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

                                   FORM 10-KSB

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

For the Fiscal Year Ended December 31, 1998.        Commission File No. 0-28720.

                            SALES ONLINE DIRECT INC.
              (Exact name of small business issuer in its charter)

         Delaware                                           73-1479833
(State or Other Jurisdiction                (I.R.S. Employer Identification No.)
 of Incorporation or Organization)

                4 Brussels Street, Worcester, Massachusetts 01610
                (Address of principal executive office)(Zip Code)

         Issuer's Telephone Number, Including Area Code: (508) 753-0945

                      Securities Resolution Advisors, Inc.
                                  (Former Name)

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


                         Common Stock, $0.001 Par Value
                              (Title of each class)


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  pursuant to Item 405 of
Regulation  S-B is not  contained  on  this  Form,  and no  disclosure  will  be
contained,  to the best of the  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:     NONE      .

As of March 1, 1999,  the registrant had  outstanding  46,411,140  shares of its
Common  Stock,  par value of $0.001,  its only class of voting  securities.  The
aggregate  market value of the shares of common stock of the registrant  held by
non-affiliates  on March 1, 1999 was  approximately  $14,792,276  based upon the
average  over the counter  sales price of $1.25 per share on such date (See Item
5).

                       DOCUMENTS INCORPORATED BY REFERENCE

No  documents  are  incorporated  by  reference  into this Report  except  those
Exhibits so incorporated as set forth in the Exhibit Index.


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                                TABLE OF CONTENTS


<TABLE>
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                                                                                                  PAGE

<S>     <C>    <C>    <C>    <C>    <C>    <C>
                                     PART I

Item 1.           Description of Business....................................................        3 
Item 2.           Description of Property....................................................       23
Item 3.           Legal Proceedings..........................................................       23
Item 4.           Submission of Matters to a Vote of Security Holders........................       23

                                     PART II

Item 5.           Market for Common Equity and Related Stockholder Matters...................       23
Item 6.           Management's Discussion and Analysis or Plan of Operation..................       24
Item 7.           Financial Statements.......................................................       29
Item 8.           Changes In and Disagreements With Accountants on
                  Accounting and Financial Disclosure........................................       29

                                    PART III

Item 9.           Directors, Executive Officers, Promoters and Control Persons;
                  Compliance with Section 16(a) of the Exchange Act..........................       30
Item 10.          Executive Compensation.....................................................       31
Item 11.          Security Ownership of Certain Beneficial
                  Owners and Management......................................................       32
Item 12.          Certain Relationships and Related Transactions.............................       33
Item 13.          Exhibits and Report on Form 8-K............................................       33
Signatures    ...............................................................................       34
</TABLE>

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                                     PART I

         Sales OnLineDirect Inc. (the "Company") was incorporated in Delaware as
Rose  International  Ltd. on August 9, 1995. As used in this Report,  unless the
context  otherwise  requires,  the term "Company"  refers to Sales  OnLineDirect
Inc.,  a  Delaware   corporation.   The   Company's   Websites  are  located  at
http://www.auctioninc.com,  www.rotmanauction.com, and www.wwcd.com. Information
contained  in the  Company's  Websites  shall not be deemed to be a part of this
Report.  The  Company's  principal  executive  offices are located at 4 Brussels
Street,  Worcester,  Massachusetts  01610, and the Company's telephone number is
(508) 753-0945.

Item 1.  Description of Business.

                                    BUSINESS

         After its formation on August 9, 1995, the Company acted primarily as a
non-operating  holding company overseeing the operations of its subsidiaries and
joint ventures. The Company's two wholly-owned  subsidiaries included RCI, a New
Jersey  corporation,  organized  on December  2, 1987,  and SPS  Alfachem,  Inc.
("SPS"),  a New Jersey  corporation,  organized on May 22, 1995 and acquired May
14,  1996.  RCI was  primarily  engaged in the  manufacturing  and  marketing of
specialty  organic  chemical dyes used principally in the petroleum and plastics
industries.  On September 30, 1997, the Company transferred to the Chiralt Corp.
its  ownership of RCI and SPS in exchange for three million  (3,000,000)  common
shares  of  NexTech  Enterprises  International,  Inc.  (formerly  International
Imaging,  Inc.),  a Delaware  corporation  ("NexTech"),  which  resulted  in the
Company's owning less than 20% of NexTech.

         On  June 5,  1998,  the  Company  acquired  82.02%  of the  issued  and
outstanding  common  stock of The  Accord  Group,  Inc.  ("Accord"),  a Delaware
corporation,  located in Port Washington,  New York and on July 8, 1998, changed
its name to Securities Resolution Advisors,  Inc. ("SRAD").  Accord, through its
operating  subsidiary  Securities  Resolution  Advisors,  Inc.  ("SRA"),  served
members of the investing community who had lost money due to the advice, lack of
fiduciary  responsibility or fraudulent practices of brokers and broker dealers.
SRA advised its  customers as to  appropriate  courses of action with respect to
arbitration,  as well as  settlement  with  brokers  and  brokerage  firms.  All
services were rendered on a contingency fee basis. The acquisition was accounted
for  utilizing  the  purchase  method of  accounting,  wherein the assets of the
Company were recorded at fair value and the operations of Accord have become the
historical operations of the Company. The Company issued 8,000,000 shares common
stock to three  individuals  in exchange for  8,000,000  shares  (82.02%) of the
common stock of Accord.  In December  1998,  as a part of a  restructuring,  SRA
became a wholly owned subsidiary of SRAD, and the Company sold Accord, which had
no other assets, for $40,000.

         On February  24,  1999,  the Company  sold the SRA  business to Richard
Singer, the former president the Company in exchange for 8,000,000 shares of the
Company's common stock,  all of which were cancelled.  On February 25, 1999, the
Company purchased all of the outstanding common stock of Internet Auction, Inc.,
a Massachusetts  corporation ("Internet Auction"),  and subsequently changed its
name to  Sales  OnLineDirect,  Inc.  The  acquisition  (the  "Transaction")  was
pursuant to an Agreement  and Plan of  Reorganization  (the  "Agreement")  dated
January 31,

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1999 between the Company and Gregory Rotman,  Richard  Rotman,  Marc Stengel and
Hannah Kramer,  the principal  shareholders (the "IA  Shareholders") of Internet
Auction.  Pursuant to the Agreement,  the Company acquired all of the issued and
outstanding  shares of the capital stock of Internet Auction in exchange for the
issuance  to  the  IA  Shareholders  of  an  aggregate  of  37,368,912   shares,
representing  approximately 80%, of the Company's common stock. At the time that
the transaction  was agreed upon by the then current  management of the Company,
the average  price of the Common Stock was  approximately  $.28 per share.  As a
result of the Transaction,  Internet Auction became a wholly-owned subsidiary of
the Company,  the IA Shareholders own  approximately 80% of the Company's issued
and outstanding  common stock, and the principal  business of the Company is the
business of Internet  Auction.  Prior to the  transaction,  Richard Singer was a
principal beneficial owner of the common stock of the Company.

         In  accordance  with  the  Agreement,  after  the  Transaction,  the IA
Shareholders  were  appointed  to the  Company's  Board  of  Directors,  and the
previously serving directors resigned, or will resign, from the Board.

         As a result of the Transaction,  Internet Auction became a wholly-owned
subsidiary of the Company,  and the principal business of the Company is now the
business of  Internet  Auction,  Inc.  The  following  is a  description  of the
Company's current business.

Overview

         The  Company  currently  has four main  divisions  under its  corporate
umbrella.  The  Company  offers  consumers  a branded  network of  comprehensive
shopping services,  a person to person auction site, a full service  consignment
auction  house and a  collectible  site.  The Company is  developing an Internet
community that specializes in e-commerce sales. Through the Internet Websites of
its operating  Divisions,  the Company brings buyers and sellers  together in an
efficient and enjoyable format to buy and sell items including collectibles such
as  antiques,  coins,  computers,  memorabilia,  stamps and toys.  The  Company,
through its four Divisions,  maintains a person-to-person trading community in a
variety of formats consisting of auctions,  e-commerce,  classifieds,  and store
fronts web design and hosting.  These services  permit sellers to list items for
sale, buyers to bid on items of interest, and all users to browse through listed
items in a fully-automated, topically-arranged, intuitive and easy-to-use online
service  that is  available  24  hours a day,  seven  days a week.  The  Company
believes  that sellers are  attracted to its Websites as a result of the variety
of formats  available  and that buyers in turn are  attracted  to the  Company's
Websites because of the broad selection of goods available.

Industry Background

         Consumers  are  spending an  increasing  amount of time on the Web. The
growth in the  number of Web  users and the  amount of time  spent on the Web is
being driven by the  increasing  importance of the Internet as a  communications
medium,  an information  resource,  and a sales and  distribution  channel.  The
Internet has also  evolved into a unique  marketing  channel.  Some  examples of
business  transactions  which occur on the Internet include trading  securities,
buying consumer goods,  paying bills and purchasing airline tickets.  Unlike the
traditional  marketing  channels,  Internet  retailers  do not have  many of the
overhead  costs  borne  by  traditional  retailers.   The  Internet  offers  the
opportunity to create a large, geographically dispersed customer base more

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quickly than traditional retailers. The Internet also offers customers a broader
selection of goods to purchase,  provides  sellers the opportunity to sell their
goods  more  efficiently  to a  broader  base  of  buyers  and  allows  business
transactions to occur at all hours.

History of the Company

         The Company was created from four  separate  companies - Auction  Inc.,
Rotman Auction,  Inc., World Wide Collectors Digest, Inc., and the wholesale and
retail collectibles business owned and operated by the Rotman family. The Rotman
collectibles  business  was founded by Steve and Leslie  Rotman,  the parents of
Richard Rotman and Gregory Rotman,  officers of the Company.  The Rotmans engage
in the  business of buying,  warehousing,  distributing,  marketing  and selling
collectibles and other memorabilia--particularly  sports related memorabilia--to
dealers,  collectors,  and consumers.  Through Rotman Auction,  Inc., founded by
Richard Rotman, the collectibles business expanded into auction formats in 1991.
Rotman  Auction,  Inc. went online on the Internet in 1996,  hosted on the store
front Website of World Wide Collectors Digest, Inc.

         World Wide Collectors Digest,  Inc. was formed in 1994 by Marc Stengel,
Vice  President  of  the  Company,   to  host  Websites  for  companies  in  the
collectibles  industry.  Mr.  Stengel,  the  President of World Wide  Collectors
Digest, in collaboration with Richard Rotman,  Gregory Rotman and Hannah Kramer,
founded Internet Auction, Inc. Internet Auction, Inc., an internet-based auction
company,  provides an online  service  for  sellers to list items for sale.  The
Rotmans,  Stengel and Kramer saw an opportunity  to bring these four  businesses
together to service the collectibles industry online through the Internet.

The Business

         Sales OnLineDirect Inc. is a fully integrated  internet auction company
specializing  in collectibles  and other  memorabilia.  The business,  conducted
through its four Divisions, offers the following services:

              o The Auction Inc. Division is a public  person-to-person  trading
community  that  offers  sellers  a vehicle  for  listing  items  for  sale.  By
developing  a  Web-based  community  in which  buyers and  sellers  are  brought
together  in an  efficient  and  entertaining  auction  format  to buy and  sell
personal items such as antiques, coins,  collectibles,  computers,  memorabilia,
stamps and toys. The Sales Online Direct service  permits  sellers to list items
for sale,  buyers to bid on items of interest and all Sales Online  Direct users
to  browse  through  listed  items in a  fully-automated,  topically-  arranged,
intuitive and easy-to-use online service that is available 24 hours a day, seven
days a week. The company's new "No Sale - No Fee Policy" allows sellers to place
items for sale without being charged any up-front  fees. A commission is charged
only when an item is sold, thereby allowing sellers to place more of their items
for sale  without  the risk of being  charged  for items that are not sold.  The
Auction Inc.  Division is in competition  with other internet  companies such as
eBay Inc., uBid Inc., Onsale Inc., Excite Auction and Yahoo Auction. The website
is located at www.auctioninc.com.

              o The  Rotman  Auction  Division  is a  full  service  consignment
auction  house  which has been in  business  for over 20 years and  started  its
online service in 1996. Rotman

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Auction  provides a full range of services to sellers and buyers  including live
online bidding of premier collectibles,  consignment services, authentication of
merchandise,  digital  photography,  and the  purchase  and  sale  of  authentic
memorabilia.  Rotman  Auction  operates a  state-of-the-art  40,000  square foot
facility in Worcester, Massachusetts and items can be previewed in the showroom,
with 30 wall to wall showcases. Last year Rotman Auction hosted over 25 auctions
containing  some 20,000 lots. In addition  Rotman Auction buys and sells its own
merchandise.  Rotman Auction always has an ongoing auction 24 hours a day 7 days
a week.  Rotman  Auction  unconditionally  guarantees  an item is genuine  and a
certificate  of  authenticity  is provided  with every  autographed  item Rotman
Auction sells.  Rotman Auction is in  competition  with other  companies such as
Sotheby's Holdings Inc. The website is located at www.rotmanauction.com.

              o The World Wide Collectors Digest Division (WWCD) was established
in 1994. This Division is the Company's premier  e-commerce  website for dealers
in the  collectibles  community.  WWCD is a  full-service  company that designs,
hosts and maintains dealer  Websites.  WWCD's software allows clients to operate
online  storefronts,  set prices,  and sell  directly to online  shoppers.  WWCD
contains many facets,  including classifieds,  live sports scores, live chats, a
full  listing of  stadiums  and arenas with  seating  charts,  directions,  team
schedules,  addresses  and phone numbers for all major league teams as well as a
complete  listings of the Halls of Fame.  Some of the companies  that WWCD hosts
include The Dick Butkus Football Network,  Internet Sports Awards,  Deacon Jones
and the MCI  National  Sports  Gallery.  Rich  Sports,  also hosted on the site,
finished  No. 2 last year with The Upper Deck  Company and  currently  is one of
only two Master Hobby  Distributors  with Steiner Sports.  Also included in this
group are Phils  Collectibles,  which  reported to be one of the largest  Sports
Illustrated  magazine  dealers in the world;  Trumpets East, the largest trading
card repacker in the country;  and Card Collectors Company,  which sells trading
cards and produces reprints of high quality cards. WWCD services  consumers from
120 countries some of which include Japan,  Australia,  Germany,  Brazil, India,
China,  Indonesia,  and Cyprus. WWCD is in competition with other companies such
as Shop-At-Home. The website is located at www.wwcd.com.

              o The  Internet  Collectibles  Division  maintains  a  substantial
inventory of memorabilia with popular and historical  significance  which allows
customers to directly  purchase the  memorabilia  without the  competition  from
bidders in an auction format,.

         The Company  believes that these online  services for the  collectibles
industry  under  the  umbrella  of one  company  provides  online  shoppers  and
businesses access to many of the services and resources they may desire.

Business Strategy

         The Company  operates in a market in which name recognition is critical
to  attracting  a high level of customer  traffic.  The Company has retained the
services  of a marketing  consultant  to promote  the name of the  Company.  The
marketing   plan   developed  by  the   consultant   consists  of   establishing
relationships  with leading internet service  providers and Web browsers through
which the Company's name will be listed,  such as Yahoo!,  AOL, Erols and others
as well as employing a mix of media and promotional activities.  The Company has
taken a disciplined  and  selective  approach in its  marketing  that  primarily
considers the costs of customer acquisition.

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The Company  attempts to maximize the return from  promotional  expenditures  by
choosing advertising media based on the cost relative to the likely audience and
ability to generate increased traffic for the Company's  Websites.  In addition,
each of the Company's  Websites  hyperlinks to its other  Websites.  The Company
actively  markets to its own base of customers  through e-mail  broadcasts.  All
customers who registered on Company's  Websites are  automatically  added to the
Company's electronic mailing list.

         The Company believes it differentiates itself from other online auction
and  e-commerce  companies  by providing  the variety of formats  offered by the
three online Divisions,  Rotman Auction, Auction, Inc. and World Wide Collectors
Digest. These formats provide sellers with a variety of service formats designed
to meet their  particular  needs and to provide the format most suitable for the
sale of the particular product.

         Sellers of high-end collectibles are offered the services of the Rotman
Auction  Division.  This  Division is a full service  consignment  auction house
which has been in business  for over 20 years and started its online  service in
1996.  Rotman  Auction  provides a full range of  services to sellers and buyers
including live online bidding for premier  collectibles,  consignment  services,
authentication of merchandise, digital photography, and the purchase and sale of
authentic  memorabilia.  The Division also offers fulfillment  services to those
customers  which may need  assistance in completing  their sales.  The Company's
warehouse  is  located  in  Worcester,   Massachusetts.   The  services  are  an
inexpensive solution for customers to conclude their sales.

         On the other hand, for sellers of  merchandise  that is not of high-end
collectible quality, the Auction Inc. Division offers a vehicle for listing such
items for sale through an auction  model.  Since most of these  products are not
premier  collectibles,  it does not offer the level of services  provided by the
Rotman Auction Division.

         The World  Wide  Collectors  Digest  Division  is a premier  e-commerce
website for dealers in the  collectibles  community  such as Rotman  Auction and
Auction,  Inc. The World Wide Collectors  Digest's  proprietary  software allows
other auction houses to create online storefronts, set prices, and sell directly
to online shoppers.  Because World Wide Collectors  Digest contains many facets,
including  hosting web-based  auctions,  classifieds,  live sports scores,  live
chats, a full listing of stadiums and arenas with seating charts, directions and
other  pertinent  information,  it does not  compete  with  Rotman  Auction  and
Auction,  Inc. Lastly,  the Internet  Collectibles  Division allows customers to
directly  purchase   memorabilia  from  a  substantial   inventory  without  the
competition from bidders in an auction format.

         The Company  believes  that one of its  competitive  advantages  is its
software  program.  Because  of  its  simplicity,  customers  can  navigate  the
Company's  Website  easily  without  having  to  spend  money  on more  powerful
computers or software.  The Company intends to develop its software to provide a
fun and user-friendly shopping experience.  The Company has implemented customer
support,  transaction-processing  and fulfillment systems using a combination of
both  proprietary  and  commercially  available,  licensed  technologies.  These
systems  are  scalable  and  secure,  and  are  designed  to make  the  customer
experience as simple as possible. The hardware and software systems are designed
to integrate  seamlessly and manage  real-time  transactions  with limited human
intervention. The current strategy is to focus the Company's internal software

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development efforts on creating and enhancing specialized,  proprietary software
that is unique to its business.

         The  merchandising  strategy  is  designed  to  combine  broad  product
selection and appeal to all classes of online  shoppers.  The Company intends to
become a one stop shopping  service by virtue of its tiered  platform of choices
including its auction and e-commerce sites. The search engine tools currently in
use allows customers to navigate through the Company's various Websites.

Competition

         The electronic  commerce market is new,  rapidly evolving and intensely
competitive,  and the Company  expects  competition  to intensify in the future.
Barriers to entry are relatively low, and current and new competitors can launch
new sites at a relatively low cost using commercially  available  software.  The
Company  currently or  potentially  competes  with a variety of other  companies
depending  on the type of  merchandise  and sales format  offered to  customers.
These competitors  include:  (i) various Internet auction houses such as ONSALE,
uBID, Yahoo! Auctions,  First Auction,  Surplus Auction,  WebAuction and Insight
Auction;  (ii) a number of indirect  competitors  that  specialize in electronic
commerce  or derive a  substantial  portion  of their  revenue  from  electronic
commerce,  including  Internet Shopping  Network,  AOL, Shopping Com and Cendant
Corp.; and (iii) a variety of other companies that offer merchandise  similar to
that of the Company but through physical auctions.

         The Company believes that the principal  competitive  factors affecting
its  market  are  the  ability  to  attract  customers  at  favorable   customer
acquisition  costs,  operate the  Websites in an  uninterrupted  manner and with
acceptable speed,  provide effective  customer service and obtain merchandise at
satisfactory  prices.  Although the Company believes that it currently  competes
favorably  with  respect to such  factors,  there can be no  assurance  that the
Company can maintain its  competitive  position  against  current and  potential
competitors,  especially  those  with  greater  financial,  marketing,  customer
support,  technical and other resources than the Company.  Increased competition
is likely to result in reduced  operating  margins,  loss of market  share and a
diminished brand franchise,  any one of which could materially  adversely affect
the Company's business,  results of operations and financial condition.  Many of
the  Company's  current and potential  competitors  have  significantly  greater
financial,  marketing,  customer support, technical and other resources than the
Company.

Intellectual Property

         The  Company's  software  programs  are  proprietary.  To  protect  its
interest in its intellectual property, the Company has non-disclosure agreements
with its employees and restricts access by others to its proprietary software.

         The Company believes that its products and other proprietary  rights do
not infringe on the proprietary rights of third parties. However, the Company is
a recent entrant in the sale of merchandise on the Internet, and there can be no
assurance  that third parties will not assert  infringement  claims  against the
Company in the future with respect to current or future products

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or other Company works.  Such an assertion may require the Company to enter into
royalty arrangements or result in costly litigation.

         The Company is also dependent upon existing  technology  related to its
operations. To the extent that new technological developments are unavailable to
the Company on terms  acceptable to it, or not at all, the Company may be unable
to continue to implement its business  plan which would have a material  adverse
effect on the Company's business, prospects,  financial condition and results of
operations.

Employees

         The  Company  currently  employs 15 people,  including  eight full time
employees.  The Company  believes that its future success will depend in part on
its continued ability to attract, hire and retain qualified personnel.

Government Regulation

         The Company is not currently subject to direct federal,  state or local
regulation,  and laws or  regulations  applicable  to access or  commerce on the
Internet,  other than regulations  applicable to businesses generally.  However,
due to the  increasing  popularity  and use of the  Internet  and  other  online
services,  it is possible that a number of laws and  regulations  may be adopted
with respect to the Internet or other online  services  covering  issues such as
user privacy,  freedom of expression,  pricing,  content and quality of products
and  services,   taxation,   advertising,   intellectual   property  rights  and
information security.




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                                  RISK FACTORS

         This Report (including  without  limitation the following Risk Factors)
contains  forward-looking  statements  (within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the  Securities  Exchange Act of 1934)
regarding  the  Company  and  its  business,  financial  condition,  results  of
operations and  prospects.  Words such as "expects,"  "anticipates,"  "intends,"
"plans,"  "believes," "seeks," "estimates" and similar expressions or variations
of such  words are  intended  to  identify  forward-looking  statements  in this
Report.   Additionally,   statements  concerning  future  matters  such  as  the
development  of new services,  technology  enhancements,  purchase of equipment,
credit  arrangements,  possible  changes  in  legislation  and other  statements
regarding matters that are not historical are forward-looking statements.

         Although  forward-looking  statements  in this Report  reflect the good
faith judgment of the Company's management, such statements can only be based on
facts and factors currently known by the Company. Consequently,  forward-looking
statements are inherently subject to risks and uncertainties, and actual results
and outcomes may differ  materially  from results and outcomes  discussed in the
forward-looking  statements.  Factors  that could  cause or  contribute  to such
differences in results and outcomes  include without  limitation those discussed
below as well as those discussed elsewhere in this Report.  Readers are urged to
carefully  review and  consider the various  disclosures  made by the Company in
this  Report,  which  attempts  to advise  interested  parties  of the risks and
factors that may affect the Company's business,  financial condition, results of
operations and prospects.

Extremely Limited Operating History

         The Company was formed in stages and placed  together as one company in
February,  1999.  Accordingly,  there is an extremely  limited operating history
upon which to base an evaluation of the Company and its business and  prospects.
The Company's  business and prospects  must be considered in light of the risks,
expenses and  difficulties  frequently  encountered  by companies in their early
stage of development, particularly companies in new and rapidly evolving markets
such as electronic commerce. Such risks for the Company include: an evolving and
unpredictable  business  model;  management  of growth,  if any;  the  Company's
ability to anticipate and adapt to a developing market;  acceptance by customers
of the Company's services and merchandise sold at such auctions; dependence upon
the  level of hits to the  Company's  sites;  development  of equal or  superior
Internet auctions and related services by competitors; dependence on vendors for
merchandise; and the ability to identify, attract, retain and motivate qualified
personnel.  To address  these  risks,  the Company  must,  among  other  things,
increase  traffic  to its  Websites,  maintain  its  customer  base and  attract
significant  numbers  of new  customers,  respond to  competitive  developments,
implement and execute successfully its business strategy and continue to develop
and upgrade its  technologies and customer  services.  There can be no assurance
that the Company will be successful in addressing these risks.

Need For Additional Capital

         The Company requires  substantial working capital to fund its business.
If the  Company is unable to obtain  financing  in the  amounts  desired  and on
acceptable terms, or at all, the

                                       10

<PAGE>



Company  may be  required  to reduce  significantly  the scope of its  presently
anticipated  advertising  and other  expenditures,  which  could have a material
adverse  effect on the  Company's  growth  prospects and the market price of the
Common Stock.

Anticipated Losses And Negative Cash Flow

         The Company expects to expend significant  resources on its technology,
Website  development,  advertising,  hiring of personnel and startup costs. As a
result,  the Company  expects to continue  to incur  losses for the  foreseeable
future.  The Company  intends to expend  significant  financial  and  management
resources on brand development,  marketing and advertising, Website development,
strategic relationships, and technology and operating infrastructure.  Primarily
as a result of the anticipated significant increase in marketing and promotional
expenses,  the Company expects to incur additional  losses,  and such losses are
expected to increase significantly from current levels. In addition, the Company
plans to continue to increase its operating  expenses  significantly in order to
increase its customer base, increase the size of its staff, expand its marketing
efforts to enhance its brand image,  increase its visibility on other companies'
high-traffic  Websites,  purchase  larger  volumes of  merchandise to be sold at
auction,  increase its  software  development  efforts,  and support its growing
infrastructure.  Moreover,  to the  extent  that  increases  in  such  operating
expenses precede or are not  subsequently  followed by increased  revenues,  the
Company's  business,  results of  operations  and  financial  condition  will be
materially  adversely  affected.  There can be no assurance  that the  Company's
revenues  will  increase  or even  continue at their  current  level or that the
Company will achieve or maintain  profitability  or generate  positive cash flow
from  operations  in future  periods.  The  Company  has made and expects in the
future  to  continue  to make  significant  investments  in  infrastructure  and
personnel in advance of levels of revenue necessary to offset such expenditures.
The Company may be unable to adjust  spending in a timely  manner to  compensate
for any unexpected revenue shortfall.

Unpredictability of, And Fluctuations In, Operating Results

         The Company's  operating  results are unpredictable and are expected to
fluctuate in the future,  due to a number of factors,  many of which are outside
the Company's  control.  These  factors  include:  (i) the Company's  ability to
significantly  increase its customer  base and traffic to its sites,  manage its
inventory  mix and the mix of products  offered,  liquidate  its  inventory in a
timely manner, maintain gross margins, and maintain customer satisfaction;  (ii)
the  availability  and  pricing of  merchandise  from  vendors;  (iii)  consumer
confidence  in  encrypted  transactions  in the Internet  environment;  (iv) the
timing, cost and availability of advertising on the Company's Websites and other
entities' Websites;  (v) the amount and timing of costs relating to expansion of
the Company's operations;  (vi) the announcement or introduction of new types of
merchandise,  service  offerings  or  customer  services  by the  Company or its
competitors;  (vii) technical  difficulties  with respect to consumer use of the
Company's  Websites;  (viii) the level of merchandise returns experienced by the
Company; (ix) governmental  regulation by federal or local governments;  and (x)
general economic conditions and economic conditions specific to the Internet and
electronic  commerce.  As a  strategic  response  to changes in the  competitive
environment,  the Company may from time to time make certain service,  marketing
or supply decisions or acquisitions that could have a material adverse effect on
the Company's results of

                                       11

<PAGE>



operations and financial  condition.  Due to all of the foregoing  factors,  the
Company's  operating  results  may fall  below the  expectations  of  securities
analysts and investors. In such event, the trading price of the Company's Common
Stock would likely be materially adversely affected.

Seasonal Fluctuations In Result of Operations

         The  Company  believes  that its  results of  operations  are  somewhat
seasonal in nature,  with fewer  auctions  listed  around the  Thanksgiving  and
Christmas  holidays  in the fourth  quarter.  The  Company's  limited  operating
history,  however,  makes it  difficult  to fully  assess  the  impact  of these
seasonal  factors or whether or not its  business  is  susceptible  to  cyclical
fluctuations in the U.S.  economy.  There can be no assurance that seasonably or
cyclical variations in the Company's  operations will not become more pronounced
over time or that they will not  materially  adversely  affects  its  results of
operations  in the  future.  Moreover,  consumer  "fads"  and other  changes  in
consumer trends may cause  significant  fluctuations in the Company's  operating
results from one quarter to the next.

Reliance On Relationships With OnLine Companies

         The Company  depends to some extent and is increasing its dependence on
relationships with other online companies.  These relationships include, but are
not  limited  to,  agreements  for  anchor  tenancy,   promotional   placements,
sponsorships  and banner  advertisements.  Generally,  these  agreements are not
exclusive and do not provide for guaranteed renewal.  The risks included in this
dependence  include:  (i)  the  possibility  that  a  competitor  will  purchase
exclusive  rights  to  attractive  space  on one or more  key  sites;  (ii)  the
uncertainty that significant  spending on these  relationships will increase the
Company's revenues substantially or at all; (iii) the possibility that potential
revenue  increases  resulting  from such spending will not occur within the time
periods that the Company is expecting;  (iv) the possibility that space on other
Websites  or the same sites may  increase in price or cease to be  available  on
reasonable terms or at all; (v) the possibility that, if these relationships are
successful,  the  Company  may  not  be  able  to  obtain  adequate  amounts  of
merchandise to meet the increased demand that is generated; (vi) the possibility
that such  online  companies  will be unable to deliver a  sufficient  number of
customer  visits or  impressions;  and (vii) the  possibility  that such  online
companies will compete with the Company for limited online auction revenues. Any
termination of the Company's arrangements with other online companies could have
a material adverse effect on the Company's  business,  results of operations and
financial condition.

Reliance On Merchandise Vendors

         The Company depends upon vendors to supply it with some merchandise for
sale through the  Company's  Internet  auctions,  and the  availability  of such
merchandise  can be  unpredictable.  Since  inception,  the  Company has sourced
merchandise  from  numerous  vendors.  None of these  vendors  is  subject  to a
long-term  supply contract with the Company.  There can be no assurance that the
Company's  current  vendors will continue to sell  merchandise to the Company or
otherwise  provide  merchandise  for sale in the Company's  auctions or that the
Company  will  be  able  to  establish  new  vendor  relationships  that  ensure
merchandise  will be available  for auction on the  Company's  Websites.  If the
Company is unable to develop and maintain satisfactory

                                       12

<PAGE>



relationships  with vendors on acceptable  commercial  terms,  if the Company is
unable to obtain sufficient quantities of merchandise, if the quality of service
provided by such vendors falls below a satisfactory standard or if the Company's
level of returns exceeds its expectations,  the Company's  business,  results of
operations and financial condition will be materially adversely affected.

Reliance On Other Third Parties

         In addition to its merchandise vendors, the Company's operations depend
on a number of third parties for  Internet/telecom  access,  delivery  services,
credit card  processing and software  services.  The Company has limited control
over these third parties and no long-term  relationships  with any of them.  For
example,  the Company  does not own a gateway  onto the  Internet,  but instead,
relies on an Internet service provider to connect the Company's  Websites to the
Internet. From time to time, the Company has experienced temporary interruptions
in its Websites connection and also its telecommunications access. Continuous or
prolonged   interruptions  in  the  Company's  Websites  connection  or  in  its
telecommunications access, or slow Internet transmissions, would have a material
adverse  effect on the Company's  business,  results of operations and financial
condition.  The  Company  uses  overnight  courier  and  delivery  services  for
substantially  all of its products.  Should these  services be unable to deliver
the  Company's  products for a sustained  time period as a result of a strike or
other  reason,  the  Company's  business,  results of  operations  and financial
condition would be adversely  affected.  If, due to computer systems failures or
other  problems  related to these  third-party  service  providers,  the Company
experiences  any delays in shipment,  its business,  results of  operations  and
financial    condition    would   be   adversely    affected.    The   Company's
internally-developed  auction software depends on operating system, database and
server  software  that was  developed  and produced by and  licensed  from third
parties.  The Company has from time to time discovered errors and defects in the
software from these third parties and, in part,  relies,  on these third parties
to correct these errors and defects in a timely manner. If the Company is unable
to develop and maintain  satisfactory  relationships  with such third parties on
acceptable commercial terms, or the quality of products and services provided by
such third parties falls below a satisfactory  standard, the Company's business,
results of operations  and  financial  condition  will be  materially  adversely
affected.

Management Of Potential Growth; New Management Team

         The Company has rapidly and  significantly  expanded its operations and
anticipates  that  significant  expansion of its operations  will continue to be
required in order to address potential market  opportunities.  This rapid growth
has placed,  and is expected to continue to place,  a significant  strain on the
Company's  management,  operational and financial  resources.  The Company's new
employees  include a number  of key  technical  employees  who have not yet been
fully integrated into the Company's  management team, and the Company expects to
add  additional  key  personnel in the near  future.  Increases in the number of
employees and the volume of merchandise sales have placed significant demands on
the Company's management, which as of March 1, 1999 included only four executive
officers. In order to manage the expected growth of its operations,  the Company
will be required to expand  existing  operations,  particularly  with respect to
customer service and merchandising, to improve existing and

                                       13

<PAGE>



implement  new  operational,  financial and inventory  systems,  procedures  and
controls. The Company may also be required to hire an accounting staff. Further,
the Company's management will be required to maintain relationships with various
merchandise vendors, freight companies,  warehouse operators, other Websites and
services,  Internet  service  providers  and other third parties and to maintain
control  over the  strategic  direction  of the  Company  in a rapidly  changing
environment.  There can be no assurance  that the Company's  current  personnel,
systems,  procedures  and  controls  will be adequate  to support the  Company's
future  operations,  that  management  will be able to  identify,  hire,  train,
retain,  motivate and manage required  personnel or that management will be able
to manage and exploit existing and potential market opportunities  successfully.
If the Company is unable to manage growth  effectively,  the Company's business,
results of operations  and  financial  condition  will be  materially  adversely
affected. See "Business-Employees."

Dependence On Key Personnel; Need For Additional Personnel

         The Company's future  performance  depends to a significant degree upon
the continued  contributions of members of Company's senior management and other
key personnel,  particularly  its President,  Gregory  Rotman;  Vice  President,
Treasurer and Secretary,  Richard Rotman; Vice President, Marc Stengel; and Vice
President,  Hannah  Kramer.  The loss of any of these  individuals  could have a
material  adverse  effect on the Company's  business,  results of operations and
financial condition. The Company does not have a long-term employment agreements
with any of its key  personnel and  maintains no key person life  insurance.  In
order to meet expected growth, the Company believes that its future success will
depend upon its ability to identify,  attract,  hire, train, motivate and retain
other  highly-skilled  managerial,  merchandising,  engineering,  marketing  and
customer service personnel. Competition for such personnel is intense. There can
be no assurance that the Company will be successful in attracting,  assimilating
or  retaining  the  necessary  personnel,  and the failure to do so could have a
material  adverse  effect on the Company's  business,  results of operations and
financial condition.

Risks Of A Purchased Inventory Model

         The Company  purchases some of its merchandise from vendors and thereby
assumes the inventory  and price risks of these  products to be sold at auction.
Since the Company relies on purchased inventory,  its success will depend on its
ability to liquidate its inventory rapidly through its auctions,  the ability of
its staff to purchase  inventory  at  attractive  prices  relative to its resale
value  at  auction  and its  ability  to  manage  customer  returns.  Due to the
inherently  unpredictable nature of auctions, it is impossible to determine with
certainty whether an item will sell for more than the price paid by the Company.
Further,  because minimum  opening bid prices for the merchandise  listed on the
Company's Websites generally are lower than the Company's  acquisition costs for
such  merchandise,  there can be no  assurance  that the  Company  will  achieve
positive  gross margins on any given sale. If the Company is unable to liquidate
its  purchased  inventory  rapidly,  if the  Company's  staff  fails to purchase
inventory at attractive  prices  relative to its resale value at auction,  or if
the Company  fails to predict with  accuracy the resale prices for its purchased
merchandise, the Company may be forced to sell its inventory at a discount or at
a loss and the Company's business, results of operations and financial condition
would be materially adversely affected.

                                       14

<PAGE>




Uncertain Acceptance Of The Evolving And Unpredictable Business Model

         The Company  believes  that the  importance of brand  recognition  will
increase as more companies engage in commerce over the Internet. Development and
awareness  of the  Company  will  depend  largely  on the  Company's  success in
increasing  its  customer  base.  If vendors do not  perceive  the Company as an
effective marketing and sales channel for their merchandise, or consumers do not
perceive the Company as offering an  entertaining  and desirable way to purchase
merchandise,  the Company will be  unsuccessful in promoting and maintaining its
brand. Furthermore,  in order to attract and retain customers and to promote and
maintain the Company in response to competitive pressures,  the Company may find
it necessary to increase its marketing and advertising  budgets and otherwise to
increase  substantially  its financial  commitment  to creating and  maintaining
brand loyalty among vendors and consumers. If the Company is unable to or incurs
significant  expenses in an attempt to achieve or maintain a leading position in
Internet commerce or to promote and maintain its brand, the Company's  business,
results of operations  and  financial  condition  will be  materially  adversely
affected.

         The Company also intends to continue to develop its business  model and
to explore other  opportunities  such as the use of the Company's Websites as an
advertising  medium for services and products of other companies,  promoting new
or  complementary  products or sales formats and expanding the breadth and depth
of products and services offered on its Websites. As its business model evolves,
the  Company  risks  diluting  its  business  model,   confusing  customers  and
decreasing interest from vendors.  In addition,  the Company could be exposed to
additional or new risks associated with these new opportunities.  If the Company
is unable to address these risks, the Company's business,  results of operations
and financial condition will be materially adversely affected.

Competition

         The electronic  commerce market is new,  rapidly evolving and intensely
competitive, and the Company expects competition to intensify in the future. The
Company  currently or  potentially  competes  with a variety of other  companies
depending  on the type of  merchandise  and sales format  offered to  customers.
These  competitors  include:  (i) various  Internet auction houses such as eBay,
ONSALE,  uBID,  Yahoo!  Auctions,  First  Auction (the auction site for Internet
Shopping  Network,  a  wholly-owned  subsidiary of Home Shopping  Network Inc.),
Surplus Auction (a wholly-owned  subsidiary of Egghead,  Inc.),  WebAuction (the
auction site for MicroWarehouse, Inc.) and Insight Auction (the auction site for
Insight  Enterprises,   Inc.);  (ii)  a  number  of  indirect  competitors  that
specialize  in  electronic  commerce  or derive a  substantial  portion of their
revenue from electronic  commerce,  including  Internet Shopping  Network,  AOL,
Shopping  Com and Cendant  Corp.;  and (iii) a variety of other  companies  that
offer  merchandise  similar to that of the Company but through physical auctions
and with which the Company competes for sources of supply.

         The Company believes that the principal  competitive  factors affecting
its  market  are  the  ability  to  attract  customers  at  favorable   customer
acquisition  costs,  operate the  Websites in an  uninterrupted  manner and with
acceptable speed,  provide effective  customer service and obtain merchandise at
satisfactory prices. There can be no assurance that the Company can maintain

                                       15

<PAGE>



its competitive position against current and potential  competitors,  especially
those with greater financial,  marketing,  customer support, technical and other
resources than the Company.

         Current and potential  competitors  have  established  or may establish
cooperative  relationships  among  themselves or directly with vendors to obtain
exclusive or semi-exclusive sources of merchandise.  Accordingly, it is possible
that new competitors or alliances  among  competitors and vendors may emerge and
rapidly  acquire  market  share.  Increased  competition  is likely to result in
reduced  operating  margins,  loss  of  market  share  and  a  diminished  brand
franchise,  any one of which could  materially  adversely  affect the  Company's
business,  results of operations and financial condition.  Many of the Company's
current  and  potential   competitors  have  significantly   greater  financial,
marketing,  customer support, technical and other resources than the Company. As
a result,  such  competitors may be able to secure  merchandise  from vendors on
more  favorable  terms than the  Company,  and they may be able to respond  more
quickly to changes in customer preferences or to devote greater resources to the
development, promotion and sale of their merchandise than can the Company.

Risk Of Capacity Constraints; Reliance On Internally-Developed
Systems; System Development Risks

         A key element of the Company's strategy is to generate a high volume of
traffic to, and use of, its Websites.  The Company's revenues depend entirely on
the  number  of  customers  who  use  its  Websites  to  purchase   merchandise.
Accordingly,  the satisfactory performance,  reliability and availability of the
Company's Websites,  transaction-processing  systems, network infrastructure and
delivery and shipping systems are critical to the Company's  operating  results,
as well as to its reputation and its ability to attract and retain customers and
maintain adequate customer service levels.

         The Company  periodically has experienced minor systems  interruptions,
including  Internet  disruptions,  which it believes  may continue to occur from
time to time. Any systems  interruptions,  including Internet disruptions,  that
result  in the  unavailability  of  the  Company's  Websites  or  reduced  order
fulfillment  performance would reduce the volume of goods sold, which could have
a material adverse effect on the Company's  business,  results of operations and
financial  condition.  The Company is  continually  enhancing  and expanding its
transaction-processing  systems,  network infrastructure,  delivery and shipping
systems and other  technologies  to  accommodate a  substantial  increase in the
volume of traffic on the Company's Websites.  There can be no assurance that the
Company will be  successful in these efforts or that the Company will be able to
accurately  project the rate or timing of  increases,  if any, in the use of its
Websites  or timely  expand  and  upgrade  its  systems  and  infrastructure  to
accommodate such increases.  There can be no assurance that the Company's or its
suppliers'  network  will be able to timely  achieve or maintain a  sufficiently
high  capacity of data  transmission,  especially  if the customer  usage of the
Company's Websites increases.  The Company's failure to achieve or maintain high
capacity data transmission  could  significantly  reduce consumer demand for its
services  and  have a  material  adverse  effect  on its  business,  results  of
operations and financial condition.



                                       16

<PAGE>



Risks Associated With Technological Change; Dependence On The
Internet

         The Internet and electronic  commerce  industries are  characterized by
rapid technological change, changes in user and customer requirements,  frequent
new  service  or  product  introductions  embodying  new  technologies  and  the
emergence  of new  industry  standards  and  practices  that  could  render  the
Company's existing Websites and proprietary  technology obsolete.  The Company's
performance  will depend,  in part, on its ability to license or acquire leading
technologies,  enhance  its  existing  services,  and  respond to  technological
advances  and  emerging  industry  standards  and  practices  on  a  timely  and
cost-effective   basis.  The  development  of  Websites  and  other  proprietary
technology  entails  significant  technical and business risks.  There can be no
assurance  that  the  Company  will be  successful  in  using  new  technologies
effectively  or adapting  its Websites and  proprietary  technology  to emerging
industry standards. If the Company is unable, for technical, legal, financial or
other  reasons,  to adapt in a timely  manner to changing  market  conditions or
customer  requirements,  or if the  Company's  Websites  do not  achieve  market
acceptance,   the  Company's  business,  results  of  operations  and  financial
condition would be materially  adversely affected.  The success of the Company's
services will depend in large part upon the development of an infrastructure for
providing  Internet  access and services.  The Internet could lose its viability
due to delays in the  development  or adoption of new  standards  and  protocols
intended to handle  increased  levels of Internet  activity or due to  increased
governmental  regulation.  There can be no assurance that the  infrastructure or
complementary  services  necessary  to make the  Internet  a  viable  commercial
marketplace will be developed or that, if they are developed,  the Internet will
become a viable marketing and sales channel for merchandise such as that offered
by the Company. The recent growth in the use of the Internet has caused frequent
periods of  performance  degradation,  requiring  the  upgrade  of  routers  and
switches,   telecommunications   links  and   other   components   forming   the
infrastructure  of the Internet service providers and other  organizations  with
links to the  Internet.  Any perceived  degradation  in the  performance  of the
Internet as a whole could undermine the benefits of the Company's services.  The
Company's  ability to  increase  the speed with which it  provides  services  to
customers  and to increase the scope of such  services  ultimately is limited by
and reliant upon the speed and  reliability  of the  networks  operated by third
parties.  Consequently, the emergence and growth of the market for the Company's
services  is  dependent  on  improvements  being  made  to the  entire  Internet
infrastructure to alleviate overloading and congestion. If the infrastructure or
complementary  services  necessary  to make the  Internet  a  viable  commercial
marketplace  are not  developed  or if the  Internet  does  not  become a viable
commercial  marketplace,  the  Company's  business,  results of  operations  and
financial condition will be materially adversely affected.

Risk Of System Failure; Single Site

         The  Company's  success is largely  dependent  upon its  communications
hardware  and  computer  hardware,  substantially  all of which are located at a
leased facility in Owings Mills,  Maryland. The Company's systems are vulnerable
to damage from fire, flood, power loss,  telecommunication failure, break-in and
similar events.  The Company does not presently have fully redundant  systems, a
formal disaster  recovery plan or alternative  providers of hosting services and
does  not  carry  sufficient  business  interruption   insurance  to  adequately
compensate

                                       17

<PAGE>



the Company for all losses that may occur. A substantial  interruption  in these
systems would have a material adverse effect on the Company's business,  results
of operations  and financial  condition.  To date,  the Company has  experienced
variable  interruptions  to its  service  as a  result  of  loss  of  power  and
telecommunications  connections.  Despite the implementation of network security
measures and firewall  security by the Company,  its servers are also vulnerable
to computer viruses, physical or electronic break-ins, attempts by third parties
deliberately  to exceed  the  capacity  of the  Company's  systems  and  similar
disruptive  problems.  Computer  viruses,  break-ins or other problems caused by
third parties could lead to interruptions,  delays, loss of data or cessation in
service to users of the Company's  services and products.  The occurrence of any
of these risks could have a material  adverse effect on the Company's  business,
results of operations and financial condition.

Risks Related To Consumer Trends

         The Company  obtains  some of its  revenues  from fees from sellers for
listing  products for sale on its service and fees from  successfully  completed
auctions.  The Company's  future revenues will depend upon continued  demand for
the  types of goods  that are  listed  by  users  of the  Company  service.  The
popularity of certain  categories of items, such as toys, dolls and memorabilia,
among consumers may vary over time due to perceived scarcity,  subjective value,
and societal and consumer trends in general.  A decline in the popularity of, or
demand for, certain collectibles or other items sold through the Company service
could  reduce  the  overall  volume  of  transactions  on the  Company  service,
resulting  in  reduced  revenues.  In  addition,  certain  consumer  "fads"  may
temporarily  inflate  the volume of certain  types of items list on the  Company
service,  placing a  significant  strain upon the Company's  infrastructure  and
transaction  capacity.  These trends may also cause significant  fluctuations in
the  Company's  operating  results from one quarter to the next.  Any decline in
demand for the goods offered  through the Company service as a result of changes
in consumer trends could have a material adverse effect.

Internet Commerce Security Risks; Risk Of Credit Card Fraud

         A significant  barrier to electronic commerce and communications is the
secure  transmission  of  confidential  information  over public  networks.  The
Company relies on encryption and authentication  technology  licensed from third
parties to provide the security and  authentication  necessary to effect  secure
transmission  of  confidential  information.  There  can  be no  assurance  that
advances in computer capabilities,  new discoveries in the field of cryptography
or other events or developments will not result in a compromise or breach of the
algorithms used by the Company to protect customer transaction data. If any such
compromise  of the Company's  security  were to occur,  it could have a material
adverse  effect on the Company's  business,  results of operations and financial
condition.  A party who is able to circumvent  the Company's  security  measures
could  misappropriate  proprietary  information  or cause  interruptions  in the
Company's operations.  The Company may be required to expend significant capital
and other resources to protect  against the threat of such security  breaches or
to alleviate  problems  caused by such  breaches.  Concerns over the security of
Internet  transactions  and the privacy of users may also  inhibit the growth of
the Internet  generally,  and the Web in  particular,  especially  as a means of
conducting commercial transactions. To the extent that activities of the Company
or third-party  contractors  involve the storage and transmission of proprietary
information, such as credit card

                                       18

<PAGE>



numbers,  security  breaches  could  expose  the  Company  to a risk  of loss or
litigation and possible liability.  There can be no assurance that the Company's
security measures will prevent security breaches or that failure to prevent such
security  breaches  will not have a  material  adverse  effect on the  Company's
business, results of operations and financial condition.

Government Regulation And Legal Uncertainties

         The  Company  is not  currently  subject  to direct  regulation  by any
government agency,  other than regulations  applicable to businesses  generally,
laws applicable to auction  companies and  auctioneers,  and laws or regulations
directly  applicable to access to or commerce on the Internet.  However,  due to
the increasing  popularity and use of the Internet, it is possible that a number
of laws and  regulations  may be adopted with respect to the Internet,  covering
issues  such as user  privacy,  pricing,  and  characteristics  and  quality  of
products and services. Furthermore, the growth and development of the market for
Internet commerce may prompt calls for more stringent  consumer  protection laws
that may impose additional burdens on those companies  conducting  business over
the Internet.  The adoption of any additional  laws or regulations  may decrease
the growth of the Internet,  which,  in turn,  could decrease the demand for the
Company's Internet auctions and increase the Company's cost of doing business or
otherwise  have  an  adverse  effect  on  the  Company's  business,  results  of
operations and financial condition.  Moreover, the applicability to the Internet
of  existing  laws in various  jurisdictions  governing  issues such as property
ownership,  auction  regulation,  sales  tax,  libel  and  personal  privacy  is
uncertain and may take years to resolve.  In addition,  as the Company's service
is available over the Internet in multiple  states,  and as the Company sells to
numerous  consumers  resident in such states,  such jurisdictions may claim that
the Company is required  to qualify to do business as a foreign  corporation  in
each such state. The failure by the Company to qualify as a foreign  corporation
in a  jurisdiction  where it is required  to do so could  subject the Company to
taxes and  penalties  for the failure to qualify.  Any such new  legislation  or
regulation,  or the application of laws or regulations from jurisdictions  whose
laws do not  currently  apply to the Company's  business,  could have a material
adverse  effect on the Company's  business,  results of operations and financial
condition.

Protection Of Intellectual Property

         As part of its confidentiality procedures, the Company generally enters
into  agreements  with its  employees and  consultants  and limits access to and
distribution of its software,  documentation and other proprietary  information.
There can be no  assurance  that the steps  taken by the  Company  will  prevent
misappropriation  of its  technology  or that  agreements  entered into for that
purpose  will be  enforceable.  Notwithstanding  the  precautions  taken  by the
Company,  it might be possible for a third party to copy or otherwise obtain and
use  the   Company's   software  or  other   proprietary   information   without
authorization   or  to  develop   similar   software   independently.   Policing
unauthorized use of the Company's technology is difficult,  particularly because
the global  nature of the  Internet  makes it  difficult to control the ultimate
destination or security of software or other data transmitted. The laws of other
countries  may afford  the  Company  little or no  effective  protection  of its
intellectual property.



                                       19

<PAGE>



         The  Company  may in the future  receive  notices  from  third  parties
claiming  infringement  by  the  Company's  software  or  other  aspects  of the
Company's  business.  While the  Company  is not  currently  subject to any such
claim,  any future claim,  with or without  merit,  could result in  significant
litigation  costs  and  diversion  of  resources,  including  the  attention  of
management,  and  require  the  Company  to enter  into  royalty  and  licensing
agreements,  which  could  have a  material  adverse  effect  on  the  Company's
business,  results of  operations  and  financial  condition.  Such  royalty and
licensing agreements,  if required,  may not be available on terms acceptable to
the Company or at all. In the future, the Company may also need to file lawsuits
to enforce the Company's  intellectual property rights, to protect the Company's
trade secrets,  or to determine the validity and scope of the proprietary rights
of others. Such litigation, whether successful or unsuccessful,  could result in
substantial  costs and  diversion  of  resources,  which  could  have a material
adverse  effect on the Company's  business,  results of operations and financial
condition.

         The  Company  also relies on a variety of  technology  that it licenses
from third parties.  There can be no assurance that these third-party technology
licenses will continue to be available to the Company on commercially reasonable
terms. The loss of or inability of the Company to maintain or obtain upgrades to
any of these  technology  licenses  could  result in delays  in  completing  its
proprietary   software   enhancements  and  new  developments  until  equivalent
technology could be identified,  licensed or developed and integrated.  Any such
delays would  materially  adversely  affect the Company's  business,  results of
operations and financial condition.

Risks Associated With Global Expansion

         The  Company  does not  currently  have  any  overseas  fulfillment  or
distribution  facility or  arrangement  or any Websites  content  localized  for
foreign markets,  and there can be no assurance that the Company will be able to
establish a global  presence.  In addition,  there are certain risks inherent in
doing  business  on a global  level,  such as  regulatory  requirements,  export
restrictions,  tariffs and other trade  barriers,  difficulties  in staffing and
managing foreign operations,  difficulties in protecting  intellectual  property
rights,  longer  payment  cycles,  problems in collecting  accounts  receivable,
political  instability,  fluctuations in currency exchange rates and potentially
adverse  tax  consequences,  which  could  adversely  impact the  success of the
Company's global  operations.  In addition,  the export of certain software from
the  United  States  is  subject  to  export  restrictions  as a  result  of the
encryption  technology  in such  software  and may give rise to liability to the
extent the Company  violates such  restrictions.  There can be no assurance that
the  Company  will be able to  successfully  market,  sell  and  distribute  its
products in foreign  markets or that one or more of such factors will not have a
material  adverse  effect  on  the  Company's  future  global  operations,   and
consequently,  on the Company's  business,  results of operations  and financial
condition.

Risks Associated With Acquisitions

         The  Company  may  choose  to  expand  its  market   presence   through
acquisitions of  complementary  businesses.  Although no such  acquisitions  are
currently being negotiated,  any future acquisitions would expose the Company to
increased  risks,  including  risks  associated  with  the  assimilation  of new
operations,  sites and personnel,  the diversion of resources from the Company's
existing businesses, sites and technologies,  the inability to generate revenues
from

                                       20

<PAGE>



new sites or content  sufficient to offset  associated  acquisition  costs,  the
maintenance  of uniform  standards,  controls,  procedures  and policies and the
impairment  of  relationships  with  employees  and customers as a result of any
integration  of new  management  personnel.  Acquisitions  may  also  result  in
additional  expenses  associated with amortization of acquired intangible assets
or potential  businesses.  There can be no assurance  that the Company  would be
successful  in  overcoming  these  risks or any other  problems  encountered  in
connection  with such  acquisitions,  and its  inability to overcome  such risks
could have a  material  adverse  effect on the  Company's  business,  results of
operations and financial condition.

Control By Principal Stockholders, Officers And Directors

         The  Company's  executive  officers and  directors,  in the  aggregate,
beneficially own approximately 80% of the Company's outstanding Common Stock. As
a result,  such persons,  acting together,  will have the ability to control all
matters  submitted to  stockholders  of the Company for approval  (including the
election and removal of directors and any merger,  consolidation  or sale of all
or substantially  all of the Company's assets) and to control the management and
affairs of the Company.  Accordingly,  such  concentration of ownership may have
the  effect of  delaying,  deferring  or  preventing  a change in control of the
Company, impede a merger, consolidation,  takeover or other business combination
involving  the Company or  discourage a potential  acquirer from making a tender
offer or otherwise  attempting to obtain  control of the Company,  which in turn
could have an adverse effect on the market price of the Company's Common Stock.

Anti-Takeover Effects Of Delaware Law And Certain Charter
Provisions

         Certain  provisions  of Delaware  law may have the effect of  delaying,
deterring or  preventing  a future  takeover or change in control of the Company
unless such takeover or change in control is approved by the Company's  Board of
Directors.  Such  provisions  also may  render  the  removal  of  directors  and
management  more difficult.  Such provisions  could limit the price that certain
investors  might be willing  to pay in the  future  for shares of the  Company's
Common  Stock.  These  provisions  of  Delaware  law may also have the effect of
discouraging or preventing certain types of transactions  involving an actual or
threatened  change of control of the  Company  (including  unsolicited  takeover
attempts),  even though such a transaction may offer the Company's  stockholders
the  opportunity  to sell their  stock at a price  above the  prevailing  market
price. In addition,  the Company is subject to the  anti-takeover  provisions of
Section 203 of the Delaware  General  Corporation  Law (the "DGCL"),  which will
prohibit  the  Company  from  engaging  in  a  "business  combination"  with  an
"interested  stockholder"  for a period  of three  years  after  the date of the
transaction  in which the person  became an  interested  stockholder  unless the
business  combination  is approved in a prescribed  manner.  The  application of
Section 203 of the DGCL also could have the effect of delaying or  preventing  a
change of control of the Company.

Possible Volatility Of Stock Price

         The market price of the shares of Common Stock has been,  and is likely
to be, highly volatile and could be subject to wide  fluctuations in response to
factors such as actual or

                                       21

<PAGE>



anticipated variations in the Company's results of operations,  announcements of
technological innovations,  new sales formats by the Company or its competitors,
developments with respect to patents,  copyrights or proprietary rights, changes
in financial  estimates by  securities  analysts,  conditions  and trends in the
Internet  and  electronic  commerce  industries,  adoption  of a new  accounting
standards  affecting the retail sales  industry,  general market  conditions and
other factors.  Further,  the stock markets,  have experienced extreme price and
volume fluctuations that have particularly  affected the market prices of equity
securities of many  technology  companies and that often have been  unrelated or
disproportionate  to the operating  performance of such  companies.  The trading
prices of many technology  companies'  stock are at or near historical highs and
reflect price earnings ratios  substantially above historical levels.  There can
be no assurance  that these  trading  prices and price  earnings  ratios will be
sustained.  These broad market factors may adversely  affect the market price of
the  Company's  Common  Stock.  These  market  fluctuations,  as well as general
economic, political and market conditions such as recessions,  interest rates or
international  currency  fluctuations,  may adversely affect the market price of
the Common  Stock.  In the past,  following  periods of volatility in the market
price  of  a  company's  securities,  securities  class  action  litigation,  if
instituted,  could result in substantial  costs and a diversion of  management's
attention  and  resources,  which  would have a material  adverse  effect of the
Company's business, results of operations and financial condition.

Year 2000 Readiness Disclosure

         Computer  systems,  software  packages,  and  microprocessor  dependent
equipment  may cease to function or generate  erroneous  data when the year 2000
arrives.  The problem  affects those systems or products that are  programmed to
accept a two-digit  code in date code  fields.  To  correctly  identify the year
2000,  a  four-digit  date code field will be  required  to be what is  commonly
termed "year 2000  compliant." The Company may realize  exposure and risk if the
systems for which it is dependent upon to conduct day-to-day  operations are not
year 2000 compliant by January 1, 2000. The potential areas of exposure  include
electronic data exchange systems operated by third parties with whom the Company
transacts  business,  certain products  purchased from third parties for resale,
and computers,  software, telephone systems and other equipment used internally.
If systems  material  to the  Company's  operation  have not been made year 2000
compliant  prior to January 1, 2000,  or if third  parties with whom the Company
does business fail to make their systems year 2000 compliant in a timely manner,
the year 2000 issue could have a disastrous  effect on the  Company's  business,
financial condition and results of operations.


                                       22

<PAGE>



Item 2.  Description of Properties.

         The  Company's  corporate  headquarters  are  presently  located  at  4
Brussels Street, Worcester, Massachusetts 01610.


Item 3.  Legal Proceedings.

         The Company is not a party to any material pending legal proceedings.


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

         None.


Item 5.  Market for Common Equity and Related Stockholder Matters.

         (a) Market  Information - The  Company's  common stock began trading on
August 11, 1995 and is presently  traded on the NASDAQ  Bulletin Board under the
symbol,  "PAID".  The following table sets forth the high and low bid prices for
the Company's Common Stock for the eight quarters ended December 31, 1998.

         1998                                        High              Low
                                                     ----              ---
         Quarter ended March 31, 1998                 3/8              5/32
         Quarter ended June 30, 1998                  3/8               1/8
         Quarter ended September 30, 1998          1 3/16               3/8
         Quarter ended December 31, 1998              7/8               1/4

         1997                                        High              Low
                                                     ----              ---
         Quarter ended March 31, 1997                1 3/8            11/16
         Quarter ended June 30, 1997                 1 1/4              3/8
         Quarter ended September 30, 1997             7/16              3/8
         Quarter ended December 31, 1997               3/8              3/8


         (b) Holders - As of December 31,  1998,  there were  approximately  145
holders of record of the Company's Common Stock.

         (c) Dividends - The Company has not  previously  paid cash dividends on
its  common  stock,  and  intends  to utilize  current  resources  to expand the
business;  thus, it is not  anticipated  that cash dividends will be paid on the
Company's Common Stock in the foreseeable future.


                                       23

<PAGE>



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

Overview

         As of  December  31,  1998,  the sole  business  of the Company was the
business of SRA, its sole, wholly-owned subsidiary,  which served members of the
investing  community  who had lost money due to the  advice,  lack of  fiduciary
responsibility  or  fraudulent  practices  of  brokers  and broker  dealers.  In
December  1998,  the  management  of the  Company  decided  to  discontinue  the
operations  of that  business.  In February  1999,  the Company  sold SRA to the
management of SRA, in exchange for eight million shares of the Company's  Common
Stock, with the goal of entering into the Internet  business.  In furtherance of
that goal, on February 25, 1999,  the Company  purchased all of the  outstanding
stock of Internet  Auction in exchange for  37,368,912  shares of the  Company's
Common Stock.  At the time the  transaction  was agreed upon by the then current
management  of  the  Company,   the  average  price  of  the  common  stock  was
approximately $.28 per share. As a result of this transaction,  Internet Auction
became a wholly-owned  subsidiary of the Company,  and the principal business of
the Company is now the business of Internet Auction, Inc.

         Prior to the  transaction  with the  Company,  the  business  currently
conducted by the Company was conducted through four related companies:  Auction,
Inc., Rotman Auction, Rotman Collectibles and World Wide Collectors Digest, Inc.
Prior to, and in anticipation of the transaction with the Company, the companies
were  combined  and  their  operations  were  integrated.  As  a  part  of  this
integration, a substantial inventory of Rotman Collectibles was transferred into
Internet  Auction.  The  following  provides  financial   information  regarding
Internet Auction as of February 15, 1999.


                                       24
<PAGE>



                             Internet Auction, Inc.
                                  Balance Sheet
                                February 25, 1999

                                     Assets

Current assets:
     Cash and Equivalents                          $   18,216
     Accounts receivable                                4,040
     Inventories (1)                                  834,153
     Loans receivable                                   1,000
     Due from affiliates (4)                           15,483
     Due from shareholders (4)                          2,280

              Total current assets                                    $ 875,172

Property and equipment, net (2)                                          50,429

Intangible assets (3)                                                     5,980

Total assets                                                          $ 931,581

                                       Liabilities and Shareholders' Equity

Current liabilities:
     Accounts payable                              $   79,544
     Accrued liabilities                               18,986
     Due to shareholders                               12,000
     Due to affiliates                                  4,745

          Total current liabilities                                   $ 115,275

Shareholders' equity:
     Common stock                                     845,194
     Accumulated deficit                              (27,888)

                                                      817,036

     Less stock subscriptions receivable               (1,000)

     Total shareholders' equity                                         816,036

Total liabilities and shareholders' equity                            $ 931,581
-------------------

(1)  Inventory  is stated at the lower of cost  (using  the  first-in  first-out
     (FIFO) method or market).

(2)  Property and equipment are stated at cost.  Depreciation  is computed using
     straight line and double  declining  balance methods over estimated  useful
     life  of 5  years.  Expenditures  for  additions,  improvements  and  major
     renewals  are  capitalized  while  those for repairs  and  maintenance  are
     charged to expense as incurred.

(3)  Intangible  assets,  comprised of  organization  expenses and  intellectual
     property, are being amortized over five years on a straight line basis.

(4)  Due to/from  affiliates and  shareholders  consist of non-interest  bearing
     advances  and are all  due on  demand.  These  advances  were  subsequently
     repaid.


                                       25
<PAGE>



Operations

       The following is a description of the operations of each of the Company's
divisions:

         Auction Inc.  Division.  The Auction Inc. is a public  person-to-person
trading  community  that  offers  sellers a vehicle of  listing  items for sale.
Substantially  all of the  Division's  revenues are derived from  placement  and
success  fees paid by  sellers.  Auction  Inc.charges  no fees to buyers and, to
date,  has  chosen to sell  almost  no  advertising  on its Web site.  By paying
additional  placement fees,  sellers can have items featured in various ways. In
the near future, Sellers will be able to highlight their auctions by utilizing a
bold font for the auction  heading for an additional  fee of $2.00.  Sellers for
whom a three to fourteen day auction is successfully  concluded (i.e.,  there is
at least  one bid  above  the  seller's  specified  minimum  or  reserve  price,
whichever  is higher) also pay a success fee for each item sold that is equal to
5% of the first $25 of the purchase  price,  2.5% of any purchase  price between
$25.01 and $1,000 and 1.25% of any  purchase  price over $1,000.  Revenues  from
placement  fees are  recognized  at the time that the item is  listed;  revenues
related  to  success  fees are  recognized  at the  time  that  the  auction  is
successfully  concluded. At no point during the auction process does the Company
take  possession  of either the item being sold or the  buyer's  payment for the
item.  Fees  to  sellers  are  aggregated  and  billed  on a  monthly  basis.  A
substantial  majority of  customer  accounts  are  settled by directly  charging
credit card numbers provided by sellers.  Provisions for estimated uncollectible
accounts and authorized  credits are recorded as percentages of revenues and are
provided for at the time of revenue recognition.

       The Company is considering  offering banner  advertising on Auction Inc's
site in the future.

         Rotman Auction Division.  Rotman Auction is a full service  consignment
auction  house  which has been in  business  for over 20 years and  started  its
online  service in 1996.  Rotman  Auction  provides a full range of  services to
sellers  and buyers  including  live  online  bidding  of premier  collectibles,
consignment services,  authentication of merchandise,  digital photography,  and
the  purchase  and sale of authentic  memorabilia.  The Company  auctions a wide
variety of property,  including, jewelry, decorative art and rare books, posters
and has a mainstay  in the sports  memorabilia  and trading  cards.  Most of the
objects  auctioned by the Company are unique items, and their value,  therefore,
can  only be  estimated  prior  to  sale.  The  Company's  principal  role as an
auctioneer is to identify,  evaluate and authenticate items through its staff of
experts and consultants,  to stimulate  purchaser interest through  professional
marketing  techniques  and to match  sellers  and  buyers  through  the  auction
process.

       In its role as auctioneer,  the Company functions as an agent,  accepting
property on  consignment  from its selling  clients.  The Company  conducts  its
auctions as agent of the  consignor,  billing the buyer for property  purchased,
receiving  payment from the buyer and remitting to the consignor the consignor's
portion of the buyer's payments.  The Company frequently  releases property sold
at auction to buyers, primarily dealers, before the Company receives payment. In
such event,  the Company is liable to the seller for the net sale  proceeds even
if the Company never receives payment from the buyer.

       All  buyers  using  the  services  pay a premium  (known  as the  buyer's
premium) to the Company on auction purchases.  The buyer's premium is 15% of the
hammer price on all items


                                       26
<PAGE>



sold for $50,000 or less,  and 15% of the first $50,000 for items sold in excess
of that  amount  (10% on the  remainder).  Generally,  similar  structures  were
simultaneously   implemented   throughout  most  of  Rotman  Auction's   auction
operations. A selling commission, which can vary depending on the sale location,
type of seller (for example,  dealers) and the selling price of the property, is
charged to the seller. In situations  involving major individual  collections or
collectors,  the selling commission tends to be negotiated to a level below that
which otherwise would apply.

       In addition, on certain occasions,  the Company will assure the consignor
a minimum  price in  connection  with the sale of  property.  The  Company  must
perform under its  assurances  only in the event that (a) the property  fails to
sell at  auction  and (b) the  consignor  prefers to be paid the  minimum  price
rather than retain ownership of the unsold property.  In such event, the Company
purchases the property at the minimum price.

         World Wide Collectors  Digest  Division  (WWCD).  WWCD,  established in
1994,  is  the  Company's  premier   e-commerce   website  for  dealers  in  the
collectibles  community.  WWCD is a full-service company that designs, hosts and
maintains  dealer  Websites.  WWCD's  software  allows clients to operate online
storefronts, set prices, and sell directly to online shoppers.

       The Company has derived  substantially  all of its  revenues to date from
the sale of  advertisements  and hosting sites.  These revenue  sources  include
placement  fees,  promotions,   banner  advertisements,   sponsorships,   direct
marketing,  and  transactions  on WWCD  properties.  The  Company's  advertising
products currently consist of banner  advertisements that appear on pages within
WWCD  properties,  higher profile  promotional  sponsorships  that are typically
focused on a particular  event,  such as a sweepstakes,  and merchant buttons on
targeted  advertising  inventory  encouraging  users to complete a  transaction.
Hypertext links are embedded in each banner  advertisement  or button to provide
the user with instant access to the advertiser's Web site, to obtain  additional
information, or to purchase products and services.

       WWCD derives other revenues primarily from its web-hosting program, which
offers  premium  services for a monthly fee,  providing  dealers with a website,
shopping cart services and additional disk space and enhanced  publishing  tools
for their web pages.

       Internet  Collectibles   Division.   Internet  Collectibles  maintains  a
substantial  inventory of memorabilia with popular and historical  significance.
This  inventory is sold through the  Company's  various  divisions  and to third
party vendors.

       The Company  believes  that these online  services  for the  collectibles
industry  under  the  umbrella  of one  company  provides  online  shoppers  and
businesses access to many of the services and resources they may desire.

Working Capital and Liquidity

The Company will require working capital to operate and grow its business. Prior
to the  acquisition  by  the  Company,  Internet  Auction  acquired  significant
inventories of collectibles that the Company believes will help generate some of
the working  capital. The Company  believes  that its current cash and financing
plans  currently  being  negotiated  by  management  are  sufficient to meet its
current  cash needs.  While the Company  expects that funds  generated  from the
Company's  operations  and funds to be  realized  from  financing  plans will be
sufficient  to meet its capital needs for 1999,  there can be no assurance  that
these funds will be sufficient.


                                       27

<PAGE>



                     Year 2000 Systems Readiness Disclosure

         Computer  systems,  software  packages,  and  microprocessor  dependent
equipment  may cease to function or generate  erroneous  data when the year 2000
arrives.  The problem  affects those systems or products that are  programmed to
accept a two-digit  code in date code  fields.  To  correctly  identify the year
2000,  a  four-digit  date code field will be  required  to be what is  commonly
termed "year 2000 compliant."

         The Company may realize  exposure  and risk if the systems for which it
is dependent to conduct day-to-day  operations are not year 2000 compliant.  The
potential areas of exposure include electronic data exchange systems operated by
third  parties  with  whom the  Company  transacts  business,  certain  products
purchased  from third parties for resale,  and  computers,  software,  telephone
systems and other equipment used internally.  To minimize the potential  adverse
affects of the year 2000  problem,  the  Company  has  established  an  internal
project  team.  This  project team has begun a process of  identifying  internal
systems (both information  technology and  non-information  technology  systems)
that  are  not  year  2000  compliant,  determining  their  significance  in the
effective operation of the Company,  and developing plans to resolve any issues.
The Company has been  communicating  with the  suppliers and others with whom it
does business to coordinate year 2000 readiness.  The responses  received by the
Company to date have  indicated  that steps are  currently  being  undertaken to
address this  concern.  However,  if such third parties are not able to make all
systems year 2000  compliant,  there could be a material  adverse  impact on the
Company.

         The Company has determined  that its principal  transaction  processing
software is year 2000  compliant.  Accordingly,  the Company does not anticipate
any material adverse  operational issues to arise. The Company plans to complete
the year 2000  compliance  assessment by the end of the second  quarter 1999 and
implement corrective solutions before the end of the third quarter 1999. Because
the principal  transaction  processing software was already year 2000 compliant,
when it was acquired,  management  expects that the Company's present and future
costs in  connection  with  its year  2000  compliance  project  are and will be
minimal;  however,  future  anticipated costs are difficult to estimate with any
certainty  and  may  differ  materially  from  those  currently  projected.  The
estimated  costs do not include  time and costs that may be incurred as a result
of any potential failure of third parties to become year 2000 compliant or costs
to implement the Company's  future  contingency  plans.  The Company has not yet
developed  a  contingency  plan in the  event  that any  non-compliant  critical
systems are not remedied by January 1, 2000,  nor has it  formulated a timetable
to create such contingency plan. If systems material to the Company's operations
have not been  made  year  2000  compliant,  or if third  parties  with whom the
Company does business fail to make their systems year 2000 compliant in a timely
manner,  the year  2000  issue  could  have a  material  adverse  effect  on the
Company's business, financial condition and results of operations.



                                       28

<PAGE>



Item 7.  Financial Statements.

         As of  December  31,  1998,  the sole  business  of the Company was the
business  of SRA,  its sole,  wholly-owned  subsidiary.  In December  1998,  the
management of the Company  decided to discontinue  that business and in February
1999 sold SRA to the  management  of SRA,  which was also the  management of the
Company at the time,  in  exchange  for eight  million  shares of the  Company's
Common Stock.

         Pursuant to the sale, the management of SRA agreed to provide financial
statements  for SRA for the year ended  December 31,  1998.  The Company has not
received  financial  statements  from SRA that are in a form  ready for  filing.
Accordingly,  no financial  statements are available for the Company's  business
from SRA in 1998.


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

         None.



                                       29

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                                    PART III

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

         Directors and Executive Officers

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

                                                                        Director
Name                       Age         Position                           Since

Gregory Rotman*            33          Director & President               1999
Richard Rotman*            28          Director & Vice President,         1999
                                       Treasurer and Secretary
Marc Stengel               41          Director & Vice President          1999
Hannah Kramer              60          Director & Vice President          1999
Robert Bertsch             33          Director                           1998
----------------------
*Gregory Rotman and Richard Rotman are brothers.


         The following is a description  of the current  occupation and business
experience for the last five years for each director and executive officer.

         Gregory P.  Rotman has served as a Director  and the  President  of the
Company since its acquisition of Internet Auction. Prior to joining the Company,
he was  involved in starting a group known as  Teamworks,  Inc.,  LLC.  Its sole
purpose from 1991-1995 was to facilitate the design,  financing and build-out of
The MCI National Sports Museum in Washington, D.C. Today the MCI National Sports
Museum is the only  interactive,  all encompassing,  sports-based  museum in the
United States.

         Richard S.  Rotman has  served as a  Director  and the Vice  President,
Treasurer  and  Secretary  of the  Company  since its  acquisition  of  Internet
Auction.  Prior to joining the Company,  he was involved in the  management  and
day-to-day operations of Rotman Auction,  which he formed in February 1997. From
1995 until  February  1997,  Mr. Rotman worked for the family  business,  Rotman
Collectibles,  where  he  began in sales  and  distribution  in the new  product
division.  As the industry was changing,  Rotman  Collectibles began focusing on
auctions as a more  permanent  division  and during  1996,  he began to create a
presence on the Internet.  Mr. Rotman's  primary  expertise is in management and
daily operations. From 1994 to 1995, Mr. Rotman served as the director of an art
gallery in Jackson, Wyoming, selling original artwork to high-end clientele.

         Marc Stengel has served as a Director and Vice President of the Company
since its acquisition of Internet  Auction.  He runs the daily operations of the
websites for the Company,  including systems  administration  and overseeing the
programming for each of the Company's  divisions.  Prior to joining the Company,
he served as president of Worldwide Collectors Digest,

                                       30

<PAGE>



Inc.,  which he  co-founded  in 1994 in an effort to combine  his  knowledge  of
computer technology with his interest in sports.  Prior to that, Mr. Stengel ran
his family clothing business.

         Hannah  Kramer  has  served as a  Director  and Vice  President  of the
Company since its acquisition of Internet Auction. Prior to joining the Company,
she served as vice president of World Wide Collectors  Digest,  Inc.,  which she
co-founded in 1994. She also owns two women's and two men's clothing stores.

         Robert Bertsch has served as a Director of the Company since June 1998,
when the Company was known as Securities Resolutions Advisors,  Inc. Mr. Bertsch
is a partner at the law firm  Bertsch &  Associates.  In 1997,  Mr.  Bertsch was
named  to the  Board  of  Directors  of SRA,  where  he also  serves  as head of
arbitration.  From 1995 to 1997,  Mr.  Bertsch  worked in the  retail  brokerage
business.  From 1992 to 1995,  Mr.  Bertsch  was  employed  as an  associate  at
Milberg,  Weiss, Bershad, Hynes and Lerach, a leading plaintiff securities class
action firm. In addition to his law degree,  he holds NASD licenses under series
7, 63, 24 and 27.

         Compliance with Section 16(a)

         Section  16(a) of the  Securities  Exchange  Act of 1934  requires  the
Company's  directors and executive  officers,  and persons who own more than ten
percent of the Company's  outstanding  Common Stock to file with the  Securities
and Exchange  Commission (the "SEC") initial reports of ownership and reports of
changes  in  ownership  of  Common  Stock.  Such  persons  are  required  by SEC
regulation to furnish the Company with copies of all such reports they file.

         To the  Company  knowledge,  based  solely on a review of the copies of
such reports furnished to the Company and representations  that no other reports
were required, all Section 16(a) filing requirements applicable to its officers,
directors and greater than ten percent beneficial owners have been complied with
for the period which this Form 10-KSB relates.


Item 10. Executive Compensation.

         The following table sets forth the  compensation of the Company's chief
executive  officer  and each  officer  whose  total cash  compensation  exceeded
$100,000, for the three fiscal years ended December 31, 1998. The Company has no
current long term compensation plans.

                           Summary Compensation Table

Name and
Principal Position                Year      Salary        Bonus       Other

Richard Singer II                 1998      $72,000      $30,000      $  --
President

Robert Bertsch                    1998      $72,000      $30,000      $  --
Head of Arbitration of SRA

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G. David Gordon                   1998            -            -
Former President                  1997            -            -      $42,350(1)
                                  1996            -            -       27,286(1)

---------------
(1) Includes fees paid G. David Gordon & Associates, P.C., the firm for which G.
David Gordon is owner.

         In 1998,  Directors were  compensated  $200 for each Directors  Meeting
attended.

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

         The following table indicated all persons who, as of February 28, 1999,
the most recent  practicable  date, are known by the Company to own beneficially
more than 5% of any class of the Company's  voting  securities and all directors
and all  officers  of the Company as a group.  The address of each person  named
below is address of the Company.

                                     Amount and
Name of Beneficial                   Nature of                     % of
      Owner                          Beneficial Owner              Class

Gregory Rotman                          8,309,005                 17.90%
Richard Rotman                         10,155,451                 21.88%
Marc Stengel                           12,925,119                 27.85%
Hannah Kramer                           5,539,337                 11.94%
Robert Bertsch                                  0                  0.00%
All directors and                      36,928,912                 79.57%
  officers as a group


                               Changes in Control

         On February  25, 1999,  the Company  purchased  all of the  outstanding
stock  of  Internet  Auction,  Inc.,  a  Massachusetts   corporation  ("Internet
Auction").  The acquisition (the "Transaction") was pursuant to an Agreement and
Plan of  Reorganization  (the  "Agreement")  dated  January 31, 1999 between the
Company and Gregory Rotman,  Richard Rotman, Marc Stengel and Hannah Kramer, the
principal shareholders (the "IA Shareholders") of Internet Auction.  Pursuant to
the Agreement,  the Company acquired all of the issued and outstanding shares of
the capital  stock of Internet  Auction in exchange  for the  issuance to the IA
Shareholders of an aggregate of 37,368,912  shares,  representing  approximately
80%, of the Company's  common stock. At the time that the transaction was agreed
upon by the then current  management  of the Company,  the average  price of the
Common Stock was  approximately  $.28 per share. As a result of the Transaction,
Internet  Auction  became  a  wholly-owned  subsidiary  of the  Company,  the IA
Shareholders now own 80% of the Company's  issued and outstanding  common stock,
and the  principal  business  of the  Company is now the  business  of  Internet
Auction.  Prior to the transaction,  Richard Singer, the former President of the
Company, was a principal beneficial owner of the common stock of the Company.


                                       32

<PAGE>



         The Company did not pay any cash or other consideration, other than the
issuance of its shares of common stock to the IA Shareholders,  as consideration
for  the  Transaction.   Prior  to  the  consummation  of  the  Transaction,  no
relationship  existed  between the Company and its officers,  directors or other
affiliates and Internet Auction and its officers, directors or other affiliates.
The  number  of  shares  of  the  Company's  common  stock  received  by  the IA
Shareholders  as a result  of the  Transaction  was  determined  by  arms-length
negotiations  between  the IA  Shareholders  and the  persons  then  serving  as
officers and directors of the Company.

         In  accordance  with  the  Agreement,  after  the  Transaction,  the IA
Shareholders  were  appointed  to the  Company's  Board  of  Directors,  and the
previously serving directors resigned, or will resign, from the Board.

Item 12. Certain Relationships and Related Transactions.

         None


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

         (a) Exhibits.

         Exhibit           Description of Exhibits
           No. 

           2.1    Agreement  and Plan of  Reorganization  dated January 31, 1999
                  among the Company and Gregory  Rotman,  Richard  Rotman,  Marc
                  Stengel and Hannah  Kramer.  (Incorporated  by reference  from
                  Form 8-K - File No. 0-28720, filed on March 10, 1999.)
           21     Subsidiaries of the Company (included in Item I)


         (b) Reports on Form 8-K.

             None




                                       33

<PAGE>



                                   SIGNATURES


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


                                      SALES ONLINE DIRECT INC.




Date:  April 15, 1999                 By: /s/ Gregory Rotman             
                                         ---------------------------------------
                                          Gregory Rotman, President



         In accordance with the Exchange Act, this annual report has been signed
below by the following persons on behalf of the registrant and in the capacities
and on the dates indicated:



Date:  April 15, 1999                 /s/ Gregory Rotman  
                                      ------------------------------------------
                                      Gregory Rotman, President and Director



Date:  April 15, 1999                 /s/ Richard Rotman                   
                                      ------------------------------------------
                                      Richard Rotman, Vice President, Treasurer,
                                      Secretary and Director



Date:  April 15, 1999                 /s/ Marc Stengel                       
                                      ------------------------------------------
                                      Marc Stengel, Vice President and Director



Date:  April 15, 1999                 /s/ Hannah Kramer                    
                                      ------------------------------------------
                                      Hannah Kramer, Vice President and Director




C76992c.636

                                       34

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