the
date hereof, the principal  indebtedness to TK is in the amount of $316,335 plus
accrued and unpaid interest from March 31, 2000.

     Until fully converted,  the TK Loan Commitment,  as interest accrues,  will
increase  the long term debt of the Company.  The Company is  currently  seeking
other potential funding. With the TK Loan Commitment and in the event additional
debt is

                                                                  7

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raised, the Company will incur future interest expense.  The TK Loan Commitment,
if fully  converted and all warrants are exercised,  will dilute the interest of
existing  shareholders and in the event additional equity is raised,  management
may be required  to dilute the  interest  of  existing  shareholders  further or
forego a substantial interest in revenues, if any. In the event that the Company
is  successful  in  securing  additional  debt  financing,  the  amount  of such
financing,  depending upon its terms,  would  increase  either the short or long
term debt of the Company or both.

     In December 2000, the Company formed a Florida  corporation,  OIX Inc. as a
wholly owned subsidiary. The Officers and Directors of Surgical serve in similar
capacities with OIX Inc.

     In February 2001, the Company executed a Term Sheet with Emagisoft  whereby
Emagisoft will merge into OIX, Inc.. The shareholders of Emagisoft will exchange
their shares for share in Surgical on a 1 for 1 basis. In addition,  Emagisoft's
Preferred  Shares will exchange their preferred  shares in Surgical's  Preferred
Shares on a 1 for 1 basis.  The  reverse  triangular  merger was  expected to be
completed some time in May 2001; however, due to a shortage of funds on the part
of both  Emagisoft  and  Surgical  the merger has not been  completed as of this
date.  Surgical and Emagisoft decided to proceed with merger plans because there
are certain  synergies  that will result from the merged  companies.  Currently,
Surgical  outsources  a great deal of its CD  production  and  computer  design.
Emagisoft  provides such services.  Further,  both companies are within the same
geographic  region and share many of the same suppliers.  Lastly,  Emagisoft has
existing  management  that can provide the stability in management  Surgical has
been seeking over the last few years. As a result of these features,  management
for these two companies  believed that collectively they could achieve the goals
of each of the  companies  at a faster  rate.  Emagisoft  provides  hosting  and
Web-based design solutions for clients in a variety of fields,  from electronics
manufacturing  to healthcare  services.  Their software and technology offer the
high levels of availability,  scalability,  and security  required to ensure the
success of corporate  online  presence.  They are dedicated to exceeding  client
expectations  with exceptional  Web-based tools and e-commerce  services.  It is
expected  that the  combination  of OIX and  Emagisoft  will create  exceptional
synergies for developing and distributing  web-based  products and services in a
variety of healthcare  markets.  At the time the merger is  completed,  Surgical
will file on Form 8K a combined business plan.

     On March 16,  2001,  the Company  entered a staff  leasing  agreement  with
Selective HR Solutions ("Selective HR") as a replacement for comparable services
previously  provided  by EPIX.  Like  the EPIX  arrangement,  the  Selective  HR
arrangement  creates a co-employment  relationship  between Selective HR and the
Company relative to the employees who work at the Company

     See (b) "Business of Issuer"  immediately  below for a  description  of the
Company's business.


                                                                  8

<PAGE>



(b)        Business of Issuer.

           About Oasis Information Exchange

     The Oasis  Information  Exchange ("OIX") strategy is healthcare  e-business
content  aggregation  and  applications  integration  through a virtual  private
network.  It links the entire healthcare  continuum,  which includes  healthcare
workers,   administration,   patients,   and   healthcare   and   pharmaceutical
manufacturers.  Oasis Information Exchange is a true healthcare data center with
multiple  access  points.  It  is  an  Internet-based  virtual  private  network
consisting of points-of-access via intranets, the Internet, internet appliances,
and through  TouchPorts  located  throughout  healthcare  facilities  across the
country.  Although the Company is now focusing on providing its services through
the  Internet,   TouchPorts   remain   available  as  an  alternative   and  are
user-friendly   touch-access   internet   appliances   which  allow   healthcare
professionals  access to high quality  clinical  reference  and agency  mandated
information services.

     OIX consists of three lines of e-business.  The primary product produced by
OIX is a service that creates customized training applications for virtually any
topic. These web browser-based  educational  modules are designed to provide the
end-user with succinct,  current information on any topic within practically any
industry.  As a second  line of  business,  OIX builds  on-line  communities  in
specific target markets positioned as information  exchanges.  The third line of
business,  a  natural  by-product  of the first  two,  is  Internet  application
development and support services

     During  the third  quarter of 2000,  the  Company  realized  that they were
focusing too much attention to the installation of hardware rather than focusing
its  attention  on its real  product -  information.  In July 2000,  the Company
signed an agreement with the  Association  of  periOperative  Registered  Nurses
("AORN"),  one of the largest  nursing  organizations  in the United States,  to
license their content - AORN Journal  Online,  OR Product  Directory,  Standards
Recommended  Practices and Guidelines  (SRPG) and other content.  See "Corporate
Developments".

     AORN has 43,000 members and other mailing lists comprising of an additional
100,000 people. As part of this initiative,  the Company was to produce a CD-ROM
for mailing in January 2001.  This CD featured  OASiS.  The CD was mailed in the
AORN Journal for members.



                                                                  9

<PAGE>


     Due to the increase and availability of PC's and Internet  accessibility in
the heathcare  environment,  the Company  realizes that, while in some cases its
OASiS  network is needed in a particular  environment,  by an large,  its larger
market is for its content.  Essentially  the Company is changing from a hardware
network  supplier to an  information  broker  which will  create an  information
exchange network for a defined healthcare  community that links the end-users to
the industry while adding value to both parties.  This is  essentially  what the
Company was doing all along;  however, it had focused on the delivery system for
its product rather than the product itself.

     Under the AORN arrangement, the Company's product will be delivered through
the  Internet  via its  website  or  information  exchange  which will be called
OasisOR.com.  The data  center  will have the same type of content  from  device
manufacturers,  clinical  associations and other relevant resources;  however it
will be for OR employees only, with the information  relevant to them.  Although
AORN has ended the original agreement, negotiations are on-going to re-establish
a joint working  relationship.  The Company has created a digital version of the
AORN's Operating Room Product  Directory and continues to host content on behalf
of AORN.

     Although  the Company  pays AORN  licensing  fees,  the Company  expects to
generate revenue from  sponsorships of the CD and from user fees and advertising
on its website.  The Company negotiated its first sponsorship  agreement with US
Surgical in lieu of the previous  agreement which required massive  expenditures
for hardware  installations.  A number of additional corporate content providers
also have been added as clients, including Stryker, Storz, Haemacure and others.

     The Company  plans to scale the concept for other niche markets by creating
websites  that  cater to a  particular  speciality.  The  Company  will focus on
providing website and intranet development.

           SutureMate(R)

     SutureMate(R),  a  patented,   disposable,   surgical  assist  device,  was
initially   introduced  in  1993.  Its  unique  design  facilitates  the  highly
recommended  one-handed  suturing  technique  which is advocated by occupational
safety experts.  When one-handed  suturing is not used, extra steps are required
by the surgeon or the  assistant in cutting the needle free of the suture thread
and extra time and hand  movements  are  required  of the  surgeon  in  manually
adjusting  needles  while  using a needle  holder  in most  suturing  processes.
SutureMate(R)  allows  the  surgeon  to use a safer,  more  efficient  method of
surgical   stitching.   The  product   has   features   which   include  a  foam
needle-cushion, and a suture cutting slot.


                                                                  10

<PAGE>



     SutureMate(R)  was re-designed in late 1998 and has been re-released  since
demand has increased due to statutory changes relating to needlestick  injuries.
Legislation has been adopted at both the federal and state level. An overview of
state needle safety legislation can be viewed at www.cdc.gov/niosh/ndl-law.html.
This legislation  essentially  requires state agencies with employees at rist to
implement needleless systems and sharps with engineered sharps injury protection
in order to prevent the spread of bloodborn pathogens in the workplace.

     The product was  re-engineered  and updated after  feedback from over 4,000
surgeons and surgical  technologists  who used or reviewed the product since its
inception.  As a result of the re- design,  the Company  believes that there are
new clinical  advantages and that the product can be produced at a significantly
lower manufacturing cost. These beliefs are based on the fact that the re-design
includes  a  tent-like  configuration  with a hidden  cutting  device  contained
between the  adhesive  base and the holding  device.  This allows the surgeon to
separate  the needle from the suture  without a scrub nurse  intervening  with a
scissor.  The cost reduction will result from the fact that the original version
cost  approximately  $6.00 per unit while the new  version  costs  approximately
$1.10 per unit including packaging and sterilization, allowing it to be marketed
in the $5 to $6 range which is more in keeping  with  pricing  for a  disposable
product.  Due to its proven history,  SutureMate(R)  is a "proven"  product that
complies with current legislation.

     On  Feb  13,  2001,  the  Company   announced  an  agreement  with  DeRoyal
Industries,  Inc. ("DeRoyal")to distribute  SutureMate(R) worldwide.  DeRoyal is
the largest  privately held healthcare  supplier of safety devices with over 250
sales  representatives  worldwide.  Formed in 1973,  DeRoyal is a international,
vertically-integrated supplier of institutional and consumer healthcare products
and services,  with 27 subsidiaries and affiliates in seven states  (California,
Florida,  Georgia,  Oklahoma,  South Carolina,  Tennessee, and Virginia) and ten
countries (Canada, Costa Rica, England,  Estonia,  Germany,  Ireland, Italy, the
Netherlands, Sweden and the United States). DeRoyal's four business units, Acute
Care, Patient Care, Wound Care and OEM (original equipment manufacturer) produce
more than 25,000  products,  including:  rehabilitation  and  therapy  products,
sports  medicine  supports,  orthopedic  bracing and  supports,  fiberglass  and
plaster  casting;  wound care dressings;  unitized  surgical  delivery  systems,
including TracePak and custom procedural trays; surgical accessories;  neonatal,
labor  and  delivery   products;   angiographic,   endoscopic,   anesthesia  and
temperature  monitoring products; as well as manufacturing services in plastics,
textiles,  electrical  manufacturing,   converting  and  sterilization.  DeRoyal
introduced the re-designated SutureMate(R) at AORN in March, placed an order for
8,000 units for which the Company was paid when it made delivery in May 2001.

     Currently,  the  re-designed  SutureMate(R)  is  manufactured by the Hansen
Plastic  Division of Tuthill  Corporation  at their plant located in Clearwater,
Florida  ("Tuthill").  The Company is in the process of  negotiating  additional
manufacturing sources and original equipment manufacturer sales.




                                                                  11

<PAGE>


           The Organization

     As of December  31,  2000,  the Company  employed  six (6) people  under an
agreement  with EPIX and on a full time  basis,  including  its Chief  Executive
Officer.  Currently, the Company employs five (5) persons under the Selective HR
agreement. Total employee salaries expense incurred for the year ending December
31, 2000 were $613,053 of which $111,250 was related to Executive  Compensation,
including  salaries and the value of Common Stock and Options issued and granted
to such executives.  Of the total amount of salaries  expense,  the Company paid
$577,595 and has accrued  $35,458 for unpaid  amounts still owed.  The Company's
executive officers and directors devote such time and effort as are necessary to
participate  in the  day-to-day  management  of the  Company.  During the fourth
quarter of 2000, the Company did not employ any additional staff. Subject to the
availability  of additional  funding,  of which there can be no  assurance,  the
Company plans to add personnel as needed to implement its growth plans.

     The  Company is  dependent  upon the  services of one of its  officers  and
directors.  Dr. G. Michael  Swor,  the founder and Chairman of the Board and the
Chief  Executive  Officer of the Company,  is responsible for inventing all four
(4) of the patents,  which  patents were assigned to the Company in exchange for
stock.  Dr.  Swor  is  responsible  for the  overall  corporate  policy  and the
financing  activities  of the  Company.  The  Company  is the  beneficiary  of a
"key-man"  insurance  policy  currently  owned by Dr.  Swor.  In addition to his
duties with the Company,  Dr. Swor is a board  certified,  practicing  physician
with a specialty in Obstetrics and Gynecology.  The Company plans to continue to
use to its advantage the  reputations  and skills of this officer in the medical
industry.  Nevertheless,  while this officer have been  successful  in the past,
there  can  be no  assurance  that  he  will  be  successful  in  the  continued
development  of the Company  which is needed for a  successful  operation of the
Company. The Company has an employment agreement with this individual.

Business Strategy

     The  Company's  business  strategy,   which  is  dependent  upon  obtaining
sufficient additional financing, is to enhance the commercialization of the OIX,
and then,  to the extent  sufficient  funds are  available (of which there is no
assurance),  the existing and future  products of the  Compliance  Plus exposure
prevention and surgical  efficiency  product line. The Company remains committed
to providing  innovative  products and services which create and maintain a safe
surgical  environment  for medical and hospital  staff,  healthcare  workers and
patients,  as well as to  enhance  the  level  of  surgical  care  available  to
patients.  The  Company's  revenues  are based upon lease  payments and fees for
display of  inservice  modules  from its Data  Systems  Division and sale of its
products and distribution fees from the Medical Products Division. The Company's
revenues are dependent on the volume of sales from its products.


                                                                  12

<PAGE>



     Revenues  from sales are  recognized in the period in which sales are made.
The  Company's  gross profit margin will be determined in part by its ability to
estimate  and  control  direct  costs  of  manufacturing   and  its  ability  to
incorporate such costs in the price charged to clients.

     The Company's objective is to become a dominant provider of medical systems
and devices which improve occupational  safety,  advance surgical techniques and
provide  greater  efficiency.  To achieve  this  objective,  and  assuming  that
sufficient  operating  capital is  available  as and when  needed,  the  Company
intends to: (i) develop  international  distribution  channels and  co-marketing
alliances for the Company's  products and services;  (ii) continue  research and
development and acquisitions of synergistic products and software programs;  and
(iii) frequently fine tune market  strategies based upon ongoing  evaluations of
customer needs, capital budgeting opportunities and market economy fluctuations.

     Management  believes that Surgical is poised to lead in the ever developing
surgical and medical  safety market and plans to  capitalize on the  opportunity
while  providing  significant  benefits to its customers  and improving  overall
patient care.  Management  expects,  in the event Surgical  continues to achieve
product  acceptance,  to  increase  the  Company's  market  penetration  through
additional  acquisitions  and potential  merger  opportunities  with appropriate
bases of business development,  although currently it is not in negotiations nor
has it made any arrangements for such mergers or acquisitions. However should it
expand  through  acquisitions  or  mergers,   such  expansion  presents  certain
challenges and risks and there could be no assurance  that Surgical,  even if it
were  successful  in  acquiring  other bases of business  development,  would be
successful in profitably penetrating these potential markets.

Sales and Marketing

Markets

     The  primary  medical  industry  markets  include   hospitals,   healthcare
facilities,   surgeons,   nurses,   and   technologists  in   procedure-oriented
specialties,  including  obstetricians,  dentists,  emergency room personnel and
other medical professionals.

     The  potential   global  market  for  Surgical's   products   (devices  and
information systems) is estimated at over $1.3 billion.  This data was presented
in an  article  written  by Dr.  Swor  which  appeared  in  Surgical  Technology
International, Vol. II where Dr. Swor was

                                                                  13

<PAGE>



referencing  an article from the Florida  Healthcare  Report and  Hospital  News
which appeared in December 1997.

     The  initial  target  market  areas for the product  side of the  Company's
business are in the major  metropolitan  centers in the United States and abroad
that presently have large teaching programs, higher disease prevalence and acute
problem  awareness.  Entry into these target areas is expected by the Company to
significantly ease general market penetration.

     OIX has been foundationally designed to accept multi-lingual  applications.
The  Company  expects  that  this  will not only  facilitate  acceptance  in the
cosmopolitan  markets  within the United  States,  but also will enable  instant
adaptations  to  international  markets  which  traditionally  follow the United
States leadership in developments of safety and exposure guidelines.

     A major  portion of the safety  products and services  currently  ready for
marketing by the Company,  including both device and information  services,  are
unique and are without apparent  competition by design since they were specified
and  designed  by the  Company to create  previously  unavailable  products  and
services. In most cases, Surgical's  state-of-the-art  products,  techniques and
services  position  the  Company as a pioneer in new  markets.  This is a direct
result of the Company's election to avoid the typical commodity sales of gloves,
gowns,  shields,  and other  products  of that type and to focus on  innovative,
safety related products such as SutureMate(R), which was the first device of its
kind to provide for lower risk, one-handed suturing.

     The market for Surgical's products is divided into three (3) segments:  end
users, healthcare risk managers and medical-related companies.

     The  primary  end user  market for the  products  and  services of Surgical
include 8,000 hospitals, 100,000 surgeons and over 1,000,000 surgical nurses and
technologists.  Secondary end user markets include out-patient  clinics,  dental
offices,  emergency medical  services,  fire and rescue  organizations,  medical
offices  and  laboratories.  This  segment of the  Company's  market will be the
ultimate user of both the medical devices and OIX and it is particularly defined
by the need for  protection  against  bloodborne  diseases  from body fluids and
sharps injuries, such as needlesticks.

     The healthcare risk manager market is defined by similar  statistics as the
end user market.  The major difference is that this segment is represented at an
administrative level. Additionally, it encompasses insurance companies and other
parties interested in capturing

                                                                  14

<PAGE>



safety and  occupational  injury  data.  This  segment of the market  focuses on
ensuring a safer,  more  efficient  workplace for the  healthcare  worker and in
obtaining  previously  unavailable   information  about  actual  occurrences  of
bloodborne pathogen exposure and the management thereof.

     The market segment for medical-related  companies consists of approximately
11,600  medical device  manufacturers,  360  pharmaceutical  companies and 1,260
training and  educational  organizations.  The Company  believes  that this is a
significant  segment for them for three reasons.  First, these companies will be
enlisted as content  providers (a content  provider  supplies  OASiS with device
information and other educational  components)  ("Content  Providers").  Content
Providers are potential customers for the Company because they pay a reoccurring
fee to broadcast  their  information  on OIX.  Secondly,  this market segment is
desirous  of  the  data  collected  by  OIX as it  relates  to  the  information
surrounding exposure occurrences.  The Company already has received requests for
access to this (yet-to-be collected) data. The third reason the Company believes
this segment to be  significant  is that these  companies are a key component to
the Company's sales strategy for its medical devices.  The Company believes that
its  relationship  with US  Surgical  as a  strategic  partner  is  based on the
integration  of OIX and the Company's  Compliance  Plus line of products and the
venue potential for US Surgical products. The Company believes that the criteria
for another appropriate strategic partner for an alliance with the Company would
have a worldwide presence, maintain a dedicated, highly trained sales force with
access to the operating room, be a respected and an  acknowledged  leader in the
industry,  be among the Fortune 500 companies or equivalent and have an interest
in  diversification  of its existing product lines. In this regard,  the Company
believes  that  its  long  term  arrangements  with US  Surgical  establishes  a
strategic alliance with a company which meets these criteria.

Distribution of Products

     OIX and SutureMate(R)  are currently the Company's only products  available
available in the marketplace.

     Under the prior arrangement with AORN, the Company licensed their content -
AORN Journal Online, OR Product Directory,  Standards  Recommended Practices and
Guidelines  (SRPG) and other content.  AORN has 43,000 members and other mailing
lists  comprising of an additional  100,000 people.  As part of this initiative,
the Company  produced a CD-ROM that was mailed in January 2001. This CD features
OASiS. The CD was mailed in the AORN Journal its members.


                                                                  15

<PAGE>



     The  arrangement  with DeRoyal  provides for the worldwide  distribution of
SutureMate(R).  An order of 8,000  pieces was  delivered  by the  Company in May
2001.

Methods of Distribution

     Notwithstanding the US Surgical contract and until such time as the Company
establishes alliances with additional strategic partners, Surgical will continue
to rely on a  significant  database  and network of  consultants,  international
business  contacts,  researchers,  medical advisors and potential  distributors,
suppliers  and  manufacturers  for  sales  of  its  products.  The  Company  has
accumulated over 3,000 sales leads and customer contacts,  with a majority being
United States based surgeons and operating room technologists.  The Company will
continue  to sell its  products  direct  to  hospitals  and other  medical  care
providers.

     The  Company  also  solicits  orders  through  direct  mail  sales,   trade
publications and advertising by targeting specific market groups. The Company is
actively  campaigning  to  establish  repeat  markets for  Surgical's  products.
Customer  follow-up is currently handled by in-house staff.  Orders obtained can
be shipped from in-house inventory or warehousing arrangements.  The Company has
the  original   SutureMate(R)   in  stock  and  is   finalizing   manufacturing,
sterilization  and inspection  procedures for the re-designed  SutureMate(R)  so
that inventory can be established.  Customers may return  defective  merchandise
for a full refund,  credit or  replacement.  In recent years,  such returns have
been insignificant.

Status of Publicly Announced Products and Services

     Based upon feedback from surgeons and operating  room  technologists  since
the introduction of  SutureMate(R) in 1993, this product has been  re-engineered
and is currently being distributed by DeRoyal.

     Once trials are  completed  and subject to the  availability  of additional
funding after  fulfillment of marketing  commitments to OIX, the Company intends
to make  final  engineering  adjustments  to  Prostasert(TM)  and then  commence
manufacturing for initial market entry in the United States. There is no current
timetable for such entry.

     The OIX is operational via  OasisOR.com,  but services and new developments
are on hold at the current time until  additional  resources  can be obtained by
way of partnerships and or funding.


                                                                  16

<PAGE>



     The  Company  continues  to look for  manufacturers  and  distributors  for
Prepwiz(TM) and Prostasert(TM).

Competition

     There is intense competition in the markets in which the Company engages in
business.  However,  the  Company  believes  that  there  is  relatively  little
competition for its products at this time.

     Notwithstanding its innovative product line, there are many major companies
which could  compete  with the Company due to their size and market share in the
medical  products  area.  The Company  believes that these major  companies will
continue their efforts to develop and market competitive devices. It is for this
reason that the Company has sought to align itself with a strategic partner such
as US Surgical.

     There is intense competition in sales of products for use in gynecological,
spinal,  vascular,  cardiovascular,  interventional  cardiology,  breast biopsy,
urologic,  orthopedic  and  oncological  procedures.  A broad range of companies
presently  offer  products  or are  developing  products  for  the  use in  such
procedures.  Many of these companies have significantly greater capital than the
Company and are expected to devote  substantial  resources to the development of
newer  technologies  which would be competitive  with products which the Company
may  offer.  There are also a number  of  smaller  companies  which  offer  such
products which present additional competition.

     The  market  for  products  for  minimally   invasive   surgery  is  highly
competitive.  The Company believes if it enters this market that it could gain a
significant  share of the market as the  result of its  innovative  efforts  and
superior products. This is principally due to the Company's involvement with Dr.
William  Saye, a Company  Director and the Advanced  Laparoscopy  Trauma  Center
("ALTC")  which he headed and which has  trained  several  thousand  surgeons in
advanced  laparoscopic  surgery.  Ethicon,  through a division  known as Ethicon
Endo-Surgery, markets a line of endoscopic instruments directly competitive with
the  Company's  contemplated  products  and this  company  would  be  Surgical's
principal  competitor in minimally invasive surgery.  Both Ethicon  Endo-Surgery
and the Company have agreements  with Dr. Saye.  However,  Dr. Saye's  agreement
with the Company specifically provides that it will not compete with the Ethicon
agreement.  Dr. Saye's agreement with Ethicon calls for him to travel to various
sites to conduct seminars and to provide teaching  services for physicians.  His
agreement  with  Surgical  conveys  to  Surgical  the right to  market  his ALTC
database. Therefore it is believed that the two arrangements do not compete. The
Company understands that Ethicon devotes considerable  resources to research and
development   and  sales  efforts  in  this  field.   Numerous  other  companies
manufacture and distribute single use endoscopic instruments.

                                                                  17

<PAGE>



     Surgical faces  competition in its data service line by a system  developed
by the  University  of Virginia  and  promoted by the  International  Healthcare
Worker Safety Center.  Designated  EpiNet,  this is a single system  designed to
track and report bloodborne  pathogen exposures in the healthcare setting. It is
installed in approximately seventy (70) healthcare facilities;  however, Company
research  indicates  that  EpiNet is  actually  used in only a fraction of those
facilities.  This research was assembled by interviewing  healthcare workers who
were users of the system at the American  College of Surgeons annual meeting and
by interviews  with members of the Medical  Advisory Panel who are familiar with
the system.  This  system has been  analyzed by  infection  and systems  control
experts and has been found to be  "non-user  friendly".  That is because it is a
DOS based  systems  which  requires  a  sophisticated  user,  it is  limited  to
bloodborne  pathogen programs and content, it requires keyboard interface and is
research based rather than user information based. Although this system has been
available for several years,  it has not achieved large market  acceptance  most
likely because of the  characteristics  which make it "non-user  friendly".  The
Company is  encouraged  by the fact that  EpiNet has been  installed  in so many
facilities as evidence that computer aided reporting and services are desired by
the  healthcare  community and  notwithstanding  EpiNet's  failure to gain large
market acceptance, believes that the Company's OIX could find greater acceptance
because  of its ease of use due to the  touch  access  concept  and the  broader
availability of information which OASiS can provide on site.

     There are  approximately  two hundred  (200)  companies  with at least some
products  designed to facilitate  healthcare  training.  With a technology shift
toward  computer  based  training  ("CBT"),   this  market  is  undergoing  some
redefinition.  Certain  companies  are  shifting  from a  VCR/booklet  format to
multimedia applications. Other companies are new and were formed specifically to
develop CBT programs for healthcare  training.  The Company  believes that these
competitors  are relying  upon the  healthcare  facility to provide the delivery
system, a personal computer,  for such training  programs.  The Company believes
that OIX, which offers a two way  interactive  feedback system will have greater
market attraction.

     The  Company's  principal  methods  of  competing  are the  development  of
innovative  products,   the  performance  and  breadth  of  its  products,   its
technically  trained  sales  force,  and  its  educational  services,  including
sponsorship  of  training  programs.  Most  of  the  Company's  potential  major
competitors  have greater  financial  resources  than the  Company.  Some of its
potential  competitors,  particularly Ethicon, have engaged in substantial price
discounting  and other  significant  efforts  to gain  market  share,  including
bundled  contracts  for  a  wide  variety  of  healthcare  products  with  group
purchasing   organizations.   In  the  current  healthcare   environment,   cost
containment  has  become  a  significant  factor  in  purchasing   decisions  by
hospitals. Additional cost effectiveness was one of the principle factors in the
redesign of SutureMate(R) and a principle consideration in the refocusing of the
OIX.

                                                                  18

<PAGE>



     Surgical currently has a limited sales force.  However, at such time as the
Company has an suitable  strategic partner and adequate  funding,  it intents to
train its sale for on an  ongoing  basis to focus on  healthcare  worker  safety
issues.  The Company  believes that it has the management  expertise to have its
sales force  distinguish  itself from the competition.  More  specifically,  the
Company is developing a clear and concise  understanding  of the inherent safety
risks  associated  with  the  healthcare  worker's  everyday  work  place.  This
understanding  is  accomplished   through  its  personnel  which  has  extensive
experience  in  the  healthcare   industry,   medical   expertise,   engineering
capabilities,  communications skills with customers, as well as an understanding
of the medical marketplace and a variety of manufacturing practices. The Company
believes  that the end result is that it is able to provide the customer  with a
unique product or service specifically  developed with individualized safety and
utility in mind, while providing that product or service to the customer so that
its value exceeds its cost.

     One of the biggest  attractions to the Company of a strategic alliance with
US  Surgical  is the fact that U S Surgical  collaborates  with some of the most
prestigious  academic  medical  centers  in the world to  establish  Centers  of
Excellence for training in many diverse  disciplines.  These centers are devoted
to teaching residents and surgeons in the use of new instrumentation, developing
new technologies, conducting preclinical trials and other research projects.

     The Company  believes that the  advantages of its various  products and its
customer  assistance  programs  will  continue  to provide the best value to its
customers.  However,  there is  considerable  competition in the industry and no
assurance can be given as to the Company's competitive  position.  The impact of
competition will likely have an effect on sales volumes and on prices charged by
the Company.  In addition,  increased cost consciousness has revived competition
from reusable  instruments to some extent.  The Company believes that single use
instruments  are safer and more cost  efficient for hospitals and the healthcare
system  than  reusable  instruments,  but it cannot  predict the extent to which
reusable  instruments will  competitively  impact the Company.  The Company also
offers semi-disposable instruments,  components of which may be reused a certain
number of times, to respond to the preferences of its customers.

     Current and future customers were interviewed at major medical organization
exhibits. Overall statistics indicate that 50% of vascular, thoracic and general
surgeons found the Compliance  Plus products to be useful,  safe and potentially
cost effective.  OB/GYN's  urologists and plastic  surgeons gave a 90% favorable
evaluations, while over 90% of surgical technologists gave "high" to "very high"
ratings to  SutureMate(R).  The Company believes that it has chosen a developing
market  with no  well-established  industry  leaders  at this  time.  Further it
believes that its products are unique and that by

                                                                  19

<PAGE>



maintaining a relatively narrow market focus, combined with technical expertise,
that it can achieve rapid growth.

Sources and Availability of Raw Materials

     The OIX software is proprietary to the Company.

     Raw  materials  necessary for the  manufacturer  of parts,  components  and
packaging supplies for all of the Company's products manufactured by the Medical
Products Division are readily available from numerous third-party suppliers.

     The Company does not rely on any other  principal  suppliers for any of its
raw materials. However, with regard to SutureMate(R), the Company has received a
price   quotation   from  Tuthill  for  the   manufacture   of  the   redesigned
SutureMate(R).

Dependence on Major Customers

     At the current  time,  Surgical is reliant upon a few major  customers  for
several of its products.  For fiscal year ending  December 31, 2000, the Company
derived  approximately 98% of its revenue from US Surgical for OASiS license and
productions  fees. For fiscal year ending December 31, 1999, the Company derived
approximately  96%  of  its  revenue  from  OASiS  licensing  fees  and  private
partnership fees from US Surgical.

     With regard to the OIX,  the Company is reliant  upon its  agreements  with
AORN and the trainlets  produced for Contender  Providers that will be viewed on
the AORN website.

     SutureMate(R)  sales  are  currently   principally  reliant  upon  in-house
distribution  and  re-establishment  of various  distribution  arrangements  for
generating  revenues for this product.  Changes in state laws have increased the
attractiveness of this product.

     Subject to the availability of additional funding, of which there can be no
assurance,  the Company  believes that it can increase its customer base so that
the  loss of any one  client  will  not  adversely  impact  upon  the  financial
condition of Surgical.



                                                                  20

<PAGE>


Research and Development

     The Company  believes that research and development is an important  factor
in its future  growth.  In the past,  the Company  engaged in extensive  product
research and  development  and it has at least four (4) additional  products for
the  medical and  healthcare  community,  all of which are in various  stages of
development,  from prototype to patent. Subject to proper timing and sufficiency
of the  installments  under  the TK  Loan  Commitment  or  the  availability  of
additional funding again may devote a substantial amount of time to the research
and development of products within distinct product lines.  Substantially all of
the  products  in  research  and  development  have been  designed,  drawn,  had
preliminary  market research conducted and have been submitted for review to the
Company's patent counsel.

     As a natural  by-product of an active research and development  department,
some product  concepts have been generated which do not fit the Company's chosen
focus.  Several  surgical and obstetrical  devices have been designed and either
will be licensed or sold outright to appropriate  corporate  entities.  Patents,
Copyrights and Trademarks

     Patents are  significant  to the  conduct of the  Company's  business.  The
Company owns four (4) patents on two (2)  products;  U. S. Patent No.  4,969,893
issued on November 13, 1990, U. S. Patent No.'s Des.  353,672 issued on December
20, 1994 and U.S.  Patent No.  5,385,569  issued on January 31,  1995,  each for
SutureMate(R)and United States Patent No. 5,364,375,  was issued on November 15,
1994 for  Prostasert(TM).  Dr. Swor was the inventor who originally  secured the
patents which he later assigned to the Company in exchange for stock.

     On June 1, 1998,  the Company filed for two (2) patents on the OASiS system
which includes  propriety  aspects of the software,  algorithms and reports,  as
well as the inservice  training modules which are owned by the Company.  Neither
of these  patents  have  been  issued  to date and the  applications  are  still
pending.

     The  Company  has an  extensive  library  of  copyrighted  educational  and
training material related to occupational safety and surgical techniques.  These
include the Surgical Safety Manual published in 1994, which was revised in 1996.

     The  Company  filed on July 1,  1993 for  trademark  registration  with the
United States Patent and Trademark Office for SutureMate(R).  This trademark was
registered on April 5, 1994.


                                                                  21

<PAGE>



     The Company applied for trademark  registration  for the OASiS Touch Access
Information  on  April  29,  1998 and the  examination  of this  application  is
pending.

     The  Company   applied  for  trademark   registration   for  TouchPort  and
VirtualTouch Reality on November 16, 1998. Examination of these applications are
pending.

     The Company is not a party to any actions  claiming patent  infringement of
any of its products.

Governmental Regulation

FDA Approval

     Regulation  by  governmental  authorities  in the United States and foreign
countries is a significant factor in the development,  manufacture and marketing
of the Company's  proposed products and services and in its ongoing research and
product  development  activities.  It is  anticipated  that virtually all of the
products  developed by the  Company's  Medical  Products  Division  will require
regulatory approval by governmental agencies prior to commercialization.

     It  is  expected  that  many  of  the  Company's  products,   as  presently
contemplated, will be regulated as medical devices. Prior to entering commercial
distribution, all medical devices must undergo FDA review under one or two basic
review  procedures:  a Section  510(K)  premarket  notification  ("510(K)") or a
premarket approval application ("PMA"). In the past, the Company's products have
been cleared by the FDA under the 501(K) expedited form of pre-market  review or
have not required FDA approval.

     To the  extent  the  Company  develops  products  for use in more  advanced
surgical  procedures,  the  regulatory  process  may be more  complex  and  time
consuming.  Some of the Company's  potential future products may require lengthy
human  clinical  trials and the PMA  application  relating  to class III medical
devices. The Company has no reason to believe that it will not be able to obtain
regulatory approval for its products,  to the extent efficacy,  safety and other
standards can be  demonstrated,  but the lengthy  approval  process will require
additional capital (of which there is no assurance that the Company). During any
review period,  there is the risk of entry by competitors and risk of changes in
the marketplace prior to market approvals being obtained.


                                                                  22

<PAGE>



     Overseas,  the degree of government regulation affecting the Company varies
considerably  among  countries,  ranging  from  stringent  testing and  approval
procedures  in certain  locations to simple  registration  procedures in others,
while in some  countries  there is  virtually no  regulation  of the sale of the
Company's   products.   In  the  past,  when  the  Company  had  active  foreign
distribution  agreements,  it had not  encountered  material  delays or  unusual
regulatory impediments in marketing its products internationally.  Establishment
of uniform  regulations for European Economic Area nations took place on January
1, 1995. These regulations subject the Company to a single regulatory scheme for
all of the  participating  countries.  Once the Company's  domestic channels are
satisfied,   Surgical   will   commence  its  program  for  meeting   regulatory
requirements internationally. The Company expects that it will be able to market
its  products  in  Europe  with  a  single   registration   applicable   to  all
participating  countries. The Company also is establishing procedures to respond
to various local  regulatory  requirements  existing in all other  international
markets in which it intends to market its products should adequate  financing be
available.

OSHA Mandatory Reporting of Illness and Injury

     Federal rules administered by the OSHA require healthcare workers to report
if they have been accidentally stuck with a needle previously used by a patient,
or splashed by blood or bodily fluids.

     On February 11, 1997,  in the Federal  Register,  OSHA issued a final rule,
effective  March 13,  1997,  that  amended the  Occupational  Injury and Illness
Reporting  Regulation  (29 CFR Part 1904)  established  in 1971.  Under the 1971
regulation,  employers were required to collect and maintain  injury and illness
data and have it  available  for OSHA to  examine  when they came on site for an
inspection.  It was  determined  that  OSHA  needed  a  separate  provision  for
collection of data by mail.

     The final rule requires,  employers,  upon request, to report to OSHA their
illness and injury data,  in addition to the number of workers and the number of
hours worked in a designated  period.  It  establishes  a mechanism  for OSHA to
conduct an annual  survey of ten (10) or more  employers by mail or other remote
transmittal.  The specific  request may come directly from OSHA or its designee,
e.g., the National Institute of Occupational Safety and Health ("NIOSH").

     OSHA also  initiated  a number  of  partnerships  with  other  federal  and
national  organizations  in  an  effort  to  reduce  the  increasing  number  of
occupational  illnesses and injuries among workers. This effort was prompted, in
part,  by  OSHA's  inability  to  inspect  and  enforce  worker  safety  in  the
approximately five million (5,000,000) work sites in the

                                                                  23

<PAGE>



United States and to collect  accurate  worker injury and illness data to assist
in  targeting  the  approximately  8,000  annual  inspections  in  the  face  of
continuing shrinking budgets.

     In August 1996,  OSHA also  announced a  seven-state  initiative to protect
workers in nursing  homes and  personal  care  facilities,  one of the  nation's
largest  growing  industries.   The  seven  states  include  Florida,  Illinois,
Massachusetts,  Missouri, New York, Ohio and Pennsylvania.  Nationwide there are
1.6  million  nursing  home  workers  in  more  than  21,000  facilities.  It is
anticipated that by the year 2005, the nursing home and personal care facilities
will be one of the largest  industries in the United States.  Potential  nursing
home hazards include back injuries from incorrect  and/or  strenuous  lifting of
residents,  slips  and  falls,  workplace  violence  and risks  from  bloodborne
pathogens, tuberculosis and other infectious diseases.

     Effective  April 2001, OSHA revised its bloodborne  pathogens  standards to
conform with the  requirements of the  Needlestick  Safety and Prevention Act of
1999.  This act  required  OSHA to revise the  standards  so as to  include  new
examples in the  definitions of  engineering  controls along with other matters.
The  final  OSHA  rule  can  be  viewed  at   www.osha-slc.gov/FedReg_osha_data/
FED200110118A.html.

State and Local Licensing Requirements

     Since  1998,  18 states have  adopted  some type of  legislation  regarding
needlesticks and health care worker exposure to bloodborne  pathogens  exposure.
They include Alaska, Arkansas, California,  Connecticut,  Georgia, Hawaii, Iowa,
Maine,  Maryland,  Massachusetts,  Minnesota,  New Hampshire,  New Jersey, Ohio,
Oklahoma, Tennessee, Texas and West Virginia. Legislation is being considered in
Florida, Illinois, Indiana, Michigan,  Montana, New York, Oregon,  Pennsylvania,
Wisconsin and the District of Columbia.

     These state laws are aimed at adding additional  safeguards for health care
workers at the state level. This includes addition provisions not in the federal
OSHA Bloodborne  Pathogens  Standards  and/or  coverage of public  employees not
regulated by OSHA. An overview of state needle safety  legislation can be viewed
at www.cdc.gov/niosh/ndl- law.html.

     Other than the governmental regulatory schemes listed above, the Company is
not subject to any other state or local regulations which apply to the operation
and business of the Company.


                                                                  24

<PAGE>



Effect of Probable Governmental Regulation on the Business

     The Company  does not  believe  that there are any  effects  from  probable
government regulation, including state or local laws, on the business.

Cost of Research and Development

     For fiscal years 1999 and 2000, the Company expended $51,281 and $44,431 of
its revenues,  respectively,  on research and  development.  These  expenditures
represented 29.3% and 7.4%,  respectively,  of the total revenues of the Company
for such fiscal  years.  The  principal  decrease  in the cost of  research  and
development  for  fiscal  2000  from  1999 was  based  upon  the  fact  that the
foundational  structure of the OASiS network  during was completed  1998 and the
2000 OASiS developments were a continuation of 1999 foundational base.

     At the  current  time,  none of the  costs  associates  with  research  and
development are bourne  directly by the customer;  however there is no guarantee
that such  costs  will not be bourne by  customers  in the  future  and,  at the
current  time,  the Company does not know the extent to which such costs will be
bourne by the customer, if at all.

Cost and Effects of Compliance with Environmental Laws

     The Company's  business also could be subject to regulation under the state
and Federal laws regarding  environmental  protection  and hazardous  substances
control,  including the  Occupational  Safety and Health Act, the  Environmental
Protection  Act, and Toxic  Substance  Control Act. In 1992,  the United  States
Congress  expressed  increasing  interest in the issues of sharp  injuries.  The
House  Subcommittee on Regulation held hearings regarding  needlestick  injuries
and the implementation of mandated guidelines on safer medical devices. However,
the Company is unaware of any bills currently pending in Congress on this issue.
The  Company  believes  that it is in material  compliance  with the current and
other applicable laws and that its continual  compliance therewith will not have
a material adverse effect on its business.

Employees and Consultants

     As of December 31, 2000,  the Company  employed six (6) persons,  under its
arrangement  with EPIX. None of these employees are represented by a labor union
for

                                                                  25

<PAGE>



purposes of collective bargaining.  The Company considers its relations with its
employees to be excellent.

     On March 16,  2001,  the Company  entered a staff  leasing  agreement  with
Selective HR Solutions ("Selective HR") as a replacement for comparable services
previously  provided  by EPIX.  Like  the EPIX  arrangement,  the  Selective  HR
arrangement  creates a co-employment  relationship  between Selective HR and the
Company relative to the employees who work at the Company

     In  December  2000,  the  Company  granted  options to  purchase a total of
300,000  shares of its Common  Stock at an  exercise  price of $0.13 to five (5)
employees  under the Company's 2000 Stock Plan approved by the  shareholders  in
February 2000. The Company granted such options  pursuant to Section 4(2) of the
Act and Rule 506.

     In August 2000,  the Company  executed a Consulting  Agreement  with Global
Development  Advisors,  Inc. ("GDA")).  Under the agreement,  GDA was to provide
business and marketing  consulting  services,  assist in the implementation of a
strategic  plan and  assist,  coordinate  and  monitor  the  Company's  investor
relations program. The agreement was for a term of three (3) months and could be
extended by the Company.  In lieu of cash payments for  services,  GDA agreed to
accept  200,000  shares of the Company's  Common Stock under the Company's  2000
Stock Plan approved by its  shareholders  on February 28, 2000. In October 2000,
the Company extended the agreement for an additional three (3) months and issued
150,000 shares of the Company's Common Stock under the Company's 2000 Stock Plan
in lieu of a cash payment. There were no further extensions to this agreement.

Item 2.  Description of Property

     The Company's  executive  offices are located at 3665 Bee Ridge Road, Suite
300,  Sarasota,  Florida 34233.  Its telephone  number is (941) 927-7874 and its
facsimile number is (941) 925-0515.

     The Company is in the process of moving its offices in  anticipation of its
merger with Emagisoft.

     The Company owns no real  property and its  personal  property  consists of
furniture,  fixtures and equipment,  prototype molds and leasehold  improvements
with a net book value of $71,973 on December 31, 2000.


                                                                  26

<PAGE>



     The Company  currently employs its capital reserves in a money market sweep
account.  Activity is monitored on a daily basis and for a month  commencing  on
February 1, 2001, had returned on average 6% on assets  employed.  Additionally,
Surgical  acquired stock in two (2) privately owned companies,  25,000 shares in
ParView Inc. as part of its  acquisition  of Endex Systems Inc. and 3,750 shares
in Linters Inc. which was received as partial compensation for clinical products
research  completed by the Medical  Consultants  Division.  It is the  Company's
strategy to engage in  transactions  which  minimize  dilution of the  Company's
equity.

Item 3.  Legal Proceedings

     On March 13, 2001,  the Company was served with a Summons and  Complaint by
IBM in an action  entitled  International  Business  Machines v. Surgical Safety
Products  Inc.  (The  "Action").  The Action was brought in the Circuit Court in
Sarasota  Florida.  In the Action,  IBM has  brought  four (4) causes of action,
namely,  breach  of  contract,  implied  contract,  account  stated  and  unjust
enrichment.  Each cause of action relates to the contract  between  Surgical and
IBM  relative to the delivery of services  and  equipment.  Surgical had entered
into the arrangement  with IBM to meet its  commitments to US Surgical.  When US
Surgical  failed to perform as  expected,  Surgical  sought  termination  of the
arrangement  with IBM.  Effective July 14, 2000,  this contract was  terminated.
Surgical has been  working with IBM in an effort to settle this matter.  Counsel
for Surgical is reviewing the Complaint and  determining  the defenses  Surgical
will interpose.  In addition  consideration  is being given to whether or not it
should bring a third party action against US Surgical. IBM is seeking payment of
in excess of $600,000  for  invoices  principally  related to software and labor
associated with  implementing the US Surgical  Agreement.  Should IBM prevail in
this Action,  it would have a material adverse effect upon Surgical's  financial
condition. The Company brought a motion to dismiss three of the causes of action
that was  denied  and now is  required  to file a  defense  by June 5,  2001.The
Company  intends to file a defense.  The  Company  believes  it has an  absolute
defense to the breach of contract  claim since the  agreement  provided that the
Company could terminate and provided the payments required for such termination.
Further  the  agreement  required  that the  Company  approve  all work prior to
performance and the work for which it was invoiced was not approved. The implied
contract  and  unjust  enrichment  claims can only go forward if the there is no
valid contract since they are alternative  pleadings.  The Company believes that
it has just and meritorious defenses to this action.

     The Company knows of no other legal  proceedings  to which it is a party or
to which any of its  property is the subject  which are pending,  threatened  or
contemplated or any unsatisfied judgments against the Company.



                                                                  27

<PAGE>


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

     There were no matters  submitted to the vote of the security holders during
the fourth quarter 2000.

     On February 28, 2000, the Company held its annual shareholder  meeting.  Of
the  11,815,373  shares  outstanding  which  were  qualified  to  vote  (of  the
14,515,373  outstanding,  2,700,000 were held in escrow under the TK arrangement
and  were  not  qualified  to  vote  at  the  meeting),  in  attendance,  either
individually  or by proxy were  holders  representing  5,960,113  shares,  which
number was sufficient to form a quorum.

     At such meeting the shareholders

     (1) approved an amendment to the Articles of  Incorporation  increasing the
number  of  authorized   shares  of  Common  Stock  from  20,000,000  shares  to
100,000,000 by a vote of 5,960,113 to -0-;

     (2) re-elected the Board of Directors as follows:

         Dr.  Swor by a vote of 5,960,013 to 100
         Mr.  Clark by a vote of 5,960,013 to 100
         Mr.  Lawrence by a vote of 5,960,013 to 100
         Mr.  Collins by a vote of 5,960,013 to 100
         Mr.  Stuart by a vote of 5,960,013 to 100
         Mr.  Norton by a vote of 5,960,013 to 100
         Mr.  Swor by a vote of 5,959,253 to760, with 100 abstaining
         Dr.  Saye by a vote of 5,960,013 to 100

Mr. Newman,  who previously was listed on the ballot,  tendered his  resignation
prior to the  shareholder  meeting and his name was withdrawn from the ballot at
the meeting and Mr. Clark has since resigned;

     (3) ratified Kerkering, Barbario & Co., P.A. as the Company's auditors by a
vote of 5,959,253 to 100 with 760 abstaining; and

     (4) approved the Company's 2000 Stock Plan by a vote of 5,960,013 to 100.


                                                                  28

<PAGE>



                                     PART II

Item 5.  Market for Common Equity and Related Stockholder Matters

           (a)        Market Information.

     The Common Stock of the Company is quoted on the OTC  Bulletin  Board under
the symbol  "SSPD".  The high and low bid  information  for each quarter for the
years ending December 31, 1996,  December 31, 1997,  December 31, 1998, December
31, 1999 and December 31, 2000 are as follows:

<TABLE>
<CAPTION>
Quarter                   High Bid   Low Bid      Average Bid
--------------------     --------- ----------     ------------
<S>                      <C>       <C>            <C>
First Quarter 1996          1/4        3/16          .218
Second Quarter 1996         3/4        1/8           .445
Third Quarter 1996          1/4        1/8           .177
Fourth Quarter 1996         1/4        1/8           .176
First Quarter 1997          1/4        3/32          .135
Second Quarter 1997         1/4        3/32          .106
Third Quarter 1997          3/8        1/8           .183
Fourth Quarter 1997         9/64       1/8           .132
First Quarter 1998         29/32       9/64          .215
Second Quarter 1998       3-1/8      1-1/16         2.299
Third Quarter 1998        2-9/64     1-9/64         1.646
Fourth Quarter 1998        31/32      17/32          .750
First Quarter 1999         13/16       1/3           .57
Second Quarter 1999       1-7/8        7/16         1.156
Third Quarter 1999        2-7/8      1-1/4          2.0625
Fourth Quarter 1999      1-11/16      13/16         1.196
First Quarter 2000        1-7/8      1              1.44
Second Quarter 2000         3/4        1/3           .50
Third Quarter 2000          3/8       13/64          .29
Fourth Quarter 2000        26/64       1/8           .26
</TABLE>

                                                         29

<PAGE>



     The quotations may reflect  inter-dealer  prices,  without retail  mark-up,
mark-down or commissions and may not reflect actual transactions.

     (b) Holders.

     As of December 31, 2000,  the Company has 1,092  shareholders  of record of
its 13,500,492 outstanding shares (14,865,373 shares are issued and outstanding;
however,  1,364,881  shares were held in escrow by Thomson  Kernaghan & Co, Ltd.
but had no voting rights), 6,619,188 of which are restricted Rule 144 shares and
6,881,304  of which are  free-trading.  As of the date  hereof,  the Company has
outstanding options to purchase 6,092,134 shares of Common Stock (without regard
to the  additional  options to Dr.  Saye  which  accrue at the rate of 8,333 per
month during the term of the agreement  subsequent to December 31, 2000). Of the
Rule 144 shares,  3,152,763  shares have been held by  affiliates of the Company
for more than one (1) year.

     (c) Dividends.

     The Company has never paid or declared  any  dividends  on its Common Stock
and does not anticipate paying cash dividends in the foreseeable future.

     There  are  no  limitations  on  the  ability  of the  Company  to  declare
dividends;  except  those set forth in New York Statute  ss.510 which  prohibits
dividends  if the  Company  is  insolvent  or  would  be made  insolvent  by the
declaration of a dividend and all dividends must be made out of surplus only.

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

Discussion and Analysis

     The  Company  was  founded  in 1992  to  combat  the  potential  spread  of
bloodborne pathogenic infections such as HIV and hepatitis. It has broadened its
mission to  research,  develop,  manufacturing,  marketing  and selling  medical
products and services to the healthcare community.

     The  Company  was in  the  development  stage  until  1993  when  it  began
commercial  shipments of  SutureMate(R),  its first  product.  From inception in
June,  1992  through  December  31,  2000,  the  Company  generated  revenues of
approximately $1,876,000 from

                                                                  30

<PAGE>



a limited number of customers.  Since inception  through  December 31, 2000, the
Company has generated  cumulative losses of approximately  $5,140,000.  Although
the Company has  experienced  a significant  percentage  growth in revenues from
fiscal 1992 to fiscal 2000,  the Company does not believe prior growth rates are
indicative of future operating results, especially in light of the contract with
AORN and its new Internet-based site, OASiSOR.com, and the revised contract with
US Surgical. Due to the Company's operating history and limited resources, among
other  factors,  there can be no assurance  that  profitability  or  significant
revenues on a quarterly or annual basis will occur in the future.  Moreover, the
Company expects to continue to incur  operating  losses through at least through
fiscal 2001,  and there can be no assurance  that losses will not continue after
such date.

     As discussed in the  independent  auditors'  report,  the operating  losses
incurred  by the  Company  raise  doubt about its ability to continue as a going
concern.  In addition,  with the  implementation of its agreement with AORN, and
its new  arrangement  with US Surgical and/or with the  establishment  of one or
more  strategic  alliances  in  addition  to AORN and US  Surgical,  the Company
expects to  experience a period of growth,  which  requires it to  significantly
increase the scale of its operations.  This will result in significantly  higher
operating  expenses.  The  increase  in  operating  expenses  is  expected to be
partially funded by an increase in revenues. However, the Company's net loss may
continue  to  increase.  Expansion  of the  Company's  operations  may  cause  a
significant strain on the Company's  management,  financial and other resources.
The Company's ability to manage recent and any possible future growth, should it
occur,  will depend upon a  significant  expansion  of its sales and  marketing,
research and development,  accounting and other internal  management systems and
the  implementation  and  subsequent   improvement  of  a  variety  of  systems,
procedures and controls.  There can be no assurance that significant problems in
these areas will not occur.  Any failure to expand these areas and implement and
improve such systems,  procedures and controls in an efficient  manner at a pace
consistent with the Company's  business could have a material  adverse effect on
the Company's  business,  financial  condition and results of  operations.  As a
result of such expected expansion and the anticipated  increase in its operating
expenses,  as well as the difficulty in forecasting  revenue levels, the Company
expects to continue to  experience  significant  fluctuations  in its  revenues,
costs and gross margins, and therefore its results of operations.

     The Company's  plan of operations for the next twelve months is to focus on
building revenue from production of its web-enabled training applications called
Trainlets that it is currently marketing to healthcare  companies.  In addition,
it  anticipates  additional  revenues  from the  development  of its website and
registered  user  base.  The  Company  also is  aggressively  seeking  strategic
alliances  with targeted  industry  partners such as  manufacturers  of devices,
manufacturers of  pharmaceuticals,  professional  organizations  such as nursing
associations and hospital group purchasing  organizations  and integrated health
networks along the lines created with the AORN contract.


                                                                  31

<PAGE>



     In  this  regard,   the  Company  executed  a  term  sheet  with  Emagisoft
Technologies  Inc. under which  Emagisoft  will merge into the Company's  wholly
owned subsidiary OIX, Inc. Surgical and Emagisoft decided to proceed with merger
plans because there are certain  synergies  that are expected to result from the
merged  companies.  Currently,  Surgical  outsources  a  great  deal  of  its CD
production and computer design. Emagisoft provides such services.  Further, both
companies  are  within  the same  geographic  region  and share many of the same
suppliers.  Lastly,  Emagisoft  has  existing  management  that can  provide the
stability in management  Surgical has been seeking over the last few years. As a
result of these  features,  management  for these two  companies  believed  that
collectively  they could  achieve the goals of each of the companies at a faster
rate  and  that  the  combined  companies  will be more  attractive  to  outside
financial sources..

     The Company  estimates  that  revenues  will be  sufficient to fund ongoing
operations  at the  current  level  when  the  website  is  functional  and  its
registered  users  base  reach  levels of 50,000 or more.  The  Company  is also
aggressively  marketing its  web-enabled  Trainlets to healthcare  companies for
which it has already received contracts totaling approximately $323,000.

     In the short term, to fund operations through fiscal 2001, the Company will
seek  additional  funds from strategic  alliances with  potential  clients,  its
shareholders,  from additional third party financing or seek third party debt or
equity financing other than those planned by the current anticipated agreements.
As of December 31, 2000,  the Company has utilized its entire  existing lines of
credit.  As of December 31, 2000,  the Company had a staff of six (6) employees.
The Company was able to meet its capital needs through year end.

     As  discussed  in Note 21 to the  Financial  Statements,  if the  financing
referred to above is not  secured,  the  recoverability  of the  recorded  asset
amounts may be impaired.

     In 2001,  the Company will require  between $5 and $8 million in additional
capital  in the form of debt or equity to fund the  continued  expansion  of the
Oasis system and its  development to meet increased  demand and to implement its
plans for  increased  marketing of its medical  device  products.  These funding
requirements are based upon the new initiative which is less hardware  intensive
and requires less maintenance.  The Company is in the process of seeking funding
from a number of different sources;  however,  it has accepted no definite offer
at this time.  There can be no assurance that such  long-term  financing will be
available to the Company or that it will be on terms that the Company may seek.




                                                                  32

<PAGE>


Results of Operations - Full Fiscal Years

Revenues

     To date, a limited number of customers and distributors  have accounted for
substantially  all of the Company's  revenues with respect to product sales. For
fiscal year ending December 31, 1999, the Company derived  approximately  96% of
its revenue from OASiS  licensing  fees and private  partner fees related to the
agreement  with US  Surgical.  For fiscal year ending  December  31,  2000,  the
Company derived  approximately  98% of its revenue from licensing and production
fees for OASiS and Trainlet production.

     The Company  anticipates that the main focus of its selling efforts will be
to focus on the AORN and other similar  website  arrangement and the development
of  Trainlets.  The  Company  intends  to  continue  to sell its  products  to a
relatively  small group of medical products  distributors  with the objective of
having its products  distributed  on a large national and  international  scale.
Recent legislation regarding needlestick injuries is expected to increase demand
for  the  SutureMate(R)   product.   The  Company  has  entered  into  worldwide
distribution  agreement  with DeRoyal for which the first order was delivered in
May 2001. Most medical product  distributors carry an extensive line of products
(some of which they  manufacture  themselves)  which they make  available to end
users (hospitals,  surgeons,  healthcare  workers) and various of these products
may compete with each other as to function, price or other factors. In addition,
numerous  medical product  distributors  are not themselves well capitalized and
their  financial  condition may impact their ability to properly  distribute the
Company's products.

     The  Company's  ability to achieve  revenues  in the future  will depend in
significant part upon its ability to obtain orders from, maintain  relationships
with  and  provide  support  to,  existing  and  new  customers,  as well as the
condition of its customers. As a result, any cancellation, reduction or delay in
orders by or  shipments  to any  customer or the  inability  of any  customer to
finance its purchases of the Company's products may materially  adversely affect
the Company's business, financial condition and results of operations. There can
be no assurance  that the Company's  revenues  will  increase in the future.  In
addition,  the Company  expects that the average  selling  price of a particular
product  line will also  decline as such  products  mature,  and as  competition
increases  in the  future.  Accordingly,  the  Company's  ability to maintain or
increase  revenues  will depend in part upon its ability to increase  unit sales
volumes of its products and to introduce and sell products at prices  sufficient
to  compensate  for  reduced  revenues  resulting  from  declines in the average
selling price of the Company's more mature products.

Net Sales

     Net sales for the year ended  December  31, 1999 are  comprised of sales of
SutureMate(R) products, partnership fees and OASiS licensing fees. Net sales for
the year ended  December  31, 2000 are  comprised  of OASiS  licensing  fees and
Trainlet production fees.

                                                                  33

<PAGE>



     The Company has an ongoing program to reduce the costs of manufacturing its
products.  As part of this program,  the Company has been  attempting to achieve
cost reductions principally through engineering and manufacturing  improvements,
product  economies  and  utilization  of  third  party  subcontractors  for  the
manufacture of the Company's  products.  Notwithstanding a delivery of defective
units, to date, it has been successful in  substantially  reducing such costs by
re-designing  SutureMate(R).  The success of these cost reduction  programs will
not be known until  production  volumes are scaled up. There can be no assurance
that the Company's  ongoing or future  programs can be accomplished or that they
will increase gross profits.

     To the extent  the  Company  is unable to reduce  its  production  costs or
introduce new products with higher margins,  the Company's results of operations
could be  materially  adversely  affected.  The  Company's  results  may also be
affected by a variety of other  factors,  including mix of products and services
sold;  production,  reliability  or quality  problems;  price  competition;  and
warranty expenses and discounts.

Operating Expenses

     Sales and Marketing:  These expenses  consist of advertising,  meetings and
conventions  and  entertainment  related to product  exhibitions and the related
travel expenses.  Since inception,  the Company has spent approximately $818,000
on sales and  marketing  expenses.  For the years  ended  December  31, 1999 and
December 31, 2000,  sales and  marketing  expenses  were  $171,102 and $281,602,
respectively. Since 1999, the Company has increased its advertising particularly
with  reference  to OASiS.  The Company has  invested  significant  resources to
expand  its sales and  marketing  effort,  including  the  hiring of  additional
personnel  and  establishing  the  infrastructure  necessary  to support  future
operations.  The Company  expects  that such  expenses in 2001 will  increase in
absolute dollars as compared to 2000.

     General and Administrative. These expenses consist primarily of the general
and administrative expenses for salaries,  contract labor and other expenses for
management,  information  technology ("IT"),  finance and accounting,  legal and
other  professional  services  including  ongoing  expenses as a publicly  owned
Company  related to legal,  accounting  and other  administrative  services  and
expenses.  Since inception,  the Company has spent  approximately  $3,880,000 on
general and administrative  expenses.  For the years ended December 31, 1999 and
December  31,  2000,  general and  administrative  expenses  were  $696,131  and
$1,619,456, respectively. The increase of $923,325 is due primarily to legal and
accounting fees  associated with the Company's SEC filings,  increased IT costs,
higher  depreciation  and  amortization,   additional  rent  for  the  Company's
headquarters  and increased  personnel  costs.  The Company  expects general and
administrative  expenses to increase in absolute  dollars in 2001 as compared to
2000, as the Company continues to expand its operations.



                                                                  34

<PAGE>


Research and Development

     These expenses  consist  primarily of costs  associated  with personnel and
equipment  costs  and   field/clinical   trials.   The  Company's  research  and
development activities include the development of the OASiS system and more than
six (6)  operating  room,  OB/GYN,  advanced  surgical  and  protective  related
products including SutureMate(R).

     Since inception,  the Company has spent approximately  $252,000 on research
and  development.  For the years ended  December 31, 1999 and December 31, 2000,
research and development  expenses were $51,281 and $44,431,  respectively.  The
Company made  enhancements to the software for the OASiS system in both 1999 and
2000,  and the  majority of these  related  costs were  capitalized  and will be
amortized  over a period not to exceed five (5) years.  During 2000, the Company
capitalized   $147,768  of  costs  related  to  the  enhancement  of  OASiS  and
development of Trainlets.  Some  previously  capitalized  costs in the amount of
$248,857 were written off due to the Company's change in focus from the delivery
of OASiS  information  from the Kiosk to the  Internet.  The Company  intends to
continue to invest  significant  resources  to continue the  development  of new
products  and  expects  that  research  and  development  expenses  in 2001 will
increase in absolute dollars as compared to 2000.

Interest and Other Income (Expense), Net

     Interest and other  income  (expense),  net consists  primarily of interest
expenses accrued on the TK loans, the direct loan to the Company under a line of
credit  agreement  for  $100,000,  interest  related to loans from the  majority
stockholder,  miscellaneous  income and  underwriting  costs.  In May 1997,  the
Company  established a line of credit in the amount of $100,000 with a financial
institution  at 1.5%  above the  prime  rate,  interest  only  payments  are due
monthly.  The  Company  renewed the line of credit in fiscal  2000.  The line of
credit  matured on December 31, 2000, at which time, the Company was required to
pay all principal and interest due on the line. The line is due on demand and is
secured by inventory,  accounts  receivable and equipment.  Demand has been made
for  the  repayment  of  this  loan.  As of  December  31,  2000,  $100,000  was
outstanding on the line. The Company is in default  pursuant to the terms of the
agreement.  As of December 31 1999, there was $100,000  outstanding on the line.
The line of credit is personally guaranteed by Dr. Swor.

     The  Company did not report any  foreign  currency  gains or losses for the
years ended December 31, 1999 and 2000 since there were no contracts  negotiated
in foreign  currencies for those periods.  In the event of contracts for foreign
distribution,  the  Company  may in the future be exposed to the risk of foreign
currency  gains or losses  depending upon the magnitude of a change in the value
of a local currency in an international  market.  The Company does not currently
engage in foreign currency hedging transactions,  although it may implement such
transactions in the future.



                                                                  35

<PAGE>


Financial Condition, Liquidity and Capital Resources

     The financial  condition,  liquidity  and capital  resources of the Company
should be assessed  in context  with the ability of the Company to continue as a
going concern as discussed in the independent auditors' report.

     At  December  31,  2000,  the  Company  had assets  totaling  $323,053  and
liabilities totaling $1,607,294. ince its inception in June of 1992, the Company
has financed its  operations and met its capital  requirements  through sales of
its products,  fees from OASiS, proceeds from the sale of or exchange for common
stock  aggregating  approximately  $2,302,000,  through  borrowing  from current
shareholders,  through its arrangement  with TK and through the $100,000 line of
credit with the financial institution which is guaranteed by Dr. Swor.

     Operating  activities  used net cash of $509,686  and  $961,843  in1999 and
2000, respectively.

     At December 31, 2000,  the Company had a deficiency  of working  capital of
approximately  $599,000 compared to working capital of approximately  $62,000 at
December 31, 1999.  This  represented a decrease in working capital of $661,000.
This is due to  significantly  higher  accounts  payable  balances  and deferred
revenue balances, combined with a lower cash balance at December 31, 2000.

     At December 31, 2000, the Company's outstanding  indebtedness  consisted of
accounts payable in the amount of $90,666, an outstanding balance on the line of
credit of  $100,000  and  accrued  expenses  of  $360,895,  deferred  revenue of
$177,875,  a loan  payable to Dr.  Swor of $35,063  and a loan  payable to TK of
$842,795.

     The Company's  principal  commitments for capital  expenditures are (1) the
Company's  obligation  to pay SMH $25,000 for each ten (10)  studies or $250,000
over  the  term of the  clinical  testing  agreement  with  them if the  Company
determines not to have SMH perform  clinical  testing;  and (2) its  obligations
under the TK Loan  Commitment  to the extent they do not elect to convert  their
debt into  equity.  The  sources  of funds to meet  these  commitments  has been
partially  made  through  cash on hand from the prior  year,  use of the line of
credit,  a loan from Dr. Swor, a loan  installment  from TK,  private  placement
funds and other  revenues  which the Company  believes it will generate over the
five (5) year term.

     The Company's  future capital  requirements  will depend upon many factors,
including  the  continued  development  of OASiS,  its current  products and new
products and  services,  the extent and timing of  acceptance  of the  Company's
products  and  services  in  the  market,   requirements  to  maintain  adequate
manufacturing   arrangements,   the  progress  of  the  Company's  research  and
development efforts, expansion of the Company's marketing and sales efforts, the
Company's results

                                                                  36

<PAGE>



of operations and the status of competitive  products and services.  The Company
will  require  additional  financing  to fund its  operations.  There  can be no
assurance  that any  additional  financing  will be  available to the Company on
acceptable  terms,  or at  all,  when  required  by the  Company.  The  TK  Loan
Commitment, since interest payments have begun to accrue, is increasing both the
short or long term debt of the Company.  The Company has entered into consulting
agreements with several other potential funding sources;  however,  to date, has
not concluded  terms for any financing  which it feels  appropriately  meets the
requirements of the Company under such agreements.  In the event additional debt
is raised,  it will incur future interest  expense.  The TK Loan Commitment,  if
fully  converted  and all  warrants  are  exercised  will dilute the interest of
existing  shareholders and in the event additional equity is raised,  management
may be required to dilute the interest of existing shareholders further or forgo
a  substantial  interest in  revenues,  if any. In the event that the Company is
successful in securing additional debt financing,  the amount of such financing,
depending upon its terms,  would increase  either the short or long term debt of
the Company or both. f adequate funds are not available as and when needed,  the
Company may be required to delay,  scale back the  development of OASiS or scale
back or eliminate one or more of its research and  development or  manufacturing
programs or obtain funds through  arrangements  with partners or others that may
require the Company to relinquish rights to certain of its products or potential
products  or other  assets  that the  Company  would not  otherwise  relinquish.
Accordingly,  the  inability  to obtain  such  financing  could  have a material
adverse  effect on the Company's  business,  financial  condition and results of
operations.






<PAGE>



Item 7.  Financial Statements


                         SURGICAL SAFETY PRODUCTS, INC.
                                 AND SUBSIDIARY

                          INDEPENDENT AUDITORS' REPORT,
                      CONSOLIDATED FINANCIAL STATEMENTS AND
                            SUPPLEMENTARY INFORMATION

                           DECEMBER 31, 2000 AND 1999









                                    CONTENTS



                                                                            Page

INDEPENDENT AUDITORS' REPORT                                                 F-1

FINANCIAL STATEMENTS
  Consolidated Balance Sheets                                                F-2
  Consolidated Statements of Operations                                      F-3
  Consolidated Statements of Changes in Stockholders' Equity (Deficit)       F-4
  Consolidated Statements of Cash Flows                                      F-5
  Notes to Financial Statements                                              F-6


SUPPLEMENTARY INFORMATION
  Independent Auditors' Report on Supplementary Information                 F-19
  Schedules of Operating Expenses                                           F-20




<PAGE>



                          INDEPENDENT AUDITORS' REPORT



The Board of Directors
Surgical Safety Products, Inc. and Subsidiary

We have audited the accompanying  consolidated balance sheets of Surgical Safety
Products,  Inc. and Subsidiary as of December 31, 2000 and 1999, and the related
consolidated statements of operations,  changes in stockholders' equity and cash
flows  for  the  years  then  ended.   These   financial   statements   are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

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

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the financial  position of Surgical  Safety
Products,  Inc. and Subsidiary as of December 31, 2000 and 1999, and the results
of its operations and its cash flows for the years then ended in conformity with
U.S. generally accepted accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will  continue as a going  concern.  As discussed in Note 21 to
the financial  statements,  the  Company's  significant  operating  losses raise
substantial doubt about its ability to continue as a going concern. Management's
plans  regarding  those matters are also  described in Note 21. These  financial
statements do not include any adjustments  that might result from the outcome of
this uncertainty.



/s/Kerkering, Barberio & Co.
KERKERING, BARBERIO & CO., PA
Sarasota, Florida
May 15, 2000



F-1


<PAGE>



<TABLE>
<CAPTION>
                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 2000 AND 1999


                                                              2000                     1999
                                                        ----------------         ----------------
<S>                                                    <C>                      <C>
                  Assets

Current Assets
  Cash and cash equivalents                            $          52,247        $         516,799
  Trade receivables                                                8,022                   15,145
  Other receivables - related party                                    -                    1,941
  Employee advances                                                1,500                        -
  Certificates of deposit                                         50,000                        -
  Prepaid expenses                                                26,409                   15,013
  Deposits                                                             -                  103,556
  Assets held for sale                                            27,600                        -
                                                        ----------------         ----------------
    Total current assets                                         165,778                  652,454

Property and equipment, net                                       71,973                  203,533
                                                        ----------------         ----------------

Other Assets
  Deferred loan costs, net                                             -                  203,356
  Intangible assets, net                                          44,278                   67,131
  Software development costs, net                                 26,629                  139,382
  Investments                                                      9,750                    9,750
  Deposits                                                         4,645                      500
                                                        ----------------         ----------------
    Total other assets                                            85,302                  420,119
                                                        ----------------         ----------------

Total Assets                                           $         323,053        $       1,276,106
                                                        ================         ================
</TABLE>





<PAGE>




<TABLE>
<CAPTION>
                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 2000 AND 1999



                                                                         2000                      1999
                                                              ---------------         -----------------
<S>                                                         <C>                      <C>
Liabilities and Stockholders' Equity

Current Liabilities
  Line of credit                                            $         100,000        $          100,000
  Accounts payable                                                     90,666                   295,878
  Accrued payroll                                                      94,251                    95,000
  Accrued legal                                                       264,015                    35,312
  Deferred revenue                                                    177,875                     6,250
  Accrued interest - related parties                                    2,629                     5,617
  Notes payable - related parties                                      35,063                    52,500
                                                              ---------------         -----------------
    Total current liabilities                                         764,499                   590,557

Long-Term Liabilities
   Note payable                                                       842,795                   650,000
                                                              ---------------         -----------------
    Total Liabilities                                               1,607,294                 1,240,557
                                                              ---------------         -----------------


Stockholders' Equity(Deficit)

 Common stock, $.001 par value, 20,000,000 shares
authorized; 14,865,373 and 14,515,373 shares issued
and outstanding in 2000 and 1999 respectively                          14,866                    14,516
  Common stock held in escrow                                          (1,365)                   (2,700)
  Additional paid-in capital                                        3,841,398                 2,804,020
  Accumulated deficit                                              (5,139,140)               (2,780,287)
                                                              ---------------         -----------------
    Total stockholders' equity (deficit)                           (1,284,241)                   35,549
                                                              ---------------         -----------------



Total Liabilities and Stockholders' Equity                  $         323,053        $        1,276,106
                                                              ===============         =================
</TABLE>




F-2


<PAGE>




<TABLE>
<CAPTION>
                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                     YEARS ENDED DECEMBER 31, 2000 AND 1999


                                                               2000                     1999
                                                         ----------------         -----------------
<S>                                                     <C>                      <C>
Revenue
   License and production fees                          $         576,631        $           72,106
   Net sales-medical products                                           -                       720
   Private partnership agreement fees                                   -                   100,000
   Other income                                                     9,700                         -
   Interest income                                                 14,596                     2,157
                                                         ----------------         -----------------
    Total revenue                                                 600,927                   174,983
                                                         ----------------         -----------------

Costs and expenses
  Cost of medical products sold                                         -                     6,610
  Production and license fees                                      84,465                         -
  Operating expenses                                            1,901,058                   886,243
  Research and development expenses                                44,431                    51,281
  Interest expense                                                258,832                   257,747
  Loss on disposal/impairment of assets                           670,994                    12,543
                                                         ----------------         -----------------
    Total costs                                                 2,959,780                 1,214,424
                                                         ----------------         -----------------

Net loss before income taxes                                   (2,358,853)               (1,039,441)

Provision for income taxes                                              -                          -
                                                         ----------------         -----------------

Net loss                                                $      (2,358,853)        $      (1,039,441)
                                                         ================         =================

Net loss per share                                      $          (0.188)        $          (0.091)
                                                         ================         =================
</TABLE>




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

F-3


<PAGE>




<TABLE>
<CAPTION>
                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
      CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
                     YEARS ENDED DECEMBER 31, 2000 AND 1999

                                                                                                       Common
                                                                   Common Stock                      Stock Held
                                                           Shares                  Amount             In Escrow
                                                      ----------------         --------------     -----------------
<S>                                                      <C>                  <C>                 <C>
Balances - December 31, 1998                                10,786,973        $        10,788     $               -

Issuance of common stock for cash                              950,000                    950

Issuance of common stock for services                           78,400                     78

Issuance of common stock to be held in escrow                2,700,000                  2,700                (2,700)

Issuance of detachable stock warrants

Conversion feature of note payable

Cancellation of stock options to employees

Net loss
                                                      ----------------         --------------     -----------------

Balances - December 31, 1999                                14,515,373                 14,516                (2,700)

Issuance of common stock for services                          350,000                   350

Issuance of common stock to be held in escrow

Issuance of detachable stock warrants

Conversion feature of note payable

Conversion of notes payable to common stock                                                                   1,335

Net loss
                                                      ----------------         --------------     -----------------

Balances - December 31, 2000                                14,865,373         $       14,866     $          (1,365)
                                                      ================         ==============     =================
</TABLE>






<PAGE>






<TABLE>
<CAPTION>
                     Additional Paid-In Capital                                                      Total
         Common                Detachable             Convertible          Accumulated           Stockholders'
          Stock              Stock Warrants              Debt                Deficit            Equity(Deficit)
     ---------------     ----------------------    -----------------    ------------------    -------------------
<S>                     <C>                        <C>                  <C>                   <C>

   $       1,998,241    $                     -    $               -    $      (1,740,846)       $        268,183

             456,908                                                                                      457,858

              57,227                                                                                       57,305

                                                                                                                -

                                        141,330                                                           141,330

                                                             241,429                                      241,429

             (91,115)                                                                                     (91,115)

                                                                               (1,039,441)             (1,039,441)
     ---------------     ----------------------    -----------------    ------------------    -------------------

           2,421,261                    141,330              241,429           (2,780,287)                 35,549

             105,525                                                                                      105,875



                                        231,385                                                           231,385

                                                             167,143                                      167,143

             533,325                                                                                      534,660

                                                                               (2,358,853)             (2,358,853)
     ---------------     ----------------------    -----------------    ------------------    -------------------

   $       3,060,111     $              372,715    $         408,572    $      (5,139,140)    $        (1,284,241)
     ===============     ======================    =================    ==================    ===================
</TABLE>


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

F-4


<PAGE>



<TABLE>
<CAPTION>
                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                     YEARS ENDED DECEMBER 31, 2000 AND 1999

                                                                               2000                      1999
                                                                   ----------------         -----------------
<S>                                                                <C>                      <C>
Cash Flows From Operating Activities
  Net loss                                                         $     (2,358,853)        $      (1,039,441)
                                                                   ----------------         -----------------
  Adjustments to reconcile net loss to cash used in operating
activities
      Depreciation and amortization                                         244,334                   105,076
      Common stock issued for services                                      105,875                    57,305
      Stock option compensation expense                                           -                   (91,113)
      Accrued interest added to notes payable                                77,455                         -
      Interest expense - issuance of convertible debt                       167,143                   241,429
      Loss on disposal/impairment of assets                                 670,994                    12,543
      Realized gain on forgiveness of debt                                   (8,000)                        -
      Decrease (increase) in operating assets
        Receivables                                                           9,064                   (15,148)
        Inventory                                                                 -                     6,555
        Prepaid expenses                                                    (12,896)                  (15,013)
        Other assets                                                       (147,749)                 (101,048)
   Deposits                                                                  99,411                  (103,556)
      Increase (decrease) in operating liabilities
        Accounts payable                                                   (205,212)                  360,615
        Accrued payroll                                                        (749)                   60,243
        Accrued legal                                                       228,703                     6,250
        Deferred revenue                                                    171,625                         -
        Accrued interest                                                     (2,988)                    5,617
                                                                   ----------------         -----------------
          Total adjustments                                               1,397,010                   529,755
                                                                   ----------------         -----------------
            Net cash used in operating activities                          (961,843)                 (509,686)
                                                                   ----------------         -----------------

Cash Flows From Investing Activities
  Proceeds from the sale of equipment                                         2,000                         -
  Furniture and equipment purchased                                         (25,272)                 (111,004)
                                                                   ----------------         -----------------
    Net cash used in investing activities                                   (23,272)                 (111,004)
                                                                   ----------------         -----------------

Cash Flows From Financing Activities
  Purchase of certificates of deposit                                       (50,000)
  Proceeds from related party loans                                               -                    52,500
  Repayments on related party loans                                          (9,437)                        -
  Payments on line of credit, net                                                 -                         -
  Financing and loan costs                                                  (70,000)                  (81,202)
  Proceeds from long-term debt                                              650,000                   650,000
  Proceeds from issuance of common stock                                          -                   475,000
                                                                   ----------------         -----------------
    Net cash provided by financing activities                               520,563                 1,096,298
                                                                   ----------------         -----------------

Net increase (decrease) in cash                                            (464,552)                  475,608
Cash and cash equivalents at beginning of year                              516,799                    41,191
                                                                   ----------------         -----------------
Cash and cash equivalents at end of year                           $         52,247         $         516,799
                                                                   ================         =================
</TABLE>



<PAGE>










<TABLE>
<S>                                          <C>                    <C>
                                                         2000                   1999
                                               --------------         --------------
Supplemental Cash Flow Information:
  Cash paid for interest                     $         10,756       $         10,701
</TABLE>

For purposes of the statement of cash flows,  management  considers all deposits
and financial  instruments with original maturities of less than three months to
be cash and cash equivalents.


Material  non-cash  transactions  not  reflected in the  statement of cash flows
include:

Year Ended December 31, 2000

-    Deferred financing costs of $231,385 related to the issuance of warrants in
     conjunction with issuance of notes payable.
-    Common  stock and  additional  paid in capital of  $534,660  issued for the
     conversion of notes payable.
-    Equipment with a value of $27,600 transferred to assets held for sale.


Year Ended December 31, 1999

-    Deposits of $58,700 for  property  and  equipment at December 31, 1998 were
     reclassified  to property and equipment  upon receipt of such during fiscal
     1999.
-    Deferred financing costs of $124,188 related to the issuance of warrants in
     conjunction with issuance of notes payable.




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


F-5










<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

Note 1 - Summary of Significant Accounting Policies

Business Activities

Surgical  Safety  Products,  Inc. and its  subsidiary  (Company)  are engaged in
product development, sales and services for the medical industry. The Company is
primarily focused on medical research and product development.  It has developed
a  software  product,  OASiS,  designed  to  reduce  the  occupational  risks of
bloodborne  diseases  in the  operating  room  and  other  related  areas.  From
1997-2000,  the Company  enhanced  its OASiS  system for  multiple  applications
within health care,  including exposure  management,  health care training,  and
health care risk management. The Company is currently licensing OASiS to various
hospitals  and  healthcare  facilities  within the United  States.  Its  medical
products are sold to health care providers.

Consolidated Financial Statements

The  financial  statements  and  notes  are  representations  of  the  Company's
management  who  is  responsible  for  their  integrity  and  objectivity.   The
accounting policies conform to generally accepted accounting principles and have
been consistently applied in the preparation of the financial statements.

Preparation  of financial  statements  in  accordance  with  generally  accepted
accounting principles requires the use of management's estimates. Actual results
could differ from those estimates.

Principles of Consolidation

Effective  December 1, 2000,  the Company  formed a  subsidiary:  OIX,  Inc. The
financial  statements  include the amounts and operations of the Surgical Safety
Products, Inc. and OIX, Inc. All material intercompany transactions and accounts
have been eliminated.

Trade Receivables

Trade  receivables  consist of amounts due from customers.  The Company utilizes
the allowance  method for  uncollectible  receivables.  At December 31, 2000 and
1999,  management has determined  all amounts are  collectible  and therefore no
allowance is necessary.

Investments

Investments  are  valued  at cost  and  represent  shares  of  common  stock  in
privately-held  companies.  Management  believes the value of the investments is
not below cost. Fair market value is not determinable.

Property and Equipment

Purchases  of property and  equipment  are  recorded at cost.  Expenditures  for
maintenance  and repairs  which extend the useful life are charged to operations
as incurred.  Depreciation is provided on an accelerated method over the assets'
useful lives which range from three to seven years.  Leasehold  improvements are
being amortized over the life of the lease term, which is two years.


F-6


<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 1 - Summary of Significant Accounting Policies (Continued)

Intangible Assets

Intangible assets subject to amortization include goodwill,  organization costs,
trade names and patent  costs.  Organization  costs are being  amortized  on the
straight-line  method over five years.  Patent costs are being  amortized on the
straight-line  method over seventeen years from the granting of the patent.  The
other assets are being amortized on the straight-line method over fifteen years.

Deferred Loan Costs

Loan costs  incurred in the  acquisition of debt have been  capitalized  and are
being amortized over the term of the debt agreement which is three years.

Software Development Costs

Certain software development costs are capitalized when incurred. Capitalization
of software  development  costs begins upon the  establishment  of technological
feasibility.  The  establishment  of  technological  feasibility and the ongoing
assessment of recoverability of capitalized  software  development costs require
considerable  judgment by management with respect to certain  external  factors,
including,  but not limited to, anticipated future revenues,  estimated economic
life, and changes in software and hardware technologies.

Amortization of capitalized  software  development costs is calculated using the
straight-line  method  over a period  of five  years.  All  other  research  and
development costs are charged to expense in the period incurred.

Income Taxes

The Company  accounts for income taxes using the asset and  liability  method in
accordance  with  Statement of Financial  Accounting  Standards  (SFAS) No. 109,
"Accounting for Income Taxes."

Long-Lived Assets

Statement  of  Financial  Accounting  Standards  No.  121,  "Accounting  for the
Impairment of Long- Lived Assets and for  Long-Lived  Assets to Be Disposed Of,"
requires that long-lived assets, including certain identifiable intangibles, and
the goodwill related to those assets, be reviewed for impairment whenever events
or changes in circumstances indicate that the carrying value amount of the asset
in question may not be  recoverable.  Management  has  evaluated  the  Company's
long-lived  assets and has determined  that there were events during fiscal 2000
that required  management to review certain of it's  intangible and fixed assets
for impairment. See Notes 16 and 17.

Revenue Recognition

The Company  recognizes revenue related to services at the point the service has
been rendered.

Net Loss Per Share

Net loss per share has been computed in accordance  with  Statement of Financial
Accounting  Standards (FASB) No. 128, "Earnings Per Share," by dividing net loss
by the weighted average

F-7


<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

Note 1 - Summary of Significant Accounting Policies (Continued)

 Net Loss Per Share (Continued)

number of shares  outstanding  during the period.  Common stock equivalents have
not been  included  in the  computation  of  weighted  average  number of shares
outstanding since the effect would have been anti-dilutive.

Additionally,  1,364,881 and 2,700,000  shares issued and outstanding  that were
held in escrow at December 31, 2000 and 1999,  respectively,  have been excluded
from the net loss per share calculation (see Note 11).

Stock Based Compensation

The Company  grants stock  options for a fixed number of shares to employees and
consultants. The Company accounts for stock option grants in accordance with APB
Opinion No. 25,  "Accounting for Stock Issued to Employees" (APB 25) and related
Interpretations   because  the  company  believes  the  alternative  fair  value
accounting  provided under FASB Statement No. 123,  "Accounting  for Stock Based
Compensation,"  requires  the use of  option  valuation  models  that  were  not
developed for use in valuing  employee stock options.  Under APB 25, the Company
only  recognized  compensation  expense to the extent that the fair value of the
shares exceeds the exercise price of the stock option at the date of grant.

The Company did not record compensation expense related to the issuance of stock
options in December 31, 2000 and 1999,  respectively.  During  fiscal 1999,  the
Company  amended the agreement  under which these 1998 stock options were issued
and reduced the  exercise  price from $1.75 to $1.00.  Accordingly,  the Company
reduced compensation in the 1999 fiscal year to reflect the amendment.

Fair Value of Financial Instruments

The carrying amounts of cash and cash equivalents, accounts receivable, accounts
payable,  and accrued  liabilities  approximate fair value due to the short-term
maturities of these assets and liabilities.  The interest rates on the Company's
bank  borrowings  are  adjusted  regularly  to  reflect  current  market  rates.
Accordingly,  the carrying  amounts of the Company's  short-term  and long- term
borrowings also approximate fair value.

Current Pronouncements

In June 1998,  the  Financial  Accounting  Standards  Board  (FASB)  issued SFAS
No.133,  "Accounting  for Derivative  Instruments  and Hedging  Activities,"  as
amended by SFAS No. 138, which was issued in June 2000. The Company adopted SFAS
No.  133 on  January  1,  2001.  SFAS  No.  133  requires  that  all  derivative
instruments be recorded on the balance sheet at their fair value. Changes in the
fair value of derivatives are recorded each period in current  earnings or other
comprehensive income, depending on whether a derivative is designated as part of
a hedge  transaction and, if it is, the type of hedge  transaction.  The Company
does not participate in any financial  instruments that meet the definition of a
derivative, and therefore, adoption of this statement did not have any effect on
the Company's financial statements.

F-8


<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 1 - Summary of Significant Accounting Policies (Continued)

Current Pronouncements (Continued)

In November  1999, the  Securities  and Exchange  Commission  (SEC) issued Staff
Accounting  Bulletin ("SAB") No. 100,  "Restructuring  and Impairment  Charges".
This SAB  provides  guidance on the  accounting  for and  disclosure  of certain
expenses and  liabilities  often reported in connection with exit activities and
business  combinations  (restructuring  activities),  and  the  recognition  and
disclosure of asset impairment charges.  The Company's  accounting treatment for
similar   transactions,   as  discussed  in  Note  17  is  consistent  with  the
requirements  of this SAB.  The fourth  quarter of 1999,  the SEC issued SAB No.
101,  "Revenue  Recognition".  The Company adopted the SAB in January 2000 which
did not have a material impact on its financial statements.

In March 2000,  the FASB issued  Interpretation  (FIN) No. 44,  "Accounting  for
Certain Transactions Involving Stock Compensation,  an interpretation of APB No.
25." The requirements of FIN No. 44 are not applicable to the Company.

In September  2000,  the  Emerging  Issues Task Force  ("EITF")  reached a final
consensus on EITF Issue 00-10,  "Accounting  for Shipping and Handling  Fees and
Costs." This consensus  requires that all amounts billed to a customer in a sale
transaction  related to shipping and  handling,  if any,  represent  revenue and
should be  classified as revenue.  The  Company's  adoption of this EITF did not
have a material effect on its financial statements.


Note 2 - Property and Equipment

Property and equipment consisted of the following at December 31:

<TABLE>
<S>                                             <C>              <C>
                                                     2000             1999
Property and equipment                          $      139,322   $      271,165
Prototype molds                                         59,652           59,652
Leasehold improvements                                    -               5,575
                                                       198,974          336,392
Less accumulated depreciation                          127,001          132,859
  Property and equipment, net                   $       71,973   $      203,533
                                                ==============   ==============
</TABLE>

Total depreciation and amortization  expense amounted to $56,515 and $66,400 for
2000 and 1999, respectively.

Note 3 - Line-of-Credit

The Company has a line-of-credit  with a financial  institution in the amount of
$100,000 that matures on December 31, 2000.  Interest is at 1.5% above the prime
rate.  Interest  payments  are due  monthly.  The line is due on  demand  and is
secured by inventory,  accounts receivable,  and equipment. The Company has also
pledged certificates of deposit in the amount of $50,000

F-9




<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 3 - Line-of-Credit (Continued)

against the line-of-credit.  The line-of-credit is also personally guaranteed by
the major stockholder.

As of  December  31,  2000,  the  entire  balance  of  the  line-of  credit  was
outstanding.  Subsequent  to year  end the  Company  paid  down  $50,000  of the
line-of-credit  utilizing the pledged  certificates  of deposit.  The balance of
$50,954, consisting of principal and accrued interest, remains outstanding as of
the  date  of this  report.  The  Company  is in  default  of the  terms  of the
line-of-credit.


Note 4 - Related Party Transactions

During fiscal 1999, the major stockholder and a related entity made loans to the
Company  totaling $52,500 at 10% interest.  The outstanding  balance at December
31,  2000 and 1999  amounted  to  $35,063  and  $52,500,  respectively.  Accrued
interest  on these  notes  amounted  to $2,630 and  $5,617  for the years  ended
December 31, 2000 and 1999, respectively.

The Company leased office space through October 12, 2000 from an entity owned by
a major  stockholder.  Rent  expense  paid to the  stockholder  was  $31,500 and
$42,000 for the years ended December 31, 2000 and 1999, respectively.

During fiscal 2000 a related entity  forgave $9,600 in rent payable,  consisting
of outstanding rent and accrued interest.

Accrued  expenses as of  December  31, 2000 and 1999  included  amounts  owed to
directors and officers in the amounts of $73,792 and $92,560, respectively.


Note 5 - Software Development Costs

During the fiscal year ended December 31, 1997, the Company  focused its efforts
in developing the software for its major product, OASiS. The Company engaged the
services  of a software  development  company  and  incurred  significant  costs
related to the design and  development  of the  software.  The Company  achieved
technological feasibility in its development of the software in fiscal 1997.

For the years  ended  December  31,  2000 and 1999,  the  Company  incurred  and
capitalized  expenditures  relating to the  enhancement  of the  software in the
amounts of $147,768 and $77,900, respectively.  Amortization expense of software
development  costs  amounted to $31,098 and $31,391 for the years ended December
31, 2000 and 1999, respectively.





F-10


<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 6 - Intangible Assets

Intangible assets consisted of the following at December 31:

<TABLE>
<S>                                         <C>              <C>
                                                 2000             1999
Goodwill                                    $        -       $       32,762
Organization costs                                  11,502           11,502
Trademarks                                          11,658           11,658
Patents                                             39,479           39,479
                                                    62,639           95,401
Less:  Accumulated amortization                     18,361           28,270
Intangible assets, net                      $       44,278   $       67,131
                                             ==============   ==============
</TABLE>

The Company  determined  that the net book value of the  goodwill as of December
31, 2000 was impaired.  At that time the Company wrote-off the remaining balance
of $19,658. See Note 17.


Note 7 - Stock Option Plans

Options granted under the 1994 and 1998 stock option plans are exercisable  only
after the  respective  vesting  period which is two years from the date of grant
under the 1994 plan,  and  determined  by the Company's  stock option  committee
under the 1998 plan.  Options  expire seven years from the date of grant.  Under
the 1999 stock option plan, options granted to employees vest ratably over three
years; vesting is determined by the Company's stock option committee for options
granted to officers,  directors, and consultants.  Options expire ten years from
the date of grant.

Pro forma information regarding net income and earnings per share is required by
Statement  123, and has been  determined as if the Company had accounted for its
stock options under the fair value method of that Statement.  The fair value for
these  options was estimated at the date of grant using a  Black-Scholes  option
pricing model with the following  assumptions for 2000:  risk-free interest rate
of 6.03%;  dividend yield of 0%;  volatility factor of the expected market price
of the Company's  common stock of .34; and a  weighted-average  expected life of
the option of 2.7 years.


For 1999, these  assumptions were as follows:  risk-free  interest rate of 6.0%;
dividend  yield of 0%;  volatility  factor of the  expected  market price of the
Company's  common  stock of .32;  and a  weighted-average  expected  life of the
option of four years.

The Black-Scholes option valuation model was developed for use in estimating the
fair value of traded  options which have no vesting  restrictions  and are fully
transferable.  In addition,  option valuation models require the input of highly
subjective  assumptions  including the expected stock price volatility.  Because
the Company's stock options have  characteristics  significantly  different from
those of traded options, and because changes in the subjective input assumptions
can


F-11


<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 7 - Stock Option Plans (Continued)

materially affect the fair value estimate, in management's opinion, the existing
models do not necessarily provide a reliable single measure of the fair value of
its stock options.

For purposes of pro forma  disclosures,  the estimated fair value of the options
is charged to expense over the  options'  vesting  period.  For the fiscal years
ended  December 31, 2000 and 1999 the Company would have  recorded  compensation
expense  of  $41,730  and  $186,066,   respectively.  The  Company's  pro  forma
information for the fiscal year ended December 31, 2000 and 1999 is as follows:

                                                2000             1999
Proforma net loss                         $   (2,400,583)  $   (1,225,507)
Pro forma earnings per common share:
  Basic                                   $       (0.192)  $       (0.107)


A summary of the Company's stock option activity and related information for the
years ended December 31 follows:

<TABLE>
<CAPTION>
                                                         2000                                1999
                                                         Weighted                          Weighted
                                                         Average                           Average
                                                         Exercise                          Exercise
                                      Options              Price           Options            Price
<S>                                   <C>             <C>             <C>                <C>
Outstanding at the beginning
  of the year                            6,007,260    $        0.64       5,241,431      $       0.41
Cancelled                                 (571,126)            0.90               -                 -
Granted                                    656,000             0.20         765,829              1.13
Exercised                                        -                -               -                 -

Outstanding at the end
  of the year                            6,092,134    $        0.43       6,007,260      $       0.64
                                     =============    =============    ============      ============
Exercisable at the end
  of the year                            5,536,134    $        0.46       5,079,431      $        .47
                                     =============    =============  ==============      ============

Weighted-average fair value of
  options granted during the year                     $        0.20                      $       0.28
                                                      =============                     =============
</TABLE>

The weighted-average  exercise price and weighted-average  fair value of options
granted during 2000 was $.20 and $.20, respectively,  for options whose exercise
price  equaled the market  price of the stock on the grant  date.  For all stock
options  granted  during fiscal 2000, the exercise price equaled the fair market
value of the options on the date of grant.

F-12


<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 7 - Stock Option Plans (Continued)

The weighted-average  exercise price and weighted-average  fair value of options
granted  during  1999 was $1.13  and  $0.28,  respectively,  for  options  whose
exercise  price  exceeded the market  price of the stock on the grant date.  The
weighted  average  exercise  price and  weighted-average  fair  value of options
granted  during  1999 was $1.00  and  $0.28,  respectively,  for  options  whose
exercise price was less than the market price of the stock on the grant date.

The following table summarizes information about the options outstanding at
December 31, 2000:

<TABLE>
<CAPTION>
                                          Weighted
                                           Average
                                          Remaining      Weighted
                      Number             Contractual      Average
Exercise Price         Outstanding          Life        Exercise Price
----------------------------------------------------------------------
<S>                      <C>            <C>             <C>
$  0.13 to 0.32          5,041,740        1.70 years    $        0.34

    0.34 to 0.90            42,566        7.91 years             0.41

    1.00 to 1.72         1,007,828        6.81 years             1.10

                         6,092,134        2.58 years    $        0.43
                 =================                      ===============
</TABLE>


Note 8 - Notes Payable

In December  1999,  the Company  entered  into an agreement  with an  investment
banking  firm  (lender) to secure a  convertible  secured  line of credit in the
amount of  $5,000,000.  Interest  on the  outstanding  balance is at 8.0% and is
payable upon any prepayment of principal and at maturity.  The agreement matures
on November 30, 2002. Advances, in the form of promissory notes, on the line are
up to a maximum of $500,000 in any 90-day period and certain  restrictions  must
be met by the  Company  in order to access  the  line.  The line is  secured  by
inventory, receivables, equipment, securities and general intangibles.

The  lender  has the  option  to  convert  all or a portion  of the  outstanding
principal and interest  balance into common stock, at a price per share equal to
the lower of $0.82 or 75% of the closing bid price on the date of conversion. In
no event, can the conversion price be lower than $0.375 per share. During fiscal
2000, the lender converted $510,000 of principal and $24,661 of accrued interest
to 1,334,535 of shares of common stock at and average  conversion price of $0.40
per share.

The  Company  also issued  warrants  to the lender to  purchase up to  4,571,428
shares of its common stock at an exercise price of $1.09 per share. The warrants
are  exercisable  from the date of  commitment  through the term of the loan and
vest as follows:  on date of commitment for 20% of the shares; and an additional
1% for each $25,000 of principal loans subsequently  advanced during the term of
the loan.

F-13


<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

Note 8 - Notes Payable (Continued)

During fiscal 2000,  the Company  received an additional  advance on the line-of
credit of $650,000.  The balance  outstanding,  including accrued  interest,  at
December 31, 2000 and 1999 was $842,795 and $650,000, respectively.

In accordance with the terms of the agreement,  an additional 1,188,571 warrants
became exercisable during fiscal 2000.


Note 9 - Conversion Feature of Notes Payable

At the time of commitment on the line of credit agreement (See Note 8), the fair
market value of the stock  approximated  $1.13.  The  conversion  feature of the
agreement provides for option of the debt to be converted at the lower of 75% of
the closing  bid on the date of  conversion  or $0.82 per share.  At the date of
commitment  the lender  had the  option to  convert  the debt at $0.82 per share
resulting in a beneficial conversion feature.

Accordingly,  the Company valued the debt and the conversion feature separately.
The Company  estimated the fair value of the conversion  feature at $241,249 and
recorded this amount as interest  expense and additional paid in capital for the
fiscal year ended December 31, 1999.

The Company  received an  additional  advance of $650,000 on March 31, 2000,  at
which time,  the fair market  value of the stock  approximated  $1.38 per common
share.  The  Company  estimated  the fair  value of the  conversion  feature  at
$167,143 and recorded  this amount as interest  expense and  additional  paid in
capital for the fiscal year ended December 31, 2000.


Note 10 - Issuance of Detachable Warrants

In conjunction  with the execution of the  convertible  line of credit (See Note
8), the Company  allocated  $124,188 of the proceeds to the detachable  warrants
exercisable at the date of commitment.  The Company recorded deferred  financing
costs and additional paid in capital in the amount of $124,188 during the fiscal
year ended December 31, 1999 related to the warrants.

For the year ended  December  31,  2000 the  Company  recorded  $231,385  of the
proceeds from the line-of-credit to the detachable  warrants  exercisable at the
date of commitment. The Company recorded deferred financing costs and additional
paid in capital in the amount of $231,385.


Note 11 - Common Stock Issuance

During fiscal 2000,  the Company  issued  350,000  shares of its common stock in
exchange for public  relations  services.  The value of the shares issued ranges
from $0.27 to 0.35 per share based on the fair market value of the shares at the
time the  agreements  were  executed.  During the fiscal year ended December 31,
1999,  the Company  issued 57,400 shares of its common stock to its employees in
lieu of compensation. The Company issued an additional

F-14



<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 11 - Common Stock Issuance (Continued)

21,000 shares of its common stock in exchange for legal,  investment,  and other
consulting  services.  The value of the shares issued ranged from $0.50 to $1.25
per share based on the fair market  value of the shares at the time the services
were rendered or at the time the agreement for services was executed,  whichever
was more estimable.

In April 1999, the Company commenced a self-directed  private placement offering
to sell shares of its  restricted  common  stock and  warrants.  Pursuant to the
offering, 950,000 shares of common stock and warrants to purchase 475,000 shares
of the  Company's  restricted  common stock were issued at an exercise  price of
$1.00  excersible  within five years were granted.  The shares and warrants were
sold  together  at $.50 per unit.  The Company  estimated  the fair value of the
warrants  to be $0.17  each and  allocated  a portion of the  proceeds  from the
issuance to such as additional paid in capital - warrants.  The amount allocated
was $17,142.

Pursuant to the secured  line of credit  entered into by the Company in December
1999 (see Note 8), the Company was  required  to issue  2,700,000  shares of its
common  stock to be held in escrow by the  lender.  The  purpose  of the  escrow
account  is to ensure  availability  of shares of common  stock  that the lender
could obtain by exercising the conversion  feature and warrants  issued pursuant
to the agreement.

During fiscal 2000, the lender converted a portion of the principal and interest
outstanding to 1,334,535 shares of common stock. Those shares were issued out of
amounts held in escrow.

The lender does not have  ownership or voting  rights to the shares;  should the
lender not exercise all or a portion of the  conversion or warrants,  the shares
will be returned to the  Company.  Therefore,  as of December 31, 2000 and 1999,
the Company has excluded the 1,364,881 and 2,700,000 shares, respectively,  from
its net loss per share calculations.

During the fiscal year ended  December  31,  1998,  the Company  issued  492,500
shares of common  stock in exchange  for legal,  computer  hardware and software
consulting services,  and public relations services. Of the total issued, 90,000
shares were restricted stock. The value of the shares issued ranged from $0.15 -
$1.75 per share based on either the fair market  value of the shares at the time
the agreement for services was executed,  or the value of the services received,
whichever was more estimable.

During 1998,  the Company also issued 520,000 shares of common stock in exchange
for cash.  The value of the shares  issued  ranged  from $1.75 - $2.19 per share
based on the fair market value of the shares at the time of issuance.

Note 12 - Income Taxes

At December  31,  2000,  the Company has net  operating  loss  carryforwards  of
approximately  $4,300,000  which expire during the years 2008 through 2012.  The
2000 and 1999 tax benefits relating to the losses incurred in each year amounted
to approximately $355,000 and $205,000,

F-15


<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 12 - Income Taxes (Continued)

respectively,  based on a blended 20% corporate tax rate. Based on the Company's
financial  history,  there is no basis to conclude that the tax benefits will be
realized.  Therefore, the tax benefit that has been recorded in the accompanying
financial  statements  for the years ended  December  31, 2000 and 1999 has been
offset by an allowance equal to the benefit.


Note 13 - Commitments

On January 30, 1998,  the Company  entered into an agreement  with a health care
provider in which the provider will perform  clinical testing of ten surgical or
medical  products  submitted by the Company.  The agreement is for a term not to
exceed five years and  requires  the  Company to pay the health care  provider a
fixed  amount of $25,000  for each of the ten  studies.  The  agreement  further
provides  that the Company is obligated to pay the  provider  $250,000  over the
term of the  agreement  in the  event  the  Company  determines  not to have the
provider perform the clinical  testing.  The Company did not submit any products
for clinical testing during the fiscal years ended December 31, 2000 and 1999.


Note 14 - Concentrations

The Company  derived 98% and 96% of its  revenues  from  technical  services and
OASiS  licensing and production  fees provided to one customer during the fiscal
years ended December 31, 2000 and 1999, respectively.


Note 15 - Lease Commitments

The Company leases office  equipment for day to day operations.  The lease terms
range from 36 to 60 months. Minimum lease payments are as follows for the fiscal
years ending:

       2001     $       21,781
       2002             21,781
       2003             12,451
       2004              6,047


Note 16 - Assets Held for Sale

During the third quarter of fiscal 2000, the Company changed it's business model
for delivering its information  product from a KIOSK unit to the Internet.  As a
result,  the Company no longer  would  require the use of the KIOSK  units.  The
Company  determined  that it would  dispose  of these  units,  and  prepared  an
analysis  to  determine  the fair  market  value of those  assets.  The  Company
gathered  bids from various  potential  customers.  Based on an average of these
bids,  the Company  adjusted  the value of the KIOSKS to reflect the fair market
value.  The write down to fair  market  value  amounted  to $71,149 for the year
ended December 31, 2000. The Company  reclassified the KIOSKS to Assets Held for
Sale from fixed assets used in operations.

F-16



<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 17 - Impairments

During the third  quarter of fiscal  2000,  the Company  changed  it's  business
model.  As a result of this change,  the Company  examined the book value of its
goodwill and capitalized software development costs. The Company determined that
the present value of the  discounted  cash flows  expected to be generated  were
less  that the book  value of the  respective  asset  values.  Accordingly,  the
Company recorded an impairment loss of $248,857 as of December 31, 2000.


Note 18 - Subsequent Events

On February 7, 2001, the lender  converted  $230,000 of principal and $18,570 of
accrued interest to 662,854 shares of the Company's common stock at a conversion
price of $0.375 per share. This reduced long-term debt by $248,570.

On February  7, 2001 the Company  executed a loan  cancellation  and  settlement
agreement  effectively ending the  line-of-credit  agreement with the investment
banking firm (see Note 8).  Pursuant to the  agreement  the lender  converted an
additional  $243,665 of  principal  and  $19,601 of accrued  interest to 702,043
shares of the Company's common stock at a conversion price of $0.375.  As of the
date  hereof,  the  principal  balance  of the  amount  owed to the  lender  was
$316,335,  plus accrued interest.  Until fully converted,  the remaining balance
will accrue  interest at 8%. In  accordance  with the  agreement  the lender has
turned over all  escrowed  shares and has  committed  to convert  the  remaining
principal  and  accrued  interest as soon as  possible.  As a result of the loan
cancellation,  the  Company  determined  that  there was no longer  any  benefit
associated  with the deferred loan costs and wrote-off the net book value of the
asset in the amount of $351,418, as of December 31, 2000 (see Note 10).

Subsequent to December 31, 2000, the Company engaged in discussions with another
company  regarding a possible merger. As of the date of this report the terms of
the agreement have not been finalized.


Note 19 - Reclassifications

To  facilitate  comparison  of  financial  data,  certain  amounts  in the  1999
financial  statements  have been  reclassified  to conform to the 2000 reporting
presentation.  Such  reclassifications  had no effect on net  income  previously
reported.


Note 20 - Contingency

The Company is a defendant  in a civil  lawsuit,  filed by a former  supplier of
support  services for the  Company's  OASiS  systems.  The plaintiff is alleging
breach of contract, implied contract, account stated, and unjust enrichment. The
Company   intends  to  vigorously   defend  these  actions  which  it  considers
groundless.  The ultimate  resolution of these matters is not  ascertainable  at
this time.  No provision has been made in the  financial  statements  related to
these claims.

F-17


<PAGE>



                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

 Note 21 - Realization of Assets

The  accompanying  financial  statements  have been prepared in conformity  with
generally accepted accounting principles,  which contemplate the continuation of
the Company as a going concern. The Company has sustained substantial losses and
has minimal revenues for the current fiscal year. The Company is also in default
of the terms of its line-of-credit agreement with a financial institution.

In view of the matters described in the preceding paragraph, recoverability of a
major portion of the recorded  asset amounts shown in the  accompanying  balance
sheet is dependent upon the Company's ability to achieve  profitable  operations
and to continue to obtain sufficient sources of funds.  Management  believes the
Company's  prospects  for  profitability  are  significant,  based on additional
funding with an appropriate  merger candidate and the ability to further develop
and market  it's  product  lines.  The  Company  believes  it has an  attractive
industry niche, combining medical device lines and information  technology.  The
company  was  founded  on  the  principles  of  healthcare   worker  safety  and
efficiency.  Recent legislative  changes and new willingness to adopt e-business
methods have opened the door to the company's primary products and services. The
company has suffered setbacks related to inadequate  funding and the significant
scale-down of OASiS, in the face of poor financial market  conditions.  This led
to the  fiscal  year  2000  business  plan  restructuring  and  down-  sizing of
operations.  Management  believes that with a successful merger and combining of
synergistic  resources,  that the Company can take positive steps and capitalize
on other  opportunities that are expected to present themselves in a down market
environment.

In July 1999, the Company  entered in to a private  partner  agreement with U.S.
Surgical  Corporation  (see Note 14), which will allow it to license its product
in over 400  hospitals  over the next three years.  The Company began to realize
some of these revenues in fiscal 1999 and anticipated a significant  increase in
revenues  for  fiscal  2000,  related  to  the  agreement.   The  agreement  was
prematurely  terminated by U.S. Surgical Corporation,  and the expected revenues
were not achieved and the Oasis project was redesigned as a webcentric  service.
Several prominent customers were achieved and OASiSOR.com was launched.  Despite
adverse  market  conditions,  the Company  believes the project and similar ones
could be successful, given proper funding and restructuring.

To help fund and expand  current  operations,  the Company  secured a $5,000,000
line-of-credit  in  December  1999  (see  Note  8).  This   line-of-credit   was
effectively  closed and loans  outstanding  renegotiated.  New  funding has been
offered pending the proposed merger mentioned above.


F-18


<PAGE>






                            SUPPLEMENTARY INFORMATION







<PAGE>







            INDEPENDENT AUDITORS' REPORT ON SUPPLEMENTARY INFORMATION



The Board of Directors
Surgical Safety Products, Inc. and Subsidiary


We have audited the accompanying  consolidated  financial statements of Surgical
Safety Products,  Inc. and Subsidiary as of and for the years ended December 31,
2000 and 1999, and have issued our report thereon dated May 15, 2001. Our audits
were made for the  purpose of forming  an  opinion on the  financial  statements
taken  as a  whole.  The  supplementary  schedules  of  operating  expenses  are
presented for purposes of additional  information and are not a required part of
the financial  statements.  Such  information has been subjected to the auditing
procedures  applied in the  examination of the financial  statements and, in our
opinion,  is fairly stated in all material respects in relation to the financial
statements taken as a whole.


/s/ Kerkering, Barberio & Co
KERKERING, BARBERIO & CO., PA
Sarasota, Florida
May 15, 2001



F-19


<PAGE>




<TABLE>
<CAPTION>
                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY
                  CONSOLIDATED SCHEDULES OF OPERATING EXPENSES
                     YEARS ENDED DECEMBER 31, 2000 AND 1999


                                                                 2000                     1999
                                                            -------------            ------------
<S>                                                    <C>                      <C>
Advertising                                            $                        $           47,048
                                                                  41,133
Contract labor                                                    99,634                    13,529
Depreciation and amortization                                    244,334                   105,076
Education and training                                             6,270                     3,950
Equipment                                                         11,989                     3,895
Equipment rental                                                  13,400                     5,472
Filing fees                                                        4,921                     1,309
Freight                                                                -                     3,793
General and administrative                                        14,475                    40,429
Insurance                                                         44,488                    18,228
Meetings/conventions                                              47,976                    13,554
OASiS internet charges                                                 -                    19,010
Occupancy                                                         46,437                    44,179
Postage and printing                                              15,553                    11,532
Product development                                               17,195                         -
Professional fees                                                286,134                    92,377
Promotion                                                        114,650                         -
Recruitment                                                       26,437                         -
Relocation                                                        30,000                         -
Repairs and maintenance                                            4,882                     1,814
Salaries and related expenses                                    613,053                   339,332
Samples and supplies                                                   -                       654
Shareholder relations                                            104,401                         -
Taxes                                                                119                     1,314
Telephone                                                         35,734                    30,755
Travel and entertainment                                          77,843                    88,993
                                                      $        1,901,058        $          886,243
</TABLE>





F-20




<PAGE>



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

     The Company has used the accounting firm of Kerkering, Barberio & Co., P.A.
since 1993. Their address is 1858 Ringling Boulevard,  Sarasota,  Florida 34236.
This firm began providing audited financial  statements for the Company in 1994.
There has been no change in the  Company's  independent  accountant  during  the
period  commencing  with the Company's  retention of Kerkering,  Barberio & Co.,
P.A. through the date hereof.

                                    PART III

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

     (a) Set forth below are the names,  ages,  positions,  with the Company and
business experiences of the executive officers and directors of the Company.

Name                          Age        Position(s) with Company
-----------------------       ----       ---------------------------------------
Dr. G. Michael Swor           43         Chairman, President and Chief Executive
4485 S. Shade Avenue                     Officer
Sarasota, FL 34237

Donald K. Lawrence (1)        38         Director
Sarasota, FL 34242

James D. Stuart               43         Director
880 Jupiter Park Drive
Suite 14
Jupiter, FL 33458

Sam Norton                    41         Director and Chairman of the Stock
1819 Main Street                         Compensation Committee
Suite 610
Sarasota, FL 34236

David Swor                    68         Director
6385 Presidential Court
Suite 104
Fort Meyers, FL 33919

Dr. William B.Saye (1)        61         Director and Medical Director of
4614 Chattahoochee Crossing              ALTC VirtualLabs
Marietta, GA 30067


                                                                 39

<PAGE>



(1)  Except  for Mr.  Lawrence  and Dr.  Saye,  who had no role in  founding  or
     organizing  the  Company,  the  above-named  persons  may be  deemed  to be
     "promoters" and "parents" of the Company,  as those terms are defined under
     the Rules and Regulations promulgated under the Act.

     All  directors  hold office until the next annual  meeting of the Company's
shareholders and until their successors have been elected and qualify.  Officers
serve at the pleasure of the Board of Director.  The officers and directors will
devote such time and effort to the business and affairs of the Company as may be
necessary  to  perform  their  responsibilities  as  executive  officers  and/or
directors of the Company.

Family Relationships

     There are no family  relationships  between or among the executive officers
and  directors of the Company  except that David Swor is Dr. G.  Michael  Swor's
father.

Business Experience

     G. Michael Swor,  M.D.,  M.B.A, age 43, has served as Chairman of the Board
and Medical/Technical Advisor of the Company since its inception in 1992. He has
served as Treasurer to the Company from June, 1998 until February 2000, as Chief
Executive Officer since February 2000 and as President since November, 2000.

     Dr.  Swor,  a board  certified,  practicing  physician  with a specialty in
OB/GYN, is the founder of Surgical. From 1992 until June 12, 1998, Dr. Swor also
served as  President  and CEO.  With a Masters in Business  Administration,  Dr.
Swor's duties for the Company include investor relations,  corporate  financing,
and  overall  corporate  policy  and  management.  He  is a  clinical  assistant
professor in the OB/GYN department at University of South Florida.  Dr. Swor was
the inventor of SutureMate(R) and  Prostasert(TM) and the original holder of the
patents  issued  to each of  these  products.  Dr.  Swor  has  written  numerous
articles,  published the "Surgical Safety Handbook," and given numerous lectures
on  safety  and  efficiency  in  the  surgical  environment.   His  professional
affiliations   include  American  College  of  Surgeons,   American  College  of
Obstetrics and Gynecology and the Florida Medical  Association.  From 1996 until
the present, Dr. Swor has acted as an independent  consultant for Concise Advise
which  provides  consulting  services  related to product  development,  patent,
research,  distribution,  joint venture, mergers and other business issues. From
1994 through

                                                                 40

<PAGE>



1996, Dr. Swor oversaw the operation of WDC. From 1987 through 1995,Dr. Swor was
the managing partner of Women's Care Specialists/Physicians  Services Inc. where
he oversaw four (4) physicians, two (2) practitioners and a staff of over twenty
five (25).  From 1987 through  1992,  Dr. Swor was a partner and board member of
Women's  Ambulatory  Services,  Inc., a diagnostic  testing facility.  From 1982
through  1985,   Dr.  Swor  was  the  President  of  University  of  Florida  at
Jacksonville,  Health Sciences Center resident staff  association  with over 200
members.  Dr. Swor  received a B.A degree in 1978 from the  University  of South
Florida,  a M.D. degree from the University of South Florida College of Medicine
in 1981, and an M.B.A. degree from the University of South Florida in 1998. From
1981  through 1985 he received  his  training in OB/GYN from the  University  of
Florida Department of Obstetrics and Gynecology in Jacksonville, Florida. He has
received  several  special  achievement  awards  including  being honored by the
University of South Florida in May, 1998 with the Alumni Award for  Professional
Achievement.

     Donald K. Lawrence, age 38, has served as a Director since May 1997, served
as Vice President, Sales & Marketing and Secretary from May, 1997 until February
2000,,  served as Executive Vice  President from January,  1998 to February 2000
and served as  President  and Chief  Operating  Officer  from  February  2000 to
October 31, 2000.

     While  an  Officer,   Mr.   Lawrence's   responsibilities   included  sales
management,  market  planning,  advertising,  and  management  for OASiS and the
Compliance  PlusTM  products.  His arrival to the Company was facilitated by the
Company's acquisition in 1997 of InterActive PIE Multimedia,  Inc., of which Mr.
Lawrence  was founder and Chief  Executive  Officer.  From  February  1996 until
February 1997, Mr.  Lawrence was the CEO of InterActive  PIE. From December 1991
until February 1996, Mr. Lawrence was employed by Ethicon Endo-Surgery/Johnson &
Johnson as a surgical sales representative.  From July 1989 until December 1991,
Mr. Lawrence acted as a surgical sales  representative for Davis and Geck. Prior
to entering the area of medical  device  sales,  from  February  1985 until July
1989, Mr. Lawrence was an account executive with DHL Worldwide  Express.  During
college, Mr. Lawrence was an independent dealer for Southwestern  Publishing Co.
Mr Lawrence  received a B.S degree in Marketing and  Communications in 1984 from
Appalachian State University.

     James D.  Stuart,  age 43, has served as a Director  since 1993,  initially
acting as Director of Marketing and Sales.

     Mr. Stuart served as Executive Vice  President  from 1993 until June,  1998
and initially  acted as the Director of Marketing and Sales.  During his time as
an  officer  of  the  Company,  Mr.  Stuart  was  responsible  for  new  product
development  and  manufacturing  and manages new  business  ventures,  including
mergers,    acquisitions,    joint    ventures,    strategic    alliances    and
licensing/distribution agreements for the Company. From November 1994 until July
1996,  Mr.  Stuart acted as  President  and CEO of WDC and was  responsible  for
managing and operating the facility.  From March 1986 until May 1993, Mr. Stuart
was employed by Liquid Air Corporation,  Buld Gases Division first as a Business
Manager for South Florida and then as a Program Manager for Food Freezing.  From
February 1981 until February 1986, Mr. Stuart was employed by NCR Corporation in
the Systemedia  Division  initially as a Territory  Manager and then as a Senior
Account Manager. Mr. Stuart received a B.A. degree in marketing in 1980 from the
University of South Florida.


                                                                 41

<PAGE>



     Sam Norton,  age 41, has served as a Director  since 1992 and has served as
Chairman of the Stock Compensation Committee since February 2000.

     Mr. Norton  provides  business and legal advisory  services to the Board of
Directors. Mr. Norton is an attorney with the firm Norton, Gurley,  Hammersley &
Lopez, P.A. in Sarasota, Florida. Mr. Norton practices primarily in the areas of
real estate,  banking,  corporate and business transactions and is a Florida Bar
board  certified real estate  specialist,  having earned such  certification  in
1991. He has  practiced  law in Sarasota  since 1985 and is the past Chairman of
the Joint  Committee  of the  Sarasota  Board of  Realtors/Sarasota  County  Bar
Association.  Mr. Norton is active in Sarasota civic organizations and currently
serves  as a member of the Board of  Directors  of  Sarasota  Bank.  Mr.  Norton
graduated from the  University of Florida in 1981 and earned a J.D.  degree from
Stetson  University School of Law in 1984 where he graduated Cum Laude. While in
law school, Mr. Norton was chosen to serve on the Law Review. He was admitted to
the Florida Bar in 1985.

     David Swor, age 68, has served as a Director since 1992.

     Mr.  Swor,  who is the  father  of Dr.  Swor,  provides  business  advisory
services for the Board of Directors.  From 1985 until the present,  Mr. Swor had
been engaged in the real estate  brokerage  business as the owner of Swor,  Inc.
The firm  specializes in the  development of commercial  real estate  properties
along with operating other related  business  interest,  holdings and investment
properties. From 1992 to the present, Mr. Swor has been a member of the Board of
Directors of SunTrust Bank in Sarasota,  Florida. From 1974 until 1985, Mr. Swor
was a co-owner of the real estate firm of Swor & Santini, Inc. which specialized
in commercial real estate and investments.  From 1973 until 1975, Mr. Swor was a
realtor  with Russ  Gorgone,  Inc..  From 1971  until  1973,  Mr.  Swor was Vice
President  and  co-owner  of  Carroll  Oil  Company,  which  operated  a  Texaco
distributorship  in Fort Myers,  Florida.  From 1959 until 1971,  Mr. Swor was a
salesman for Texaco and from 1958 until 1959, Mr. Swor was in advertising  sales
for the  Orlando  Sentinel  Star.  Mr.  Swor  received  a B.A.  degree  from the
University of Kentucky in 1955 and holds teaching  certificates  from the states
of Kentucky and Florida.

     William B. Saye, MD, FACOG, FACS, age 61, has served as Medical Director of
ALTC VirtualLabs since November 1998 and as a Director since January, 1999.

     Dr. Saye is the founder, CEO and Medical Director of ALTC. ALTC was started
in 1990. Dr. Saye is also the Clinical  Assistant  Professor of OB/GYN for Emory
University  School of Medicine in  Atlanta,  Georgia.  Dr.  Saye,  with  another
pioneering   surgeon,   made  medical   history  when  he  performed  the  first
laparoscopic cholecystectomy (removal of the gall bladder) in the United States.
In the past nine (9) years, Dr. Saye has been instrumental in training more than
15,000  surgeons  in  various   laparoscopic   techniques  and  spearheaded  the
development  of  a  new  minimally  invasive  therapy,   laparoscopic  Doderlien
hysterectomy.  Dr. Saye  received a BS from Georgia  Institute of  Technology in
1962 and his MD degree from Tulane  University  Medical School in 1965. Dr. Saye
is board  certified  in  Obstetrics  and  Gynecology  and in  Advance  Operative
Laparoscopy. Dr. Saye is the author of numerous articles on laparoscopic surgery
and techniques.


                                                                 42

<PAGE>



Scientific Advisory Board

     In addition to the  officers and  directors of the Company,  Surgical has a
scientific  advisory  board  which  has  provided  advisory  input on  products,
research and  educational  projects for the  Company.  Inactive  members of this
board can be called on to address  issues  which arise in ongoing  research  and
development  projects.   Active/Inactive   status  depends  upon  the  level  of
participation in the Company's  current  activities.  Scientific  Advisory Board
members  receive no salaries  for their  services  but are  compensated  for any
reasonable out of pocket expenses incurred on behalf of the Company. Included on
such board are the following:

Mark Davis, M.D.
OB/GYN Physician & Safety Consultant
DeKalb Medical Center
Atlanta, Georgia

Donna Haiduven, RN/C.I.C.
Infection Control Specialist
Santa Clara Valley Medical Center
San Jose, California

Robert Morrison, M.D.
Optometrist/Chairman, Morrison International
New York, New York

Gail Lebovic, M.D. (Inactive)
Breast Surgeon
Co-Founder, Bay Area Breast Center
Palo Alto, California

Sharon Tolhurst, RN, MBA
Director, Cape Surgery Center
Sarasota, Florida

John Nora, M.D.
General Surgeon
Sarasota, Florida



                                                                 43

<PAGE>



George Maroulis, M.D. (Inactive)
Professor, University of South Florida
College of Medicine, Department of OB/GYN

Marguerite Barnett, M.D. (Inactive)
Plastic Surgeon
Venice, Florida

Phyliss Barber
FDA Compliance Consultant
Sarasota, Florida

Anne Johnson, O.R.T.
Surgical Technician
Columbus, Ohio

Andrew Garlisi, M.D.
Emergency Medicine
LaPorte, Indiana

Dr. Nathan Belkin
Former Researcher and Author in the infection control field

Scott Silverstein, M.D.
Occupational Health and Information Systems Specialist
Wilmington, Delaware

Gail Vallone
Operating Room Technologist
Las Vegas, Nevada

OASiS Medical Advisory Panel

     In addition to the  officers and  directors of the Company,  Surgical has a
medical  advisory  panel  which  approves,  edits  and  contributes  to  content
information  for the OASiS system.  Medical  Advisory  Panel members  receive no
salaries for their services but are compensated for any reasonable out of pocket
expenses  incurred  on behalf of the  Company.  Included  on such  panel are the
following:

                                                                 44

<PAGE>



Michael Abidin, MD
Nathan Belkin, PhD
Trish Carlson, RN, CEN, CFRRN
Dorothy Corrigan, RN
Mark Davis, MD
Donna Haiduven, BSN, MSN, CIC
Pamela Hart, CLS
Richard Howard, MD
James Li, MD
Mark Lipman, MD
James A. McGregor, MD CM
Trista Negele, MD
Heidi M. Stephens, MD
Pam Tenaerts, MD
Steven Weinstein, MT

     (b) Section 16(a) Beneficial Ownership Reporting Compliance

     No Director,  Officer,  Beneficial  Owner of more than ten percent (10%) of
any class of equity  securities of the Company  failed to file on a timely basis
reports  required by Section  16(a) of the  Exchange  Act during the most recent
fiscal year or prior fiscal years.



                                                                 45

<PAGE>

Item 10.  Executive Compensation

<TABLE>
<CAPTION>
                                                                    Long Term Compensation
                                                            ------------------------------------
                         Annual Compensation                         Awards             Payouts
--------------------------------------------------------    -------------------------  ---------
<S>          <C>     <C>           <C>          <C>          <C>           <C>            <C>       <C>
(a)          (b)     (c)           (d)          (e)          (f)           (g)            (h)       (i)
                                                Other        Restricted    Securities
Name and                                        Annual       Stock         Underlying               All Other
Principal                                       Compen-      Award(s)      Options/       LTIP      Compen-
Position     Year    Salary ($)    Bonus ($)    sation ($)   ($)           SARs  (f)      Payouts   sation ($)
                                                                                                    (1)


G.               1996                -                                                              5,280
Michael          1997                -                                                              4,877
Swor,            1998           32,500                                                              5,400
Chairman         1999           47,500                                     20,000 (6)               5,400
of the           2000           43,000                                                              5,800
Board,
President
and Chief
Executive
Officer
(2)

Frank M.         1996               -
Clark            1997               -
President        1998           32,731                        50,000       70,417
and CEO          1999           57,477                        12,000       20,000 (6)
into 2000        2000              500
(3)

Donald           1996                -
K.               1997           16,675                        13,657
Lawrence         1998           57,278                                     17,604
President        1999           57,499                                    170,000 (6)
and Chief        2000           97,208                                    150,000
Operating
Officer
into 2000
(4)

David            1999           38,795         15,575         34,000       85,000 (6)
Collins,         2000            5,250
Acting
Chief
Financial
Officer,
Treasurer
and
Secretary
into 2000(5)
</TABLE>


                                                                 46

<PAGE>



(1)  All other compensation  includes certain health and life insurance benefits
     paid by the Company on behalf of its employee.
(2)  Dr. Swor did not  receive  any salary  prior to June 1998 at which time the
     Company and he executed an Employment Agreement for a salary of $60,000 per
     year. In 2000,  Dr. Swor received a salary of $75,000.  Dr. Swor elected to
     defer  payment  of $19,000 of such  salary  until such time as the  Company
     receives  its next  round of  funding.  Other  compensation  includes  life
     insurance paid by the Company.
(3)  Mr. Clark  executed an Employment  Agreement  with the Company in June 1998
     for an annual salary of $60,000.  As a signing  bonus,  Mr. Clark  received
     50,000 shares of restricted stock in the Company which is valued at $50,000
     and options to purchase  200,000 shares of the Company's Common Stock at an
     exercise  price of $1.75 per share.  The Company's  options have no current
     trading value.  Mr. Clark retired as President and Chief Executive  Officer
     in January  2000.  In April  1999,  Mr.  Clark  received  12,000  shares of
     restricted Common Stock in lieu of salary due in the amount of $7,812.  Mr.
     Clark resigned in _, 2000.
(4)  Mr. Lawrence executed an Employment  Agreement with the Company in May 1997
     for an annual salary of $50,000.  Effective in January 1998,  the salary of
     Mr.  Lawrence was  increased to $100,000  per year;  however,  he agreed to
     defer receipt of the additional  amounts until a mutually  agreed date. The
     Company began  installment  payments of the deferred amount on September 1,
     1999.  The  Company has accrued  $95,000 for amounts  owed to Mr.  Lawrence
     related to his  compensation.  As consideration  for the acquisition of the
     assets of Endex,  Mr. Lawrence  received 250,000 shares of restricted stock
     in the Company.  Such shares were valued at the asset value of $13,657.  In
     June 1998, the Company  granted Mr.  Lawrence  options to purchase  100,000
     shares of the  Company's  Common  Stock at an  exercise  price of $1.75 per
     share.  The Company's  options have no current trading value.  Mr. Lawrence
     was the Company's Executive Vice President during fiscal 1999. Mr. Lawrence
     resigned as  President  on October  31,  2000.  Effective  January 1, 2000,
     Mr.Lawrence  began receiving an annual salary of $75,000.  The Company also
     began repaying previously deferred  compensation.  Compensation paid to Mr.
     Lawrence  reflects  2000 annual  salary  amounts and  repayment of deferred
     amounts.  At the time of Mr. Lawrence's  resignation,  the Company owed him
     $60,791,  which has been  accrued at December 31,  2000.  In  addition,  in
     December 2000, Mr.  Lawrence was granted  options to purchase 150,00 shares
     of Common Stock under the 1999 Employee Stock Option Plan.
(5)  Mr.  Collins  is paid as a  consultant  for his  services  as Acting  Chief
     Financial  Officer prior to his receiving  payments under the Staff Leasing
     arrangement.   In  April  1999,  Mr.  Collins  received  34,000  shares  of
     restricted  Common  Stock in lieu of  consulting  fees due in the amount of
     $23,410. Mr. Collins resigned in April, 2000.
(6)  See Option Grants in the Last Fiscal Year Below

Option Grants in Last Fiscal Year

           The following table provides information regarding the grant of stock
options during fiscal year 2000 to the named executive officers.



                                                                 47

<PAGE>


<TABLE>
<CAPTION>
                                           Individual Grants            Potential realizable value at    Alternative
                                                                        assumed annual rates of stock    to (f) and (g):
                                                                        price appreciation for option    Grant date
                                                                        term                             value


Name       Number of     Percentage    Exercise or       Expiration     5% $/sh (f)    10% $/sh (g)      Grant date
(a)        Securities    of Total      base price        Date (e)                                        present value
           underlying    options/SA    ($/sh) (d)                                                        $/sh (f)
           Options/SA    R's granted
           R's Granted   to
           (#) (b)       employees
                         during
                         fiscal year
                         (c)
<S>        <C>           <C>           <C>               <C>                                             <C>
G.         0
Michael
Swor
Frank M.   0
Clark

Donald K   150,000       50%           $0.13             12/27/10                                        19,500
Lawrence
David      0
Collins
</TABLE>

Aggregate Option Exercises in Last Fiscal Year and Fiscal Year-End Values

     The following table provides information  regarding the aggregate exercises
of options by each of the named  executive  officers.  In  addition,  this table
includes  the number of shares  covered by both  exercisable  and  unexercisable
stock options as of December 31, 2000, and the values of "in-the-money" options,
which values  represent the positive  spread  between the exercise  price of any
such option and the fiscal year-end value of the Company's Common Stock.

Year End Option Values for Executive Officers

<TABLE>
<CAPTION>
Name           Exercised      Value Realized       No. of             Value of
                                                   Unexercised        Unexercised
                                                   Exercisable/       Exercisable/
                                                   Unexercisable      Unexercisable
<S>              <C>            <C>                <C>                <C>
G. Michael        0              0                 3,870,686/0        $1,252,220/0
Swor
Frank M.          0              0                    0                  $0
Clark (1)

Donald K.         0              0                   420,000/0          $289,500/0
Lawrence
David Collins     0              0                    0                  $0
(1)
</TABLE>


                                                            48

<PAGE>






(1)  All options  previously  held by Mr. Clark and Mr. Collins  expired in 2000
     when they were not exercised within the time required following  respective
     retirement and resignation from the Board and the Company.

     In November 1998, the Company  entered into a seven (7) year  collaborative
agreement with Dr. William B. Saye, the Medical Director and CEO of the Advanced
Laparoscopy  Training  Center in  Marietta,  Georgia  ("ALTC")  under  which the
Company  acquired the "digital  rights" of ALTC and the resulting  amalgam as it
relates to surgical  education and marketing rights to the ALTC database.  Under
this agreement, Dr. Saye became a member of the Company's Board of Directors and
agreed to act as the  Medical  Director of ALTC  VirtualLabs.  Dr. Saye is to be
compensated for travel expenses and will be paid an honorarium of $2,500 per day
when his services are requested by Surgical.  In addition,  Dr. Saye was awarded
stock options to purchase up to 1,000,000  shares of the Company's  Common Stock
over the  period,  300,000  of which  were  issued  upon  the  execution  of the
agreement,  and the balance of which are issuable monthly.  The intention of the
agreement is that any  educational  activity  involving  ALTC or Dr. Saye on the
Internet  or other  digital  presence  would be the  property  of and  under the
control of Surgical.

     Except for certain shares of the Company's Common Stock issued and sold and
options  granted to the nine (9)  executive  officers  and/or  directors  of the
Company as of December 31, 2000 in  consideration  for various  cash,  loans and
services  performed for the Company by each of them,  and rent paid to a company
controlled by Dr. Swor for the Company's facility, cash or non-cash compensation
in the  amount of  $358,971  was  awarded  to,  earned  by or paid to  executive
officers or directors of the Company for all services rendered in all capacities
to the Company since January 1, 1996.

     The  Company has adopted an  Employee  Stock  Option Plan and a  Consultant
Stock Option Plan.

Employee Contracts and Agreement

     The Company  has an  arrangement  with EPIX,  a Florida  licensed  employee
leasing company,  and has entered into Employee Agreements with Dr. Swor and had
an Employee  Agreement with Mr. Clark prior to his  retirement and Mr.  Lawrence
prior to his  resignation.  Dr.  Swor,  Mr.  Lawrence  and Mr. Clark are or were
treated as co-employees by EPIX and the Company.

     The  agreement  with Dr. Swor was entered  into on June 15,  1998.  At that
time, Dr. Swor was employed as the Treasurer and Medical Director of the Company
at an annual salary of $60,000.  The  agreement  initially was for a term of one
(1) year, which term is renewable year to year unless

                                                                 49

<PAGE>



either party provides notice to the other within fourteen (14) days prior to the
expiration that it seeks to terminate the agreement.  In 2000, Dr. Swor received
a salary of $75,000. Dr. Swor elected to defer payment of $19,000 of such salary
until such time as the Company  receives its next round of funding.  Dr. Swor is
required  to devote  such  time as is  required  to  fulfill  his  duties to the
Company.  Dr. Swor is reimbursed  reasonable and necessary  expenses incurred on
behalf of the  Company.  Prior to the  execution  of this  agreement,  Dr.  Swor
received no salary for his services to the Company since its inception. Dr. Swor
became Chief Executive Officer of the Company in February 2000.

     The  agreement  with Mr. Clark was entered  into on June 15, 1998.  At that
time,  Mr.  Clark was  employed as the  President  and CEO of the Company for an
initial  term of one (1) year at a salary of  $60,000,  which term is  renewable
year to year unless either party  provides  notice to the other within  fourteen
(14) days prior to the expiration that it seeks to terminate the agreement.  Mr.
Clark is  required  to devote  such time as is required to fulfill his duties to
the Company. Mr. Clark is reimbursed  reasonable and necessary expenses incurred
on behalf of the Company. Mr. Clark received a signing bonus of 50,000 shares of
restricted  stock in the  Company and was  granted  options to purchase  200,000
shares of the  Company's  Common Stock at an exercise  price of $1.75 per share.
Mr. Clark retired as President and Chief Executive Officer in January 2000.

     The agreement with Mr.  Lawrence was entered into on April 1, 1997. At that
time, Mr. Lawrence was employed as the Marketing  Director of the Company for an
initial  term of one (1) year at a salary of  $50,000,  which term is  renewable
year to year unless either party  provides  notice to the other within  fourteen
(14) days prior to the  expiration  that it seeks to  terminate  the  agreement.
Effective in January 1998, the salary of Mr.  Lawrence was increased to $100,000
per year;  however, he agreed to defer receipt of the additional amounts until a
mutually agreed date. Effective January 1, 2000,  Mr.Lawrence began receiving an
annual salary of $75,000.  The Company also began repaying  previously  deferred
compensation.  The Company began installment  payments of the deferred amount on
September  1, 1999.  The  Company has  accrued  $60,791 for amounts  owed to Mr.
Lawrence related to his  compensation.  In addition to salary,  Mr. Lawrence was
granted  options to purchase  150,000  shares of Common Stock at $0.13 per share
under the Company's 1999 Employee Stock Option Plan. Commencing January 1, 1998,
Mr. Lawrence  became the Executive Vice President of the Company,  and effective
February  1,  2000,  Mr.  Lawrence  became  the  Company's  President  and Chief
Operating Officer. He resigned in October 31, 2000 to take another position that
he believed  was best for is career;  however,  he has remained as a Director of
the  Company.  Mr.  Lawrence was required to devote such time as was required to
fulfill his duties to the Company.  Mr.  Lawrence was reimbursed  reasonable and
necessary expenses incurred on behalf of the Company.

Key Man Life Insurance

     The Company currently does not maintain key-man life insurance  coverage on
any of its officers or directors.  However, the Company is the named beneficiary
of a key-man life insurance policy currently owned by Dr. Swor.




                                                                 50

<PAGE>


Employee and Consultants Stock Option Plans

Employee Stock Option Plans

     On July 21, 1994,  the Board of Directors  adopted an Employee Stock Option
Plan which is  available  to employees  and  Directors of the Company  ("ESOP").
Pursuant  to the ESOP,  employees  are  given  the  opportunity  to  purchase  a
designated  number of shares of the  Company's  common  stock at a pre-set  flat
rate.  The  options  are  granted  for a period  of seven  (7) years and are not
transferable except by will or laws of descent and distribution. The options may
not be  exercised  unless  the  Company  has  filed  an  effective  registration
statement  on Form S-8  relating  to the shares  underlying  the  option.  As to
employees who are not also  directors,  such employees must agree to remain with
the  Company  for a period of two (2) years from the date the option is granted.
In the event that such  employee is  terminated  during such two (2) year period
for cause or at the request of the employee,  to the extent any options have not
been exercised,  the options  terminate  immediately upon the termination of the
employee.  If  termination  is for any other  reason,  the  employee has two (2)
months  from the date of  termination  to  exercise.  In the case of death,  the
options must be exercised within the lesser of (i) three (3) years from the date
of death or (ii) five (5) years from the option  issuance  date.  In the case of
the  capital  restructure  of the  Company,  the  options  are  effective  as if
exercised prior to the capital  restructuring  event. The employee is limited to
exercise  the  equivalent  of  $100,000  of Common  Stock in the  Company in any
calendar year.

     In  January,  1998,  the Board of  Directors  revised  the term of the ESOP
("1998 Revised  ESOP").  Under the revised plan, the term is now determined by a
Committee   consisting  of  Frank  Clark  and  Sam  Norton  (the  "Stock  Option
Committee").  The Stock  Option  Committee  is  evaluating  recommendations  for
adjusting stock compensation for the Company employees and consultants.

     In January,  1999, the Board of Directors  further  revised the ESOP ("1999
Revised ESOP"). Under the further revised plan which is designated the "Surgical
Safety  Products  1999 Stock  Option  Plan",  employees  qualify for issuance of
Incentive  Stock  Options  under  Section 422 of the Internal  Revenue  Code, as
amended, Non-incentive Stock Options and Reload Options. Directors,  consultants
and  advisors  who  are  issued   options   under  the  plan  only  qualify  for
Non-incentive  Stock Options and Reload  Options.  All of the options under this
plan terminate ten (10) years (except those issued to 10% or more  shareholders,
in which case they  terminate  in five (5)  years)  from  issuance  and vest for
employees  at the rate of  one-third  each  year for three (3) years and vest as
established  by the  Stock  Option  Committee  for  Directors,  Consultants  and
Advisors.  The plan is overseen by the Board of  Directors  or the Stock  Option
Committee and all issuances are at fair market value as defined in the plan (and
110% of fair market  value in the case of a 10% or more  shareholder).  The plan
provides the exercise rights on death,  disability or termination of employment.
The Company may, at its option,  provide  change of control rights to designated
persons and if granted,  the option  holder is entitled to certain cash payments
on all options granted whether or not vested if the Company changes control.

     The Board of Directors  approved the Company's 2000 Stock Plan ("2000 Stock
Plan") on February 7, 2000.  The  shareholders  approved such plan at the Annual
Meeting held on February 28, 2000. The 2000 Stock Plan is substantially  similar
to the 1999 Revised ESOP with the addition that the Stock Compensation Committee
may grant  awards of stock in addition to options  and may grant  awards  and/or
options to members of the Board of Directors  upon  assumption  of a seat on the
Board and upon  reelection of awards of up to 25,000  shares  and/or  options to
purchase up to 25,000 shares

                                                                 51

<PAGE>



of the Company's Common Stock. The 2000 Plan is funded with 10,000,000 shares of
Common Stock. This plan covers employees,  Officers, Directors,  consultants and
advisors. The Board elected to voluntarily restrict the number of shares granted
each year to 1,000,000 in March , 2000.

     Pursuant  to the  1994  ESOP,  the  Company  granted  options  to  purchase
4,166,316  shares of the Company's  Common Stock of which 63,126 have expired or
lapsed.  The remaining  options  represent  proceeds on exercise of $1,300,711 .
Under the 1998 Revised ESOP,  the Company  granted  options to purchase  808,325
shares of the  Company's  Common Stock of which  200,000 have expired or lapsed.
The remaining options represent proceeds on exercise of $808,325 (without regard
to the  additional  options to Dr.  Saye  which  accrue at the rate of 8,333 per
month after December 31, 2000). Under the 1999 Revised ESOP, the Company granted
options to purchase 465,000 shares of the Company's Common Stock of which 30,000
have expired or lapsed.  The remaining options represent proceeds on exercise of
$424,500. The outstanding options as of this date are as follows:

<TABLE>
<CAPTION>
Employee                   Date Option      No. of Shares           Exercise Price   Term
                              Granted      subject to Exercise                       Years
1994 ESOP (1)(2)

<S>                       <C>                <C>                        <C>            <C>
G. Michael Swor (3)        07/21/94          3,850,686                    $.317          7

Irwin Newman (4)           07/21/94             63,126                    $.317          7

James D. Stuart            07/21/94             63,126                    $.317          7

Samuel Norton              07/21/94             63,126                    $.317          7

David Swor                 07/21/94             63,126                    $.317          7

1998 Revised ESOP(2)

Donald L. Lawrence (5)     06/15/98           100,000                     $1.00          7

William B. Saye (6)        11/20/98           508,325                     $1.00          7

1999 Revised ESOP (2)

G. Michael Swor (3)         1/01/99             10,000                    $1.00         10
                           12/27/99             10,000                    $1.00         10
</TABLE>

                                                                 52

<PAGE>

<TABLE>
<S>                       <C>                <C>                        <C>            <C>
Donald L. Lawrence (5)      1/01/99             10,000                    $1.00          10
                            5/25/99            150,000                    $1.00          10
                           12/27/99             10,000                    $1.00          10
                           12/28/00            150,000                    $0.13          10

Irwin Newman (7)            6/30/99             25,000                    $1.72          10
Sam Norton (7)              6/30/99             25,000                    $1.72          10
Dr.  William Saye (7)       6/30/99             25,000                    $1.72          10
James Stuart (7)            6/30/99             25,000                    $1.72          10
David  Swor (7)             6/30/99             25,000                    $1.72          10
</TABLE>

(1)  The options  granted  under the 1994 ESOP have been adjusted to reflect the
     new conversion rate in accordance with the capital restructuring  provision
     which came into  effect  when  Surgical  Safety  Products,  Inc. of Florida
     merged into Sheffeld Acres, Inc., the surviving New York corporation.

(2)  The Company relied upon Section 4(2) of the Act, Section 517.061(11) of the
     Florida  Code and Section  10-5-9 (13) of the Georgia Code for the grant of
     these options.

(3)  Dr. Swor received  options for 63,126 shares of the Company's  Common Stock
     as a Director  and options for  3,787,560  shares of the  Company's  Common
     Stock in exchange  for  transfer  of patents and rights to existing  patent
     concepts.  Dr. Swor was granted Non Incentive  Stock Options under the 1999
     Revised ESOP.

(4)  In addition to the options  granted to Mr.  Newman for 63,126 shares of the
     Company's Common Stock as a Director of the Company, options to purchase up
     to 315,630  shares of the  Company's  Common  Stock  were  granted to Jenex
     Financial  Services,  Inc., a company of which Mr. Newman is the principal.
     Jenex is a financial service company which was issued the options under the
     Company's 1994 CSOP. Mr. Newman resigned from the Board in February 2000.

(5)  Mr.  Lawrence  received  his 1999  options as a bonus in  consideration  of
     outstanding  services  to the  Company  for the prior  year.  Although  the
     options  granted to him were  exercisable at $1.75 per share,  the Board of
     Directors on January 20, 1999 voted to reduce the exercise  price to $1.00.
     Since the change was made after  December 31, 1998,  the original  exercise
     price was used in the  financial  statements  for  purposes of  determining
     weighted averages.  Mr. Lawrence received Non Incentive Stock Options under
     the  1999  Revised  ESOP.  The  options  granted  to Mr.  Lawrence  in 2000
     represent  a bonus  attributable  for 1999 and were  issued  under the 1999
     Revised ESOP.


                                                                 53

<PAGE>



(6)  Dr. Saye received  300,000  issued on November 20, 1998.  Dr. Saye receives
     additional 100,000 options per year on a monthly basis. Accordingly,  8,333
     options are  attributable  for the each month from  December  1998  through
     December  1999.  The exercise  price for the options is $1.00 for year one,
     $1.50 for year two, $2.00 for year three and $2.50 for years 4 through 7.

(7)  In June 1999,  the Board granted  options to purchase  25,000 shares of the
     Company's  Common  Stock at an exercise  price of $1.72 to each of its five
     (5)  outside  directors  as a bonus  for  their  service  on the  Board  of
     Directors. The Company granted such options pursuant to Section 4(2) of the
     Act and Rule 506.  These options are Non Incentive  Stock Options under the
     1999 Revised ESOP.

     In  December  2000,  each board  member  executed a  Voluntary  Restriction
Agreement which requires any certificate  issued upon exercise of the options to
bear a legend that refers to such agreement.  Under such agreements,  the option
holders agree not to sell, assign, tranfer or hypothecate any shares received on
exercise  until  such  time  as the  Company  either  (i)  reports  reveneus  of
$1,500,000  on a Form  10KSB  or Form 10Q SB as filed  with the  Securities  and
Exchange  Commission or (ii) reports positive pre-tax earnings on its Form 10KSB
or on two out of three Forms 10Q SB. Each of the  voluntary  agreements is for a
term of two (2) years from execution.

Consultant Stock Option Plans

     On July 21, 1994,  the Board of Directors  also adopted a Consultant  Stock
Option Plan which is available to certain  consultants  who provide  services to
the  Company  ("CSOP").   Pursuant  to  the  CSOP,  consultants  are  given  the
opportunity  to purchase a designated  number of shares of the Company's  common
stock at a pre-set flat rate.  The options are granted for a period of seven (7)
years  and  are  not  transferable  except  by  will  or  laws  of  descent  and
distribution.  The options may not be exercised  unless the Company has filed an
effective  registration  statement on Form S-8 relating to the shares underlying
the  option.  In the  event  the  consultant's  services  are  terminated,  such
consultant  has two (2) months from the date of termination in which to exercise
and in the case of death,  the estate has the lesser of (i) three (3) years from
the date of death or (ii) five (5) years from the option  issuance date in which
to exercise.  In the case of the capital restructure of the Company, the options
are effective as if exercised prior to the capital  restructuring  event.  There
are no yearly  limitation  on the amount of options  which may be  exercised  by
consultants.

     In  January,  1998,  the Board of  Directors  revised  the term of the CSOP
("1998 Revised CSOP"). Under the revised plan, the term is now determined by the
Stock  Option  Committee.  The  1998  CSOP  requires  that the  options  are not
exercisable for a period of two (2) years from issuance

     In January,  1999,  the Board of  Directors  adopted the 1999  Revised ESOP
which covers consultants and advisors to the Company.

     In February  2000,  the Board of  Directors  adopted  and the  shareholders
approved  the 2000 Stock Plan  which  covers  consultants  and  advisors  to the
Company.

                                                                 54

<PAGE>



     Pursuant to the 1994 CSOP,  the  Company  has  granted  options to purchase
346,115 shares of the Company's Common Stock of which -0- expired or lapsed. The
remaining options represent proceeds of $110,781 to the Company.  Under the 1998
Revised CSOP,  the Company  granted  options to purchase  129,000  shares of the
Company's Common Stock of which 50,000 expired or lapsed.  The remaining options
represent of $89,500 to the Company.  Under the 1999 Revised  ESOP,  the Company
granted  options to purchase  312,500  shares of the  Company's  Common Stock of
which 188,000 expired or lapsed.  The remaining  options  represent  proceeds of
$114,500 to the Company.  Under the 2000 Plan,  the Company  granted  options to
purchase  1,000,000  of which -0-  expired  or  lapsed.  The  remaining  options
represent  $217,780 of proceeds to the Company.  The  outstanding  options as of
this date are as follows

<TABLE>
<CAPTION>
Consultant/                        Date Option      No. of Shares      Exercise Price   Term
Services Rendered                  Granted      subject to Exercise                    Years
1994 CSOP(1)(2)

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

Danielle Chevalier                 07/21/94             3,156              $.317           7
   For marketing assistance
   at conventions

Donna Haiduven                     07/21/94            15,782              $.317           7
   For medical advisory and
   clinical studies

Jenex Financial Services
Inc. (3)                          07/21/94            315,630              $.317           7
   For financial advisory and
   corporate financing
   consulting services

Leann Swor                         07/21/94             6,313              $.317           7
   For marketing assistance
   at conventions

Loren Schuman                      07/21/94             4,734              $.480           7
   For marketing consulting
   services

Bruce Cohen                        01/24/95               500              $0.90           7
   Performed business
   valuations of acquisition
   candidates
</TABLE>


                                                                 55

<PAGE>



<TABLE>
<S>                                <C>                <C>                  <C>            <C>
1998 Revised CSOP (2)

Danielle Chevalier                 01/01/98             2,000              $0.50           7
   For marketing assistance
   at conventions

Leann Swor                         01/01/98             2,000              $.050           7
   For marketing assistance
   at conventions

Mike Williams (4)                  08/03/98            50,000              $1.00           7
   As a signing bonus

T.T. Communications                10/15/98            25,000              $1.50           7
   For investor relations
   services

1999 Revised ESOP (2)

Mike Williams (5)(6)               1/01/99              5,000              $1.00          10
   As a performance bonus          1/08/99             50,000              $1.00          10
                                   2/27/99             10,000              $1.00          10

Scott Heap, Ad-Vantagenet          01/8/99             20,000              $1.00          10
   For OASiS development
   services

Ray Villares, Ad-Vantagenet        01/8/99             20,000              $1.00          10
   For OASiS development
   services

Karen Arango         (5)(7)        05/25/99             1,000              $1.00          10
 As a performance bonus
</TABLE>

                                                                 56

<PAGE>


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

Bernice Gordon (5)(7)              05/25/99            1,000               $1.00          0
 As a performance bonus

Ron Ley (8)                        12/03/99            2,500               $1.00          10
 As a performance bonus

2000 Plan (2)

Global Development(9)              08/16/00          200,000               $0.25          10
 Marketing Consulting              10/25/00          150,000               $0.36          10

Donald F.  Mintmire                08/16/00          244,000               $0.25          10
 Legal Services by
 Mintmire & Associates

Ray Duplain (5)(10)                12/28/00           50,000               $0.13          10
 As a performance bonus

Heather Voege     (5)(10)          12/28/00          100,000               $0.13          10
 As a performance bonus

Laurie Walz(5)(10)                 12/28/00           50,000               $0.13          10
 As a performance bonus

Mike William (5)(10)               12/28/00           50,000               $0.13          10
 As a performance bonus

Pauline Parrish(10)                12/28/00          100,000               $0.13          10
 As a performance bonus

Anthony Palmer (5)(10)             12/28/00           50,000               $0.13          10
 As a performance bonus
</TABLE>


                                                             57

<PAGE>


<TABLE>
<S>                                <C>                <C>                  <C>            <C>
Mike Conner (10)                   12/28/00            6,000               $0.13          10
 As a performance bonus
</TABLE>

(1)  The options  granted  under the 1994 CSOP have been adjusted to reflect the
     new conversion rate in accordance with the capital restructuring  provision
     which came into  effect  when  Surgical  Safety  Products,  Inc. of Florida
     merged into Sheffeld Acres, Inc., the surviving New York corporation.

(2)  The Company relied upon Section 4(2) of the Act and Section  517.061(11) of
     the Florida Code for the grant of these options.

(3)  These  options  were  granted to Jenex in exchange  for  certain  financial
     services  provided to the Company.  Mr.  Newman,  a former  Director of the
     Company,  is the principal of Jenex.  Mr.  Newman is deemed the  beneficial
     owner of these options.

(4)  Mr. Williams received his options as a bonus as an additional  incentive to
     join the Company as the Sales Manager.  Although the options granted to Mr.
     Williams  were  exercisable  at $1.75 per share,  the Board of Directors on
     January 20,  1999 voted to reduce the  exercise  price to $1.00.  Since the
     change was made after  December 31, 1998,  the original  exercise price was
     used in the  financial  statements  for  purposes of  determining  weighted
     averages.

(5)  Each of these persons is covered by the Staff agreement and is treated as a
     co-employee;  however, for purposes of qualification under the 1999 Revised
     ESOP,  such  person has been  treated as a  consultant  and  advisor to the
     Company who qualifies for non-incentive stock options.

(6)  In December 1999, the Company granted  year-end options to purchase a total
     of 67,500  shares of the  Company's  Common  Stock at an exercise  price of
     $1.00 as a bonus for performance  during fiscal 1999. Of such options,  Dr.
     Swor, Mr. Clark, Mr. Lawrence and Mr. Collins, all officers of the Company,
     each were granted options to purchase 10,000 shares.  The balance of 27,500
     were granted to employees, including Mr. Williams.

(7)  In May 1999, the Company granted options to purchase  170,000 shares of the
     Company's  Common Stock at an exercise  price of $1. Of such  options,  Mr.
     Lawrence was granted options to purchase 150,000 shares in consideration of
     his efforts for the  exploitation of OASiS,  and two of his assistants each
     received options to purchase 1,000 shares. The Company granted such options
     pursuant to Section 4(2) of the Act and Rule 506.

(8)  In December 1999, the Company  granted options to purchase a total of 5,000
     shares of its Common  Stock at an  exercise  price of $1.00 to two  outside
     consultants,  one of whom was Mr. Ley.  The Company  granted  such  options
     pursuant to Section 4(2) of the Act and Rule 506.


                                                                 58

<PAGE>



(9)  GDA  received  the shares in August in lieu of cash under an  agreement  to
     provide  marketing  consulting  services and the shares in October  under a
     second agreement for the same purpose.

(10) In December 2000, the Company granted  year-end options to purchase a total
     of 300,000  shares of the  Company's  Common Stock at an exercise  price of
     $0.13 as a bonus for  performance  during fiscal 2000 to five (5) employees
     and 106,000 to two (2) former employees.

Compensation of Directors

     The Company has no standard  arrangements for compensating the directors of
the Company for their attendance at meetings of the Board of Directors.  As part
of the 2000 Stock Plan approved by the Board of Directors and shareholders,  the
Stock  Compensation  Committee  may grant awards of stock in addition to options
and may grant awards  and/or  options to members of the Board of Directors  upon
assumption of a seat on the Board and upon  reelection of awards of up to 25,000
shares and/or  options to purchase up to 25,000  shares of the Company's  Common
Stock.  The 2000 Plan is funded with  10,000,000  shares of Common Stock and was
amended  to  provide  for the  granting  of not more than  options  to  purchase
1,000,000 shares per year.

Item 11.  Security Ownership of Certain Beneficial Owners and Management

     The  following  table sets  forth  information  as of  December  31,  2000,
regarding the ownership of the Company's Common Stock by each shareholder  known
by the Company to be the beneficial  owner of more than five percent (5%) of its
outstanding shares of Common Stock, each director and all executive officers and
directors as a group.  Except as otherwise  indicated,  each of the shareholders
has sole voting and  investment  power with respect to the share of Common Stock
beneficially owned.

<TABLE>
<CAPTION>
Name and Address of                Title of        Amount and Nature of      Percent of
   Beneficial Owner                  Class              Beneficial Owner      Class
-------------------------------------------------------------------------------------
<S>                                <C>                 <C>                   <C>
Dr. G. Michael Swor                 Common              1,836,945 (2)         13.61%

Donald K. Lawrence                  Common                140,000 (3)          1.04%

James D. Stuart                     Common                548,973 (4)          4.07%

Sam Norton                          Common                103,400 (5)           .77%

David Swor                          Common                523,445 (5)          3.88%

Dr. William B. Saye                 Common                     -0-(5)           .00%

All Executive Officers and Directors                    3,152,763             23.37%
as a Group (six (6) persons)
----------
</TABLE>


                                                                  59

<PAGE>





(1)  The  percentages  are based upon  13,500,492  voting shares of Common Stock
     outstanding.  In addition to the shares owned by the Executive Officers and
     Directors,  said officers and directors own (including  those  beneficially
     held) options to purchase  5,088,389  shares of the Company's  Common Stock
     (without  regard to the additional  options to Dr. Saye which accrue at the
     rate of 8,333 per month after  December 31, 2000)  pursuant to Employee and
     Consultant  Stock Option Plans adopted in 1994, 1998, 1999 and 2000. In the
     event all such options to purchase were  exercised,  this group would own a
     total of  8,241,152  shares  of the  Company's  Common  Stock  which  would
     represent 44.33% of the total shares of Common Stock outstanding. Under the
     1994 ESOP,  1998 Revised ESOP, 1999 Revised ESOP and 2000 Plan all of these
     options  may be  exercised  within  60 days;  however,  in all  cases,  the
     exercise price far exceeds the current market price quoted on the OTC BB.

(2)  As part of a divorce settlement,  Dr. Swor transferred  1,205,685 shares of
     his stock to his former wife.

(3)  Mr. Lawrence  received his shares of restricted Common Stock as part of the
     acquisition of all of the assets of Endex by the Company.

(4)  These shares are a portion of the 816,619 shares which Mr. Stuart  received
     as a gift from Dr. Swor in 1996.

(5)  Each of these Directors purchased 50,000 shares of the Company's restricted
     Common  Stock and  warrants  to  purchase  25,000  shares of the  Company's
     restricted  Common  Stock  exercisable  at the price of $1.00 for a term of
     five (5)  years on the same  terms as other  investors  in a  self-directed
     private placement commenced by the Company in April 1999.

Item 12.  Certain Relationships and Related Transactions

     In November 1998, the Company  entered into a seven (7) year  collaborative
agreement with Dr. William B. Saye, the Medical Director and CEO of the Advanced
Laparoscopy  Training  Center in  Marietta,  Georgia  ("ALTC")  under  which the
Company  acquired the "digital  rights" of ALTC and the resulting  amalgam as it
relates to surgical  education and marketing rights to the ALTC database.  Under
this agreement, Dr. Saye became a member of the Company's Board of Directors and
agreed to act as the  Medical  Director of ALTC  VirtualLabs.  Dr. Saye is to be
compensated for travel expenses and will be paid an honorarium of $2,500 per day
when his services are requested by Surgical.  In addition,  Dr. Saye was awarded
stock options to purchase up to 1,000,000  shares of the Company's  Common Stock
over the  period,  300,000  of which  were  issued  upon  the  execution  of the
agreement,  and the balance of which are issuable  monthly for which 99,996 were
granted in fiscal

                                                                  60

<PAGE>



2000. The intention of the agreement is that any educational  activity involving
ALTC or Dr. Saye on the Internet or other digital presence would be the property
of and under the control of Surgical.

     In February 2000, the Company  executed a Consulting  Agreement with Global
Development  Advisors,  Inc.  ("GDA");   however,  shortly  therafter,   further
negotiations  ensured  and the  agreement  never  became  effective.  Under  the
agreement, GDA was to provide business and marketing consulting services, assist
in the implementation of a strategic plan and assist, coordinate and monitor the
Company's investor  relations  program.  The agreement was for a term of six (6)
months and could have been extended by the Company. In lieu of cash payments for
services, GDA agreed to accept 50,000 shares of the Company's Common Stock under
the Company's 2000 Stock Plan approved by its  shareholders on February 28, 2000
and options to  purchase an  additional  50,000  shares at an exercise  price of
$1.09. Due to the further negotiations, the issuance was never made. The parties
have canceled this agreement.

     On February 29, 2000, the Company  entered into a contract with Steel Beach
to  design,  develop,  implement  and  test  the  OASiS  Version  3.0 web  based
application.  The  contract is for a total of $160,100 and is to be paid $80,500
in cash and $80,500 in stock  options.  The Company paid a deposit of $20,012.50
and the  balance  is to be paid  upon  delivery  of the  prototype,  preliminary
product  and final  product.  The options are due at the time of delivery of the
final  product.  The common stock option number will be calculated  based on the
average closing share price ("ACSP") in the twenty (20) days of trading prior to
deliver of the final product.  The exercise price will be 50% of the twenty (20)
day average  closing price as quoted on the OTC BB. The number of options issued
will be  calculated  by  multiplying  $80,050  times two (2) and dividing by the
ACSP.  The  options  are to have a term of five (5) years and are to  conform to
Company's consultant option policy as far as additional terms and details.  This
agreement with Steel Beach replaces two earlier  agreements;  specifically,  one
agreement  for Version 2.0 dated  December  30, 1999 in the amount of $37,800 in
cash and  $37,800 in stock  options,  and one  agreement  for  Version 3.0 dated
December 30, 1999 in the amount of $42,250 in cash and $42,250 in stock options.
All  efforts  expended  by Steel  Beach  Productions  under  these  two  earlier
contracts are compensated under the terms of this agreement. The Company retains
all propriety rights in the application.  Steel Beach is responsible for its own
costs and expenses. The agreement may be canceled by either party on thirty (30)
days written notice.  The Company did not consider the final product  acceptable
and no further payments were made.

     Effective  June 7,  2000,  the  Company's  line of credit in the  amount of
$100,000 with  SouthTrust  renewed  through  August 12, 2000,  with an option to
extend the maturity until October 15, 2000 if the Company  pledged a certificate
of deposit in the amount of $25,000.  The  interest  rate is prime plus 1.5% and
the line is secured by the Company's equipment,  receivables and inventory.  The
line is  guaranteed  personally  by Dr. Swor.  The line of credit was renewed on
October 15, 2000 and the maturity  date is December 31,  2000.  The  outstanding
balance at such time was $100,000.  The Company  pledged an  additional  $25,000
certificate  of  deposit  to secure  the line.  As of  December  31,  2000,  the
outstanding  balance was $100,000.  In 2001, the Company paid down the line with
the two  pledged  certificates  of  deposit.  A  balance  of  $50,945  is  still
outstanding.  The  Company is in default of the terms of the  agreement.  During
2000,  Dr. Swor  advanced  $40,000 of  additional  funds to the Company that was
repaid.  As of December  31, 2000 there were no amounts  outstanding  related to
advances. Dr. Swor has a year to year employment contract with the Company.

                                                                  61

<PAGE>



     On July 6, 2000,  the Company  entered into an agreement  with Carver Cross
Securities Corp.  ("CCSC") for investment banking services,  including financial
advisory  services and efforts to secure equity or debt financing.  TK had given
verbal approval for this arrangement, subject to final approval of any financing
package.  The CCSC agreement was exclusive for a term of 120 days commencing the
later of  September  6,  2000 or the date a  placement  memorandum  is ready for
distribution.  Under the agreement,  CCSC received a retainer of $6,000,  plus a
warrant to purchase 40,000 shares of the Company's  common stock for a period of
5 years at an exercise price of $0.625 per share and monthly  payments of $2,500
plus  warrants  for  40,000  shares of  common  stock..  In any case,  under the
agreement, CCSC would not receive warrants to purchase more than 120,000 shares.
CCSC was to receive compensation for equity financing arranged by CCSC, the sale
of assets or a public  offering  placement.  In the case  equity  financing  was
arranged,  CCSC would receive  complete  warrants  exercisable for 5 years at an
exercise price equal to 101% of the amount paid by the  investors.  In addition,
CCSC was to receive approved expenses.  This agreement was terminated  effective
September 2000. No warrants were issued relative to this agreement; however, the
Company made payments to CCSC totaling $11,000.

     On August 16, 2000, the Company finalized a consulting  agreement with GDA.
Under the  agreement,  GDA was to  provide  business  and  marketing  consulting
services,  assist  in  the  implementation  of  a  strategic  plan  and  assist,
coordinate and monitor the Company's investor  relations program.  The agreement
was for a term of three (3) months, which term could be extended by the Company.
In lieu of cash payments for services,  GDA agreed to accept  200,000  shares of
the Company's  Common Stock under the Company's  2000 Stock Plan approved by its
Shareholders  on February 28, 2000. On October 25, 2000, the Company  executed a
second agreement with GDA which, effectively, extends its initial agreement with
GDA for another  term of three (3)  months.  In lieu of cash  payments,  for its
services,  GDA agreed to accept an  additional  150,000  shares of the Company's
Common  Stock  under the  Company's  2000  Stock  Plan.  There  were no  further
renewals.

     In  December  1999,  the Company  executed a Loan  Agreement  with  Thomson
Kernaghan & Co.,  Ltd.  ("TK"),  as Agent and Lender,  whereby TK agreed to make
loans to the Company of up to $5,000,000 in installments for a period commencing
with the date of the  agreement  and ending on  November  30, 2002 (the "TK Loan
Commitment").  The Company may request additional draws of no less than $500,000
provided its Common  Stock has traded for a minimum of $1.00 for 20  consecutive
days and the stock has had an average  trading  volume of 25,000  shares for the
same period.  Due to the Company's  current share price, it does not qualify for
additional draws at this time.  Under the terms of the TK Loan Commitment,  each
installment  is supported by a convertible  note and security  agreement and the
Agent and Lender are granted warrants to purchase shares of the Company's Common
Stock.  Further,  2,700,000  shares are held by TK in escrow  for the  potential
conversion  under the notes or exercise of the warrants.  Under the terms of the
TK Loan Agreement, an initial loan of $650,000 was made on December 30, 1999. On
March 31, 2000 the Company received a second installment under the TK Commitment
in the amount of $650,000.  On April 28, 2000, TK elected to convert $100,000 of
outstanding  principal and $2,630 of the accrued  interest into shares of Common
Stock at a price of $0.5625 per share which represents  182,453 shares.  On June
9, 2000, TK elected to convert  $120,000 of outstanding  principal and $4,129 of
the accrued  interest into shares of Common Stock at a price of $0.375 per share
which represents

                                                                  62

<PAGE>



331,010  shares.  On July 11, 2000, TK elected to convert $40,000 of outstanding
principal and $1,683.13 of the accrued interest into shares of Common Stock at a
price of $0.375 per share which represents  111,155 shares. On October 24, 2000,
TK elected to convert  $250,000  of  outstanding  principal  and  $16,219 of the
accrued  interest  into  shares of Common  Stock at a price of $0.375  per share
which represents 709,918 shares. The Company granted TK registration  rights and
was  obligated to file a Form S-3 within sixty (60) days of the  agreement.  The
Company  filed a  registration  statement on Form S-3 on March 2, 2000  covering
initially  20,038,097 shares of its Common Stock. The issuance of the securities
was  made  pursuant  to  Regulation  S of the Act.  The  Form  S-3  registration
statement  was declared  effective on April 11, 2000.  Since the Company did not
meet financial  projections  which were an integral part of the transaction,  TK
and  the  Company  re-negotiated  the  arrangement  which  terminated  the  Loan
Commitment and settled all matters between the parties.

     Pursuant to a loan cancellation and settlement agreement effective February
7, 2001 (the "Cancellation Agreement"),  TK agreed to convert the balance of the
December 1999 debt in the amount of $140,000 plus accrued and unpaid interest in
the amount of $12,395 and to convert $90,000 on the  installment  given on March
31, 2000 under the Loan  Commitment  plus accrued and unpaid  interest of $6,175
into a total of 662,854  shares of the Common Stock  registered  by the Form S-3
registration,  thereby leaving an outstanding  principal balance dating to March
31, 2000 of $560,000  plus accrued and unpaid  interest  (the "March  Balance").
Interest  on the March  Balance  shall  continue  to accrue at the rate of eight
percent (8%) per annum;  however, all future interest payments, at the option of
the  Company,  may be made in cash or by  delivery  of  registered  shares  at a
conversion  price  equal per share  equal to the  amount of  accrued  and unpaid
interest as of the  conversion  or  repayment  date  divided by the five (5) day
average closing bid price prior to the conversion or repayment date. Further, TK
committed,  subject to not exceeding  ownership of 4.99%,  to convert as soon as
possible the March Balance. The Company may continue to repay all or any part of
the March  Balance in cash.  TK agreed to return  all shares  held in escrow and
agreed to a triangular merger contemplated by the Company.  Provided such merger
occurred  before May 15, 2001,  TK agreed not to sell,  directly or  indirectly,
more than twenty-five  percent (25%) of the Company's volume in any trading day.
Such anticipated merger, to be discuss below, did not occur before May 15, 2001.
In consideration of the  Cancellation  Agreement and the accelerated  conversion
into the Company's  shares,  the Company  agreed to issue 682,108  shares of its
restricted  Common  Stock in relation to the balance of the  December  1999 debt
which was  converted  and  3,109,487  shares of its  restricted  Common Stock in
relation to the March 31, 2000  installment as bonus shares (the "Bonus Shares")
Additionally,  the Company granted,  for a period of two years,  both the Lender
and the  Agent  each  warrants  to  purchase  380,000  shares  of the  Company's
restricted Common Stock at $0.1846 per share (the "Bonus Warrants"). Until fully
converted,  TK was given the option to place an  independent  third party on the
Company's Board of Directors.  Of the 20,038,097  shares registered on Form S-3,
only those shares issued pursuant to the earlier conversions and pursuant to the
agreement and original  Lender and Agent Warrants  would be registered  with the
balance  deemed  null and void.  Accordingly,  the  registration  of  13,255,946
potentially  issuable  registered  shares would be null and void and such shares
would not be issued .

     Following  execution  of  the  Cancellation   Agreement,  TK  converted  an
additional  $243,665 of  principal  on the March  Balance and accrued and unpaid
interest in the amount of $19,601

                                                                  63

<PAGE>



into a total of 702,043  shares.  The  certificate for shares held in escrow was
cancelled  and there are no  longer  any  escrowed  shares  in  relation  to the
arrangements  between  the  parties.  As  of  the  date  hereof,  the  principal
indebtedness to TK is in the amount of $316,335 plus accrued and unpaid interest
from March 31, 2000.

     Until fully converted,  the TK Loan Commitment,  as interest accrues,  will
increase  the long term debt of the Company.  The Company is  currently  seeking
other potential funding. With the TK Loan Commitment and in the event additional
debt is raised,  the Company will incur  future  interest  expense.  The TK Loan
Commitment,  if fully converted and all warrants are exercised,  will dilute the
interest of existing  shareholders and in the event additional equity is raised,
management  may be  required to dilute the  interest  of  existing  shareholders
further or forego a substantial interest in revenues,  if any. In the event that
the Company is successful in securing  additional debt financing,  the amount of
such  financing,  depending upon its terms,  would increase  either the short or
long term debt of the Company or both.

     On February, 2001, the Company executed a Term Sheet with Emagisoft whereby
Emagisoft will merge into OIX, Inc.. The shareholders of Emagisoft will exchange
their shares for share in Surgical on a 1 for 1 basis. In addition,  Emagisoft's
Preferred  Shares will exchange their preferred  shares in Surgical's  Preferred
Shares on a 1 for 1 basis.  The  reverse  triangular  merger was  expected to be
completed  some time in April 2001;  however,  due to a shortage of funds on the
part of both Emagisoft and Surgical the merger has not been completed as of this
date.  Surgical and Emagisoft decided to proceed with merger plans because there
are certain  synergies  that will result from the merged  companies.  Currently,
Surgical  outsources  a great deal of its CD  production  and  computer  design.
Emagisoft  provides such services.  Further,  both companies are within the same
geographic  region and share many of the same suppliers.  Lastly,  Emagisoft has
existing  management  that can provide the stability in management  Surgical has
been seeking over the last few years. As a result of these features,  management
for these two companies  believed that collectively they could achieve the goals
of each of the  companies at a faster rate. At the time the merger is completed,
Surgical will file on Form 8K a combined business plan.

     In December, 2000, the Company issued options to purchase 300,000 shares of
its  restricted  Common Stock to five (5)  employees  exercisable  at a price of
$0.13 per share. As of December 31, 2000, the Company owed employees,  exclusive
of officers, deferred compensation in the amount of $20,458.



                                                                  64

<PAGE>

Item 13.  Exhibits and Reports on Form 8-K

           (a)       Exhibits

<TABLE>
<CAPTION>
Item No.             Description
-----------------------------------

<S>       <C>        <C>
3.(I).1              Articles of Incorporation of Surgical Safety Products, Inc., a Florida corporation filed
                     May 15, 1992 [1]

3.(I).2              Articles of Amendment filed December 9, 1992 [1]

3.(I).3              Articles of Amendment filed July 19, 1994 [1]

3.(I).4              Articles of Amendment filed October 11, 1994 [1]

3.(I).5              Articles of Incorporation of Sheffeld Acres, Inc., a New York Corporation filed May
                     7, 1993 [1]

3.(I).6              Articles of Merger filed in the State of Florida October 12, 1994 [1]

3.(I).7              Certificate of Merger filed in the State of New York February 8, 1995 [1]

3.(I).8              Certificate to Do Business in the State of Florida filed April 11, 1995 [1]

3.(I).9              Certificate of Amendment filed May 1, 1998 [1]

3.(I).10             Certificate of Amendment filed February 28, 2000 [7]

3.(II).1             Bylaws of Sheffeld Acres, Inc., now known as Surgical Safety Products, Inc. [1]

3.(II).2             Amended Bylaws of Surgical Safety Products, Inc. [2]

10.1                 Acquisition of Endex Systems, Inc. d/b/a/ InterActive PIE dated December 8, 1997 [1]

10.2                 Prepaid Capital Lease Agreement with Community Health Corporation relative to
                     Sarasota Medical Hospital OASiS Installation dated January 30, 1998 [1]

10.3                 Letter of Intent with United States Surgical Corporation dated February 12, 1998 [1]

10.4                 Form of Rockford Industries, Inc. Rental Agreement and Equipment Schedule to
                     Master Lease Agreement [1]

10.5                 Ad-Vantagenet Letter of Intent dated June 19, 1998 [1]

10.6                 Distribution Agreement with Morrison International Inc. dated September 30, 1996 [1]
</TABLE>


                                                                  65

<PAGE>


<TABLE>
<S>       <C>        <C>
10.7                 Distribution Agreement with Hospital News dated August 1, 1997 [1]

10.8                 Clinical Products Testing Agreement with Sarasota Memorial Hospital dated January
                     30, 1998 [1]

10.9                 Real Estate Lease for Executive Offices effective June 1, 1998 [1]

10.10                Employment Agreement with Donald K. Lawrence dated April 1, 1997 [1]

10.11                Employment Agreement with G. Michael Swor dated June 15, 1998 [1]

10.12                Employment Agreement with Frank M. Clark dated June 15, 1998 [1]

10.13                Agreement for Consulting Services with Stockstowatch.com Inc. dated March 30,
                     1988 [1]

10.14                Form of Employee Option Agreement dated July 1994 [1]

10.15                Form of Employee Option Agreement dated 1998 [1]

10.16                Form of Consultants Option Agreement dated July 1994 [1]

10.17                Form of Consultants Option Agreement dated 1998 [1]

10.18                Confidential Private Offering Memorandum dated May 30, 1995 [1]

10.19                Supplement to Private Offering Memorandum dated October 30, 1995 [1]

10.20                Stock Option Agreement with Bay Breeze Enterprises LLC dated April 9, 1998 [1]

10.21                Revolving Loan Agreement, Revolving Note, Security Agreement with SouthTrust
                     Bank dated May 2, 1997 [1]

10.22                Agreement between the Company and T. T. Communications, Inc. dated October 15,
                     1998 [2]

10.23                Agreement between the Company and U.S. Surgical Corporation dated October 28,
                     1998. [2]
</TABLE>

                                                                  66

<PAGE>


<TABLE>
<S>       <C>        <C>
10.24                Collaborative Agreement between the Company and Dr. William B. Saye dated
                     November 16, 1998. [2]

10.25                Kiosk Information System, Inc. Purchase Order dated November 3, 1998 [2]

10.26                Surgical Safety Products 1999 Stock Option Plan adopted January 1999 [2]

10.27                Form of the Employee Option Agreement under the Surgical Safety Products 1999
                     Stock Option Plan dated January 1999 [2]

10.28                Form of the Director, Consultant and Advisor Option Agreement under the Surgical
                     Safety Products 1999 Stock Option Plan dated January 1999 [2]

10.29                Verio, Inc. Access Service Agreement dated February 16, 1999. [2]

0.30                 Form of Investor Subscription Documents and Agreements relative to the April 1999
                     Self Directed Private Placement Offering under Rule 506 of Regulation D. [3]

10.31                Form of the Warrant issued pursuant to the April 1999 Self Directed Private Placement
                     Offering under Rule 506 of Regulation D. [3]

10.32                Consulting Agreement dated April 1999 with Koritz Group, LLC. [3]

10.33                Agreement dated April 1999 with KJS Investment Corporation. [4]

10.34                Agreement dated May 1999 with Ten Peaks Capital Corp. [4]

10.35                Private Partner Network Agreement dated July 30, 1999 with US Surgical [5]

10.36                Staff/Client Leasing Agreement dated October 16, 1999, as amended September 15,
                     1999 [5]

10.37                Agreement dated July 15, 1999 with Triton Capital Inc.[6]

10.38                Effective December 30, 1999, Loan Agreement, Note, Security Agreement, Lender's
                     Warrant, Agent's Warrant, Registration Rights Agreement and Escrow Agreement
                     relative to the December 1999 transaction with Thomson Kernaghan & Co., Inc.  and
                     Amendment thereto. [7]
</TABLE>


                                                                  67

<PAGE>


<TABLE>
<S>       <C>        <C>
10.39                Effective January 3, 2000 IBM Customer Agreement and Statement of Work. [7]

10.40                Investment Banking Services Agreement dated February 2, 2000 with Dunwoody
                     Brokerage Services Inc. [8]

10.41                Consulting Agreement dated February 15, 2000 with Global Development Advisors
                     Inc. [8]

10.42                Surgical Safety Products 2000 Stock Option and Award Plan [8]

10.43                Agreement with Steel Beach Productions dated February 29, 2000 [9].

10.44                Agreement with Horizon Marketing Group dated May 16, 2000 [10]

10.45                Agreement with EPIX dated May 25, 2000 [10]

10.46                Amendment to the Company's 2000 Stock Option and Awards Plan dated June 6, 2000
                     [10]

10.47                Revolving Loan Agreement, Revolving Note, Security Agreement with SouthTrust
                     Bank dated June 7, 2000 [10]

10.48                Agreement with AORN effective July 1, 2000 [10]

10.49                Agreement with Carver Cross dated July 6, 2000 [10]

10.50                Agreement with U.S. Surgical effective June 28, 2000 [11]

10.51                Agreement with Imagyn dated September 18, 2000 [12]

10.52                Agreement with Haemacure dated September 19, 2000 [12]

10.53                Agreement with Storz dated September 29, 2000 [12]

10.54                Agreement with Quantum dated October 6, 2000 [12]

10.55                Agreement with Stryker dated October 9, 2000 [12]
</TABLE>

                                                                  68

<PAGE>


<TABLE>
<S>       <C>        <C>
10.56                Property Lease dated October 13, 2000 [12]

10.57                Agreement with GDA dated October 25, 2000 [12]

10.58     *          Loan Cancellation and Settlement Agreement with Thomson Kernaghan & Co.  Ltd.
                     effective February 7, 2001

10.59     *          Term Sheet for merger with Emagicsoft Technologies Inc.  dated February, 2001

10.60     *          Selective HR Solutions Agreement dated March 2001.

10.61     *          DeRoyal Industries, Inc.  Agreement dated 2001

13.1                 Definitive Proxy Statement filed February 28, 2000 [8]
----------------
</TABLE>

[1]  Previously filed with the Company's Form 10SB

[2]  Previously filed with the Company's Amendment No. 1 to the Form 10SB

[3]  Previously  filed with the Company's Form 10QSB for the Quarter ended March
     30, 1999

[4]  Previously  filed with the Company's  Form 10QSB for the Quarter ended June
     30, 1999

[5]  Previously filed with the Company's Amendment No. 2 to the Form 10SB

[6]  Previously  filed  with the  Company's  Form  10QSB for the  Quarter  ended
     September 30, 1999

[7]  Previously filed with the Company's Form S-3 on March 2, 2000.

[8]  Previously  filed with the  Company's  Form 10KSB for the fiscal year ended
     December 31, 1999.

[9]  Previously  filed with the Company's Form 10QSB for the Quarter ended March
     31, 2000.

[10] Previously  filed with the Company's  Form 10QSB for the Quarter ended June
     30, 2000.

[11] Previously  filed with the Company's  Amendment 3 to the Form 10QSB for the
     Quarter ended June 30, 2000.

                                                                  69

<PAGE>




[12] Previously  filed  with the  Company's  Form  10QSB for the  Quarter  ended
     September 30, 2000.

*    Filed herewith

     (b)Reports on Form 8K

     There  were no  reports  of Form 8K for the last  quarter  covered  by this
report.

                                    SIGNATURE

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



                         Surgical Safety Products, Inc.
                                  (Registrant)



Date: May 24, 2001          By:/s/ Dr.  G.  Michael Swor
                            ---------------------------------------
                            Dr.  G.  Michael Swor
                            President and Chief Executive Officer


Pursuant to the requirements of the Exchange Act, this report has been signed by
the following persons in the capacities and on the dates indicated.

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

/s/ G.  Michael Swor          Chairman of the Board               May 24, 2001
- ---------------------       President and Chief Executive
 G. Michael Swor              Officer

                                                                  70

<PAGE>



/s/ Donald K.  Lawrence      Director                             May 24, 2001
- ----------------------
 Donald K. Lawrence

/s/ James D. Stuart          Director                             May 24, 2001
- ----------------------
 James D. Stuart

 /s/ Sam Norton              Director                             May 24, 2001
------------------------
 Sam Norton

 /s/ David Swor              Director                             May 24, 2001
------------------------
 David Swor

/s/ William B. Saye          Director                             May 24, 2001
------------------------
 William B. Saye




                                                                  71

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