UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

FORM 10-KSB

ANNUAL REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended June 30, 2000

Commission file No. 0-29501

COM-GUARD.COM, INC(Exact name of registrant as specified in its charter)

(A
Development Stage Entity)

NEVADA(State or other jurisdiction of
incorporation or organization)

33-0879853(IRS Employer ID No.)


2075 Corte del Nogal, Suite B
Carlsbad, California 92009
(760) 431-2206(Address and telephone number of principal executive offices)

Securities
registered under Section 12(b) of the Exchange Act: NONE

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

Common Stock, $0.001 par value

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. / / Yes /x/ No

Check
if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of
registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this
Form 10-KSB. /x/

At
March 31, 2001, there was no market value of the voting stock of the Registrant as, to date, there has been no trading on any stock exchange in the Registrant's common stock,

At
March 31, 2001, there were 10,292,000 shares of the registrant's Common Stock, $0.001 par value, issued and outstanding.

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Forward Looking Statements

In addition to historical information, this Annual Report on Form 10-KSB may contain forward-looking statements that involve a number of
risks and uncertainties, including those discussed below at "Risks and Uncertainties." While this outlook represents management's current judgment on the future direction of the business, such risks
and uncertainties could cause actual results to differ materially from any future performance suggested below. Readers are cautioned not to place undue reliance on the forward-looking statements,
which speak only as of the date of this Annual Report. The Company undertakes no obligation to publicly release any revisions to forward-looking statements to reflect events or circumstances arising
after the date of this document. See "Risks and Uncertainties." References in this Annual Report on Form 10-KSB to "Com-Guard.com" and the "Company" are to
Com-Guard.com, Inc.

PART I

Item 1.  Description of Business.

Com-Guard.com, Inc. (the "Registrant" or the "Company") was incorporated as e-World Security, Inc. in the State of Nevada
on October 7, 1998. The Company's name was changed to Com-Guard.com, Inc. and filed on April 16, 1999.

The
Registrant has limited operating history. The principal business of the Registrant is the exploitation of niche products for the microcomputer industry that provide enhanced
system security for both individual users and network administrators. The Company's initial product, Com-Guard, includes unique software and hardware that will enable users to
protect and limit access to data; and to provide a security system against tampering and unauthorized use of computers.

Com-Guard
is able to lock down data files so that if there is a security violation locally or on the net the intruder will not be able to read the files in the
Com-Guard protected area. The Company's Web-Guard product will keep unauthorized users from using their browser and therefore limit their access to the internet.

The
Registrant's present business address is 2075 Corte del Nogal, Suite B, Carlsbad, California 92009.

Overview.

Com-Guard.com, Inc. will provide a group of products, called Com-Guard, to provide users of personal computers with
(1) internet security, (2) file and hardware security, and (3) internal facility security.

The
Com-Guard system monitors a computer or network and detects, through proprietary software and hardware, unauthorized attempts to use, tamper with, or remove data or
equipment. The system is designed to generate an alarm and a message, which can be sent to any receiving device, including pagers, telephones, other computers, etc.

The
market for Com-Guard consists of individual users and industry. The popularity of the Internet has created a need for both data security and access limitations.
Limiting access to sensitive and/or confidential files has grown to be a need for all users of microcomputers.

Home
automation, including systems to provide "internal" security to certain areas of a home or office, represents an additional market for Com-Guard. The system,
installed in a PC, has the ability to function as an internal home security system, controlling a series of sensors to protect against theft and intrusion, and can be utilized for child safety, etc.

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The Company is managed by experienced individuals who have worked in the microcomputer industry for many years.

The Product.

Com-Guard is a PC-based hardware/software system. It provides features to provide security for computers, networks, and home/office
environments.



Com-Guard
will be offered in several configurations depending upon the need of the individual customer. Com-Guard will consist of three products:
(1) Com-Guard-local version, including Com-Guard hardware and Soft-Guard software; (2) Com-Guard-network version, including
Com-Guard hardware, Soft-Guard, and network client/server software; (3) Soft-Guard-software only; and (4) Web-Guarda software
package to provide limiting access to the browser will be free.

The Market.

The U.S. personal computer industry consists of thousands of computer manufacturers, assemblers, OEMs, and peripheral/parts producers. Their products are sold
and supported by a variety of
distributors, resellers, systems integrators, retail merchants, and service companies. Saturating markets and increasing competition is forcing vendors to seek new users in homes, small businesses and
classrooms with revamped marketing strategies and lower cost computers. The information on the size of the PC Computer Industry and network market is considered pertinent because the Registrant cannot
sell and install a Com-Guard board and its related software unless there are Personal Computers that are installed.

Shipments
of personal computers (including desktops, network servers, and portables) exceeded 25 million in 1996, while revenues were over $60 billion, according to
Dataquest. This included

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computers manufactured in the United States by domestic and foreign firms, plus imported systems. PCs with Pentium processors represented over 70 percent of shipments. In 1996, the U.S.
installed base of personal computers grew to 85 million units.

According
to recent research, market growth in the 10 to 20 percent range will continue into the new century, with annual unit shipments approaching 60 million by the
year 2002. By this time, computer use in the United States will be substantially more pervasive, especially in homes and educational institutions, and will impact more human activities. Consumer sales
will define the market as telecommuting, electronic commerce, digital home "infotainment" systems, and Internet access attain high levels of market penetration. There will be more types of computers,
from single use to multi-purpose devices, networks will be all encompassing (including in the home), and the use of portable and wireless technologies will be widespread.

With
the exception of anticipated growth in sales via electronic commerce (the Internet, TV shopping networks, etc.), there should be minimal shifts in market share among the various
distribution channels. The outlets with the highest projected growth through 2000 are the large computer, office product, and consumer electronics superstores. These large retailers will focus on
providing more product support and services to their customers. Direct response and mail order sales are also expected to do well. The channels that may be most negatively affected by current trends
toward consolidating marketing and selling at the national level will be small operations, like computer specialty stores and VARs, which will lose market clout.

Major
vendors are beginning to target small businesses, which form the least penetrated, fastest growing business sector. Market drivers include the improved availability of PCs in
consumer outlets at attractive prices and new efforts by major vendors to address the problems faced by these companies, most of which have limited resources and technical know-how. Sales
to the more than 6 million firms with less than 100 employees in the United States constitute the largest share of shipments to the business sector, rising to an estimated 42 percent by
the year 2000. The small business sector represents more than 60 percent of business employees.

Sales
to the nation's 100 million U.S. households jumped dramatically in 1994 and 1995. Growth during this period averaged 30 percent per year. Besides price, this
sector is driven by growth in telecommuting and home businesses, improved consumer software, and more recently, the popularity of the Internet and online information services. Vendors are beginning to
base computer designs on consumer preferences and needs and to promote these features, rather than solely pushing technology and performance. About 35 percent of the 100 million U.S.
households owned personal computers in 1996, while one-fourth of all PC households had multiple computers.

Sales
of PCs to educational institutions in the United States during 1996 exceeded 1.8 million units, about 8 percent of total shipments for the year. Although there is
a high number of PCs in the computer labs and libraries of K-12 schools, personal computers have not yet visibly penetrated the classroom for instructional purposes. Additional funding,
more curriculum-based software, lower prices, and intensified training and technical awareness among teachers and administrators should lead to greater growth in this sector.

National,
state and local governments are a small, but growing, market segment, representing about 8 percent of total units shipped in 1996 and 10 percent of server
sales, according to Dataquest. Unit shipments exceeded 1.9 million and were valued over $4.3 billion. There is an estimated installed base of over 3 million PCs in the Federal
Government, over 90 percent of which are connected to LANs. Future demand at all levels of government will be stimulated by greater emphasis on enhancing employee productivity and the ongoing
modernization of government programs.

Networking
is having an increasingly profound effect on the PC industry, from local area networks (LANs) and wide area networks to the Internet and intranets. Over half of the
business PCs in the

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United States are now connected via a LAN and 80 percent of all organizations with more than 100 employees have a LAN installed according to International Data Corporation ("IDC"). Networking
and client/server technologies have enabled the personal computer to play a greater role in mission-critical business functions, which expands its value to companies and reduces the status of legacy
mainframe and midrange systems. LAN functions are graduating from traditional print sharing, file transfer, and e-mail uses to transaction processing, management support, and Internet
access applications. Users are also seeking to link LANs to wider areas to accommodate regional offices and to provide remote access to home workers.

Like
multimedia in the early 1990s, the Internet is creating a revolution in the way PCs are used in organizations and households. In 1996 the number of Internet users worldwide was
estimated at 50 million, and the number has been growing exponentially. In 1999, there were approximately 100 million users. After traditional business applications, the Internet could
historically be the biggest driver of PC sales, especially in the home, as the World Wide Web takes on more electronic commerce and consumer applications. Since the Internet is a global phenomenon,
demand for PCs and network
servers will be stimulated in all regions. Although the United States accounts for about two-thirds of the over 13 million host computers on the Internet, other countries are
creating sites at a fast pace, led by Japan and Western Europe. Organization-specific intranets are also gaining popularity. It has been estimated that over 90 percent of Fortune 1000 companies
have either established or plan to establish an intranet. These are closed or tightly controlled networks within the Internet that are used for e-mail, information dissemination, and other
business functions.

According
to Dataquest, the global market for personal computers is over $168 billion. Unit shipments have been growing at an annual rate of 70 million, feeding an
installed base of over 228 million machines. The largest national markets were the United States (36 percent of global shipments) and Japan (11 percent), followed by the major
Western European countries. Regionally, North America represented 39 percent of the world market, Western Europe, 23 percent, and Asia, most of the rest.

Sources
used in the above analysis are: Dataquest. (http://www.dataquest.com); and IDC.,
(http://www.idcresearch.com).

Increased
use of the internet and of enterprise-wide internal networks increases the complexity of the IT environment, which requires the use of IT security tools. Some of
the tools used most often for network and data security have been commercially available for over a decade. Newer technologiesthose moving away from standard hardware and software
password protectionare now being introduced to the marketplace.

A
recent IDC survey of businesses revealed that security is of paramount concern in the enterprise. Increased use of the Internet and corporate growth are among the most significant
business drivers for adding security; and there was little evidence that these pressures would change over the next several years.

The
IDC survey also covered the priority given by respondents to securing assets. Other than virus protection, which has been addressed by dozens of products over the past few years,
the most important concern was corruption of data and unwanted disclosure of data.

Finally,
the IDC report indicated a general dissatisfaction with the usability and integration of current security technologies, which represents an opportunity for
Com-Guard and associated technologies.

Business Strategy.

The Company's fundamental strategy is to position its Com-Guard product as a preferable method of PC security to end-users, businesses,
and institutions worldwide.

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Prior to the Company acquiring the worldwide rights to the product, Guardtec, Inc. (formerly, Kyungki System Co. Ltd.) had sold over 5,000 units of an earlier version of
Com-Guard.

Production
of the product and inventory procurement have been arranged with the original Korean developer/manufacturer. The Korean developer/manufacturer will be used to manufacture
the Com-Guard product, assuming that price and delivery will be agreed to by both parties. Management believes that its costs will remain competitive with alternative sources of supply. In
any case, the Company does not, at this time, plan to build its own manufacturing capability and will continue to outsource Com-Guard inventories. The principal supplier as mentioned, will
be Guardtec, Inc. The Company believes that there are many contract manufacturing companies that would bid on manufacturing the Com-guard product.

End-user
marketing will focus on providing a limited version of the product over the Company's internet site. In this way, the product is exposed to a broad sector of the
market that would match the profile of our consumer. Customers could order broadened feature sets of the product direct from the Company, or from resellers, who might stock the product in stores.

Com-Guard
will be made available to selected resellers either as a branded product or under private-label arrangements. The product would be merchandised for sale with new
computer systems or as an add-on product to existing PC owners. The Company intends to use standard distribution such as major distributors, specialty distributors in the enterprise area
and computer resellers located throughout the United States.

The
Company's sales force will be responsible for selling direct to business and commercial accounts' principally Fortune 1000 companies whose needs for the product have been
validated by the research.

The
Company will plan and execute an integrated advertising public relations campaign to promote Com-Guard, including participation in trade shows and seminars, and
frequent use of consumer and trade publications.

Neither
the Company nor anyone acting on behalf of the Company, to date, has taken any affirmative steps to request or encourage any broker-dealer to act as a market-maker for the
Company's securities.

Competition.

While many security products for the PC are available, most are either inadequate or too costly for general consumption and use. Most products are either
costly "firewall" systems for internet management, or software products that rely on complex encryption technologies or password protection, which has proven both cumbersome and inadequate.
Furthermore, existing technologies do not combine the features of data security as well as theft protection; and no PC product combines the features of Com-Guard along with an interior
security system (for home or office).

Firewall
products are designed to keep out potential intruders and encryption products are used to scramble or otherwise render data "unreadable." Com-Guard was designed
to detect an intrusion and notify the owners. The Soft-Guard product coupled with Com-Guard will detect unauthorized use, report the intrusion and prevent the unauthorized
intruder from accessing data in the Com-Guard protected area, using Soft-Guard.

Consequently,
the Company believes that Com-Guard is well-positioned in features and price, which can provide it a competitive position in a market of
considerable size.

The
Company's management has extensive experience in outsourcing computer hardware products and believes that there is a lot of competition for manufacturing computer related hardware
boards. The components for Com-Guard are widely available from multiple manufactures.

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Companies generally compete by advertising product features and having products tested by independent product reviewers and testing companies. The Company will pursue these avenues
for competing with their products.

Intellectual Property.

The Company has a patent in the United States (Application number 09/030,993), which covers the implementation of Com-Guard hardware. Copyright
applications will be filed on all software developed for the system. The Intellectual Property covers the use of a hardware board which has a device to determine when the computer had been moved or
tampered with. The Company has spent $582,000 on research and development over the last two fiscal years.

Employees.

The Company is in the development stage. However, the Company has engaged a total of seven (7) consultants at June 30, 2000, of whom three were
in corporate administration and finance, three in engineering and research and development, and one in sales and marketing.

Reports to security holders.

The
Company is not now fully reporting. The Company will deliver this Form 10-KSB as its annual report to its shareholders. The Company intends to report its
quarterly and annual financial results to the Securities and Exchange Commission ("SEC"). The last report filed by the Company was for the period ended March 31, 2000. As soon as possible
following this Form 10-KSB, the Company intends to file quarterly reports for the periods ended September 30, 2000, and December 31, 2000.

Accordingly,
the public may read and copy any materials filed by the Company with the SEC at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. The
public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an internet site that contains
reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC (http://www.sec.gov). The Company's internet address is
www.com-guard.com.

Risks and uncertainties.

Lack of Operations and Profitability.The Company is in the development-stage and commenced pre-operating
activities approximately one year ago. It has no history of operations or profits in the industries in which it participates.

Uncertainty of Commercial Success and Changing Technology.Although the Company is optimistic about its revenue and
profitability prospects, there can be no assurance of commercial success of its Com-Guard product. Furthermore, the computer industry is characterized by rapid change and growth. There can
be no assurance that the Company will be able to keep up with the pace of technological change or fund its growth.

Competition.The Company is subject to competition from other companies that may try to emulate or compete with similar
products or services. These competitors have been in the business longer than the Company and may have large executive and operating staffs. There can be no assurance that the Company's prospects will
not be adversely affected by competition from these companies.

Need for Additional Financing.The Company will require additional financing in order to establish profitable, ongoing
operations; there is no assurance that such financing will be available or, if available, that it can be obtained on terms favorable to the Company.

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Dependence on Management.The Company is largely dependent upon the efforts and abilities of Dr. Edward W.
Savarese and there can be no assurance that the Company can be successful in operating the Company should the services of Dr. Savarese be unavailable. Dr. Savarese has had extensive
experience in marketing, sales and financing. He has managed for Hewlett-Packard and has extensive contacts in the computer industry.

Dividends.The Company has never paid a cash dividend on its common stock. The Company is not obligated to pay a
dividend on its common stock and does not anticipate payment of any dividends for the foreseeable future. The Company anticipates retaining its earnings to finance its operations, growth, and
expansion.

No Assurance of Public Market; Potential Volatility of Stock Price.There currently is no public trading market for the
Company's common stock. There can be no assurance that an active public trading market can be established or sustained. Furthermore, if a public market for the common stock is established, the shares
could be subject to significant fluctuations in response to operating results and other factors, many of which are not within the control of the Company.

Dependence on Proprietary Technology; Risks of Third Party Infringement Claims.Although the Company has received
patent protection, there can be no assurance that the Company's measures to protect its current proprietary rights will be adequate to prevent misappropriation of such rights or that the Company's
competitors will not independently develop or patent technologies that are substantially equivalent to or superior to the Company's technologies. Additionally, although the Company believes that its
products and technologies do not infringe upon the proprietary rights of any third parties, there can be no assurance that third parties will not assert infringement claims against products and
technologies that the Company licenses, or has the rights to use, from third parties. Any such claims, if proved, could materially and adversely affect the Company's business and results of
operations. In addition, though any such claims may ultimately prove to be without merit, the necessary management attention to, and legal costs associated with litigation or other resolution of such
claims could materially and adversely affect the Company's business and results of operations.

Item 2.  Description of Property.

The Company occupies approximately 1,800 square feet of space in a facility located at 2075 Corte del Nogal, Suite B, Carlsbad, CA 92002, at a monthly rental
rate of $1,466. The lease expires on November 30, 2001. Monthly rental on this facility is subject to annual rent adjustments based on the Consumer Price Index (CPI). The Company owns no real
property.

Item 3.  Legal Proceedings.

None.

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

None.

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PART II

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

There currently is no established public trading market for the Company's common stock. Once the Company is current with its reports to the SEC and is
fully-reporting, it will take steps to have its common stock traded on a public exchange.

1,055,000
shares of the Company's common stock is subject to outstanding options or warrants to purchase, or securities convertible into the Company's common stock. There are
1,055,000 of shares of common stock reserved for outstanding options and warrants to purchase common stock.

By
virtue of Rule 3a51-1 of the Securities Act of 1934 (the "Act"), if the Company's common stock has a price of less than $5.00 per share it will be considered a
"penny stock." The perquisites required of broker-dealers engaging in transactions involving "penny stocks" have discouraged, or even barred, many brokerage firms from soliciting orders for certain
low priced stocks.

Still
further, with respect to the trading of penny stocks, broker-dealers have an obligation to satisfy certain special sales practice requirements pursuant to
Rule 15g-9 of the Act, including a requirement that they make an individualized written suitability determination for the purchase and receive the purchaser's written consent prior
to the transaction.

Still
even further, such broker-dealers have additional disclosure requirements as set forth in the Securities Enforcement Act Remedies and Penny Stock Reform Act of 1990. These
disclosure requirements include the requirement for a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document that provides information about penny
stocks and the risks of the penny stock market.

Still
even further, a broker-dealer must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in
the transaction, and
monthly account statements showing the market value of each penny stock held in the customer's account.

Accordingly,
the above penny stock regulations and the associated broker-dealer requirements may have an adverse effect on the market liquidity of the Company's common stock and the
ability of any present and prospective shareholder investors to sell their securities on the secondary market.

However,
regardless of the price of the Registrant's stock, in the event the Company has net tangible assets in excess of $2,000,000 and if the Company has been in continuous
operation for at least three (3) years, or net tangible assets of $5,000,000, if the Company has been in continuous operation for less than three (3) years,
Rule 3a51-1(g) of the Act will preclude the Company's common stock from being classified as a "penny stock."

Dividends.

The Company has never paid any cash dividends on its capital stock. The Company currently anticipates that it will retain all available earnings for use in the
operation and expansion of its business, and does not anticipate paying any cash dividends in the foreseeable future.

Recent Sales of Unregistered Securities; Use of Proceeds From Registered Securities.

The Company has had several stock issuances. All such shares were sold by the Company, by its officers and directors, and no underwriters were utilized.
Reference is made to the financial statements and notes to the financial statements from Inception through June 30, 2000 incorporated in this Form 10-KSB and to Item 4 of the
Company's Form 10-SB/A4, filed September 29, 2000.

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During the period from Inception to June 30, 1999, the Company issued 9,094,500 shares of its common stock. Of these, 5,000,000 shares were issued for a total offering of
$5,000, 1,024,500 were issued for cash ($0.20 to $1.00 per share) pursuant to a Regulation D, Rule 504 offering, 560,000 shares were issued for the purchase of research of development
($0.20 to $1.00 per share), and 2,510,000 were issued for services rendered to the Company ($0.02 to $1.00 per share).

With
respect to the issuance of 8,070,000 common shares above, such issuances were made in reliance upon the private placement exemptions provided by Section 4(2) of the Act
and the Nevada Statutes.

During
the period from June 30, 1990 to June 30, 2000, the Company issued 786,500 shares of its common stock. Of these, 550,000 were issued ($1.00 to $1.50 per share)
pursuant to a Regulation D, Rule 504 offering. 26,500 shares of common stock were issued for services ($1.00 per share), and 210,000 shares of common stock were issued to convert
outstanding notes payable and interest ($1.00 per share).

With
respect to the issuance 1,024,500 and 550,000 common shares above, such issuances were made in reliance on the private placement exemptions provided by Section 4(2) of the
Securities Act of 1933 as amended, (the "Act"), SEC Regulation D, Rule 504 of the Act and Nevada Revised Statutes Sections 78.211, 78.215, 78.3784, 78.3785 and 78.3791 (collectively the
"Nevada Statutes").

The
Company has relied upon the private placement exemptions from registration provided by Section 4(2) of the Securities Act of 1933 as amended (the "Act") and SEC
Regulation D, Rule 504 of the Act. With respect to the Rule 504 exemption, this type of offering is available to issuers who are not reporting companies, investment companies or
"blank check" companies. Accordingly, this offering was available to the Company. A further requirement is that the offering may not exceed $1,000,000 in any twelve (12) month period. There is
no limitation on the number of purchasers nor is there a requirement that such purchasers be accredited investors. All of the shares issued pursuant to Rule 504 offering satisfied these
requirements.

Those
shares not issued pursuant to Rule 504 were issued pursuant to Section 4(2) of the Act, which exempts from registration transactions by an issuer not involving a
public offering. This offering exemption is available to any issuer but prohibits general solicitation or advertising. Prospective purchasers must have access to information about the issuer. The
Company utilized this Section 4(2) exemption by providing prospective purchasers with such sufficient information and required that all such purchasers be financially sophisticated; have a
certain net worth and have the ability to bear the risk of loss of their respective investments.

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

The following discussion and analysis should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this
Annual Report on Form 10-KSB. The discussion of the Company's business contained in this Quarterly Report on Form 10-KSB may contain certain projections,
estimates and other forward-looking statements that involve a number of risks and uncertainties, including those discussed above at "Risks and Uncertainties." While this outlook represents
management's current judgment on the future direction of the business, such risks and uncertainties could cause actual results to differ materially from any future performance suggested below. The
Company undertakes no obligation to release publicly the results of any revisions to these forward-looking statements to reflect events or circumstances arising after the date hereof.

Overview.

The Company was incorporated as e-World Security, Inc. in the State of Nevada on October 7, 1998. The Company's name was changed to
Com-Guard.com, Inc. and filed on April 16, 1999.

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The Company has limited operating history and is in the development stage. It's principal business is the exploitation of niche products for the microcomputer industry that provide
enhanced system security for both individual users and network administrators. The Company's initial product, Com-Guard, includes unique software and hardware that will enable users to
protect and limit access to data; and to provide a security system against tampering and unauthorized use of computers.

The
Com-Guard system monitors a computer or network and detects, through proprietary software and hardware, unauthorized attempts to use, tamper with, or remove data or
equipment. The system is designed to generate an alarm, which can be sent to any receiving device, including pagers, telephones, and other computers.

The
market for Com-Guard consists of individual users and industry. The popularity of the internet has created a need for both data security and access limitations.
Limiting access to sensitive and/or confidential files has grown to be a need for all users of microcomputers.

Home
automation, including systems to provide "internal" security to certain areas of a home or office, represents an additional market for Com-Guard. The system,
installed in a PC, has the ability to function as an internal home security system, controlling a series of sensors to protect against theft and intrusion, and child safety.

The
Company's business continues to be the development phase. Accordingly, quarter-to-quarter financial comparisons may be of limited usefulness now and for
the next several quarters as the Company prepares to launch and market its first products.

The
Company's current strategy is to develop, commercialize and distribute its products. To successfully execute its strategy, the Company will need to improve its working capital
position. The Company needs to raise additional funds to fully develop its business. There can be no assurance, however, that the Company will be able to complete any additional debt or equity
financing on favorable terms or at
all, or that any such financings, if completed, will be adequate to meet the Company's capital requirements. Any additional equity or convertible debt financings could result in substantial dilution
to the Company's stockholders. If adequate funds are not available, the Company will be required to delay, reduce or eliminate some or all of its planned activities. The Company's inability to fund
its capital requirements would have a material adverse effect on the Company. Also See "Risks and Uncertainties" in Part I of this Annual Report on Form 10-KSB.

Results of Operations.

Net Revenues.

Revenues were $3,996 for the year ended June 30, 2000 and $7,024 for the period from October 7, 1998 (Date of Inception) to June 30, 2000.
The Company has not begun sales of its products and all revenues for the periods described were from interest earned from bank deposits.

Research and Development Expenses.

For the year ended June 30, 2000, research and development expenses were $190,937. For the period from October 7, 1998 (Date of Inception) to
June 30, 2000, research and development expenses were $582,428. Included in these figures is $560,000 of research and development, prior to March 31, 1999, relating to the acquisition of
core product technology, which was made through the issuance of common stock.

Provision to Write Down Inventories.

During the year ended June 30, 2000, the Company wrote-down inventories based on management's planned marketing, distribution, and pricing
strategies of the related products.

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General and Administrative Expenses.

General and administrative expenses for the year ended June 30, 2000 were $1,036,004. General and administrative expenses for the period from
October 7, 1998 (Date of Inception) to June 30, 2000 were $1,240,228. These expenses grew during the year ended June 30, 2000 due to several factors related to building the
business, including increases in expenses related to facilities and staff. More specifically, general and administrative expenses included consulting fees of $626,928, inventory provisions of
$154,755, and related costs for general corporate functions, including finance, accounting, facilities, legal, marketing-related expenses, and fees for professional services.

Liquidity and Capital Resources.

The Company is in the development stage and has financed its operations primarily through cash generated from the sale of its stock.

As
of June 30, 2000, the Company had a working capital deficit of ($167,843) as compared to working capital of $261,865 at June 30, 1999. The decrease of $429,708 (or
156%) in working capital is due primarily to accumulated operating losses totaling $1,815,632 during development of its business. During the year ended June 30, 2000, the Company raised capital
of $700,000 in cash, and $56,500 in services, which has been the Company's principal source of liquidity since its inception. Additionally, $210,000 in notes payable, including interest, was converted
to common stock during the year ended June 30, 2000.

The
Company's auditors have expressed their uncertainty as to the Company's ability to continue as a going concern. They cite the minimal capital resources available to meet existing
and anticipated obligations. In order to address this uncertainty, the Company has taken steps to raise additional funds to finance its operations.

At
June 30, 2000, the Company had no material commitments for capital expenditures. However, in December 2000, the Company issued a purchase order for PCI circuit
boards. The purchase order is for 6,000 units at a cost of $100 each.

11

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Item 7. Financial Statements.

|Independent Auditor's Report                                  |  | 13
|------------------------------------------------------------- |  | --
|Balance Sheet                                                 |  | 14
|Statements of Operations                                      |  | 15
|Statements of Changes in Stockholders' Net Capital Deficiency |  | 16
|Statements of Cash Flows                                      |  | 17
|Notes to Financial Statements                                 |  | 18
|Consent of Independent Public Accountant                      |  |   

12

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Independent Auditors' Report

Board
of Directors
COM-GUARD.COM, INC.

We
have audited the accompanying balance sheet of COM-GUARD.COM, INC. (a Nevada corporation) as of June 30, 2000 and the related statements of operations,
changes in stockholders' net capital deficiency and cash flows for the year then ended, from Inception (October 7, 1998) through June 30, 1999, and from Inception (October 7,
1998) through June 30, 2000. These statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these statements based on our audit.

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

In
our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of COM-GUARD.COM, INC. as of
June 30, 2000 and the results of its operations and cash flows for the year then ended, from Inception (October 7, 1998) through June 30, 1999, and from Inception
(October 7, 1998) through June 30, 2000, in conformity with generally accepted accounting principles.

The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. However, the Company has minimal capital resources presently
available to meet obligations that normally can be expected to be incurred by similar companies, and with which to carry out its planned activities. These factors raise substantial doubt about the
Company's ability to continue as a going concern. Management's plans in regard to this matter are discussed in Note 3. The financial statements do not include any adjustments that might result
from the outcome of this uncertainty.

MANUEL J. RAMIREZ, C.P.A.

January 30, 2001 and March 30, 2001 (for subsequent events)
Irvine, California

13

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COM-GUARD.COM, INC.  (A Development Stage Entity)    BALANCE SHEETS

|                                     |                                                                                                                                                | 6/30/00                      |         | 6/30/99    |         
|------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------- | ------- | ---------- | --------
|
|ASSETS                               |                                                                                                                                               
|Current assets                       |                                                                                                                                                |                              |         |            |         
|                                     | Cash and cash equivalents                                                                                                                      |                              | $       | 7,834      |         
|                                     | Vendor advance to purchase inventory                                                                                                           |                              |         |           |         
|                                     | Inventories                                                                                                                                    |                              |         | 483,414    |         
|                                     | Prepaid expenses                                                                                                                               |                              |         |           |         
|                                     |                                                                                                                                                |                              |         |            |         
|                                     |                                                                                                                                                | Total current assets         |         |            | 491,248 
|                                     |                                                                                                                                                |                              |         |            |         
|Fixed assets                         |                                                                                                                                                |                              |         |            |         
|                                     | Furniture and equipment                                                                                                                        |                              |         | 34,612     |         
|                                     | Accumulated depreciation                                                                                                                       |                              |         | (10,179    | )       
|                                     |                                                                                                                                                |                              |         |            |         
|                                     |                                                                                                                                                | Furniture and equipment, net |         |            | 24,433  
|                                     |                                                                                                                                                |                              |         |            |         
|                                     |                                                                                                                                                | $                            | 515,681 |            | $       
|                                     |                                                                                                                                                |                              |         |            |         
|LIABILITIES AND SHAREHOLDERS' EQUITY |                                                                                                                                               
|Current liabilities                  |                                                                                                                                                |                              |         |            |         
|                                     | Accounts payable and accrued liabilities                                                                                                       |                              | $       | 659,091    |         
|                                     | Notes payable                                                                                                                                  |                              |         |           |         
|                                     |                                                                                                                                                |                              |         |            |         
|                                     |                                                                                                                                                | Total current liabilities    |         |            | 659,091 
|                                     |                                                                                                                                                |                              |         |            |         
|Stockholders' equity                 |                                                                                                                                                |                              |         |            |         
|                                     | Common stock, $0.001 par value, 100,000,000 shares authorized; 9,881,000 and 9,094,500 shares issued and outstanding at June 30, 2000 and 1999 |                              |         | 9,881      |         
|                                     | Additional paid-in capital                                                                                                                     |                              |         | 1,885,419  |         
|                                     | Stockholder loans and advances                                                                                                                 |                              |         | (223,078   | )       
|                                     | Accumulated deficit during development                                                                                                         |                              |         | (1,815,632 | )       
|                                     |                                                                                                                                                |                              |         |            |         
|                                     |                                                                                                                                                | Total shareholders' equity   |         |            | (143,410
|                                     |                                                                                                                                                |                              |         |            |         
|                                     |                                                                                                                                                | $                            | 515,681 |            | $       
|                                     |                                                                                                                                                |                              |         |            |         

See
notes to financial statements.

14

---

COM-GUARD.COM, INC.  (A Development Stage Entity)    STATEMENTS OF OPERATIONS

|                                                    |                             | Year ended June 30,
2000 |            | October 7, 1998
(Inception) to
Dec. 31, 1999 |   | October 7, 1998
(Inception) to
June 30, 2000 |        
|--------------------------------------------------- | --------------------------- | ------------------------ | ---------- | -------------------------------------------- | - | -------------------------------------------- | -------
|Revenues                                            |                             |                          |            |                                              |   |                                              |        
|                                                    | Interest                    |                          | $          | 3,996                                        |   | $                                            | 3,028  
|                                                    |                             |                          |            |                                              |   |                                              |        
|Costs and expenses                                  |                             |                          |            |                                              |   |                                              |        
|                                                    | Research and development    |                          |            | 190,937                                      |   |                                              | 391,491
|                                                    | General, and administrative |                          |            | 1,036,004                                    |   |                                              | 204,224
|                                                    |                             |                          |            |                                              |   |                                              |        
|                                                    |                             |                          | 1,226,941  |                                              |   | 595,715                                      |        
|                                                    |                             |                          |            |                                              |   |                                              |        
|Net loss                                            |                             | $                        | (1,222,945 | )                                            | $ | (592,687                                     | )      
|                                                    |                             |                          |            |                                              |   |                                              |        
|Net loss per share available to common shareholders |                             |                          |            |                                              |   |                                              |        
|                                                    | Basic and Diluted           |                          | $          | (0.13                                        | ) | $                                            | (0.07  
|                                                    |                             |                          |            |                                              |   |                                              |        
|Weighted average common shares                      |                             |                          | 9,386,718  |                                              |   | 7,983,917                                    |        

See
notes to financial statements.

15

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COM-GUARD.COM, INC.  (A Development Stage Entity)    STATEMENT OF CHANGES IN STOCKHOLDERS' NET CAPITAL DEFICIENCY

|                   |                            | Common Stock |           |   |       |       |   |           |         |   |         
|------------------ | -------------------------- | ------------ | --------- | - | ----- | ----- | - | --------- | ------- | - | --------
|
|
|Issuance of Stock: |                            |              |           |   |       |       |   |           |         |   |         
|                   | Cash$0.002/share          |              | 5,000,000 |   | $     | 5,000 |   | $         | 5,000   |   | $       
|                   | Services$0.02/share       |              | 2,440,000 |   |       | 2,440 |   |           | 46,360  |   |         
|                   | Cash$0.20/share           |              | 540,000   |   |       | 540   |   |           | 107,460 |   |         
|                   | Services$0.20/share       |              | 25,000    |   |       | 25    |   |           | 4,975   |   |         
|                   | Purchase R&D$0.20/share   |              | 250,000   |   |       | 250   |   |           | 49,750  |   |         
|                   | Cash$0.50/share           |              | 325,000   |   |       | 325   |   |           | 162,175 |   |         
|                   | Cash$1/share              |              | 159,500   |   |       | 160   |   |           | 159,340 |   |         
|                   | Services$1/share          |              | 45,000    |   |       | 45    |   |           | 44,955  |   |         
|                   | Purchase R&D$1/share      |              | 310,000   |   |       | 310   |   |           | 309,690 |   |         
|                   | Capital as services        |              | 0         |   |       | 0     |   |           | 30,000  |   |         
|                   | Stockholder loans/advances |              |          |   |       |      |   |           |        |   |         
|                   | Net loss                   |              |          |   |       |      |   |           |        |   |         
|                   |                            |              |           |   |       |       |   |           |         |   |         
|Balance, 6/30/99   |                            | 9,094,500    |           |   | 9,095 |       |   | 919,705   |         |   | (55,000 
|Issuance of Stock: |                            |              |           |   |       |       |   |           |         |   |         
|                   | Cash$1/share              |              | 250,000   |   |       | 250   |   |           | 249,750 |   |         
|                   | Services$1/share          |              | 26,500    |   |       | 26    |   |           | 26,474  |   |         
|                   | Cash$1.50/share           |              | 300,000   |   |       | 300   |   |           | 449,700 |   |         
|                   | Conversionnotes$1/share  |              | 210,000   |   |       | 210   |   |           | 209,790 |   |         
|                   | Capital as services        |              | 0         |   |       | 0     |   |           | 30,000  |   |         
|                   | Stockholder loans/advances |              | 0         |   |       | 0     |   |           | 0       |   |         
|                   | Net loss                   |              |          |   |       |      |   |           |        |   |         
|                   |                            |              |           |   |       |       |   |           |         |   |         
|Balance, 6/30/00   |                            | 9,881,500    |           | $ | 9,881 |       | $ | 1,885,419 |         | $ | (223,078
|                   |                            |              |           |   |       |       |   |           |         |   |         

See notes to financial statements.

16

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COM-GUARD.COM, INC.  (A Development Stage Entity)    STATEMENT OF CASH FLOWS

|                                                                         |                                              | Year ended
June 30, 2000                 |                                    | October 7, 1998
(Inception) to
Dec. 31, 1999 |          | October 7, 1998
(Inception) to
June 30, 2000 |        
|------------------------------------------------------------------------ | -------------------------------------------- | ---------------------------------------- | ---------------------------------- | -------------------------------------------- | -------- | -------------------------------------------- | -------
|Cash flows from operating activities                                     |                                              |                                          |                                    |                                              |          |                                              |        
|Net loss                                                                 |                                              | $                                        | (1,222,945                         | )                                            | $        | (592,687                                     | )      
|Adjustments to reconcile net loss to net cash from operating activities: |                                              |                                          |                                    |                                              |          |                                              |        
|                                                                         | Depreciation                                 |                                          |                                    | 8,583                                        |          |                                              | 1,596  
|                                                                         | Stock issued for services                    |                                          |                                    | 26,500                                       |          |                                              | 98,800 
|                                                                         | Stock issued for research and development    |                                          |                                    |                                             |          |                                              | 360,000
|                                                                         | Services provided as contributed capital     |                                          |                                    | 30,000                                       |          |                                              | 30,000 
|                                                                         | Provision for inventory write-down           |                                          |                                    | 154,755                                      |          |                                              |       
|                                                                         | Changes in operating assets and liabilities |                                          |                                    |                                              |          |                                              |        
|                                                                         |                                              | Vendor advance                           |                                    |                                              | 50,000   |                                              |        
|                                                                         |                                              | Inventory                                |                                    |                                              | (638,169 | )                                            |        
|                                                                         |                                              | Prepaid expenses                         |                                    |                                              | 2,500    |                                              |        
|                                                                         |                                              | Accounts payable and accrued liabilities |                                    |                                              | 657,171  |                                              |        
|                                                                         |                                              |                                          |                                    |                                              |          |                                              |        
|                                                                         |                                              |                                          | Net cash from operating activities |                                              |          | (931,605                                     | )      
|Cash flows from investing activities                                     |                                              |                                          |                                    |                                              |          |                                              |        
|                                                                         | Capital expenditures                         |                                          |                                    | (13,768                                      | )        |                                              | (20,844
|                                                                         |                                              |                                          |                                    |                                              |          |                                              |        
|Cash flows from financing activities                                     |                                              |                                          |                                    |                                              |          |                                              |        
|                                                                         | Proceeds from issuance of stock              |                                          |                                    | 700,000                                      |          |                                              | 440,000
|                                                                         | Proceeds from issuance of notes payable      |                                          |                                    | 200,000                                      |          |                                              |       
|                                                                         | Stockholder loans and advances               |                                          |                                    | (168,078                                     | )        |                                              | (55,000
|                                                                         |                                              |                                          |                                    |                                              |          |                                              |        
|                                                                         |                                              | Net cash from financing activities       |                                    |                                              | 731,922  |                                              |        
|Net increase (decrease) in cash and cash equivalents                     |                                              |                                          | (213,451                           | )                                            |          | 221,285                                      |        
|Cash and cash equivalents                                                |                                              |                                          |                                    |                                              |          |                                              |        
|                                                                         | Beginning of period                          |                                          |                                    | 221,285                                      |          |                                              |       
|                                                                         |                                              |                                          |                                    |                                              |          |                                              |        
|                                                                         | End of period                                |                                          | $                                  | 7,834                                        |          | $                                            | 221,285
|                                                                         |                                              |                                          |                                    |                                              |          |                                              |        
|Supplemental disclosure of cash flow information:                        |                                              |                                          |                                    |                                              |          |                                              |        
|                                                                         | Interest paid                                |                                          | $                                  |                                             |          | $                                            |       
|                                                                         | Taxes paid                                   |                                          | $                                  |                                             |          | $                                            |       

---

On
June 30, 2000, notes and accrued interest totaling $210,000 were converted into common stock at $1.00 per share.

In
conjunction with this conversion, warrants to purchase 200,000 shares at $1 per share were issued, but remain outstanding.

See
notes to financial statements.

17

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COM-GUARD.COM, INC.  (A Development Stage Entity)    NOTES TO FINANCIAL STATEMENTS

1.  THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES

The Company.The Company was formed and incorporated in the state of Nevada on
October 7, 1998 as e-WORLD SECURITY, INC. On April 16, 1999 the Company changed its name to COM-GUARD.COM, INC. Planned principal operations of the
Company have not yet commenced; activities to date have been limited to forming the Company, assembling a management and consultant team, identifying markets, developing products, and obtaining
initial capitalization. The Company intends to sell products that afford security protection to computer hardware and software in microcomputers. The Company's initial product, Com-Guard,
includes unique software and hardware that will enable users to protect and limit access to data; and to provide a security system against tampering and unauthorized use of computers.

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

Shares Issued in Exchange for Services.The fair value of shares issued in exchange for
services rendered to the Company was determined by the Company's officers and directors.

Work in Process Inventory.Inventories are stated at the lower of cost (first-in,
first-out) or market.

Furniture and Equipment.Furniture and equipment is stated at cost. Additions, renovations, and
improvements are capitalized. Maintenance and repairs which do not extend asset lives are expensed as incurred. Depreciation is provided on a straight-line basis over estimated useful
lives (3 years).

Organization Costs.Organization costs of approximately $10,000 have been charged against
operating income.

Research and Development.Research and development, which includes purchased research and
development and internal costs incurred on the technology are expensed as incurred. Statement of Financial Accounting Standards No. 86 (SFAS-86, "Accounting for the Costs of
Computer Software to Be Sold, Leased, or Otherwise Marketed") does not materially effect the Company because the Company has elected to expense as research and development all such costs prior to
establishing technological feasibility as required by FAS 86. Management expects technological feasibility to be established upon completion of beta testing.

Stock-Based Compensation.In accordance with the provisions of Statement of Financial Accounting Standards
No. 123, "Accounting for Stock-Based Compensation," ("FAS 123"), the Company has elected to follow Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees," ("APB 25") and related interpretations in accounting for its employee stock option plans. Under APB 25, if the exercise price of the Company's employee stock options equals or exceeds the
fair value of the underlying stock on the date of grant, no compensation is recognized. Information regarding the Company's pro forma disclosure of stock-based compensation pursuant to FAS 123
may be found in Note 5.

Income Taxes.The Company has made no provision for income taxes because of financial statement
and tax losses since its inception. A valuation allowance has been used to offset the

18

---

recognition of any deferred tax assets due to the uncertainty of future realization. The use of any tax loss carryforward benefits may also be limited as a result of changes in Company ownership.

Fair Value of Financial Instruments.The Company considers all liquid interest-earning
investments with a maturity of three months or less at the date of purchase to be cash equivalents. Short-term investments generally mature between three months and six months from the
purchase date. All cash and short-term investments are classified as available for sale and are recorded at market using the specific identification method; unrealized gains and losses are
reflected in other comprehensive income. Cost approximates market for all classifications of cash and short-term investments; realized and unrealized gains and losses were not material.

Net Loss Per Common Share.Basic loss per common share ("Basic EPS") excludes dilution and is
computed by dividing net loss available to common shareholders (the "numerator") by the weighted average number of common shares outstanding (the "denominator") during the period. Diluted loss per
common share ("Diluted EPS") is similar to the computation of Basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if
the dilutive potential common shares had been issued. In addition, in computing the dilutive effect of convertible securities, the numerator is adjusted to add back the after-tax amount of
interest recognized in the period associated with any convertible debt. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive
effect on net loss per share. For the periods ended June 30, 2000 and 1999, all potential common shares are anti-dilutive; therefore, Basic EPS equals Diluted EPS.

Concentration of Credit Risk.The Company maintains cash and cash equivalents with a single
financial institution. The Company performs periodic evaluations of the relative credit standing of the financial institution. The Company has not sustained any material credit losses from these
instruments.

2.  PURCHASED RESEARCH AND DEVELOPMENT

On January 14, 1999, the Company acquired from Guardtec, Inc. (formerly Kyungki System Co., Ltd.), a Korean corporation, the right, title,
and interest to certain technology including copyrights, trademarks, patents, object codes, source codes, enhancements, and updates or other modifications and user manuals. As consideration for this
acquisition of technology, the Company issued 560,000 shares of its common stock. The acquisition of technology is reflected in the accompanying financial statements as research and development
because technological feasibility was not established and the technology has no alternative future use.

On
July 20, 1999, the U.S. Patent and Trademark Office issued a patent on the technology acquired for common stock as discussed above.

3.  COMMITMENTS AND CONTINGENCIES

Going Concern Considerations.The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. However, the Company has minimal capital resources presently available to meet obligations that normally can be expected to be incurred by similar
companies, and with which to carry out its planned activities. These factors raise substantial doubt about the Company's ability to continue as a going concern. Management is seeking additional equity
financing to fund planned operations; management believes actions currently being taken provide the opportunity for the Company to operate. However, there is no assurance that the Company will be able
to obtain such financing. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

19

---

Lease Commitment.In November 1999, the Company entered into an agreement for the lease
of operating facilities. The lease agreement provides for monthly payments of $1,466 through November 2001.

4.  RELATED PARTY TRANSACTIONS

Consulting Services.During the period ended June 30, 1999, the Company incurred $78,800
in fees from related parties, including an officer and director, for various corporate and administrative services. Payment was made in the form of cash ($51,800) and stock (2,725,000 shares.)

During
the period ended June 30, 2000, the Company incurred $358,300 in fees from related parties, including an officer and director, for various corporate and administrative
services. Payment was made in the form of cash ($169,300) plus accrued liabilities ($189,000). (See Contributed Capital in Note 5.)

Rent.During the periods ended June 30, 2000 and 1999, the Company incurred rent expense
of $15,000 under a short-term facility lease with an officer and director of the Company. This leasing agreement was terminated in November 1999 in connection with the lease of
facilities discussed in Note 3.

Inventory.During the year ended June 30, 2000, the Company purchased work in process
inventory from a vendor who is a stockholder of the Company. As of June 30, 2000, the Company has recorded a provision of $154,755 to reduce the value inventory to the lower of cost or market.

Stockholder Loans and Advances.From time to time, the Company loans or advances monies to
officers and directors for travel, personal expenditures, and other matters. At June 30, 2000, the loans and advances totaled $223,078. These loans are non-interest bearing and are
classified as a reduction of stockholders' equity in the accompanying financial statements. On July 1, 2000 the advances were converted to an interest bearing note. (See Note 6)

5.  STOCKHOLDERS' NET CAPITAL DEFICIENCY

Stock Options.During the period ended June 30, 1999, the Company granted
non-qualified stock options to certain advisors, consultants and directors to purchase up to 1,605,000 shares of the Company's common stock at an exercise price equal to market value at
date of grant as determined by the Board of Directors. During the period ended June 30, 2000, the Company granted 200,000 non-qualified stock options upon the conversion of notes
payable to certain note holders. All options vested immediately upon grant.

The
following is a summary of the stock option activity:

Granted

$0.02-$1.00

1,605,000Exercised

$0.02-$0.50

(750,000
)Outstanding, June 30, 1999

$0.02-$1.00

855,000Granted

$1.00

200,000Exercised



Outstanding, June 30, 2000



1,055,000


Stock-Based Compensation.The Company recognized no stock-based compensation during the periods
ended June 30, 2000 and 1999. There would be no material difference to compensation cost had the compensation cost been computed under FAS 123.

20

---

Convertible Notes.During the fiscal quarter ended March 31, 2000, the Company issued
three convertible notes together totaling $200,000. The notes bore interest at 7% and matured one year from the date of issuance. On June 30, 2000, these notes and accrued interest of $10,000
were converted into common stock at $1.00 per share. Warrants to purchase 200,000 shares at $1 per share remain outstanding.

Contributed Capital.The president elected to forgo his salary through December 31,
1999. The value of the services, determined as equal to his forgone salary of $60,000, has been treated as contributed capital.

6.  SUBSEQUENT EVENTS

Since June 30, 2000, the Company sold 20,000 shares of stock at $1.00 per share. An additional 111,000 shares of restricted stock were issued for
services.

On
July 1, 2000 an officer and director entered into a 7% note payable for $223,078 with interest and principal due no later than June 30, 2002. Subsequent to
July 1, 2000, $40,000 of this note has been repaid to the Company.

On
December 19, 2000, the Company entered into a Share Purchase Agreement for 150,000 restricted shares of the Company's common stock with Guardtec, Inc. The purchase
price was for $1.00 per share. The Agreement also calls for registration of the shares in the future.

On
December 25, 2000, the Company entered into a Technology License Agreement with Guardtec, Inc. for certain computer security software known as "GTC Firewall." The
Company paid for the license with 150,000 shares of its restricted common stock.

In
December 2000, the Company issued a purchase order for a new series of circuit boards. The purchase order is for 6,000 units at a cost of $100.00 each.

21

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PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons.

|Name               |  | Age |  | Position                              |  | Term   |  | Served Since 
|------------------ |  | --- |  | ------------------------------------- |  | ------ |  | -------------
|Edward W. Savarese |  | 54  |  | President and Chief Executive Officer |  | Annual |  | Inception    
|Edward H. Currie   |  | 59  |  | Director                              |  | Annual |  | June 25, 1999

Dr. Edward W. Savarese is the founder of the Company and has been a director and Chairman of the Board of Directors since its inception.
He held the position of Chief Executive Officer of Imaging Technologies Corporation (formerly Personal Computer Products, Inc.) from 1982 to 1998. From 1981 to 1982, he was director of sales
for SofTech Microsystems. His responsibilities included establishing and supervising an international sales organization for marketing a microcomputer operating system. From 1978 to 1981,
Dr. Savarese was employed by Hewlett Packard Company, first as a sales representative for computer products, and later as district sales manager supervising a sales force in the marketing of
mini- and microcomputers. Dr. Savarese holds a Doctorate degree from Columbia University, Teacher's College, with specialization in educational technology and software and systems
design. He also holds a Master of Science in administration and management from Pace University.

Dr. Edward
H. Currie has been a director of the Company since June 25, 1999. He has more than twenty years of senior management experience in domestic and international
microcomputer-related software publishing and hardware manufacturing. Since 1988, Dr. Currie has been president and chief executive officer of ImageSoft, Inc., an international software
publisher. From 1981 to 1988, he was chairman, president, and chief executive officer of Lifeboat, a software publishing company. From 1978 to 1981, Dr. Currie served as vice president of
product management for the Microsystems Division of Pertec Computer Corp., a supplier of magnetic tape storage devices and microcomputer peripherals. From 1975 to 1978, he was Executive Vice President
and General Manager for MITS, the creator of the first microcomputer personal computer, which was subsequently acquired by Pertec. Dr. Currie is a co-founder of PC Magazine, the
largest circulation magazine on the personal computer. He also is the founder of C++ Journal and publisher of The PostScript Journal. He has published many articles, including technical articles in
U.S. and international trade magazines. He holds BSEE, MS Physics, and Ph.D. Physics from the University of Miami.

Dr. Savarese
will be employed on a full time basis for the Registrant. Mr. Currie will be employed on a part time as needed basis.

Item 10. Executive Compensation.

Other than Dr. Savarese, there was no executive or director who has received compensation in excess of $100,000 since the incorporation date of the
Company.

Summary Compensation Table

|                     |  |      |  | Annual Compensation |  | Long Term Compensation |   |    
|-------------------- |  | ---- |  | ------------------- |  | ---------------------- | - | ---
|
|
|Edward Savarese, CEO |  | 2000 |  | 120,000             |  | 165,000(a              | ) | -0-

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The Registrant has no agreements with its directors for the payment of director fees.

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Option/SAR Values

|Name               |  | Shares Acquired
on Exercise |  | Value
Realized |  | Number of Securities Underlying
Unexercised Options/SARs
at FY-End |     | Unexercised In-the-
Value of
Money Options/SARs
at FY-End
|------------------ |  | --------------------------- |  | -------------- |  | ------------------------------------------------------------------ | --- | ---------------------------------------------------------
|Edward W. Savarese |  | -0-                         |  | -0-            |  | 500,000                                                            | (1) | $                                                        
|Edward H. Currie   |  | -0-                         |  | -0-            |  | 50,000                                                             | (1) | $                                                        

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

Title of Class

Name and Address of Beneficial
Owner

Amount and Nature of
Beneficial Relationship

Percent of ClassCommon

Edward W. Savarese(1)
2003 Caracol Court
Carlsbad, CA 92009

5,200,000

52.6
%Common

Edward H. Currie(2)
6-57 158th Street
Whitestone, NY 11357

75,000

0.7
%Common

Directors and officers as a group (2 persons)

5,275,000

53.3
%


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Item 12. Certain Relationships and Related Transactions.

During the period ended June 30, 1999, the Company incurred $78,800 in fees from related parties, including an officer and director, for various
consulting and administrative services. Payment was made in the form of cash ($51,800) and stock (2,725,000 shares.)

During
the period ended June 30, 2000, the Company incurred $358,300 in fees from related parties, including an officer and director, for various consulting and administrative
services. Payment was made in the form of cash ($169,300) plus accrued liabilities ($189,000).

During
the periods ended June 30, 2000 and 1999, the Company incurred rent expense of $15,000 under a short-term facility lease with an officer and director of the
Company. This leasing agreement was terminated in November 1999.

During
the year ended June 30, 2000, the Company purchased $638,169 of work in process inventory from a vendor who is a stockholder of the Company. As of June 30, 2000,
the Company has recorded a provision of $154,755 to reduce the value inventory to the lower of cost or market.

From
time to time, the Company loans or advances monies to officers and directors for travel, personal expenditures, and other matters. At June 30, 2000, the loans and advances
totaled $223,078. These loans and advances are non-interest bearing and are classified as a reduction of stockholders' equity in the accompanying financial statements. On July 1,
2000 the advances were converted to an interest bearing note.

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

None.

Exhibits.

| |  | (3a)  |  | Articles and Bylaws of the Company incorporated by reference to Exhibits 2 and 2.3 of Form 10-SB/A1 dated April 11, 2000.                                      
| |  | ----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | (3b)  |  | Certificate of Amendment of Articles of Incorporation of e-World Security, Inc. incorporated by reference to Exhibit 2.1 of Form 10-SB/A1 dated April 11, 2000.
| |  | (10a) |  | Technology Purchase Agreement incorporated by reference to Exhibit 6.1 of Form 10-SB/A1 dated April 11, 2000.                                                  
| |  | (10b) |  | Consulting Agreement incorporated by reference to Exhibit 6.2 of Form 10-SB/A1 dated April 11, 2000.                                                           
| |  | (10c) |  | Consulting Agreement between the Company and Edward Savarese, dated October 1, 2000, effective July 1, 1999.                                                   
| |  | (10d) |  | Consulting Agreement between the Company and Edward Currie, dated March 13, 2001, effective July 1, 1999.                                                      
| |  | (10e) |  | Consulting Agreement between the Company and Joseph Sigismonti, October 1, 2000, effective July 1, 1999.                                                       
| |  | (10f) |  | Share Purchase Agreement between the Company and Guardtec, Inc., dated December 19, 2000.                                                                      
| |  | (10g) |  | Technology License Agreement between the Company and Guardtec, Inc., dated December 25, 2000.                                                                  
| |  | (27)  |  | Financial Data Schedule                                                                                                                                        

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.

|Dated: May 15, 2001 |  |                                                                                                             
|------------------- |  | ------------------------------------------------------------------------------------------------------------
|COM-GUARD.com, INC. |  |                                                                                                             
|By:                 |  | /s/EDWARD W. SAVARESEEdward W. Savarese Chief Executive Officer
(Principal Financial and Accounting Officer)

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Supplemental Information to be Furnished With Reports Filed Pursuant to Section 15(d) of the Exchange Act By Non-reporting Issuers

The Company has not, to date, provided an annual report or proxy statement to its shareholders. The Company plans to provide a copy of this
Form 10-KSB to its shareholders within thirty (30) days of its filing with the SEC.

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