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, 1999

            [  ]        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.)

         2018 Oak Terrace
          Sarasota, Florida                              34231
- ---------------------------------------              ----------
(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. $174,983.

     Of  the14,515,373  shares  of voting  stock of the  registrant  issued  and
outstanding   as  of  December   31,   1999,   9,244,440   shares  are  held  by
non-affiliates.  The Company trades on the OTC under the symbol "SURG". On March
29, 2000, the closing price was $1.437. Accordingly,  the aggregate market value
based of the non-affiliate  shares based upon this closing price as of March 29,
2000 was $13,284,260.




<PAGE>


<TABLE>
<CAPTION>
                                TABLE OF CONTENTS



PART I
<S>            <C>                                                              <C>
Item 1.         Description of Business                                           1

Item 2.         Description of Property                                         30

Item 3.         Legal Proceedings                                               31

Item 4.         Submission of Matters to a Vote of Security Holders             31

PART II

Item 5.         Market for Common Equity and Related Shareholder Matters        32

Item 6.         Management's Discussion and Analysis or Plan of Operation       33

Item 7.         Financial Statements - Commencing on                            40

Item 8.         Changes and Disagreements with Accountants on Accounting
                And Financial Disclosure                                        41

PART III

Item 9.         Directors, Executive Officers, Promoters and Control Persons;
                Compliance with Section 16(a) of the Exchange Act               41

Item 10.        Executive Compensation                                          48

Item 11.        Security Ownership of Certain Beneficial Owners and             59
                Management

Item 12.        Certain Relationships and Related Transactions                  61

Item 13.        Exhibits and Reports on Form 8K                                 64
</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  "SURG".  The Company's  executive  offices are
presently  located at 2018 Oak Terrace,  Sarasota,  Florida 34231, its telephone
number is (941) 927-7874 and its facsimile number is (941) 925-0515.

     The Company was formed for the initial  purpose of combating  the potential
spread  of  bloodborne  pathogen  infections,  such  as HIV and  hepatitis.  The
founding  philosophy arose from a concern  regarding the  occupational  risks of
healthcare  workers in the  operating  room.  Since  inception,  the Company has
broadened its mission to include the  research,  development  and  production of
innovative  products  and services  which  create and  maintain a safe  surgical
environment for medical and hospital staff,  healthcare workers and patients, as
well as enhance the level of surgical care available to patients.

     The Company is engaged in product  development,  sales and services for the
medical industry. The Company is currently engaged in one line of business which
is divided into three (3)  divisions  each of which is involved  with  specialty
medical product research and development:  (1) a division which develops various
medical-related  services to be marketed to healthcare facilities,  including an
entire family of computer  software  applications  designed to evaluate,  track,
organize and manage  infection  control data for  healthcare  facilities  and to
provide  multi-media  information  centers for a facility's  healthcare  workers
("Data Systems Division");  (2) a division which researches and develops medical
products for sale in the marketplace  ("Medical Products  Division");  and (3) a
division  which  provides  confidential  consultation  services  to third  party
developers of medical products,  usually  physicians and healthcare  technicians
("Medical Products  Consultation  Division").  The common thread interwoven into
each area  requires  medical  research,  education  and a  commitment  to safety
issues.  It is the Company's  intention to gradually make the transition  from a
research and  development-oriented  medical device company into a  multi-product
device manufacturer and distributor.



                                        1

<PAGE>



     In January 1999, the Company  granted  options to purchase 10,000 shares of
the  Company's  Common Stock at $1.00  pursuant to the 1999 Revised Stock Option
Plan ("1999 Revised ESOP") to each of Frank Clark,  Donald  Lawrence and Michael
Swor, respectively the Company's President, Vice President and Treasurer.  Prior
to becoming a Director of the Company and  assuming the position of Acting Chief
Financial  Officer,  David  Collins was  granted  options to purchase a total of
75,000 shares of the  Company's  Common Stock at $1.00 for  consulting  services
rendered  pursuant to the 1999 Revised  ESOP.  The granted  such  options  under
Section 4(2) of the Act and Rule 506.

     In April 1999 the  Company  commenced  a  self-directed  private  placement
offering of its restricted Common Stock and warrants for which it received gross
proceeds of $475,000.  Pursuant to such  offering,  950,000 shares of restricted
Common  Stock  were  issued  and  warrants  to  purchase  475,000  shares of the
Company's  restricted  Common  Stock at an exercise  price of $1.00  exercisable
within five (5) years were granted.  Three directors purchased shares under this
offering.  The Company  conducted this offering  pursuant to Section 4(2) of the
Securities  Act of 1933, as amended (the "Act") and Rule 506  promulgated  under
Regulation  D of the Act  ("Rule  506").  No  offering  memorandum  was  used in
connection with this offering. Rather investors were provided with access to the
Company's  Registration  Statement on Form 10-SB, as amended,  its Form 10-K and
its  Form  10Q for the 1st  Quarter  1999,  all of  which  are  filed  with  the
Securities and Exchange Commission ("SEC").

     In April, 1999, the Company executed a Consulting and Assistance  Agreement
with Koritz Group LLC., a Connecticut  limited liability  company  ("Koritz") to
identify sources of capital or potential  business  relationships  and to assist
the Company in (i) raising equity or debt financing in the amount of $15,000,000
(ii) arranging for trade financing for production,  sale, lease, rental or other
disposal of the Company's products; and (iii) arranging for the sale, merger, or
consolidation  of the Company or for joint ventures or strategic  alliances with
other appropriate business. This agreement was terminated on July 30, 1999.

     In April 1999,  the Company  entered into an agreement  with KJS Investment
Corporation of Tampa Florida ("KJS") to provide consulting services.  KJS agreed
to accept 7,000 shares of the  Company's  common stock valued at the current bid
price of $.50 as part of an initial  retainer  with the  balance of $1,500 to be
paid in cash at such time as KJS  introduces  the Company to five  institutional
funding  sources.  The issuance was made pursuant to Section 4(2) of the Act and
Rule 506.

     In April 1999, the Company  issued 2,000 shares each to two  consultants of
the Company for  services  relating to their  production  of a CD-Rom disc to be
used to promote  OASiS.  Such 4000 shares were valued at $2,250  which was based
upon the closing  price for the shares on the dates the services  were due to be
paid.  Such  issuance  was made in reliance on Section  4(2) of the Act and Rule
506.

     In May 1999,  the Company  entered into an agreement with Ten Peaks Capital
Corp.  of  Berkeley,  California  ("Ten  Peaks")  to  pay  a  finder's  fee  for
successfully  securing specifically defined financing for the Company. Ten Peaks
agreed to accept 6,000 shares of the Company's common

                                        2

<PAGE>



stock in lieu of a  retainer  provided  such  stock had a fair  market  value as
reported on Bloomberg,  LLP on the date of execution of not less than $.66.  The
issuance  was  made  pursuant  to  Section  4(2) of the Act and Rule  506.  This
agreement expired without the payment of any further fees.

     In May 1999,  the Company issued a total of 46,000 shares of its restricted
Common  Stock  to Frank  Clark  and  David  Collins  and  11,400  shares  of its
restricted  Common  Stock to three (3)  other  employees  in lieu of salary  and
consulting  fees  due  from  the  Company  to each of  them,  which  salary  and
consulting  fees were valued at $31,222 in the case of Mr. Clark and Mr. Collins
and at $7,832 in the case of the three (3)  employees.  The Company  issued such
shares pursuant to Section 4(2) of the Act and Rule 506.

     In May 1999, the Company granted options to purchase  170,000 shares of the
Company's Common Stock at an exercise price of $1. If 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.

     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.

     In July 1999, the Company  executed a Consulting  and Assistance  Agreement
with Triton Capital, Inc., a Florida corporation ("Triton").  Under the terms of
this  agreement,  Triton  has been  engaged  to  identify  sources of capital or
potential business relationships and to assist the Company in (i) raising equity
or debt financing in the amount of $6,000,000 (ii) arranging for trade financing
for production, sale, lease, rental or other disposal of the Company's products;
and (iii) arranging for the sale, merger, or consolidation of the Company or for
joint ventures or strategic alliances with other appropriate business.

     In December 1999 the Company issued 10,000 shares of its restricted  Common
Stock.  Originally,  the Company granted three (3) consultants a total of 12,500
shares,  one person was granted  7,500 shares the  Company's  restricted  Common
Stock for his work with the  Company's  patents,  one person was  granted  2,500
shares of restricted  Common Stock for his work on OASiS, and the third, a nurse
at SMH,  was granted  2,500  shares of  restricted  Common Stock for her work on
OASiS. However, the nurse at SMH declined,  stating that such grant would not be
appropriate  under SMH policy and such  issuance was not made.  The issuance was
made pursuant to Section 4(2) of the Act and Rule 506.

     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").  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.

                                        3

<PAGE>



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, the Lender
was granted a warrant to purchase  3,428,571  shares and the Agent was granted a
warrant to purchase 1,142,857 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.

     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.  The Company  granted such options  pursuant to Section 4(2) of the
Act and Rule 506.

     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
other employees .

     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 has agreed to introduce entities
to the Company for potential  strategic  partnerships,  licensing  arrangements,
mergers,  acquisitions,  investments or funding. For such services,  Swartz will
receive a scaled fee based upon the value of any completed transaction. Said fee
is payable in cash or stock at Swartz's  option and by the issuance of warrants,
the  number of which is based upon the fee  divided  by the market  price of the
Company's  Common  Stock.  There is no  obligation on the part of the Company to
accept any transaction offered by the Swartz to the Company.

     In February 2000, the Company  executed a Consulting  Agreement with Global
Development  Advisors,  Inc.  ("GDA")).  Under the  agreement,  GDA will 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  is for a term of six (6)  months and may be
extended by the Company.  In lieu of cash payments for services,  GDA has 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. The issuance
was made pursuant to Section 4(2) of the Act and Rule 506.

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





                                        4

<PAGE>



(b)         Business of Issuer.

General

     The Company was formed in 1992,  and until 1996,  was primarily  engaged in
women's  healthcare,  medical  research and product  development with a focus on
safety-related  products  geared  to the  reduction  of  occupational  risks  to
healthcare  workers.  To date,  the Company has received four (4) patents on two
(2)  products,  is seeking  patent  protection  on other  products and is in the
process  of  developing  or  acquiring  the  rights  to  approximately  nine (9)
additional medical products intended to be marketed to the healthcare community.
The  concepts  and designs of the  additional  medical  products  are at various
stages of development or negotiation. The Company has an exclusive five (5) year
manufacturing  and  supply  agreement  for a  line  of  protective  prescription
eyeglasses;  however,  it has decided to discontinue  marketing efforts for this
line due to poor  sales.  The  Company  markets  its  product  lines  under  the
trademark, Compliance Plus.

     The Company's premiere product in the Compliance Plus line,  marketed under
the trade name,  SutureMate(R),  is a  disposable  Food and Drug  Administration
("FDA") approved, multi- function, suturing safety device for surgery. Three (3)
of  the  patents  apply  to  this  product.  The  original  instrument  and  its
developmental variations facilitate advanced surgical techniques, which increase
surgical  efficiency and reduce the occupational  risk of exposure to bloodborne
pathogens such as HIV and  hepatitis.  The original  product is currently  being
re-released.  The product has been re-engineered and updated after feedback from
over 4,000  surgeons and surgical  technologists.  New clinical  advantages  and
significantly  lower  manufacturing  costs create  potential for this  patented,
disposable  surgical  assist device which was originally  designed to facilitate
the preferred one-handed suturing technique.

     The Company  intends to market under the trade name,  Prostasert(R),  a FDA
listed  product  which was  developed  to improve  the  preparation  of pregnant
patients for labor by  providing a mechanism  for  applying  and  maintaining  a
pharmaceutical  gel to the cervix and vagina.  One (1) of the patents applies to
this product.

     In addition,  the Company intends to market an infection  control equipment
kit for healthcare workers under the trademark, IcePak(TM).

     The  Company has two (2)  additional  products  in the  development  stage:
Prepwiz(TM),  which is a  revolutionary  surgical  prep  and  drape  system  and
FingerSafe(TM), which is a multi-featured surgical thimble.

     The Company  aggressively  protects  its  intellectual  properties  through
patents,  trademarks and copyrights,  as well as by proprietary software designs
(flow charts, algorithms, reports and databases). In addition to the utility and
design patents already issued to the Company,  the Company has a number of other
products in various stages of development which have patent potential.



                                        5

<PAGE>



     In 1997,  the  Company  focused on the  creation  and  establishment  of an
information system for multiple  applications within healthcare.  Formerly named
Surgical Safety Network,  this information system is now marketed under the name
OASiS which is the  acronym  for  Occupational  Automated  Services  Information
System. In April 1998, the Company filed for two (2) patents on this system, one
related  to this  touch-access  information  system  and the other  related to a
technology transfer  application.  This touch access system has developed into a
platform for initially managing three areas of need: (1) exposure (to bloodborne
pathogen)   management;   (2)healthcare   training;   and  (3)  healthcare  risk
management.

     In February 1998, the Company  executed a letter of intent to joint venture
with U.S.  Surgical  Corporation  ("U S.  Surgical"),  a major  manufacturer  of
surgical products which distributes its products worldwide, for the marketing of
the OASiS system.  The parties executed a final agreement dated October 28, 1998
(the "Short  Term  Agreement").  On October 1, 1998,  Tyco  Healthcare  Group LP
("Tyco")  consummated  a merger  with US  Surgical.  On July 30,  1999  Surgical
entered into a private  partner  network  agreement with US Surgical.  Under the
July agreement,  Surgical is to supply up to four hundred (400) OASiS systems to
US Surgical under licenses calling for installation in nominated  hospitals (the
"Long Term Agreement").

     The Company  entered into an agreement with IBM Global  Services  effective
January 3, 2000 which includes an IBM Customer Agreement and a Statement of Work
(the "IBM Global  Agreement").  Under the terms of the IBM Global  Agreement IBM
will 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 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  include  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 is approximately  $10 million.  In addition,  IBM Global
Services  will  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 will provide technical resources and oversee
the IBM Global's  activities.  The Company  believes  that this  agreement  will
expedite the  deployment  of its OASiS  systems under the terms of its Long Term
Agreement with US Surgical.

     The Company's  other  products and concepts in  development  generally fall
into the categories of occupational  safety,  infection control,  obstetrics and
gynecology, and new "minimally invasive" surgery devices and techniques. Most of
these development projects originated from within the Company,  although several
are being  co-developed  with  outside  third  party  inventors  who are  mainly
physicians  and medical  technicians  for whom the Company  provides  consulting
services in new product development.

     The  FDA  lists  Surgical  as  a  medical  device   specifier.   Under  FDA
Registration No. 1056687,  as a medical device specifier,  Surgical is permitted
to control the  specifications of its products.  The Company spent its formative
years in research and development and in obtaining patent protection on its core
products and services.  Tangential to its core competency, the Company had found
it necessary  to diversify  its  offerings,  but has,  over the past fiscal year
focused  a  majority  of  its  efforts  towards  the  commercialization  of  its
touch-access information system, OASiS.

                                        6

<PAGE>





     Surgical is attempting to secure a research-backed, OSHA mandate status for
its OASiS  information  system which would make the  availability  of Compliance
Plus required in hospitals and other medical  facilities.  The Company's plan is
to  accumulate  enough  research on product lines to  demonstrate  statistically
their significant  safety advantages to support such products  inclusion in OSHA
requirements  for workplace  safety  compliance.  There can be no assurance that
such statistics will demonstrate such facts, or even if demonstrated,  that such
products will be included in OSHA requirements.

     Fifteen  (15) OASiS unit are now  installed in seven (7)  hospitals.  Lease
payments  from OASiS  currently  are made directly to Surgical from the customer
hospital  but  may be  made,  in the  future,  through  a  third  party  leasing
intermediary.  In the case of the third party  intermediary,  Surgical is paid a
lump sum at the front end of the lease and the hospital  then makes its payments
to the leasing company. Selection of the leasing arrangements is made based upon
Surgical's current financial status and based upon the financial strength of the
hospital involved.

     SutureMate(R)  was  originally  sold in limited  quantities and had limited
success due to the high manufacturers  suggested retail price. New manufacturing
arrangements  will  allow  sales in the $5 to $6  range,  more in  keeping  with
disposable products. Due to limited sales, the Company is dropping the MediSpecs
Rx(TM) product line.  Consulting fees are derived from the Medical  Consultation
Division on an as needed basis.

     The Company now is  positioned  to  commercialize  Compliance  Plus product
lines and its proprietary  OASiS system through its alliances with U.S. Surgical
and IBM  Global  and each of their  full size  international  sales  force.  The
Company is  preparing  other  alliances  with one or more  established  industry
leaders in  healthcare.  The Company  believes that recurring  multiple  revenue
streams and a "cookie  cutter"  program and network  will allow for  potentially
rapid growth in the number of OASiS system installations.  When the OASiS system
reaches  the  appropriate  size,  the  Company may  consider  the  spin-off of a
separate  subsidiary  for managing this  Internet-based  healthcare  information
network and  subsequently  an initial  public  offering  related to the spun off
subsidiary.  If the Company grows and attains its projected earnings, it intends
to apply for listing on the NASDAQ Quotation System where it believes the market
would apply an appropriate multiple to the earnings per share. At such time, the
Company  may  position  itself as an  acquisition  target  for major  medical or
information system entities, although it has no such plans at this time.

     The  Company has been  seeking  debt or equity  financing  in the amount of
between $2,000,000 and $5,000,000. In December 1999, the Company executed the TK
Loan  Commitment  which provides for the Company to borrow up to $5,000,000 from
TK subject to the terms and conditions  contained therein.  The Company thus far
has  borrowed  $650,000 as the first  installment  under which the note could be
convertible into a maximum of 1,7333,333 shares of the Company's Common Stock at
the  lowest  possible  conversion  price and has  issued  warrants  to  purchase
3,428,571 and 1,142,857 shares of the Company's Common Stock. However due to the
formula  nature of the  conversion  price,  the Company is unable to project the
exact number of additional

                                        7

<PAGE>



shares of its Common  Stock  which will be  required  to be issued if all of the
debt is converted or all of the warrants are exercised. As of December 31, 1999,
the  Company  had short term debt as a result of draw downs  under its  $100,000
revolving loan agreement with South Trust Bank and long term debt of $650,000 as
a  result  of the  initial  loan  under  the TK  Loan  Commitment.  The TK  Loan
Commitment, once interest payments begin to accrue, will increase 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.  With the TK Loan Commitment
and 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.

     The TK Loan  Commitment will be used by the Company to meet its obligations
under  the Long  Term  Agreement  with US  Surgical  and for  general  operating
expenses.  With the  additional  installments  under the TK Loan  Commitment  or
subject to the  availability of additional  financing,  of which there can be no
assurance,  the  Company  plans (1) to  facilitate  implementation  of its sales
strategies,  (2) to apply additional funding to existing new technology; and (3)
to apply  additional  funding to  complimentary  products and  services  through
corporate acquisition and exclusive licensing.

     The Company  currently  employs,  under the  agreement  with Staff and on a
full-time basis, seven (7) people, including its Chief Executive Officer and its
President  and Chief  Operating  Office.  Total  employee  salaries for the year
ending  December 31, 1999 were $363,418 of which  $216,221 was paid as Executive
Compensation,  including  salaries  and the  value of Common  Stock and  Options
issued and granted to such  executives.  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 1999,  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  the Long Term  Agreement  with US Surgical and
other growth plans.

     The  Company is  dependent  upon the  services of two 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.  Donald K. Lawrence,  a Director
and President and Chief Operating Officer,  is responsible for sales management,
market planning, advertising for the Company. Mr. Lawrence in addition to nearly

                                        8

<PAGE>



ten (10) years in medical  device sales,  has  extensive  experience in computer
graphics, multi-media and computer equipment leasing programs. The Company plans
to  continue to use to its  advantage  the  reputations  and skills of these two
officers in the medical industry.  Nevertheless,  while these officers have been
successful in the past,  there can be no assurance  that they will be successful
in the  continued  development  of the Company  which is needed for a successful
operation of the Company.  The Company has  employment  agreements  with each of
these individuals.

Data Systems Division

     In February 1998, the Company  executed a letter of intent to joint venture
with U.S. Surgical Corporation ("US Surgical"), a major manufacturer of surgical
products  which  distributes  its products  worldwide,  for the marketing of the
OASiS system. The parties executed a final agreement dated October 28, 1998 (the
"Short Term  Agreement").  On October 1, 1998, Tyco Healthcare Group LP ("Tyco")
consummated a merger with US Surgical.  On July 30, 1999 Surgical entered into a
private  partner network  agreement with US Surgical.  Under the July agreement,
Surgical  is to supply up to four  hundred  (400)  OASiS  systems to US Surgical
under licenses calling for  installation in nominated  hospitals (the "Long Term
Agreement").

     In November 1998, the Company announced a planned  enhancement to the OASiS
system called "Vendor Watch". Currently in development and testing, this program
is expected to aid the hospital  administration  in  monitoring  the presence of
vendors and sales representatives  visiting the hospital. Also, it is planned as
a  communications  tool for sending  messages to the  vendors.  Beta testing was
planned for late 1999 but was delayed until the release of OASiS Version 3 which
is anticipated for April 2000.

     OASiS Version 2.0 became  operational at Sarasota  Medical Hospital ("SMH")
in  February,  1999.  For the  installation,  Surgical has  outsourced  Internet
services to Verio,  Inc.  ("Verio") , a provider  of Internet  services  such as
broadband  connectivity,   WEB  hosting  solutions,  virtual  private  networks,
e-commerce and other enhanced Internet services. Verio provides OASiS with fast,
reliable and secure access to the Internet via Tier 1 connectivity.  In February
1999,  Surgical  entered into an agreement with Verio for access service at SMH.
The  agreement  required  payment of a set up fee of $60 and monthly  charges of
$199.  Surgical is  responsible  for paying the monthly  charges.  A  comparable
agreement  with Verio or other  provider is  contemplated  for each  hospital at
which OASiS is installed.

     In February 1999,  Surgical  completed  negotiations which had commenced in
the summer of 1998 to install OASiS units as a test site in St. Francis Hospital
in Trenton,  New Jersey ("St. Francis  Hospital").  Three units with Version 2.0
software were installed in February.  The Company has an oral  arrangement  with
St.  Francis  Hospital under which the hospital pays Surgical $200 per month per
unit as a monthly  software license fee and pays $50 per month per unit for "hot
swap" maintenance service based upon a monthly invoice.

     In February 1999, the first  installations  under the US Surgical agreement
became  operational,  each with  Version  2.0  software.  One OASiS  system  was
installed at Atlanticare

                                        9

<PAGE>



Hospital in  Massachusetts  and two OASiS  systems  were  installed  at Columbia
Presbyterian  Hospital in New York. In addition,  US Surgical  inservice modules
were  installed  in the SMH system and in the system  installed  at St.  Francis
Hospital.

     In March 1999, the Company installed additional units under the US Surgical
agreement at the  California  Pacific  Medical  Center and the Kaiser  Permeante
Medical Center, both in San Francisco, California.

     In April, 1999, the Company shipped and did the preliminary installation at
three more US Surgical sites, a second California  Pacific Medical Center in San
Francisco, the California Pacific Medical Center in Los Angeles,  California and
the University of Washington in Seattle, Washington.

     In  April  1999,  the  Company   attended  the  AORN  convention  where  it
experienced  more acceptance from potential  content  providers and users partly
because of the commencement of the arrangement with US Surgical.

     In  June  1999,  the  Company   completed  the  installation  and  Internet
connection  on  the  unit  at the  University  of  Washington  in  Seattle.  The
preliminary  preparations  were  completed  for the units  under the US Surgical
agreement at the  California  Pacific  Medical Center sites in San Francisco and
Los Angeles.  To date,  these last two sites are not installed fully and are not
connected to the Internet.

     On July 30, 1999, the Company  entered into the Long Term Agreement with US
Surgical  which is a  private  partner  network  agreement.  Under the Long Term
Agreement,  Surgical is to supply up to four hundred  (400) OASiS  systems to US
Surgical under licenses  calling for installation in nominated  hospitals.  Each
license  is  for  a  term  of  three  (3)  years  commencing  with  "substantial
installation: of such unit. "Substantial installation" is defined as delivery of
the OASiS unit to the hospital and connection to the Internet.

     Under the terms of the Long Term  Agreement,  US Surgical  must license two
hundred (200) units within the first year, and subject to certain obligations on
the part of  Surgical  to  license  units  to third  parties,  must  license  an
additional  two  hundred  (200)  units  by the end of the  second  year to third
parties.  Previously  installed units under the Short Term Agreement are counted
toward the minimum units required.  On August 10, 1999 US Surgical paid Surgical
$100,000.00 as an initial investment. The first 200 licenses are $1,500 each and
additional licenses are $1,000 each.

     The Long Term Agreement  further  provides that neither  Surgical,  nor any
third  party  other  than US  Surgical,  may  place  OASiS  units  in any of the
"protected  departments"  of the  hospitals,  unless  it is  installed  prior to
receipt of a purchase  order from US  Surgical  or unless US  Surgical  does not
exercise  its  right  of first  refusal  after  notice  from  Surgical  for such
hospital.  The Long Term Agreement defines "protected  departments" as Operating
Room,  Labor  and  Delivery,  Emergency  Room,  Ambulatory/Same  Day  Surgery  /
Outpatient,  Nuclear Medicine,  Intensive Care, Orthopedic / Ortho Casting Room,
and Dialysis. US Surgical is required to have each hospital bear

                                       10

<PAGE>



the entire risk of loss and damage to any OASiS system  except if such is caused
by the  negligence or wilful  misconduct of Surgical.  US Surgical must maintain
casualty  insurance in amounts and with companies  acceptable to Surgical on the
OASiS  units and its related  amenities  with  Surgical  as the loss  payee.  US
Surgical may elect to have the OASiS systems installed in hospitals it nominates
co-branded  with its name.  Surgical has the  discretion  to select the content,
related services and in-service  products for the OASiS systems  installed under
this  agreement;  however,  during the term of the  agreement,  US  Surgical  is
required to pay for and  maintain a minimum of one hundred  forty (140)  product
in-services modules in an average of at least 80% of all OASiS systems installed
in the United States  whether or not covered by this agreement and 100% on those
that are covered by the agreement. US Surgical's  product-based modules produced
by Surgical  become the property of US Surgical.  Surgical  retains the right to
display such modules on other OASiS units. All other modules remain the property
of Surgical.  Surgical receives a fee for production of the modules. If Surgical
installs additional OASiS units in a designated hospital, US Surgical receives a
10% commission.  Surgical  receives a monthly  maintenance fee for each unit, of
$149,  unless  paid a year in advance in which case it may be  discounted  up to
10%.

     The Company  expected to complete the installation of the balance of the US
Surgical sites under the Short Term Agreement in 1999's third calendar  quarter;
however, such installations have been merged into the Long Term Agreement.

     The Company  entered  into the IBM Global  Agreement  effective  January 3,
2000.  Under the terms of the IBM Global  Agreement  IBM will  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  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  include
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 is
approximately  $10  million.  In  addition,  IBM Global  Services  will 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  will  provide   technical   resources  and  oversee  the  IBM  Global's
activities.   The  Company  believes  that  this  agreement  will  expedite  the
deployment of its OASiS systems under the terms of its Long Term  Agreement with
US Surgical.

     The Company  knows of only one other system which is designed to accumulate
exposure  data which is called  Epinet,  a single  system  designed to track and
report  bloodborne  pathogen  exposure in the  healthcare  setting.  The Company
believes that OASiS is the superior product and that it represents the leader in
the  industry  at this  time.  The  basis for this  belief  is that  Epinet is a
software only product and that the OASiS system can be adapted to accept Epinet.

Medical Products Division

     Compliance Plus is the designation  under which all the Company's  products
are developed.  The Company  trademarked this term in order to indicate that the
criteria used in the

                                       11

<PAGE>



research and development of every Surgical  product and service meets or exceeds
compliance  mandates set forth by the OSHA, the Centers for Disease  Control and
Prevention  ("CDC") and other governing bodies. It is the goal of the Company to
exceed  existing  standards in order to assume a leadership  role in the area of
medical prevention and safety products.

     The Compliance Plus Exposure  Prevention  Program  includes  several safety
engineered  products  dedicated to reducing exposure and cross  contamination in
the operating room. These exposure  prevention products are designed to maximize
surgical  efficiency while reducing  bloodborne  pathogen exposure to healthcare
workers and improving patient care in a wide range of applications.  The Company
has already  introduced the first two Compliance Plus products into the market -
MediSpecs  Rx(TM)  and  SutureMate(R).  These are the only two  Compliance  Plus
products  which it currently  markets.  Both of these products meet OSHA and CDC
mandates.  There  is no  current  time  table  for  the  release  of  additional
Compliance  Plus products.  The remainder of the proposed  Compliance  Plus line
will be added through further in-house development and acquisitions.

     Although  the Company has a  commitment  for $5 million in funding from TK,
the Company  intends to use those funds  primarily  to exploit the  expansion of
OASiS under the Long Term US Surgical  Agreement  and the IBM Global  Agreement.
The  Company  will  require  additional  funding  or  sufficient  cash flow from
operations to implement the exploitation of its Compliance Plus line.

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.

     SutureMate(R)  was re-designed in late 1998 and will be re-released at such
time as the Company has sufficient resources to market this product. 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 will be 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.

                                       12

<PAGE>



     Currently,  the  re-designed  SutureMate(R)  is  manufactured by the Hansen
Plastic  Division of Tuthill  Corporation  at their plant located in Clearwater,
Florida  ("Tuthill").  Tuthill  manufactures  each non-sterile unit at a cost of
$.902 per unit. The non-sterile product is then shipped to Gamma Services,  Inc.
in Lakeland, Florida for sterilization.  The cost per unit for the sterilization
process is $.172.  This results in a total cost per unit of $1.074.  The Company
currently is considering other manufacturing sources.

MediSpecs Rx(TM)

     MediSpecs  Rx(TM)  is a  prescription  protective  eyewear  which  Surgical
co-developed for use in the operating room and related areas. The Company has an
exclusive,  renewable  5-year,  distribution  agreement  which covers the United
States with Morrison  International,  Inc., a Pennsylvania  corporation with its
principal place of business in Sarasota, Florida ("Morrison").  The initial term
expires  in  September  2000.  Under the terms of the  agreement  with  Morrison
executed  in  September,  1996,  the  Company  acquired  the right to  purchase,
promote,   resell  and  distribute  Morrison's  trademarked  glasses  under  the
Company's private label trademark,  MediSpecs Rx(TM).  The price for the product
is fixed for the initial five-year term and requires minimum purchases which are
scaled over the first five-year period from 2,750 units the first year to 56,000
the fifth year. Under the agreement,  the Company its entitled to distribute the
product either  directly or through other  dealers.  Although the Company is not
reaching its quotas,  it has not been found in default by Morrison since this is
a "best  efforts"  contract  with no  penalties  on the part of the  Company for
failure to reach a quota,  other than loss of the  ability to sell the  product.
Due to poor sales,  Morrison  discontinued  the  manufacturing  of this product;
however it has  substantial  inventory on hand for sale. The Company is dropping
this line due to poor sales.

Prostasert(TM)

     Prostasert(TM),originally   named  LaborMate,  is  a  patented  disposable,
obstetrical/gynecological  specialty device with many potential uses,  including
use for  patients  undergoing  the  induction of labor.  The product  provides a
vaginal  application of a precise dosage of pharmaceutical gel which is designed
to shorten  and  improve  the labor and  delivery  process.  Although  simple in
design,  the Company believes that  Prostasert(TM)  is unique in that it differs
from its  competitors  by  allowing  for a more  site-specific  application  and
improved  maintenance  of the  pharmaceutical  gel used.  Prostasert(TM),  a FDA
listed  device,  is a specially  designed  medication  delivery and  maintenance
system which allows a physician to deliver the proper  dosage and maintain  that
dosage  precisely.  With over four (4)  million  births  annually  in the United
States alone, the Company  estimates the potential market for obstetrical use of
this  product  to be  approximately  200,000 to 400,000  cases  annually.  These
estimates  are based on the fact that 10% to 20% of the four (4) million  births
annually  are induced  (labor  stimulated  medically)  and that such  numbers of
induced  births are  increasing  because of the lower  risks and  patient/doctor
convenience factors.  Alternate uses and other applications for this product are
under  development  including  treatment for cervical  infections  and PAP smear
abnormalities for which the market is estimated to be 1,000,000 cases per year.


                                       13

<PAGE>



     There is no timetable  for the entry of this  product into the market.  The
Company is seeking a distribution  outlet for such licensing  arrangement  while
the clinical trials are being conducted.

Icepak(TM)

     The Company is researching patent protection for this specialty product and
its  accessory  components.  This  product is a belt which is  designed to carry
various infection  control- related products  providing  healthcare workers with
easy  access to  personal  protective  supplies.  The belt  itself is a durable,
reusable  product with  consumable  supplies  attached.  The Company  intends to
market  and  sell  this  product  primarily  through  catalogs,  with a focus on
distribution  to nurses.  The Company  will be required to develop  arrangements
with  suppliers of the  consumable  supplies to be used in the belt. A prototype
has been  manufactured  and the  product is  expected to enter the market if the
required agreements with potential  manufacturers/suppliers  have been completed
and if  additional  funding is available  (of which there can be no  assurance).
Accordingly,  no timetable for release of this product has been set. There is no
requirement for regulatory approval of this product.

Research and Development

     The Company previously engaged in extensive research and development of new
medical  technology.  Many product concepts and partially developed designs have
been  accumulated  from  internal  and  external  sources.  As  funding  becomes
available,  of which there can be no  assurance,  new  products  will be brought
through the development process. Initial products in development include:

     RD91862:  PrepWiz(TM):  This is a  multiple  product  for pre-  paring  the
patient's  surgical  site.  The  Company  anticipates  that  this  product  will
potentially  solve  major  efficiency,  costs and safety  problems.  The Company
currently   plans  to  co-develop   this  product  line  with  a  major  medical
manufacturer and subsequently license it for sales and distribution.  Currently,
pattern  designs  are in process and the Company  received  non-sterile  samples
which it is  currently  evaluating.  The  samples  were  provided  to a contract
converter who produced non-sterile disposable samples to be used in finalization
of the design.

     RD121096:  Finger-Safe(TM)Surgical  Thimble:  The Company is seeking patent
protection on this fingertip protection device. It is expected that this product
can be added to the  Compliance  Plus  product  line in the event  that  Company
secures additional capital, of which there can be no assurance.  This product is
used much like a thimble for sewing,  but has special  features that  facilitate
the  suturing  technique  and also has  special  safety  features  and a storage
component.  The product is designed to reduce  further the risk of  needlesticks
and glove perforations to the non- dominant hand.

     Both  RD91862  and  RD121096  require  regulatory  approval  from  the FDA.
PrepWiz(TM)is in the development  phase and no application  under 501(K) will be
undertaken until

                                       14

<PAGE>



final designs and approvals have been executed. Finger-Safe(TM) Surgical Thimble
is on the shelf and no development activity is currently underway.

Advanced Surgical Techniques

     The Company  has  several  products  in  development  that are  designed to
contribute to the rapidly  growing market of "minimally  invasive"  surgery with
increasing emphasis on small incisions,  laparoscopy,  laser treatment, and more
efficient  post-surgery  convalescence.  The  Company  believes  that there is a
significant  demand for improved  technology to facilitate these newly developed
procedures. The Company has several concepts and projects in development related
to this type of surgery,  and many of the new  product  ideas  presented  to the
Medical  Products  Consultation  Division by third  parties are included in this
group.

Medical Consultation Division

     The Medical  Consultation  Division previously provided consulting services
to individual  inventors on a fee basis.  Dr. Swor, Mr. Clark and Mr. Stuart,  a
Director of the Company,  have provide such services  depending upon the type of
expertise required.  The principal function of the division is to find new ideas
and potential products which compliment the Company's product mix.

     This division has been retained to conduct several research  evaluations of
various  proprietary  medical products and has completed two such projects,  one
for  London  International  U.S.  Holdings,  Inc.  (a  study  to  determine  the
spermicidal activity of several  concentrations of nonoxynol-9 lubricated condom
products)  and another  for Purely  Cotton (a study of a tissue made from cotton
rather than paper to determine whether the product was less irritating to people
with  chronic  skin  conditions).  Based upon the  initial  evaluation  of these
products,  the Company  believes that one or more could be very  successful  and
lead to additional business for the Company.

Business Strategy

     The Company's business strategy,  which is dependent upon its being able to
take the  instalments  under the TK Loan  Commitment  as  planned  or  obtaining
sufficient  additional  financing,  is to enhance the  commercialization  of the
OASiS information system, 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,  sale
of its products and  distribution  fees from the Medical  Products  Division and
consulting  fees  earned by the Medical  Consultation  Division.  The  Company's
revenues are dependent on the volume of sales from its products.

                                       15

<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 provided  under the TK Loan  Commitment as and
when needed or other  capital  becomes  available,  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  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.



                                       16

<PAGE>



     OASiS  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 OASiS  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  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 OASiS.  Secondly,  this market segment is
desirous  of the  data  collected  by  OASiS 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 OASiS and the Company's  Compliance Plus line of products and the
venue potential for US Surgical products.


                                       17

<PAGE>



     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

     OASiS, SutureMate(R), and MediSpecs Rx(TM) are currently the Company's only
products  available,  although the Company is dropping the MediSpecs Rx(TM) line
due to poor sales.  Only OASiS currently is being actively  marketed.  While the
Company had entered into a number of agreements  regarding the  distribution  of
SutureMate(R), and MediSpecs Rx(TM), none are currently active.

     On July 30,  1999,  the  Company  entered the Long Term  Agreement  with US
Surgical.  Under  the Long  Term  Agreement,  Surgical  is to  supply up to four
hundred  (400)  OASiS  systems  to  US  Surgical  under  licenses   calling  for
installation  in  nominated  hospitals.  Each license is for a term of three (3)
years  commencing with  "substantial  installation"  of such unit.  "Substantial
installation"  is defined as  delivery  of the OASiS  unit to the  hospital  and
connection to the Internet.

     Under the terms of the Long Term  Agreement,  US Surgical  must license two
hundred (200) units within the first year, and subject to certain obligations on
the part of  Surgical  to  license  units  to third  parties,  must  license  an
additional  two  hundred  (200)  units  by the end of the  second  year to third
parties. Previously installed units under the October 1998 agreement are counted
toward the minimum units required.  On August 10, 1999 US Surgical paid Surgical
$100,000.00 as an initial investment. The first 200 licenses are $1,500 each and
additional  licenses  are  $1,000  each.  It is  expected  that  the IBM  Global
Agreement will compliment the sales efforts of US Surgical to place these units.

Methods of Distribution

     With the financing available under the TK Loan Commitment Surgical plans to
fund part of its commitment under the IBM Global  Agreement,  which in turn will
assist in the rapid deployment of OASiS units under the Long Term Agreement with
US  surgical.  Surgical  also plans to provide  sales  support to its  strategic
partner,  US Surgical by adding sales staff.  IBM Global will manage the primary
sales  functions  with the Company  acting as an  additional  resource for sales
support. As to the OASiS system, IBM Global will complete a site survey for each
customer facility, provide the equipment can coordinate the installations.

     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

                                       18

<PAGE>



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.

     In addition to sales by U.S.  Surgical and  distributors,  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  0roducts.   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)  and MediSpecs  Rx(TM) 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  ready  for  distribution,  subject  to the  availability  of
additional  funding,   of  which  there  can  be  no  assurance.   The  original
SutureMate(R) is available and on the market.  The Company is seeking additional
distribution channels for this product.

     MediSpecs Rx(TM) currently is available;  however,  the Company is dropping
the line due to poor sales.

     Once trials are  completed  and subject to the  availability  of additional
funding or sufficient  excess from the  instalments  received  under the TK Loan
Commitment  after  fulfillment of marketing  commitments  to OASiS,  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  OASiS  system  is fully  operational  at its  initial  sight at SMH in
Sarasota,  Florida,  at seven  (7)  hospitals  under  the  arrangements  with US
Surgical  and at St.  Francis in  Trenton,  New  Jersey.  Although  the  Company
expected  to  complete  the  balance of the  installations  under the Short Term
Agreement  with US  Surgical  installations  in the  third  quarter  1999,  such
installations  have been  merged  into the Long Term  Agreement.  The Company is
ready for additional  installations  at other  locations and it is expected that
the IBM Global arrangement will advance the installation schedule significantly.
Version 2.0 is being  installed at the US Surgical  sites and is in final stages
of test trials.

     A prototype of IcePak(TM) has been manufactured and the product is expected
to   enter   the   market   if   the   required    agreements   with   potential
manufacturers/suppliers have been completed and additional funding is available.
There is no current timetable for such entry.

                                       19

<PAGE>



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 and
has entered  into the Long Term  Agreement  with US Surgical  and the IBM Global
Agreement.

     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 heads and which is  currently  training  surgeons in advanced
laparoscopic  surgery  since it is felt that if the Company  develops a suitable
product, it could be incorporated into this training program. 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.

     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

                                       20

<PAGE>



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 OASiS system 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 OASiS,  which offers a complete system,  software and hardware,  in a touch
access format, 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 lease pricing
structure for OASiS.

     Surgical's  sales  force is being  trained 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.

                                       21

<PAGE>





     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.
Under the terms of the joint venture  between the Company and U S Surgical,  the
OASiS  system  was to be  installed  in a total of ten (10) of these  Centers of
Excellence for an initial nine (9) month trial period. Although such trials have
not been  completed,  U S Surgical has entered into an additional  agreement for
200 units and a potential  of 200 more.  In today's  managed  care  environment,
these  multi-center  installations  are expected to bring into sharper focus the
cost benefits of a wide range of the Company's products.

     The Company also believes that its arrangement with IBM Global adds a level
of expertise that will facilitate the rapid  deployment of the OASiS units under
the Long Term Agreement with US Surgical.

     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) and MediSpecs Rx(TM).  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 maintaining a
relatively narrow market focus,  combined with technical expertise,  that it can
achieve rapid growth.

Sources and Availability of Raw Materials

     Raw materials  necessary for the hardware  requirements of the OASiS system
are available from numerous  third-party  OEM's;  however,  the Company believes
that its  arrangement  with IBM Global is  competitively  priced and that it can
rely upon the quality which for which IBM is known. The software integrated into
the assembled system is proprietary to the Company.

                                       22

<PAGE>



     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.

     Except for its  arrangement  with IBM Global,  the Company does not rely on
any other principal suppliers for any of its raw materials. However, with regard
to MediSpecs  Rx(TM),  the Company entered into a  manufacturing  agreement with
Morrison,  the initial term of which expires in September  2000 and, 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, 1998, the Company
derived  approximately 93% of its revenue from technical services it provided to
US  Surgical  during a medical  products  convention.  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 OASiS system, the Company is reliant upon its agreements
with US Surgical for sales revenues and further exploitation of the system.

     SutureMate(R)sales   are  currently   principally   reliant  upon  in-house
distribution  and  re-establishment  of various  distribution  arrangements  for
generating revenues for this product.

     The  Company  is  reliant  on  in-house  sales  efforts  for  it  MediSpecs
Rx(TM)product line and is dropping the line due to poor sales.

     Subject to the proper timing of instalments under the TK Loan Commitment or
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.

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  instalments  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.


                                       23


     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.

     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.

     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.


                                       24

<PAGE>



     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.

     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

                                       25

<PAGE>



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 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.

State and Local Licensing Requirements

     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.

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 1998 and 1999, the Company expended $34,536 and $51,281 of
its revenues,  respectively,  on research and  development.  These  expenditures
represented 81.5% and 29.3%, respectively,  of the total revenues of the Company
for such fiscal  years.  The  principal  decrease  in the cost of  research  and
development  for  fiscal  1999  from  1998 was  based  upon  the  fact  that the
foundational  structure of the OASiS  network  during 1998 was  completed,  less
emphasis was placed on medical  devices and the 1999 OASiS  developments  were a
continuation of 1998 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.

                                       26

<PAGE>





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, 1999, the Company employed seven (7) persons,  under its
arrangement with Staff Leasing, a Florida licensed Employee Leasing company,  on
a full time basis.  None of these employees are represented by a labor union for
purposes of collective bargaining.  The Company considers its relations with its
employees to be excellent.

     In October 1996, the Company entered into a staff/client  leasing agreement
whereby Staff Leasing leases all existing and new employees to the Company.  The
initial  term  of  the  agreement  was  for  one  (1)  year.  The  agreement  is
automatically  renewable  on a monthly  basis until  renewed for a fixed term or
terminated.  The agreement  remains open on a monthly basis.  All of the persons
described  herein to be employees of the Company are covered by this  agreement,
since Staff Leasing and the Company treat these employees as co-employees.

     In April, 1999, the Company executed a Consulting and Assistance  Agreement
with Koritz Group LLC, a Connecticut limited liability company  ("Koritz").  The
company  exercised its right to cancel the agreement on July 30, 1999. Under the
terms of this  agreement,  Koritz was engaged to identify  sources of capital or
potential business relationships and to assist the Company in (i) raising equity
or debt  financing  in the  amount  of  $15,000,000  (ii)  arranging  for  trade
financing for production, sale, lease, rental or other disposal of the Company's
products;  and (iii) arranging for the sale,  merger,  or  consolidation  of the
Company or for joint  ventures or  strategic  alliances  with other  appropriate
business. This agreement was non-exclusive.  In the event Koritz was successful,
the  Company  was to pay  compensation  to  Koritz  equal to 2.5% for any  trade
financing  and 10% of the  value  of each  business  arrangement.  In the  event
Investment  Financing was secured,  the Company was to pay compensation equal to
10%  for  any  investment  financing  to  the  person  or  entity  placing  such
investment;  provided  such  person or entity  was  qualified  to  receive  such
compensation in the state of residence of the investor.  The Company was free to
reject any offered  financing or  arrangements;  however,  in the event that the
Company entered any  arrangement  within 180 days of its written  rejection,  on
terms  less  favorable  to the  Company,  Koritz  was to  receive  a flat fee of
$100,000. In addition to the cash compensation, in the event the Company secured
investment

                                       27

<PAGE>



financing, then the qualified,  placing person or entity was to receive warrants
to purchase  the  Company's  Common  Stock  exercisable  for 36 months after the
closing at the same  price as the  investment  financing  source  received,  the
number of which warrants  would be equal to the amount of the financing  divided
by the exercise price. Such warrants were to have  anti-dilution and piggy- back
registration  rights.  In the event the Company "shopped" any offer of financing
presented to it to other  potential  sources and accepted such other  financing,
the  Koritz  was  entitled  to a  success  fee.  Koritz  was  to  be  reimbursed
pre-approved   disbursements   and   expenses.   The   agreement   provided  for
confidentiality  and  cross-indemnification  .  The  agreement  was  subject  to
cancellation  by either  party with five (5) days written  notice.  It was under
this provision that the Company  terminated this agreement on July 30,1999.  Any
disputes under the agreement were required to be submitted to arbitration,  with
costs payable by the losing party.

     In April 1999,  the Company  entered into an agreement  with KJS to provide
consulting  services.  The  agreement  is on a  non-exclusive  basis  and has no
defined term.  The  agreement  provides for such services to be performed in two
phases.  Under phase one, KJS is to assist in the development of a comprehensive
business plan and assist the Company in  positioning  such plan with the capital
markets with a view towards finding potential business combinations, mergers and
compressed time tables for the Company's business  strategy.  The estimated cost
of this  phase is  $5,000.  Under  phase  two,  KJS is to  identify  appropriate
financial  institutions and distribute the plan,  analyze the initial  feedback,
arrange meetings, evaluate all proposals,  provide management with each proposal
and assist in the  negotiations.  Upon  execution,  the Company was  required to
commit to pay a $5,000  retainer  to cover the  estimated  phase one costs.  KJS
agreed to  accept  7,000  shares of the  Company's  common  stock  valued at the
current  bid  price of $.50 as part of such  retainer  and with the  balance  of
$1,500 to be paid in cash at such time as KJS  introduces  the  Company  to five
institutional  funding sources.  Phase two compensation will be paid in the form
of common  stock equal to 1.5% of the funds  raised from the capital  markets in
the form of a spin-off of the OASiS division and 10% of any mezzanine  financing
from any source introduced by KJS.

     In April 1999, the Company issued 2,000 shares each to David Utz and Robert
Wingate,  two consultants of the Company, in lieu of cash, for services relating
to their  production  of a CD-Rom disc to be used promote OASiS in lieu of cash.
Such 4000 shares were  valued at $2,250  which was based upon the closing  price
for the shares on the dates the services were dut to be paid.  Such offering was
made in reliance to Section 4(2) of the Act and Rule 506.

     In May 1999, the Company  entered into an agreement with Ten Peaks to pay a
finder's fee for successfully  securing  specifically  defined financing for the
Company.  Such financing  included finding a strategic  partner and/or financial
partner who secures  equity in the  Company or a stake in future  revenues.  Ten
Peaks was to provide  advice on  long-term  business,  financial  and  strategic
decisions. The term of the agreement was for three (3) months from the execution
date and it expired on August 13, 1999.  Upon  execution of the  agreement,  the
Company  was  required  to  commit  to pay a  retainer  of  $4,000  to cover all
anticipated  out of pocket  expenses during the term. Ten Peaks agreed to accept
6,000 shares of the  Company's  common stock in lieu of such  retainer  provided
such stock had a fair market value as reported on Bloomberg,  LLP on the date of
execution of not less than $.66. In the event the Company's  shares were trading
for less, the

                                       28

<PAGE>



difference between $4,000 and the value of the shares was to be paid in cash. In
the event the Company  receives  gross  proceeds of up to  $2,000,000,  Although
obligated to issue such  shares,  the Company does not intend to deliver them to
Ten Peaks since the Company believes that Ten Peaks failed to perform as agreed.
Ten Peaks was to receive an amount  equal to 5% of such  proceeds in the form of
cash, equity or some combination thereof. Thereafter, Ten Peaks was to receive a
sliding scale equal to 4% of the next million,  3% of the fourth million,  2% of
the fifth million and 1% for each additional  million.  In the event the Company
entered into a transaction as a result of this agreement, it was to enter into a
consulting  agreement  with Ten Peaks for a term of six months  under  which Ten
Peaks was receive $5,000 in cash or equity.

     Other than the  commitments  relative  to the initial  retainers,  no other
payments have been made to either KJS or Ten Peaks.  Since  execution of the KJS
agreement  the Company has been  advised  that fees and  commissions  related to
transactions  in  securities  may only be paid to  those  legally  qualified  to
receive such payments in  accordance  with  regulations  under Federal and state
securities laws. Neither KJS nor Ten Peaks were licensed in any state to receive
commissions or other remuneration for the sale of securities.  The Company is in
the process of modifying this agreement such that only appropriate payments will
be made in the event of  placement  of any equity in the  Company  from  sources
identified  by KJS.  The Ten Peaks  agreement  expired  without  any  additional
payments.  In the event that the Company had made inappropriate  payments to KJS
or Ten Peaks related to the sale of securities,  the Company could have lost any
applicable  state  exemption  under  which the sale was made and could have been
subject faced material adverse consequences as a result of actions by the states
in which sales were made, including sanctions,  penalties and the requirement to
offer a rescission.

     In July 1999, the Company  executed a Consulting  and Assistance  Agreement
with  Triton.  Under the terms of this  agreement,  Triton  has been  engaged to
identify sources of capital or potential  business  relationships  and to assist
the Company in (i) raising  equity or debt financing in the amount of $6,000,000
(ii) arranging for trade financing for production,  sale, lease, rental or other
disposal of the Company's products; and (iii) arranging for the sale, merger, or
consolidation  of the Company or for joint ventures or strategic  alliances with
other  appropriate  business.  This  agreement  is  non-exclusive.  In the event
Investment Financing is secured, the Company was to pay compensation equal to 8%
for any investment  financing to the person or entity  placing such  investment;
provided such person or entity is qualified to receive such  compensation in the
state  of  residence  of the  investor  and  will  issue  warrants  to  purchase
restricted  Common  Stock in the Company in an amount equal to 100,000 for every
$1 million  funded,  exercisable for a period of five (5) years at a price equal
to the closing bid price of the Company's shares on the date of such funding and
which warrants are to have piggy-back  registration rights and cashless exercise
provisions. The Company is free to reject any offered financing or arrangements;
however, in the event that the Company enters any arrangement within 180 days of
its written  rejection,  on terms less  favorable to the  Company,  Triton is to
receive a flat fee.  In the event the  Company  "shops"  any offer of  financing
presented to it to other  potential  sources and accepts  such other  financing,
Triton is entitled to a success  fee.  Triton is to be  reimbursed  pre-approved
disbursements  and expenses.  The  agreement  provides for  confidentiality  and
cross-indemnification . The agreement is subject to cancellation by either party
with five (5) days written notice. Any disputes under the agreement are

                                       29

<PAGE>



required to be submitted to arbitration, with costs payable by the losing party.
No funding under this agreement has been received as of the date hereof.

     In December 1999 the Company issued 10,000 shares of its restricted  Common
Stock.  Originally,  the Company granted three (3) consultants a total of 12,500
shares,  one person was granted  7,500 shares the  Company's  restricted  Common
Stock for his work with the  Company's  patents,  one person was  granted  2,500
shares of restricted  Common Stock for his work on OASiS, and the third, a nurse
at SMH,  was granted  2,500  shares of  restricted  Common Stock for her work on
OASiS. However, the nurse at SMH declined,  stating that such grant would not be
appropriate  under SMH policy and such  issuance was not made.  The issuance was
made pursuant to Section 4(2) of the Act and Rule 506.

     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.  The Company  granted such options  pursuant to Section 4(2) of the
Act and Rule 506.


     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 has agreed to introduce entities
to the Company for potential  strategic  partnerships,  licensing  arrangements,
mergers,  acquisitions,  investments or funding. For such services,  Swartz will
receive a scaled fee based upon the value of any completed transaction. Said fee
is payable in cash or stock at Swartz's  option and by the issuance of warrants,
the  number of which is based upon the fee  divided  by the market  price of the
Company's  Common  Stock.  There is no  obligation on the part of the Company to
accept any transaction offered by the Swartz to the Company.

     In February 2000, the Company  executed a Consulting  Agreement with Global
Development  Advisors,  Inc.  ("GDA")).  Under the  agreement,  GDA will 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  is for a term of six (6)  months and may be
extended by the Company.  In lieu of cash payments for services,  GDA has 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. The issuance
was made pursuant to Section 4(2) of the Act and Rule 506.

Item 2.  Description of Property

     The Company's executive offices are located at 2018 Oak Terrace,  Sarasota,
Florida 34231.  Its telephone  number is (941) 927-7874 and its facsimile number
is (941) 925-0515.

     The Company  pays rent in the amount of $3500 per month  which  consists of
3,500 square feet of office space.  The lease is for a term of two (2) years and
is automatically renewable

                                       30

<PAGE>



for an additional  year.  The initial term of the lease expires in May 2000. The
property is owned by Savannah  Leasing which is owned by Dr. and Mrs.  Swor. The
Company  first  rights of refusal on  surrounding  properties  owned by Savannah
Leasing and therefore  believes that the leased space and the property under the
first rights of refusal will be  sufficient  for its  corporate  offices for the
next ten (10) years.

     The Company owns no real  property and its  personal  property  consists of
furniture,  fixtures and equipment,  prototype molds and leasehold  improvements
with an original cost of $336,392 on December 31, 1999.

     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,  2000,   had  returned  on  average   5.20%  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

     The  Company  knows  of no 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.

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 1999.

     On February 28, 2000, the Company held its annual shareholder  meeting.  Of
the 11,815373 shares outstanding which were qualified to vote (of the 14,515,373
outstanding,  2,700,000 are 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

                                       31

<PAGE>



                 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;

          (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.

                                     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 "SURG".  The high and low bid  information for each quarter for
the years ending  December 31,  1996,  December 31, 1997,  December 31, 1998 and
December 31, 1999 are as follows:

 Quarter                     High Bid        Low Bid      Average Bid
 ----------------------------------------------------------------------
 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          11/16         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

                                       32

<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, 1999,  the Company has 1,096  shareholders  of record of
its  14,515,373  outstanding  shares of  Common  Stock,  9,780,913  of which are
restricted  Rule 144 shares and 4,734,460 of which are  free-trading.  As of the
date hereof, the Company has outstanding  options to purchase  10,653,688 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, 1999). Of the Rule 144 shares,  5,270,933 shares have
been held by affiliates  of the Company for more than one (1) year.  The Company
is  obligated  to issue 6,000  shares of its Common Stock to Ten peaks under the
terms of an agreement with that company; however, the Company does not intend to
deliver  such  shares  since it  believes  that Ten Peaks  failed to  perform as
agreed.

            (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, 1999, the Company generated  revenues of approximately
$1,275,000 from a limited number of customers.  Since inception through December
31,  1999,  the  Company  has  generated   cumulative  losses  of  approximately
$2,780,000. Although the Company has experienced a significant percentage growth
in revenues from fiscal 1992 to fiscal 1999,  the Company does not believe prior
growth rates are indicative of future operating results,  especially in light of
the contract with US Surgical to assist in the introduction of OASiS. Due to the
Company's  operating history and limited resources,  among other factors,  there
can be no assurance that profitability or significant revenues

                                       33

<PAGE>



on a quarterly or annual basis will occur in the future.  Moreover,  the Company
expects to continue to incur operating losses through at least the first half of
2000,  and there can be no assurance  that losses will not  continue  after such
date. The Company had commitments for  installations  in a total of 12 hospitals
on or before  June 30,  1999,  ten of which  related  to the  agreement  with US
Surgical and two are a result of the Company's sales department.  As of the date
hereof the Company has  completed  installations  of fifteen (15) units in seven
(7) hospitals, six (6) of which are under the Short Term Agreement. Installation
of the  remaining  units under the US Surgical  Short Term  Agreement  have been
merged into the Long Term Agreement.

     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 US Surgical
and in the event of the  reactivation  of its  various  distribution  agreements
and/or with the establishment of one or more strategic  alliances in addition to
US  Surgical,  the  Company  expects to  experience  a period of  growth,  which
requires it to significantly increase the scale of its operations. This increase
will  include the hiring of  additional  personnel  in the areas of (i) customer
service to provide technical  support for the hospitals where  installations are
located and (ii) technical staff to make changes  requested by those  hospitals.
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 the  installation  of the OASiS  system in the  hospitals
designated by US Surgical under the Long Term Agreement utilizing the IBM Global
arrangement to expedite installations and to install additional OASiS systems in
hospitals  not under the US  Surgical  agreement  but with whom the  Company has
begun  negotiations  and in some cases reached a commitment.  Additionally,  the
Company  intends to install the  inservice  modules  from US Surgical  and other
medical product  manufacturers  at both the US Surgical and the other hospitals.
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.



                                       34

<PAGE>


     The  Company  estimates  that  if  it is  successful  in  consummating  new
strategic  alliances,  the  agreements  will provide for infusion of  sufficient
capital to fund  ongoing  operations  for the  balance of the year.  The Company
estimates  revenues  from an expanded base of content  providers and  individual
installations may grow to the level where they can support ongoing operations.

     The Company  estimates  that  revenues  will be  sufficient to fund ongoing
operations at the current level when the number of OASiS  installations  reaches
approximately  100 to 125 and the total  number  of  inservice  modules  reaches
approximately  150. The Company  purchased 20 OASiS units from Kiosk Information
Systems,  Inc., which were installed under the US Surgical agreements and at St.
Francis  Hospital.  Based upon  potential  additional  commitments,  the Company
believes  that if it were to order 20 more  units,  that all such units would be
placed by the end of 1999.  The Company  already has 32 inservice  modules under
the US  Surgical  agreement  and is in  discussion  with  various  manufacturers
interested  in using  OASiS to  inservice  more than 50 of their  products.  The
Company believes that each of the initial  installations  should have a position
as to long term  acceptance  within  three (3) to six (6)  months  and that this
initial time is the test period to determine the potential for market acceptance
at that  hospital.  In the case of US  Surgical  hospitals  under the Short Term
Agreement,  this period will be for nine (9) months by  contract.  At the end of
such test period, the Company believes it will be in a position to execute three
(3) year leases and finance such leases through a leveraged leasing  arrangement
with Rockford or a similar funding source.

     In the short term, to fund operations through the fourth quarter, 1999, the
Company was required to seek  additional  funds from  strategic  alliances  with
potential  clients,  from its shareholders,  from a limited number of accredited
investors  in a  private  placement  of  its  restricted  securities,  and  from
additional  third  party  financing  through  TK. For fiscal  2000,  the Company
intends to use the TK loan  arrangement to fund  operations and its  obligations
under the IBM Global  Agreement which will result from increased cash flows from
lease  payments for installed  OASiS units.  It is  anticipated  that these cash
flows will satisfy the balance  required under the IBM Global Agreement and lead
to  further  revenues.  There  can be no  assurance  that  the  Company  will be
successful in these efforts.

     As  discussed  in Note 13 to the  Financial  Statements,  if the  financing
referred to above is not  secured,  the  recoverability  of the  recorded  asset
amounts may be impaired.

     Once the  testing  period  is over,  the  Company  projected  that it would
require  between $2 and $5 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.  The Company's  purpose for executing the agreement
for  the  TK  Loan  Commitment  was  because  such  commitment  affords  it  the
opportunity to fund such expansion and meet its obligations  under the Long Term
Agreement  with US Surgical,  which it believes  will  increase  demand for this
product substantially and increase market acceptance rapidly.  Other than the TK
arrangement,  the Company has met with several venture capital firms, investment
bankers,  factoring companies and traditional lending sources, each of whom have
expressed  early  interest and many of whom are awaiting the  conclusion  of the
testing period.  The Company has executed an investment  banking  agreement with
Swartz;  however,  other than the TK  arrangement,  the Company has  accepted no
definite offer and, if the  instalments  under the TK Loan  Commitment are timed
correctly, it may not require additional financing to achieve its goals. Should

                                       35

<PAGE>



it need an  additional  source of capital,  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.

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
the fiscal year ending December 31, 1998, the Company derived  approximately 93%
of its  revenue  for  product  sales from  technical  services it provided to US
Surgical during a medical products  convention.  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 .

     The Company  anticipates that the main focus of its selling efforts will be
to focus on the US Surgical  arrangement and 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.
Although the Company had entered into exclusive distributorship agreements, none
of these  arrangements  are  currently  active.  And,  although  the  Company is
currently engaged in a joint marketing  agreement with US Surgical,  there is no
assurance that the Company will be able to obtain  adequate  distribution of its
products to the intended end user.  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, 1998 of $16,545 were comprised of
sales   of   the   Company's   proprietary   SutureMate(R)products,    MediSpecs
Rx(TM)eyewear and technical services

                                       36

<PAGE>



provided  to US  Surgical.  Net sales for the year ended  December  31, 1999 are
comprised  of sales  of  SutureMate(R)  products,  partnership  fees  and  OASiS
licensing  fees.  Product  sales and related cost of sales  amounted to $720 and
$6,610,  respectively  for the  year  ended  December  31,  1999.  Cost of sales
includes  a  write-down  of   approximately   $5,900  for  defective   units  of
SutureMate(R).

     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 $536,000
on sales and  marketing  expenses.  For the years  ended  December  31, 1998 and
December 31, 1999,  sales and  marketing  expenses  were  $265,261 and $171,102,
respectively. In 1998, the Company began increasing 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 2000 will  increase in
absolute dollars as compared to 1999.

     General and Administrative. These expenses consist primarily of the general
and administrative expenses for salaries,  contract labor and other expenses for
management and 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  $2,260,000  on  general  and  administrative
expenses.  For the years ended December 31, 1998 and December 31, 1999,  general
and  administrative  expenses  were  $517,189 and  $696,131,  respectively.  The
increase of $178,942 is due primarily to legal and  accounting  fees  associated
with the  Company's  SEC  filings,  higher  depreciation  and  amortization  and
additional rent for the Company's headquarters.  The Company expects general and
administrative  expenses to increase in absolute  dollars in 2000 as compared to
1999, as the Company continues to expand its operations.


                                       37

<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) and MediSpecs Rx(TM).

     Since inception,  the Company has spent approximately  $208,000 on research
and  development.  For the years ended  December 31, 1998 and December 31, 1999,
research and development  expenses were $34,536 and $51,281,  respectively.  The
Company made  enhancements to the software for the OASiS system in both 1998 and
1999,  and the  majority of these  related  costs were  capitalized  and will be
amortized  over a period not to exceed five (5) years.  During 1999, the Company
capitalized  $77,900 of costs related to the  enhancement of OASiS.  The Company
intends to continue to invest significant  resources to continue the development
of new products and expects that research and development  expenses in 2000 will
increase in absolute dollars as compared to 1999.

Interest and Other Income (Expense), Net

     Interest and other  income  (expense),  net consists  primarily of interest
expenses  accrued  on 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
with an expiration date of May 2, 2017. The line is due on demand and is secured
by  inventory,  accounts  receivable  and  equipment.  There was no  outstanding
balance  as of  December  31,  1999 and 1998.  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, 1998 and 1999 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.

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,  1999,  the Company had assets  totaling  $1,276,106  and
liabilities  totaling  $1,240,557.  Since  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

                                       38

<PAGE>



current shareholders, through its arrangement with Thomson Kernaghan & Co., Ltd.
and through the $100,000 line of credit with the financial  institution which is
guaranteed by Dr. Swor.

     Operating  activities  used net cash of $441,458  and  $408,638  in1998 and
1999, respectively.

     At December  31,  1999,  the Company had working  capital of  approximately
$62,000,  made up of assets including $517,000 of cash, $104,000 of deposits and
$17,000 of  receivables.  This represents an increase of  approximately  $59,000
over working capital of $3,000 at December 31, 1998.

     At December 31, 1999, the Company's outstanding  indebtedness  consisted of
accounts payable in the amount of $395,878, accrued expenses of $142,179, a loan
payable to Dr.  Swor of $52,500  and a loan  payable to Thomson  Kernaghan & co.
Ltd. Of $650,000.

     The Company's principal  commitments for capital expenditures are (1) those
associated with the arrangements with US Surgical and IBM Global under which the
Company will provide an additional number of units; (2) 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 (3) its obligations under the TK Loan Commitment
in the event 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,  revenues
generated by the Long Term Agreement with US Surgical,  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 of  operations  and the status of  competitive  products  and
services.  In the short term,  it is likely that the Company will be required to
take down  instalments  under the TK Loan  Commitment in addition to the initial
closing in December 1999. In addition,  the Company will require additional loan
instalments  and may require  additional  financing  after such date 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,  once interest payments begin to accrue,  will
increase  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.  With
the TK Loan Commitment and 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

                                       39

<PAGE>



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. If 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.

Impact of the Year 2000 Issue

     The Year 2000  Issue is the  result of  potential  problems  with  computer
systems or any equipment  with computer  chips that use dates where the date has
been stored as just two digits (e.g. 98 for 1998). On January 1, 2000, any clock
or date recording  mechanism  including date sensitive  software which used only
two digits to represent the year, could have recognized the date using 00 as the
year 1900  rather  than the year  2000.  This could  have  resulted  in a system
failure or  miscalculations  causing  disruption of operations,  including among
other things, a temporary inability to process  transactions,  send invoices, or
engage in similar activities.

     Management   reviewed  its  current   internal  systems  and  upgraded  its
accounting system to be Year 2000 compliant.  The Company purchased new hardware
in 1998 that is Year 2000 compliant. Its internal systems are Year 200 compliant
and the Company completed testing of such systems in the fourth quarter of 1999.
Management did not incur any significant  additional  costs that would relate to
upgrading its systems to support the Year 2000 and in fact, none occurred.

     Further,  management  did not believe the Year 2000 would have an impact on
the  operation  of the OASiS  system since the software for this system does not
rely on legacy  applications  or  subsystems,  and in fact,  no impact  has been
experienced  to date.  OASiS is  designed  to handle  dates in the form of a two
digit month and day and a four digit year, thus avoiding the Year 2000 problem.

     The  Company  believes  that  it has  disclosed  all  required  information
relative to Year 2000 issues  relating to its  business  and  operations.  While
there  was no  assurance  that the  systems  of  other  companies  on which  the
Company's  systems rely also would be  converted in a timely  manner or that any
such failure to convert by another  company would not have an adverse  affect on
the Company's business, operations or financial condition, in fact, the Company,
to date, has experienced no difficulties with such companies.

Item 7.  Financial Statements



                [Financial Statements appear on following pages]


                                       41

<PAGE>



                         SURGICAL SAFETY PRODUCTS, INC.

                          INDEPENDENT AUDITORS' REPORT,
                            FINANCIAL STATEMENTS AND
                            SUPPLEMENTARY INFORMATION

                           DECEMBER 31, 1999 AND 1998




<PAGE>



                                    CONTENTS



                                                                          Page

INDEPENDENT AUDITORS' REPORT                                              F-1

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


SUPPLEMENTARY INFORMATION
  Independent Auditors' Report on Supplementary Information               F-17
  Schedules of Operating Expenses                                         F-18




<PAGE>



                          INDEPENDENT AUDITORS' REPORT



The Board of Directors
Surgical Safety Products, Inc.

We have audited the  accompanying  balance sheets of Surgical  Safety  Products,
Inc. as of December 31, 1999 and 1998, and the related 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  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Surgical Safety Products,  Inc.
as of December 31, 1999 and 1998, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted  accounting
principles.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue  as a  going  concern.  As  discussed  in Note 13 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 13. These  financial
statements do not include any adjustments  that might result from the outcome of
this uncertainty.




KERKERING, BARBERIO & CO., PA
Sarasota, Florida
March 29, 2000


                                       F-1


<PAGE>



<TABLE>
<CAPTION>
                         SURGICAL SAFETY PRODUCTS, INC.

                                 BALANCE SHEETS
                           DECEMBER 31, 1999 AND 1998

                                                            1999                        1998
                                                         -----------------            ---------------
                          Assets
<S>                                                     <C>                         <C>
Current Assets
  Cash                                                  $          516,799          $          41,191
  Trade receivables                                                 15,145                          -
  Other receivables - related party                                  1,941                      1,941
  Prepaid expenses                                                  15,013                          -
  Deposits                                                         103,556                     58,700
  Inventory                                                              -                      6,555
                                                         -----------------            ---------------
    Total current assets                                           652,454                    108,387
                                                         -----------------            ---------------

Property and equipment, net                                        203,533                    112,772
                                                         -----------------            ---------------

Other Assets
  Deferred loan costs, net                                         203,356                        317
  Intangible assets, net                                            67,131                     48,915
  Software development costs, net                                  139,382                     92,873
  Investments                                                        9,750                      9,750
  Deposits                                                             500                        500
                                                         -----------------            ---------------
    Total other assets                                             420,119                    152,355
                                                         -----------------            ---------------

Total Assets                                            $        1,276,106          $         373,514
                                                         =================            ===============


       Liabilities and Stockholders' Equity

Current Liabilities
  Accounts payable                                      $        395,878             $        35,262
  Accrued expenses                                               136,562                      70,069
  Accrued interest                                                 5,617                           -
  Notes payable - related parties                                 52,500                           -
                                                         -----------------            ---------------
    Total current liabilities                                    590,557                     105,331

Long-Term Liabilities
   Note payable                                                  650,000                           -
                                                         -----------------            ---------------
    Total Liabilities                                          1,240,557                     105,331

Stockholders' Equity
  Common stock, $.001 par value, 20,000,000 shares
    authorized; 14,515,373 and 10,786,973 shares
  issued and outstanding in 1999 and 1998 respectively            14,516                      10,788
   Common stock held in escrow                                   (2,700)                           -
  Additional paid-in capital                                   2,804,020                   1,998,241
  Accumulated deficit                                        (2,780,287)                 (1,740,846)
                                                         -----------------            ---------------
    Total stockholders' equity                                    35,549                     268,183
                                                         -----------------            ---------------
Total Liabilities and Stockholders' Equity              $      1,276,106             $       373,514
                                                         =================            ===============
</TABLE>


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

                                       F-2



<PAGE>




<TABLE>
<CAPTION>
                         SURGICAL SAFETY PRODUCTS, INC.

                            STATEMENTS OF OPERATIONS
                     YEARS ENDED DECEMBER 31, 1999 AND 1998

                                                           1999                      1998
                                                       --------------            ------------
<S>                                                   <C>                       <C>
Revenue
   OASiS licensing fees                               $        72,106           $      15,342
   Net sales-medical products                                     720                   1,203
   Other income                                                                        16,564
   Private partnership agreement fees                         100,000
   Interest income                                              2,157                   9,284
                                                       --------------            ------------
    Total revenue                                             174,983                  42,393
                                                       --------------            ------------

Costs and expenses
  Cost of medical products sold                                 6,610                   1,783
  Operating expenses                                          886,243                 836,227
  Research and development expenses                            51,281                  34,536
  Interest expense                                            257,747                  13,759
  Other                                                             -                   3,750
  Loss on disposal of assets                                   12,543                       -
                                                       --------------            ------------
    Total costs                                             1,214,424                 890,055
                                                       --------------            ------------

Net loss before income taxes                              (1,039,441)               (847,662)

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

Net loss                                              $   (1,039,441)           $   (847,662)
                                                       ==============            ============

Net loss per share                                    $       (0.091)           $     (0.081)
                                                       ==============            ============
</TABLE>


   The accompanying notes are an integral part of these financial statements.
                                       F-3





<PAGE>




<TABLE>
<CAPTION>
                         SURGICAL SAFETY PRODUCTS, INC.

                  STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                     YEARS ENDED DECEMBER 31, 1999 AND 1998

                                                                                        Common
                                                                 Common Stock         Stock Held
                                                            Shares        Amount       In Escrow
                                                        -----------     ------------  -----------
<S>                                                     <C>             <C>           <C>
Balances - December 31, 1997                             9,774,473      $   9,775     $

Issuance of common stock for cash                          520,000            520

Issuance of common stock for services                      492,500            493

Stock options granted to employees

Net loss

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)
</TABLE>



<PAGE>





<TABLE>
<CAPTION>
                         SURGICAL SAFETY PRODUCTS, INC.

                  STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                     YEARS ENDED DECEMBER 31, 1999 AND 1998

                                                    Additional
                                                       Paid-In
                                                       Capital     Detachable                                    Total
                                                        Common       Stock      Convertible    Accumulated    Stockholders'
                                                         Stock      Warrants       Debt         Deficit          Equity
<S>                                               <C>              <C>          <C>           <C>             <C>
Balances - December 31, 1997                      $    824,366                                $  (893,184)    $     (59,043)

Issuances of common stock for cash                     938,476                                                      938,996

Issuance of common stock for services                  144,286                                                      144,779

Stock Options granted to employees                      91,113                                                       91,113

Net loss                                                                                         (847,662)         (847,662)

Balances - December 31, 1998                         1,998,241           -            -        (1,740,846)          268,183

Issuance of common stock for cash                      456,908                                                      457,858

Issuance of common stock for services                   57,227                                                       57,305

Issuance of common stock to be held in                                                                                    -
escrow

Issuance of detachable stock warrants                              141,330                                          141,330

Conversion feature of note payable                                              241,429                             241,429

Cancellation of stock options to employees            (91,115)                                                     (91,115)

Net loss                                                                                       (1,039,441)       (1,039,441)

Balances - December 31, 1999                         2,421,261     141,330      241,429        (2,780,287)           35,549
</TABLE>



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

                                       F-4



<PAGE>




<TABLE>
<CAPTION>
                         SURGICAL SAFETY PRODUCTS, INC.

                            STATEMENTS OF CASH FLOWS
                     YEARS ENDED DECEMBER 31, 1999 AND 1998

                                                                    1999               1998
<S>                                                          <C>                 <C>
Cash Flows From Operating Activities
  Net loss                                                   $    (1,039,441)     $    (847,662)
  Adjustments to reconcile net loss to cash
    used in operating activities
      Depreciation and amortization                                  105,076             57,461
      Common stock issued for services                                57,305            144,779
      Stock option compensation expense                              (91,113)            91,113
   Interest expense - issuance of convertible debt                   241,429                  -
  Write-down of investments                                                               3,750
    Loss on disposal of assets                                        12,543                  -
  Decrease (increase) in operating assets
    Receivables                                                      (15,148)           250,125
        Other receivables                                                  -             (1,941)
                                                                       6,555            (15,156)
Inventory
        Prepaid expenses                                             (15,013)                 -
        Deposits                                                    (103,556)           (58,700)
   Increase (decrease) in operating liabilities
        Bank overdraft                                                     -            (13,984)
        Accounts payable                                             360,615            (82,514)
        Accrued expenses                                              66,493             48,938
        Accrued interest                                               5,617            (17,667)
          Total adjustments                                          630,803            406,204
            Net cash used in operating activities                   (408,638)          (441,458)

Cash Flows From Investing Activities
  Furniture and equipment purchased                                 (111,004)           (57,294)
  Software development additions
                                                                     (77,900)           (56,256)
--------------------
  Patent and trademark costs                                         (23,148)            (9,077)
  Financing and loan costs                                           (81,202)                 -
    Net cash used in investing activities                           (293,254)          (122,627)

Cash Flows From Financing Activities
  Proceeds from related party loans                                   52,500             23,000
  Repayments on line of credit, net                                        -           (100,000)
  Repayment of stockholder loans                                           -           (256,720)
  Proceeds from long-term debt                                       650,000                  -
  Proceeds from issuance of common stock                             475,000            938,996
    Net cash provided by financing activities                      1,177,500            605,276

Net increase (decrease) in cash                                      475,608             41,191
Cash at beginning of year                                             41,191                  -
Cash at end of year                                          $       516,799     $       41,191
</TABLE>




<PAGE>







                         SURGICAL SAFETY PRODUCTS, INC.

                            STATEMENTS OF CASH FLOWS
                     YEARS ENDED DECEMBER 31, 1999 AND 1998


                                                            1999          1998
Supplemental Cash Flow Information:
  Cash paid for interest                               $   10,701      $  31,426



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,
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.

Year Ended December 31,
1998
  There were no  material  non-cash  transactions  during the fiscal year ending
December 31, 1998.




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

                                       F-5



<PAGE>



SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 1 - Summary of Significant Accounting Policies
Business Activities
Surgical  Safety  Products,  Inc.  (Company) is 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 1997-1999, 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.

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.

Trade Receivables
Trade  receivables  consist of amounts due from customers.  The Company utilizes
the  allowance  method for  uncollectible  receivables.  At December  31,  1999,
management has determined all amounts are collectible and therefore no allowance
is necessary.  As of December 31, 1998,  there were no  outstanding  receivables
from customers.

Inventory
Inventory is stated at the lower of cost  (first-in,  first-out)  or market (net
realizable value) and consists of finished goods.

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.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

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  judgement 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 reviewed the Company's long-
lived assets and has determined  that there are no events  requiring  impairment
loss recognition.

Revenue Recognition
The Company  recognizes  revenue at the point of passage of title of  inventory,
which is generally at the time of shipment to the customer.  Revenue  related to
services is recognized at the point the service has been rendered.


                                       F-7



<PAGE>



SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 1 - Summary of Significant Accounting Policies (Continued)
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 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, 2,700,000 shares issued and outstanding that are held in escrow at
December  31, 1999 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  recorded  compensation  expense  related to the  issuance of stock
options  in the  amount  of $0 and  $91,113  for  December  31,  1999 and  1998,
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.

Impact of Recently Issued Accounting Standards
In June 1998,  the FASB issued  Statement No. 133,  "Accounting  for  Derivative
Instruments  and  Hedging  Activities."  The  Company  expects  to adopt the new
Statement  effective  January 1, 2000. The Statement will require the Company to
recognize all derivatives on the balance sheet at fair value.  This Statement is
not applicable to the Company as of December 31, 1999.

Note 2 - Property and Equipment
Property and equipment consisted of the following at December 31:

                                          1999                    1998
Property and equipment             $            271,165    $            111,136
Prototype molds                                  59,652                  59,562
Leasehold improvements                            5,575                   5,575
                                                336,392                 176,273
Less accumulated depreciation                   132,859                  63,501
  Property and equipment, net      $            203,533    $            112,772
                                   ====================    ====================


                                       F-8


<PAGE>



SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 2 - Property and Equipment (Continued)
Total depreciation and amortization  expense amounted to $66,400 and $36,234 for
1999 and 1998, respectively.


Note 3 - Line-of-Credit
Effective May 1997, the Company had 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 with an expiration  date of May 2, 2017.  The line
is  due  on  demand  and is  secured  by  inventory,  accounts  receivable,  and
equipment. There were no outstanding balances at December 31, 1999 and 1998. The
line-of-credit is personally guaranteed by the major stockholder.


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, 1999  amounted to $52,500.  Interest  has been accrued on these notes in the
amount of $5,617 at December 31,  1999.  There were no amounts owed to the major
stockholder at December 31, 1998.  Interest paid to the major stockholder during
1998 totaled $9,882 for notes outstanding during the fiscal year 1998.

The Company leases office space from an entity owned by a major stockholder. See
Note 16.


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,  1999 and 1998,  the  Company  incurred  and
capitalized  expenditures  relating to the  enhancement  of the  software in the
amounts of $77,900 and $56,256,  respectively.  Amortization expense of software
development  costs  amounted to $31,391 and $21,227 for the years ended December
31, 1999 and 1998, respectively.



                                       F-9



<PAGE>



SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 6 - Intangible Assets
Intangible assets consisted of the following at December 31:

                                         1999             1998
Goodwill                               $       32,762    $      32,762
Organization costs                             11,502           11,502
Trademarks                                     11,658           11,658
Patents                                        39,479           16,328
                                               95,401           72,250
Less:  Accumulated amortization                28,270           23,335
Intangible assets, net                 $       67,131    $      48,915
                                       ==============    =============


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 1999:  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.


For 1998, these  assumptions were as follows:  risk-free  interest rate of 5.0%;
dividend  yield of 0%;  volatility  factor of the  expected  market price of the
Company's  common  stock of .20;  and a  weighted-average  expected  life of the
option of three 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 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.


                                      F-10


<PAGE>



SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 7 - Stock Option Plans (Continued)
For purposes of pro forma  disclosures,  the estimated fair value of the options
is charged to expense over the options' vesting period.  The Company's pro forma
information for the fiscal year ended December 31, 1999 and 1998 is as follows:

                                           1999               1998
Proforma net loss                        $    (1,225,507)   $     (887,065)
Pro forma earnings per common share:
  Basic                                  $       (0.107)    $       (0.084)


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

<TABLE>
                                                 1999                          1998
                                                        Weighted                      Weighted
                                                        Average                       Average
                                                        Exercise                      Exercise
                                          Options       Price              Options    Price
<S>                                       <C>           <C>                <C>        <C>
Outstanding at the beginning of the       5,241,431     $          0.41    4,512,431  $         .38
year
Granted                                   765,829       1.13               1,129,000  1.49
Exercised                                 -             -                  400,000    1.75
Outstanding at the end of the year        6,007,260     $          0.64    5,241,431  $         0.57
                                          =========     ===============    =========  ==============
Exercisable at the end of the year        5,079,431     $            .47   4,512,431  $         0.38
                                          =========     ================   =========  ==============
Weighted-average fair value of                          $          0.28               $         0.32
options granted during the year                         ===============               ==============
</TABLE>


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 weighted-average  exercise price and weighted-average  fair value of options
granted  during  1998 was $1.37  and  $0.03,  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  1998 was $1.75  and  $0.64,  respectively,  for  options  whose
exercise price was less than the market price of the stock on the grant date.

                                      F-11


<PAGE>




SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 7 - Stock Option Plans (Continued)
The following  table  summarizes  information  about the options  outstanding at
December 31, 1999:

<TABLE>
                                        Weighted
                                          Average
                                        Remaining     Weighted
                           Number       Contractual   Average
  Exercise Price       Outstanding      Life          Exercise Price
<S>                    <C>              <C>           <C>
$  0.32 to 0.48         4,511,931        1.50 years   $    0.32
           0.50            54,000        5.00 years        0.50
   0.90 to 1.00         1,291,329        7.96 years        1.00
   1.50 to 1.72           150,000        8.88 years        1.68
   0.32 to 1.72         6,007,260        6.49 years   $    0.50
                        ==========                     =========
</TABLE>


Note 8 - Notes Payable
In December  1999,  the Company  entered  into an agreement  with an  investment
banking  firm 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  balance
outstanding at December 31, 1999 was $650,000.

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.

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.


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.


                                      F-12




<PAGE>



SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 9 - Conversion Feature of Notes Payable (Continued)
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.

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.

Note 11 - Common Stock Issuance
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  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
1998 (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.

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,  the  Company  has  excluded  the
2,700,000 shares 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

                                      F-13




<PAGE>



SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 11 - Common Stock Issuance (Continued)
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,  1999,  the Company has net  operating  loss  carryforwards  of
approximately  $2,300,000  which expire during the years 2008 through 2012.  The
1999 and 1998 tax benefits relating to the losses incurred in each year amounted
to  approximately  $205,000 and $166,000,  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, 1999 and 1998 has been offset by an  allowance  equal to the
benefit.


Note 13 - 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.

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 the development
of OASiS,  a proprietary  product.  The Company has  aggressively  promoted this
product  during  fiscal years 1999 and 1998 and  anticipates  revenues in fiscal
2000 related to the licensing of its product to medical facilities.

In July 1999,  the Company  entered into a private  partner  agreement with U.S.
Surgical Corporation (see Note 14) which will allow it to license its product in
400 hospitals  over the next three years.  The Company has begun to realize some
of these  revenues  in fiscal 1999 and  anticipates  a  significant  increase in
revenues from such to be realized in fiscal 2000.

To help fund and expand  current  operations,  the Company  secured a $5,000,000
line of credit in December 1999. Management believes this will allow the Company
to expand operations and target additional markets for its products.


                                      F-14





<PAGE>



SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 14 - Commitments
In July 1999, the Company entered into a private partner network  agreement with
U. S. Surgical Corporation.  Under the agreement, the Company is to supply up to
four hundred  OASiS  systems to U. S. Surgical  under  licenses  calling for the
installation in specified hospitals over a three year period.

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, 1999 and 1998.


Note 15 - Concentrations
The Company  derived 96% and 93% of its  revenues  from  technical  services and
OASiS  licensing  fees  provided to one  customer  during the fiscal years ended
December 31, 1999 and 1998, respectively.


Note 16 - Lease Commitments
On June 1, 1998,  the Company  entered  into an  agreement to lease office space
from an affiliated entity. The lease term expires on May 21, 2000 with automatic
one year  renewals.  Minimum lease  payments are as follows for the fiscal years
ending:

          2000         $  17,500

Rent expense for the fiscal years ending  December 31, 1999 and 1998 amounted to
$42,000 and $30,750, respectively.

The Company also leases  office  equipment.  The lease term is for 60 months and
expires October 2003. Monthly payments are $344.

Minimum lease payments are as follows for the fiscal years ending:

          2000         $   4,128
          2001             4,128
          2002             4,128
          2003             4,128
          2004             3,440



                                      F-15



<PAGE>



SURGICAL SAFETY PRODUCTS, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998

Note 17 - Correction of an Error
During  1998,  an officer of the  Company  agreed to allow the  Company to defer
payment of one-half of his annual  salary for 1998 and 1999 until  September  1,
1999.  At such time,  the Company was to begin  making  monthly  payments on the
amount outstanding.

For the fiscal  year ended  December  31,  1998,  the Company did not record the
amount  owed to the  officer  for  compensation  in the amount of  $50,000.  The
accompanying financial statements for the year ended December 31, 1998 have been
restated to account for this transaction.  The correction of this error resulted
in an  increase of the  previously  reported  net loss and  accrued  expenses by
$50,000. Loss per share increased from $(0.076) per share to $(0.081) per share.



                                      F-16


<PAGE>






                            SUPPLEMENTARY INFORMATION













<PAGE>









            INDEPENDENT AUDITORS' REPORT ON SUPPLEMENTARY INFORMATION



The Board of Directors
Surgical Safety Products, Inc.


We have  audited  the  accompanying  financial  statements  of  Surgical  Safety
Products,  Inc. as of and for the years ended  December  31, 1999 and 1998,  and
have issued our report  thereon  dated March 29, 2000.  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.



KERKERING, BARBERIO & CO., PA
Sarasota, Florida
March 29, 2000




                                      F-17



<PAGE>




<TABLE>
<CAPTION>
                  SURGICAL SAFETY PRODUCTS, INC. AND SUBSIDIARY

                         SCHEDULES OF OPERATING EXPENSES

                     YEARS ENDED DECEMBER 31, 1999 AND 1998


                                          1999                 1998
                                    -------------           -------------
<S>                                 <C>                     <C>
Professional fees                   $      92,377           $      58,260
Advertising                                47,048                 103,281
Contract labor                             13,529                  28,950
Meetings/conventions                       13,554                  27,694
Depreciation and amortization             105,076                  57,461
Salaries and related expenses             339,332                 418,417
Travel                                     82,666                  12,273
Education and training                      3,950                   1,650
Filing fees                                 1,309                   3,521
Bank fees                                   2,217                     635
Meals and entertainment                     6,327                   5,814
Postage                                    11,532                   4,953
Insurance                                  18,228                  11,542
Equipment rental                            9,367                   7,724
General and administrative                 38,212                  32,019
Occupancy                                  44,179                  31,774
Repairs and maintenance                     1,814                   6,146
Samples and supplies                          654                   3,195
Taxes                                       1,314                   1,615
OASiS internet charges                     19,010                       -
Freight                                     3,793                   3,777
Telephone                                  30,755                  15,526
                                    $     886,243           $     836,227
</TABLE>



                                      F-18



<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               42       Chairman and Chief Executive Officer
4485 S. Shade Avenue
Sarasota, FL 34237

Frank M. Clark (1)(2)             67       Director
7313 Oak Leaf Way
Sarasota, FL 34241

Donald K. Lawrence (1)            37       Director, President and Chief
716 Edgemer Lane                           Operating Officer
Sarasota, FL 34242

David Collins           (1)       58       Director, Acting Chief Financial
6210 Sun Boulevard                         Officer,Treasurer and Secretary (3)
St. Petersburg, FL 33715

James D. Stuart                   42       Director
880 Jupiter Park Drive
Suite 14
Jupiter, FL 33458

Irwin Newman (2)                  51       Director
1515 SW 22nd Avenue Circle
Boca Raton, FL 33486

Sam Norton                        40       Director and Chairman of the Stock
1819 Main Street                           Compensation Committee
Suite 610
Sarasota, FL 34236

David Swor                        67       Director
6385 Presidential Court
Suite 104
Fort Meyers, FL 33919

Dr. William B.Saye (1)            60       Director and Medical Director of
4614 Chattahoochee Crossing                ALTC VirtualLabs
Marietta, GA 30067


                                       41

<PAGE>



(1)  Except for Mr. Clark,  Mr. Lawrence,  Dr. Saye and Mr. Collins,  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.

(2)  Mr. Clark retired as President and Chief Executive Officer in January 2000.
     Mr.  Newman  resigned as a Director on February 9, 2000 and did not request
     that the Company publish his reasons.

(3)  Mr.  Collins is not engaged as a full time  employee of the Company.  He is
     devoting  and will  continue to devote such time as required to fulfill the
     obligations as the Company's Acting Chief Financial  Officer.  At such time
     as the Company has sufficient additional revenue or there is a surplus as a
     result of the TK Loan  Commitment,  it is intended that Mr. Collins will be
     employed  by the  Company as the Chief  Financial  Officer and that he will
     devote his full time to the business of the Company.

     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 42, has served as Chairman of the Board
and Medical/Technical Advisor of the Company since its inception in 1992 and has
served as Treasurer to the Company from June,  1998 until  February 2000 and has
served as Chief Executive Officer since February 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

                                       42

<PAGE>



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 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.

     Frank M.  Clark,  age 67, has served as a Director  since June,  1998.  Mr.
Clark was  President  and Chief  Executive  Officer from June 1998 until January
2000, when he retired. Mr. Clark now serves as a consultant to the Company.

     While President, Mr. Clark was responsible for the day to day operations of
the Company and was responsible for new product  development and manufacturing,.
He  managed  new  business  ventures,  including  mergers,  acquisitions,  joint
ventures,  strategic  alliances and  licensing/distribution  agreements  for the
Company.  Mr.  Clark also serves on the Board of GenSci  Regeneration  Sciences,
Inc. From 1991 to 1997,  Mr. Clark was Chairman and CEO of Corporate  Consulting
Services Group where his primary activities were providing  consulting  services
to start-up companies,  under-performing companies and training people in career
transitions.  From 1984 to 1991,  Mr. Clark was COO and Executive Vice President
of Right  Associates,  a  consulting  firm with  responsibilities  for  business
development  with Fortune 100 corporations for which he acted. He acquired a Los
Angeles based  consulting firm and became the Managing  Principal.  From 1981 to
1984, Mr. Clark was a Vice  President of National  Medical Care, a subsidiary of
W.R. Grace,  Inc. where his innovative  marketing  leadership helped the company
recapture a dominant share of the dialysis market.  From 1978 to 1981, Mr. Clark
served as President,  Corporate Vice  President and a Director of R.P.  Scherer,
Inc.,  the world's  leading  producer of soft gelatin  capsules  where he was in
charge of  worldwide  businesses.  From 1959 to 1978,  Mr. Clark was employed by
Johnson & Johnson,  Inc.,  first with  Ethicon,  Inc.  where he served as a Vice
President and Director,  then with Ethnor  Medical  Products where he was a Vice
President,  General Manager and a Director and then with Stimulation Technology,
where he served as Executive Vice  President and a Director.  From 1956 to 1958,
Mr. Clark was employed by Federated  Department stores in the executive training
program at Bloomingdales in New York City. Mr. Clark received a certificate from
Teachers College in Connecticut in 1955.

     Donald K. Lawrence, age 37, 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 has served as President and Chief Operating Officer since February 2000..


                                       43

<PAGE>



     Mr. Lawrence's responsibilities include 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.

     David  Collins,  age 58, has served as a Director  since  January  1999, as
Acting Chief Financial  Officer since March 1999 and has served as Treasurer and
Secretary since February 2000.

     Mr. Collins  responsibilities  include  overseeing the financial affairs of
the Company on a part time basis and he is currently  engaged as a consultant to
the Company. Mr. Collins devotes such time as is necessary to fulfill his duties
to the Company.  During 1997 and 1998,  Mr. Collins was Controller for the Sales
and Marketing  Division for GES  Exposition  Services,  a subsidiary of the NYSE
listed Viad Corporation.  From 1993 to 1996, Mr. Collins was General Manager and
Chief Financial Officer of Spectra Services Corporation.  From 1989 to 1992, Mr.
Collins was a Partner and Consultant to Quantum  Corporation,  a venture capital
firm.  From 1977 to 1988, Mr. Collins rose from  Controller to Vice President of
Finance (1982) and then to Vice President of Finance and Chief Financial Officer
(1984) of R.P. Scherer  Corporation,  a NYSE listed company.  From 1975 to 1977,
Mr.  Collins  was Vice  President  and  Controller  of  Wheelhorse  Products,  a
subsidiary of American Motors/Chrysler. From 1971 to 1975, Mr. Collins rose from
Controller of the Midwest  Dental  Division to Vice  President and Controller of
the American Hospital Division of American Hospital Supply  Corporation  (1974).
From 1969 to 1971,  Mr.  Collins was a Senior  Auditor and  Consultant in Public
Accounting with Deloitte & Touche. Mr. Collins received a BSBA from Northwestern
University in 1964 and a MBA from the Kellogg  Graduate  School of Management at
Northwestern  University in 1967. He became a Certified Public Accountant in the
State of Illinois in 1971.

     James D.  Stuart,  age 42, 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.



                                       44

<PAGE>



     Irwin Newman, age 51, served as a Director from 1993 until February 2000.

     Prior to his resignation,  Mr. Newman provided  financial advisory services
to the Board of Directors. From 1993 until the present, Mr. Newman served as the
Senior Vice  President of Finance for Falcon  Marketing & Management,  Inc. From
1993 to the present,  Mr. Newman has served as the President of Jenex  Financial
Services, Inc. ("Jenex"), an affiliate of Falcon Marketing & Management Inc. Mr.
Newman is the  principal  of  Jenex.  Mr.  Newman  is and has been a  practicing
attorney since 1973.  From 1993 to 1998, Mr. Newman served as Vice President and
General Counsel for Boca Raton Capital  Corporation,  a publicly  owned,  NASDAQ
listed investment  holding company where he completed an Initial Public Offering
for a $4 million subsidiary, completed a $3.5 million secondary offering and was
responsible  for  shareholder  and investor  relations.  From 1983 to 1988,  Mr.
Newman  served  with the New York  Stock  Exchange  firms of  Gruntal & Co.  and
Butcher  and  Signer,  specializing  in common and  preferred  stocks,  options,
municipal and  corporate  bonds and GNMA's.  During this period,  he broadcast a
daily television  market comments  program over the Financial News Network.  Mr.
Newman  received  a  B.S.  degree  in  Business   Administration  from  Syracuse
University in 1970 and a J.D. degree from the University of Florida in 1973.

     Sam Norton,  age 39, 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 67, 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 60, has served as Medical Director of
ALTC VirtualLabs since November 1998 and as a Director since January, 1999.

                                       45

<PAGE>



     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
Paparoscopy. Dr. Saye is the author of numerous articles on laparoscopic surgery
and techniques.

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



                                       46

<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

Ruth Dyal, M.D. (Inactive)
OB/GYN, Women's Care Specialists
Sarasota, Florida

Neil Pollack, M.D.
OB/GYN, Women's Care Specialists
Sarasota, Florida

Michael Shroder, M.D.
OB/GYN, Women's Care Specialists
Sarasota, Florida

Galen Swartzendruber, M.D.
OB/GYN, Women's Care Specialists
Sarasota, 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



                                       47

<PAGE>



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:

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.

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                 5,400
of the                                                                                    (6)
Board
and Chief
Executive
Officer
(2)
</TABLE>


                                       48

<PAGE>


<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)

Frank M.     1996         -
Clark        1997         -
President    1998    32,731                                  50,000         70,417
and CEO      1999    57,477                                  12,000         20,000
into 2000                                                                  (6)
(3)
-----------------------------------------------------------------------------------------------------------
Donald       1996         -
K.           1997    16,675                                  13,657
Lawrence     1998    57,278                                                 17,604
President    1999    57,499                                                170,000
and Chief                                                                  (6)
Operating
Officer
(4)
-----------------------------------------------------------------------------------------------------------
David        1999    38,795                     15,575       34,000         85,000
Collins,                                                                    (6)
Acting
Chief
Financial
Officer,
Treasurer
and
Secretary
(5)
--------------------------
</TABLE>

(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. 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.

(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

                                       49

<PAGE>



     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.

(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.

(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 1999 to the named executive officers.

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

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

G.           10,000        4.1%             $1.00          12/26/09         $1.63          $2.59          $1.00
Michael      10,000                         $1.00          12/31/08         $0.815         $1.295         $0.50
Swor
Frank M.     10,000        4.1%             $1.00          12/26/09         $1.63          $2.59          $1.00
Clark        10,000                         $1.00          12/31/08         $0.815         $1.295         $0.50

Donald K.    10,000       35.0%             $1.00          12/26/09         $1.63          $2.59          $1.00
Lawrence    150,000                         $1.00          05/24/09         $1.271         $2.02          $0.78
             10,000                         $1.00          12/31/08         $0.815         $1.295         $0.50
David        10,000       18.7%             $1.00          12/26/09         $1.63          $2.59          $1.00
Collins      65,000                         $1.00          01/18/09         $1.532         $2.435         $0.94
             10,000                         $1.00          12/31/08         $0.815         $1.295         $0.50
</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, 1999, 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.



                                       50

<PAGE>



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          $2,678,849/0
Swor

Frank M. Clark     0               0                   220,000/0          $    3,432/0


Donald K.          0               0                   270,000/0          $    4,212/0
Lawrence

David Collins      0               0                    85,000/0          $    1,326/0
(1)
</TABLE>

(1)  Mr.  Collins  received  options to purchase  75,000 shares of the Company's
     Common  Stock  prior to being  appointed  to the  Board  of  Directors  for
     consulting services rendered.

     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, 1999 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  $216,221  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.




                                       51

<PAGE>


Employee Contracts and Agreement

     The Company  has an  arrangement  with Staff  Leasing,  a Florida  licensed
employee leasing company, and has entered into Employee Agreements with Dr. Swor
and Mr.  Lawrence  and had an  Employee  Agreement  with Mr.  Clark prior to his
retirement.  Dr.  Swor,  Mr.  Lawrence  and Mr.  Clark  are or were  treated  as
co-employees by Staff 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  either  party  provides
notice to the other within  fourteen (14) days prior to the  expiration  that it
seeks to terminate the agreement. 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.  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.  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.  Mr. Lawrence is required to devote such time as is required
to fulfill his duties to the Company. Mr. Lawrence is 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.

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


                                       52

<PAGE>




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 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.

     Pursuant to the ESOP, the Company has granted options to purchase 4,166,316
shares of the  Company's  Common  Stock  representing  proceeds  on  exercise of
$1,320,722  under the 1994 ESOP,  708,329  shares of the Company's  Common Stock
representing  proceeds  on  exercise of  $708,329  under the 1998  Revised  ESOP
(without regard to the additional options to Dr. Saye which accrue at the rate

                                       53

<PAGE>



of 8,333 per month after  December 31, 1999) and 345,000 shares of the Company's
Common  Stock  representing  proceeds on  exercise  of  $435,000  under the 1999
Revised ESOP to date 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

Thomas DeCesare (5)         07/21/94            63,126            $.317          7


1998 Revised ESOP(2)
---------------------
Frank M. Clark (6)          06/15/98           200,000            $1.00          7

Donald L. Lawrence (6)      06/15/98           100,000            $1.00          7

William B. Saye (7)         11/20/98           408,329            $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

Frank M. Clark (6)          1/01/99             10,000            $1.00         10
                           12/27/99             10,000            $1.00         10

Donald L. Lawrence (6)      1/01/99             10,000            $1.00         10
                            5/25/99            150,000            $1.00         10
                           12/27/99             10,000            $1.00         10

David Collins (8)          12/27/99             10,000            $1.00         10


Irwin Newman (9)           6/30/99              25,000            $1.72         10
Sam Norton (9)             6/30/99              25,000            $1.72         10
Dr.  William Saye (9)      6/30/99              25,000            $1.72         10
James Stuart (9)           6/30/99              25,000            $1.72         10
David  Swor (9)            6/30/99              25,000            $1.72         10
</TABLE>

                                       54

<PAGE>



(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.  DeCesare  resigned  as  director  on  May  4,  1999  due  to  personal
     considerations.

(6)  Each of these persons  received their options as a bonus; Mr. Clark's as an
     additional  incentive  to join the  Company as its CEO and Mr.  Lawrence in
     consideration  of  outstanding  services to the Company for the prior year.
     Although the options granted to Mr. Clark and Mr. Lawrence 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. In addition,  the
     Board of Director at the January  1999  meeting  increased  the term of Mr.
     Clark's options from one (1) to seven (7) years. Messrs. Clark and Lawrence
     each received Non Incentive Stock Options under the 1999 Revised ESOP.

(7)  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.

(8)  Prior to  becoming a Director in January  1999,  Mr.  Collins had  received
     options under the Company's  CSOP for  consulting  services  rendered.  Mr.
     Collins  received  these options as Non  Incentive  Stock Options under the
     1999 Revised ESOP.

(9)  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.

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

                                       55

<PAGE>



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.

     Pursuant to the CSOP, the Company has granted  options to purchase  346,115
shares of the Company's  Common Stock  representing  proceeds of $110,779 to the
Company under the 1994 CSOP, options to purchase 129,000 shares of the Company's
Common  Stock  representing  proceeds of $114,500 to the Company  under the 1998
Revised  CSOP and 312,500  shares of the  Company's  Common  Stock  representing
proceeds of $312,500 under the 1999 Revised ESOP to date as follows:

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

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
</TABLE>



                                       56

<PAGE>


<TABLE>
<CAPTION>
Consultant/                 Date Option    No. of Shares         Exercise Price Term
Services Rendered           Granted        subject to Exercise                  Years
<S>                         <C>            <C>                   <C>            <C>

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

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

Stacy Quaid (4)             01/01/98       50,000                $0.50           7
 For assistance in
 becoming a reporting
 company

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)

David Collins (5)            1/01/99       10,000                $1.00          10
 For financial consulting    1/19/99       65,000                $1.00          10
 services

Mike Williams (6)(7)         1/01/99        5,000                $1.00          10
 As a performance bonus      1/08/99       50,000                $1.00          10
                            12/27/99       10,000                $1.00          10

Leann Lafko-Spofford (6)     1/01/99        5,000                $1.00          10
 As a performance bonus      1/08/99       50,000                $1.00          10
</TABLE>


                                       57

<PAGE>


<TABLE>
<CAPTION>
Consultant/                 Date Option    No. of Shares         Exercise Price Term
Services Rendered           Granted        subject to Exercise                  Years
<S>                         <C>            <C>                   <C>            <C>

Stacy Quaid (6)(7)           1/01/99         3,500               $1.00          10
 As a performance bonus      1/08/99        21,500               $1.00          10
                            12/27/99         5,000               $1.00          10

Eric Hill (6)(7)             1/01/99         3,000               $1.00          10
 As a performance bonus      1/08/99        25,000               $1.00          10
                            12/27/99        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            (8)  05/25/99        1,000               $1.00          10
 As a performance bonus

Bernice Gordon (8)           05/25/99        1,000               $1.00          10
 As a performance bonus

Ron Ley (9)                  12/03/99        2,500               $1.00          10
 As a performance bonus

Rick Smith (9)               12/03/99        2,500               $1.00          10
 As a performance bonus

Kim Conroy (7)               12/27/99        2,500               $1.00          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)  Each of these  persons  received  their  options as a bonus;  Ms.  Quaid in
     consideration of outstanding  services to the Company for the prior year in
     assisting with the Company's  registration  as a reporting  company and Mr.
     Williams  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.

                                       58

<PAGE>



(5)  David Collins  received  these options as a consultant to the Company prior
     to his election to the Board of Directors on January 20, 1999.

(6)  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.

(7)  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 other employees .

(8)  In May 1999, the Company granted options to purchase  170,000 shares of the
     Company's  Common Stock at an exercise  price of $1. If 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.

(9)  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.  The Company granted such options  pursuant to Section 4(2) of
     the Act and Rule 506.

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.

Item 11.  Security Ownership of Certain Beneficial Owners and Management

     The  following  table sets  forth  information  as of  December  31,  1999,
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.



                                       59

<PAGE>


<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          3,763,890 (2)           25.93%

Frank M. Clark          Common             62,000 (3)             .43%

Donald K. Lawrence      Common            250,000 (4)            1.72%

James D. Stuart         Common            730,198 (5)            5.03%

Irwin Newman (7)        Common                -0-                 -0-

Sam Norton              Common            103,400 (7)             .71%

David Swor              Common            523,445 (7)            3.61%

Dr. William B. Saye     Common             50,000 (7)             .34%

David Collins           Common             34,000 (3)             .23%
</TABLE>

All Executive Officers and Directors    5,516,933               38.00%
as a Group (nine(9) persons)
----------

(1)  The  percentages   are  based  upon  14,515,373   shares  of  Common  Stock
     outstanding,  not  including  the  6,000  shares to Ten Peaks for which the
     Company is  obligated,  but has not  delivered  due to its belief  that Ten
     Peaks  has  failed to  perform.  In  addition  to the  shares  owned by the
     Executive   Officers  and  Directors,   said  officers  and  directors  own
     (including those beneficially held) options to purchase 5,497,149 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, 1999)
     pursuant to Employee and  Consultant  Stock  Option Plans  adopted in 1994,
     1998 and 1999.  In the event all such options to purchase  were  exercised,
     this group would own a total of 110,140,082  shares of the Company's Common
     Stock  which would  represent  55.04% of the total  shares of Common  Stock
     outstanding.  Under the 1994 ESOP, 1998 Revised ESOP and 1999 Revised ESOP,
     none of these options may be exercised within 60 days.

(2)  This  includes  631,260  owned by Dr. Swor's wife of which he is deemed the
     beneficial owner.

(3)  In April 1999, Mr. Clark and Mr. Collins received 12,000 and 34,000 shares,
     respectively, of the Company's restricted Common Stock in lieu of salary in
     the amount of $7,812 due to Mr. Clark and consulting  fees equal to $23,410
     due to Mr. Collins.

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

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

                                       60

<PAGE>



(6)  Mr. Newman  resigned in February 2000 without  requesting  that the Company
     disclose his reasons.

(7)  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

     The Company has a line of credit in the amount of $100,000 which expires in
May 2017 and is guaranteed by Dr. Swor and his wife. In fiscal 1999, the line of
credit has been used to fund operations on a short term basis; however, $-0- was
outstanding as of December 31, 1999.  During 1999, Dr. Swor advanced  additional
funds to the Company.  As of December 31, 1999,  those advances totaled $52,500.
Dr. Swor has a year to year employment contract with the Company.

     On June  15,  1998,  the  Company  engaged  Frank  M.  Clark  to act as the
President of the Company.  As such he received  50,000  shares of the  Company's
Common Stock as a signing  bonus valued at $50,000 and options to purchase up to
200,000 shares of the Company's Common Stock at a price of $1.75 per share under
the 1998 Revised ESOP.  In January 1999,  the Board voted to reduce the exercise
price on the option to $1.00 per share and to increase  the exercise  term.  Mr.
Clark's  shares were  valued at $50,000  and there was no value  attached to the
grant of his options.  Mr. Clark has a year to year employment contract with 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 for which 99,996 were
granted in fiscal 1999.  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 January 1999, the Company  granted  options to purchase 10,000 shares of
the  Company's  Common Stock at $1.00  pursuant to the 1999 Revised Stock Option
Plan ("1999 Revised ESOP") to each of Frank Clark,  Donald  Lawrence and Michael
Swor, respectively the Company's President, Vice President and Treasurer.  Prior
to becoming a Director of the Company and  assuming the position of Acting Chief
Financial  Officer,  David  Collins was  granted  options to purchase a total of
75,000 shares of the  Company's  Common Stock at $1.00 for  consulting  services
rendered  pursuant to the 1999 Revised  ESOP.  The granted  such  options  under
Section 4(2) of the Act and Rule 506.

     In April 1999 the  Company  commenced  a  self-directed  private  placement
offering of its restricted Common Stock and warrants for which it received gross
proceeds of $475,000,  for which  Directors Sam Norton,  David Swor and Dr. Saye
each  purchased  50,000  shares and were  granted  warrants to purchase  25, 000
shares on the same terms as outside  investors.  Pursuant  to such  offering,  a


                                       61

<PAGE>



total of 950,000  shares of restricted  Common Stock were issued and warrants to
purchase 475,000 shares of the Company's  restricted Common Stock at an exercise
price of $1.00 exercisable  within five (5) years were granted.  Three directors
purchased  shares  under this  offering.  The Company  conducted  this  offering
pursuant to Section  4(2) of the Act and Rule 506. No  offering  memorandum  was
used in  connection  with this  offering.  Rather  investors  were provided with
access to the Company's  Registration  Statement on Form 10-SB, as amended,  its
Form 10-K and its Form 10Q for the 1st Quarter 1999, all of which are filed with
the SEC.

     In April 1999,  the Company  entered into an agreement  with KJS to provide
consulting  services.  KJS agreed to accept 7,000 shares of the Company's common
stock  valued at the  current  bid price of $.50 as part of an initial  retainer
with the balance of $1,500 to be paid in cash at such time as KJS introduces the
Company to five institutional funding sources.

     In April 1999, the Company issued 2,000 shares each to David Utz and Robert
Wingate, two consultants of the Company in lieu of cash for services relating to
their production of a CD-Rom disc to be used to promote OASiS.  Such 4000 shares
were valued at $2,250  which was based upon the closing  price for the shares on
the dates the services were due to be paid.

     In May 1999, the Company  entered into an agreement with Ten Peaks to pay a
finder's fee for successfully  securing  specifically  defined financing for the
Company.  Ten Peaks agreed to accept 6,000 shares of the Company's  common stock
in lieu of a retainer provided such stock had a fair market value as reported on
Bloomberg,  LLP on the  date  of  execution  of not  less  than  $.66.  Although
obligated  to issue such  shares,  the Company  has decided not to deliver  such
shares since it believes that Ten Peaks did not perform as required.

     In May 1999,  the Company issued a total of 46,000 shares of its restricted
Common  Stock  to Frank  Clark  and  David  Collins  and  11,400  shares  of its
restricted  Common  Stock to three (3)  other  employees  in lieu of salary  and
consulting  fees  due  from  the  Company  to each of  them,  which  salary  and
consulting  fees were valued at $31,222 in the case of Mr. Clark and Mr. Collins
and at $7,832 in the case of the three (3) employees.

     In May 1999, the Company granted options to purchase  170,000 shares of the
Company's Common Stock at an exercise price of $1. If 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.

     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.

     In December 1999 the Company issued 10,000 shares of its restricted  Common
Stock.  Originally,  the Company granted three (3) consultants a total of 12,500
shares,  one person was granted  7,500 shares the  Company's  restricted  Common
Stock for his work with the  Company's  patents,  one person was  granted  2,500
shares of restricted  Common Stock for his work on OASiS, and the third, a nurse
at SMH,  was granted  2,500  shares of  restricted  Common Stock for her work on
OASiS. However, the nurse at SMH declined,  stating that such grant would not be
appropriate  under SMH policy and such  issuance was not made.  The issuance was
made pursuant to Section 4(2) of the Act and Rule 506.

                                       62

<PAGE>





     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.  The Company  granted such options  pursuant to Section 4(2) of the
Act and Rule 506.

     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
other employees .

     In December 1999, the Company  executed the TK Loan  Commitment with 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  permits
instalments  aggregating $500,000 in any 90-day period. The proceeds of the loan
are to pay agent fees and for working capital  purposes.  The TK Loan Commitment
provides  that the offering has been  conducted  under  Regulation S of the Act.
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.  Prior to each
instalment,  the Company is  obligated  to escrow  shares  under the terms of an
escrow agreement. The convertible note bears interest at 8% per annum and may be
prepaid at any time.  The note is convertible at any time at the option of TK at
the  higher of (i) $.375 or (ii) the lower of $.8203 or 75% of the  closing  bid
price  of the  Company's  Common  Stock on the  conversion  date.  The  security
agreement  grants TK a  security  interest  in all of the  Company's  equipment,
inventory,  accounts,  contract rights,  chattel paper and instruments,  and the
proceeds of any of the  collateral.  Both the Lender's and the Agent's  warrants
are  exercisable  at $1.09375  per share,  subject to defined  adjustments.  The
warrants are exercisable 20% immediately and at the rate of an additional 1% for
each $25,000 of principal borrowed. The Company was obligated to issue 2,700,000
shares of its  Common  Stock to be held in escrow for the  potential  conversion
under the notes or exercise  of the  warrants.  TK acts as escrow  agent for the
shares and is authorized to release such shares upon receipt of a notice of note
conversion  notice or warrant  exercise.  The  Company  granted TK  registration
rights  and was  obligated  to file a Form S-3  within  sixty  (60)  days of the
agreement,  initially to cover 20,038,097 shares. The Company filed the Form S-3
with the Securities  and Exchange  Commission on March 2, 2000. In the event the
Company's  registration statement is not declared effective within 120 days of a
specified deadline,  the Company is required to pay a penalty equal to 2% of the
principal  amount  of the  loans  outstanding.  Under  the  terms of the TK Loan
Commitment,  an initial  loan of $650,000  was made on December  30,  1999,  the
Lender was  granted a warrant  to  purchase  3,428,571  shares and the Agent was
granted a warrant to purchase  1,142,857 shares.  The issuance of the securities
was made pursuant to Regulation S of the Act.

     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 has agreed to introduce entities
to the Company for potential  strategic  partnerships,  licensing  arrangements,
mergers,  acquisitions,  investments or funding. For such services,  Swartz will
receive a scaled fee based upon the value of any completed transaction. Said fee
is payable in cash or stock at Swartz's  option and by the issuance of warrants,
the  number of which is based upon the fee  divided  by the market  price of the
Company's  Common  Stock.  There is no  obligation on the part of the Company to
accept any transaction offered by the Swartz to the Company.

                                       63

<PAGE>



     In February 2000, the Company  executed a Consulting  Agreement with Global
Development  Advisors,  Inc.  ("GDA")).  Under the  agreement,  GDA will 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  is for a term of six (6)  months and may be
extended by the Company.  In lieu of cash payments for services,  GDA has 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. The issuance
was made pursuant to Section 4(2) of the Act and Rule 506.

Item 13.  Exhibits and Reports on Form 8-K

            (a)         Exhibits

<TABLE>
<S>                 <C>
Item No.            Description
--------            --------------
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]
</TABLE>

                                       64

<PAGE>


<TABLE>
<S>                 <C>
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]

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]

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]
</TABLE>

                                       65

<PAGE>

<TABLE>
<S>                 <C>
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]

10.30               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]

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.

10.41       *       Consulting Agreement dated February 15, 2000 with Global Development Advisors
                    Inc.

10.42       *       Surgical Safety Products 2000 Stock Option and Aware Plan

13.1        *       Definitive Proxy Statement filed February 28, 2000

27.1        *       Financial Data Sheet
</TABLE>

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


                                       66

<PAGE>


[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.

*    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: March 30, 2000         By:/s/ Dr.  G.  Michael Swor
                             ------------------------------
                             Dr.  G.  Michael Swor
                             Chief Executive Officer


                             By:/s/ Donald K. Lawrence
                             ------------------------------
                             Donald K. Lawrence
                             President and Chief Operating Officer


                             By:/s/ David Collins
                             ------------------------------
                             David Collins
                             Acting Chief Financial Officer, Treasurer and
                             Secretary

                                       67

<PAGE>



            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.

<TABLE>
<S>                               <C>                                           <C>
Signature                         Title                                         Date
- ---------                       -----                                         ----

/s/ G.  Michael Swor              Chairman of the Board                         March 30, 2000
- -------------------------       and Chief Executive Officer
 G. Michael Swor

/s/ Frank M.  Clark               Director                                      March 30, 2000
- -------------------------
 Frank M. Clark

/s/ David Collins                 Acting Chief Financial Officer,                March 30, 2000
- -------------------------       Treasurer, Secretary and Director
 David Collins                    (principal financial or accounting officer)

/s/ Donald K.  Lawrence           President, Chief Operating Officer            March 30, 2000
- -------------------------       And Director
 Donald K. Lawrence

/s/ James D. Stuart               Director                                      March 30, 2000
- -------------------------
 James D. Stuart

 /s/ Sam Norton                   Director                                      March 30, 2000
---------------------------
 Sam Norton

 /s/ David Swor                   Director                                      March 30, 2000
---------------------------
 David Swor

 /s/ William B. Saye              Director                                      March 30, 2000
---------------------------
 William B. Saye
</TABLE>

[SIGNATURE PAGE 10-KSB 12/31/99]

                                       68