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


                                   FORM 10-KSB


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

                      For the year ended December 31, 2000

                                  MAXXON, INC.
             (Exact name of registrant as specified in its charter)


          Oklahoma                       0-28629                 73-1526138
          --------                       -------                 ----------
(State or other jurisdiction of       (SEC File Number)        (I.R.S. Employer
 incorporation or organization)                           Identification Number)

                        8908 South Yale Avenue, Suite 409
                              Tulsa, Oklahoma 74137
          (Address of principal executive offices, including zip code)

                                 (918) 491-7557
              (Registrant's telephone number, including area code)

                                 (918) 492-2560
              (Registrant's facsimile number, including area code)


Securities to be registered pursuant
to Section 12(b) of the Act:            NONE

Securities to be registered pursuant
to Section 12(g) of the 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

         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 ]

         State issuer's revenues for its most recent fiscal year:      $-0-

         State the aggregate  market value of the voting and  non-voting  common
equity held by  non-affiliates  computed by  reference to the price at which the
common  equity  was sold,  or the  average  bid and asked  price of such  common
equity,  as of a specified  price  within the past 60 days.  $13,753,710  as of
March 31, 2001

         State the number of shares  outstanding of each of the issuer's classes
of common equity,  as of the latest  practicable  date: As of March 31, 2001, we
had 18,818,110 shares of common stock, $0.001 par value, outstanding.


<PAGE>
Certain  Forward-Looking  Information

         Certain  statements  included in this report  which are not  historical
facts are forward-looking  statements,  including the information  provided with
respect to future business opportunities, expected financing sources and related
matters.  These  forward-looking  statements are based on current  expectations,
estimates,  assumptions  and  beliefs of  management.  Words such as  "expects,"
"anticipates,"  "intends,"  believes,"  "estimates" and similar  expressions are
intended to identify such forward-looking statements.  Since this information is
based on current  expectations  that  involve  risks and  uncertainties,  actual
results  could differ  materially  from those  expressed in the  forward-looking
statements.


                                     Part I

Item 1.  Description of Business

         (a)  Business Development.

         1. Form and Year of Organization. We are a Nevada corporation organized
on August 16, 1996 under the name Cerro Mining  Corporation.  On May 9, 1997, we
entered into a Merger  Agreement with Maxxon,  Inc., a  privately-held  Oklahoma
corporation  that owned the rights to a proprietary  disposable  safety  syringe
that retracts the needle into the barrel of the syringe after use ("Maxxon-OK").
After  receiving  approval from a majority of our  shareholders  and Maxxon-OK's
shareholders,  we issued  7,578,000  shares of our common  stock for 100% of the
issued and outstanding common stock of Maxxon-OK and changed our name from Cerro
Mining  Corporation to Maxxon,  Inc.  Maxxon-OK ceased to exist by reason of the
Merger. The Merger was effective May 20, 1997.

         Present  Business  Objective.  Our  present  business  objective  is to
develop and market a  commercially  viable  hypodermic  syringe that reduces the
risk of accidental  needlestick injuries.  These injuries pose a serious risk of
transmitting fatal or chronic diseases to healthcare  workers.  We are presently
developing a safety syringe. We have not yet begun the FDA approval process.

         2. Bankruptcy or  Receivership.  Maxxon has never been in bankruptcy or
receivership.

         3.  Mergers, Reclassifications and Purchases of Assets.

Our Present Safety Syringe Development Efforts
----------------------------------------------
         On November 18, 1999, we purchased from Mr.  Wayland  Rippstein and his
associates,  Lynn Carter and Ken Keltner,  the  exclusive  worldwide  license to
develop,  manufacture  and  market  his then  patent-pending  disposable  safety
syringe  that  automatically  retracts the needle into the barrel of the syringe
immediately  after an injection has been given. A copy of the Rippstein  License
was filed as an exhibit to our Form 10-SB dated  December 22,  1999.  The Maxxon
Safety SyringeTM  accomplishes the needle retraction by a vacuum. As the syringe
is being used, a vacuum is created and when the plunger is released,  the needle
is forced into the  interior of the barrel by the  pressure  differential.  Once
inside, the needle will remain indefinitely,  substantially reducing the risk of
accidental  needlestick  injuries. On February 27, 2001, the patent covering Mr.
Rippstein's  syringe  design was published by the U.S.  Patent  Office.  Details
regarding our License  Agreement with Mr. Rippstein and associates are discussed
in  Item  7.  "Patents,  Trademarks,   Licenses,  Royalty  Agreements  or  Labor
Contracts".



                                        2
<PAGE>

History of Our Safety Syringe Development Efforts
-------------------------------------------------
         Since  1997,  we have been  working  to develop a  commercially  viable
safety syringe. On April 30, 1997, prior to the Merger,  Maxxon-OK purchased the
exclusive  license to a patented  safety  syringe  owned by Mr.  Harry  Kaufhold
("Kaufhold  Syringe").  Maxxon-OK paid Mr. Kaufhold  $10,000 at execution of the
License  Agreement,  plus a $90,000  promissory  note,  which we paid in full on
March 1, 1998. The rights and obligations  under this License  Agreement  became
ours by reason of the  Merger.  A copy of the License  Agreement  is attached as
Exhibit 6.5.

         To facilitate the development and marketing of the Kaufhold Syringe, we
entered  into a  Development  Agreement,  dated June 9, 1998 with Texas  Applied
Biological Sciences ("TABS") and Hartzell  Manufacturing,  Inc.  ("Hartzell") to
refine and produce a prototype of the Kaufhold Syringe.  A copy of the agreement
was  filed  as an  exhibit  to our Form  10-SB  dated  December  22,  1999.  The
Development  Agreement required the completion of the Kaufhold Syringe prototype
by September  1998.  On October 19, 1999, we received 2 prototypes of the safety
syringe  which TABS claimed were working  prototypes.  TABS advised us that this
delivery completed its obligations under the Development Agreement,  even though
TABS  advised us that  additional  optimization  of the molds  would be required
before production molds could be made.

         In  November,  1999,  after  more than 2 years of  efforts to produce a
viable,  usable, working prototype of the safety syringe based on Mr. Kaufhold's
design,  our Board of Directors  determined  to  discontinue  this  effort.  The
License  Agreement with Mr.  Kaufhold  expired on April 30, 1999 because we were
not able to produce or market a syringe based on his design. Although we believe
that TABS and Hartzell  breached the  Development  Agreement dated June 9, 1998,
our Board  determined that  management's  time and our resources would be better
spent developing the Rippstein syringe.

         Acquisition   and   Disposition   of   Ives   Health   Company,    Inc.
-------------------------------------------------------  On August 18, 1997,  we
completed a share  exchange  transaction  with Ives Health  Company,  Inc. ("Old
Ives"),  a  privately-held  Oklahoma  corporation that markets a line of natural
remedies and homeopathic  medicines  primarily  through retail pharmacy outlets.
Pursuant to that  Agreement,  we issued 586,600 shares of our common stock,  par
value $.001 per share,  in exchange  for all the issued and  outstanding  common
stock of Old Ives. The  shareholders  of Old Ives consisted of Keith Ives and 32
individual investors. Keith Ives received 320,360 shares of our common stock and
the 32  individual  investors  received a total of 266,240  shares of our common
stock.  As a  result  of the  transaction,  Old  Ives  became  our  wholly-owned
subsidiary. A copy of the Agreement and Plan of Exchange was filed as an exhibit
to our Form 10-SB dated December 22, 1999.

         After  trying  unsuccessfully  to obtain  financing  for Old  Ives,  we
entered into an  agreement  to rescind the share  exchange on December 31, 1997.
Under the Rescission Agreement,  which was filed as an exhibit to our Form 10-SB
dated  December 22, 1999.  we  organized a new Oklahoma  corporation  named Ives
Health  Company,  Inc.  ("Ives") and transferred Old Ives into Ives. We received
1,700,000  shares of Ives common  stock,  which at that time  represented  about
19.5% of Ives' outstanding common stock and Keith Ives received 7,000,000 shares
(or 80.5%) of Ives common  stock.  Keith Ives  resigned as a director,  officer,
employee,  agent and representative of Maxxon and gave back to us 275,360 shares
of the 320,360 shares of our common stock that he received in the share exchange
transaction. A copy of the Rescission Agreement is attached as Exhibit 6.8.

         Ives began  reporting  under the Securities Act of 1934 on November 22,
1999 and its common  stock  began  trading on the OTC  Bulletin  Board under the
symbol IVEH on May 25, 2000. On June 2, 2000, we contacted  Ives' transfer agent
to remove the  restrictive  legend on the 1,000,000  shares of Ives common stock
still owned by us (the other 700,000  shares were  transferred  in early 2000 to
our employees as payment for their services). We believed

                                        3
<PAGE>

that we had  satisfied  Rule  144  requirements  when we first  contacted  their
transfer  agent.  On July 6, 2000,  we filed suit  against Ives and its transfer
agent to remove the  restrictive  legend and to  recover  damages  caused by the
delay in removing the  restrictions.  Ives  countersued  us alleging  failure of
consideration  and fraudulent  inducement.  On October 31, 2000, Maxxon and Ives
agreed to end the litigation.  As part of the settlement,  a total of 500,000 of
the original  1,700,000 shares of Ives common stock issued to us was returned to
Ives (294,118 shares were returned by us and 205,882 shares were returned by our
employees).  Ives agreed to drop its  countersuit  and to remove the restrictive
legend on the Ives shares.  To pay our expenses  related to the Ives litigation,
we transferred  141,176 of our remaining Ives shares to our legal counsel.  Upon
settlement  and at December 31,  2000,  we owned  564,705  shares of Ives common
stock. During February,  2001, we sold 397,500 shares of Ives common stock at an
average price of $0.43 per share, for $169,030.46 in cash.

         On March 5, 2001,  the SEC suspended  trading in Ives common stock.  On
March 19, 2001, Ives began trading on the Pink Sheets.  As of March 31, 2001, we
still owned  167,205  shares of Ives common  stock.  There is no assurance  that
there  will be  sufficient  trading  volume for us to sell our  remaining  stock
position. In addition, there is no assurance that the price at which we sell our
remaining stock position will equal or exceed or even approach the $0.43 average
per share price we received for the 397,500  shares we sold in  February,  2001.
Based upon the uncertainty surrounding the future value of Ives common stock, we
determined  that our ownership of Ives common stock had no value at December 31,
2000 and we adjusted our investment in Ives common stock to zero.

The Health Club, Inc.
---------------------
         On  August  18,  1997,  in  connection  with  the Ives  Health  Company
transaction described above, we issued 35,000 shares of our common stock for all
of the issued and outstanding common stock of The Health Club, Inc. ("THC"),  an
Oklahoma corporation  organized for the planned multi-level marketing operations
of Old Ives.  The sole officer,  director and  shareholder  was Keith Ives. As a
result of the transaction, THC became our wholly-owned subsidiary. We valued the
stock  portion of the  transaction  at  $54,950,  or $1.57 per share,  which was
determined by Maxxon's Board of Directors to be the fair value of the restricted
stock issued in the  transaction.  The closing price of Maxxon's common stock on
the date of the transaction was $2.50 per share and the Board  determined that a
35% discount was appropriate for the restricted  stock issued.  Maxxon also paid
Keith Ives $10,000 in  connection  with the  transaction.  On December 31, 1997,
when Maxxon and Ives Health Company entered into the Rescission  Agreement,  the
Board reduced the value of THC to $45,000, which represented the $10,000 in cash
paid and 35,000 shares issued at $1.00 per share,  the closing price of Maxxon's
common  stock on December  30,  1997.  For two years  following  the  Rescission
Agreement,  Keith Ives had the right to unwind our  acquisition of THC by paying
Maxxon  $10,000 and by returning to us the 35,000  shares of Maxxon common stock
issued to Keith Ives in connection  with our acquisition of THC. At December 31,
1999,  Keith Ives did not  exercise his right.  For the year ended  December 31,
1999, we reduced the value of THC to $0, after the Board  determined  THC had no
future value to Maxxon.

(b)  Business of Issuer

1.  Principal Products and Services of Maxxon and Their Markets

Principal Product
-----------------
         Maxxon  has no  products  or  services  for  sale at this  time.  It is
anticipated  that the  Safety  Syringe  will be  marketed  when  development  is
completed  and FDA approval is secured.  The Safety  Syringe is the only product
Maxxon has in development.

         The Maxxon  Safety  Syringe is designed to be a disposable  retractable
syringe that uses a proprietary, patented technology whereby a vacuum causes the
needle to retract  into the barrel of the syringe  after an  injection is given.
The  Safety  Syringe  is  designed  to  be  a   cost-effective   alternative  to
traditionally  constructed  disposable  syringes  and is  intended  to avoid the
danger of accidental  needle  puncture  associated with  traditional  disposable
syringes.  With a traditional  disposable  syringe, a needle contaminated with a
patient's  blood  remains a danger to health  care  professionals  handling  the
needle until it is  permanently  disposed of in a proper  biohazard  containment
unit.  We believe the Maxxon  Safety  Syringe,  as designed,  will not present a
"needle  stick"  hazard  to  health   professionals   after  use,   because  the
contaminated needle is retracted into the barrel of the syringe after use.

                                        4
<PAGE>
Market for Our Product
----------------------
         The  world-wide  market for  disposable  syringes is estimated to be in
excess of 12 billion units annually.  There are over 2,400 needle sticks per day
in the United  States  alone,  according  to the San  Francisco  Chronicle,  and
approximately 76% of accidental needle sticks could be prevented by an effective
safety  syringe,  according to the Centers for Disease  Control.  Every  clinic,
hospital,  doctor's  office,  laboratory,  public  health  department,   medical
research facility,  medical school and retail purchaser of syringes for diabetes
and other home uses is a potential  customer for the Maxxon Safety  Syringe,  if
and when developed, approved by the FDA and available commercially.

2.       Distribution Method of Products and Services

         We have not yet determined how the Safety Syringe will be  distributed.
We do not presently have any manufacturing or distribution capacity. We have not
determined the commercial arrangements under which we would be willing to engage
a manufacturer or a corporate marketing partner.

3.  Status of Publicly Announced Products or Services

         On April 28, 2000, we entered into a Development Agreement with Genesis
Design  Group,  located in Simi  Valley,  California,  to design  and  produce a
prototype of the Maxxon Safety Syringe.  A copy of the Development  Agreement is
attached as Exhibit 10.11. On December 13, 2000, Genesis delivered the prototype
that functioned  according to  specifications.  On February 21, 2001, we entered
into a one-year consulting agreement with Genesis Design Group to assist us with
the  manufacturer  of the injection molds and the development of a manufacturing
process for the safety  syringe.  A copy of the agreement is attached as Exhibit
10.17

         On March 26, 2001, we announced that Artistic  Plastics,  Inc., located
in  Anaheim,  California,  was  selected  produce  the  injection  molds for the
syringe.  Once  syringes  are  produced,  they will be used to collect  the data
required to submit our  application for FDA approval and will be used as samples
for potential distributors. We have not yet submitted our application to the FDA
for approval,  but we expect that such  application will be submitted by the end
of 2001.  We do not know how long it will take for us to receive  FDA  approval.
There is no assurance that the FDA will approve our safety syringe.

4.  Competitive Business Conditions, Competitive Position and Methods of
Competition

         Competition in the medical  products and services  industry is intense.
Although  growth in the  medical  industry  in general  and sales of  disposable
safety  syringes in particular is expected to grow and expand as the  population
ages, the number of potential  competitors in the marketplace  makes competitive
pressures severe. In particular, the medical device industry has attracted large
and sophisticated  potential competitors with established brand names which have
greater  financial,   technical,   manufacturing,   marketing,   regulatory  and
distribution resources than Maxxon.

         There is no known  cost-competitive  safety  syringe  available  in the
market today. Although there are other safety syringes  commercially  available,
the  cost of  these  alternative  safety  syringes  makes  them  impractical  as
alternatives  to  traditional  disposable  syringes.  Unless the  Maxxon  Safety
Syringe can be manufactured  and sold at wholesale at a price  competitive  with
current  disposable  syringes,  the Maxxon  Safety  Syringe  will not be able to
compete  effectively  in the  marketplace.  Although we believe  that our Safety
Syringe can be manufactured to be cost  competitive,  there is no assurance that
we will be successful.

         Our  primary   potential   competitors   are  the   manufacturers   and
distributors of existing  syringes  currently  available in the marketplace.  In
particular,  we estimate that Becton-Dickinson controls much of the distribution
of the disposable  syringe market in the US. If  Becton-Dickinson  or any of our
other  established  competitors  were to  develop  or  acquire a safety  syringe
technology  that  could  produce a safety  syringe at a price  competitive  with
disposable  syringes,  our  ability to  compete  would be  materially  adversely
affected.

5.  Sources of Raw Materials and the Names of Principal Suppliers

         We do  not  presently  manufacture  any  products,  so we  have  no raw
materials requirements. The materials used to make the Maxxon Safety Syringe are
commercially available from a number of suppliers.  The manufacturing process is
highly  technical  and  demanding  with very low fault  tolerances.  There is no
assurance that we will be able to engage a company capable of manufacturing  the
safety syringe in a cost-effective manner.

                                        5
<PAGE>
6.  Dependence on One or Few Major Customers

         We  anticipate  that our safety  syringe will be marketed to the entire
field of medical  professionals.  We do not  anticipate  being  dependent on any
particular  customer.  We do not know if any one customer  will account for more
than 1% of our safety syringe sales.

7.  Patents, Trademarks, Licenses, Royalty Agreements or Labor Contracts

         Patents.  On February 27,  2001,  the patent  covering Mr.  Rippstein's
syringe  design was  published  by the U.S.  Patent  Office.  We do not own this
patent.  This patent is owned by Mr.  Rippstein and his associates,  Ken Keltner
and Lynn Carter.

         The  Rippstein  License.  On November 18, 1999,  we purchased  from Mr.
Wayland  Rippstein  and his  associates,  the  exclusive  worldwide  license  to
develop,  manufacture  and  market  his then  patent-pending  disposable  safety
syringe  that  automatically  retracts the needle into the barrel of the syringe
immediately  after  an  injection  has  been  given.  We paid  them  $10,000  in
reimbursable  patent  costs and  agreed to pay them a total of  $200,000  if the
following  events  occur by September  30,  2001(1) a U.S.  patent  covering the
syringe is issued,  (2) a fully functional and working  prototype of the syringe
is completed,  and (3) FDA approval to sell the syringe in the U.S. is obtained.
However,  if FDA  approval is not received by  September  30, 2001,  but we have
begun selling syringes in places that do not require FDA approval,  then we will
pay  them the  $200,000  out of the  first  net  profits  from the sale of those
syringes.  If such events have not occurred by September 30, 2001,  then we will
not be obligated to pay the $200,000 at all. The Rippstein  license provides for
us to pay  royalties  of 4% of  gross  sales  of  syringes  and  minimum  annual
royalties ranging from $10,000 to $20,000 beginning on the 4th anniversary after
both a working prototype syringe is developed and a U.S. patent is issued.  Such
royalties  continue for the life of the last to expire patent,  if issued. If we
enter into any sublicense, distribution or other marketing arrangements, then we
will  pay to the  Licensor  10% of any  fees  received  by us  pursuant  to such
sublicense, distribution or marketing arrangements.

         Options  Granted  Pursuant to the  Rippstein  License.  On November 18,
1999,  the  Board of  Directors  of  Maxxon  granted  to Mr.  Rippstein  and his
associates  options to purchase a total of  1,600,000  shares of common stock of
Maxxon at an exercise  price of $0.50 per share,  which was the closing price of
our common stock on the day the Rippstein  License was signed.  Of the 1,600,000
options granted, 800,000 were granted to Mr. Rippstein, and 400,000 were granted
each to Mr.  Carter and Mr.  Keltner.  The options  expire  October 31, 2009 and
become  exercisable in stages upon the occurrence of the following  events:  (1)
Options to purchase 320,000 shares are exercisable  immediately;  (2) Options to
purchase  320,000 shares are exercisable when a fully working safety syringe has
been produced (3) Options to purchase 320,000 shares are exercisable when a U.S.
Patent covering the Rippstein Syringe is issued; (4) Options to purchase 320,000
shares  are  exercisable  when  the  first  syringe  is  produced  from the hard
production molds and is ready for full scale production; (5) Options to purchase
320,000  shares are  exercisable  when FDA approval is  obtained.  In any event,
options to purchase all 1,600,000 shares become exercisable,  even if the events
described in items (1) through (5) do not occur beforehand,  if Maxxon sells the
Ripp Syringe Technology or if Maxxon is acquired by another company.  On October
27,  2000,  Mr.  Carter  and Mr.  Keltner  assigned  their  options  to  Petroxx
Resources, Inc.

         Technical Consulting Agreement with Wayland Rippstein.  On November 18,
1999, Maxxon entered into a Technical  Consulting  Agreement with Mr. Rippstein.
Mr. Rippstein  agreed to provide us technical design and consulting  services to
achieve startup of production of the Maxxon Syringe, to secure the issuance of a
U.S. patent and all other intellectual  property  protections,  and to meet with
potential investors, funding sources, strategic alliance partners,  distributors
and licensors.  We paid him $12,500 upon execution of the Agreement,  and agreed
to pay  him  the  balance  of  $37,500  when  the  following  milestones  in the
development  of the syringe were achieved:  (1) $12,500 upon the  manufacture of
the first fully  operational  working  syringe  prototype  and (2) $25,000  upon
production  of  syringes  from the steel  molds.  On March 1, 2001,  we paid Mr.
Rippstein  $12,500 because the first  operational  working syringe prototype had
been produced.

                                        6
<PAGE>
         Broker-Dealer  Selling  Agreement.  On December 18,  2000,  we signed a
Broker-Dealer  Selling  Agreement  on  with  RichMark  Capital  Corporation,   a
registered  broker-dealer.  A copy of the  Broker-Dealer  Selling  Agreement  is
attached as Exhibit  10.12.  The  Agreement  provides  that  RichMark  receive a
commission  of ten  percent  (10%) of the sales  price of shares  sold,  a three
percent  (3%)  non-accounted  expense  allocation  and a two  percent  (2%)  due
diligent fee. On December 31, 2000, we began an Offering  Regulation D, Rule 506
offering to sell up to 4,000,000  Units at a price of $0.25 per Unit.  Each Unit
consists of one share of Common Stock and one Common Stock purchase warrant that
expires on December 31, 2005.

         Employment  Agreements.  On January 3, 2001,  we entered  into  written
employment  agreements  with Gifford Mabie,  our sole officer and director,  and
Rhonda Vincent,  Thomas Coughlin and Vicki Pippin,  our employees.  The material
terms of their respective  employment  agreements are the same,  except that Mr.
Mabie's  employment  agreement  states he will not compete  with us for one-year
after he  resigns  voluntarily  or is  terminated  for  cause.  If Mr.  Mabie is
terminated  without  cause or if he  resigns  because  a change of  control  has
occurred,  then the non-compete  clause of his employment  agreement will not be
applicable.  The  employment  agreements  are attached as Exhibits 10.13 through
10.16.

         The term of each employment  agreement is for one year,  ending January
3, 2002 with an  automatic  and  continuous  renewal  for  consecutive  two year
periods.  Each  agreement  can be ended either by us or by the employee  upon 30
days' written notice.  Each agreement  provides for an annual salary of at least
$100,000 with an annual  salary  increase  equal to no less than the  percentage
increase in the Consumer  Price Index during the previous  calendar  year.  Each
employee's salary will be accrued by the Company and paid in whole or in part as
cash is available.  If an employee resigns or is terminated for any reason,  his
or her  accrued  and unpaid  salary plus  severance  pay ranging  from three (3)
months to twenty-four (24) months,  depending on the circumstances of his or her
departure,  will be due and payable within 30 days of his or her  resignation or
termination.   Under  each  employment  agreement,  we  provide  certain  fringe
benefits,  including,  but not  limited  to,  participation  in  pension  plans,
profit-sharing plans, employee stock ownership plans, stock appreciation rights,
hospitalization  and  health  insurance,  disability  and life  insurance,  paid
vacation and sick leave.  We will reimburse each employee for any reasonable and
necessary  business expenses,  including travel and entertainment  expenses that
are  necessary  to carry out his or her duties.  Each  employee has the right to
participate in other  businesses as long as those businesses do not compete with
us and so long as the employee devotes the necessary working time, as determined
in his or her sole  discretion,  to our business  activities.  We will indemnify
each  employee  for  all  legal  expenses  and  liabilities  incurred  with  any
proceeding  involving  the  employee  by reason of his or her being an  officer,
director, employee or agent of the Company. We will pay reasonable attorney fees
and expenses as incurred in the event that, in the employee's sole judgment,  he
or she needs to retain counsel or otherwise expend personal funds for his or her
defense. If there is a change in control, each employee has the right to resign.
A change in control is defined as a change in the majority of  Directors  within
any twelve  month  period  without 2/3  approval of the shares  outstanding  and
entitled  to vote,  or a merger  where less than 50  percent of the  outstanding
common stock survives and a majority of the Board of Directors  remains,  or the
sale of  substantially  all of our  assets,  or if any  other  person  or  group
acquires more than 50 percent of the voting capital.

         Agreements  with Marty Smith and Stuart Daley of Genesis  Design Group.
On February 21, 2001, the Company entered into an agreement with Marty Smith and
Stuart Daley of Genesis  Design Group for their  assistance in  supervising  the
production of the molds and the testing of the syringes. The contract was valued
at $25,000 and in lieu of paying cash, the Company issued them 100,000 shares of
its common  stock at $0.25 per share,  the closing  price of our common stock on
the date of the  agreement.  As an  incentive  to  deliver  to Maxxon  assembled
syringes that are fully functional  within 12 weeks from the date the order with
the manufacturer is placed, the Company granted them an option to purchase up to
150,000  shares of Maxxon common stock at $0.25 per share,  exercisable in whole
or in part until December 31, 2002. The options are exercisable  only if Genesis
is  successful  in meeting the 12-week  requirement.  A copy of the agreement is
included as Exhibit 10.17.

         On February 22, 2001, the Company  entered into an agreement with Marty
Smith and Stuart  Daley of Genesis  Design Group to pay a finders fee to them if
their  efforts  result in bringing a  financial  partner to invest in or acquire
Maxxon. If such a transaction  occurs as a result of their efforts,  the Company
agreed to pay them  100,000  shares of Maxxon  common  stock and one-half of one
percent of the total amount of the transaction. A copy of the

                                        7
<PAGE>

agreement is included as Exhibit 10.18.

         On March 26, 2001, we announced that Artistic  Plastics,  Inc., located
in Anaheim,  California,  was  selected to produce the  injection  molds for the
syringe at an estimated  cost of $139,000,  of which $69,500 has been paid.  The
remaining  $69,500 will be payable upon delivery of the syringes.

8.  Need for Governmental Approval

         Pursuant to the Federal Food,  Drug and Cosmetic Act, the FDA regulates
the  research,  design,  testing,   manufacture,   safety,  labeling,   storage,
record-keeping,  advertising  and  promotion,  distribution,  and  production of
medical  devices in the United States.  Maxxon's  Safety Syringe is considered a
medical  device,  is subject to FDA  regulation,  and must  receive FDA approval
prior to sale in the United States.

         Medical devices are classified into one of three classes,  depending on
the controls deemed by FDA to be necessary to reasonably ensure their safety and
effectiveness.  Class I devices are subject to general controls (e.g.  labeling,
pre-market notification and adherence to Quality System regulations,  which have
replaced Good Manufacturing  Practice regulations.) These devices are subject to
the lowest level of regulatory control.  Class II devices are subject to general
controls  and to  special  controls  (e.g.  performance  standards,  post-market
surveillance,  patient  registries,  and FDA guidelines).  Generally,  Class III
devices are those which must  receive  pre-market  approval by the FDA to ensure
their safety and  effectiveness,  and require  clinical testing and FDA approval
prior to marketing and  distribution.  Class III devices are the most rigorously
regulated.

         Generally, before a new device can be introduced into the market in the
United  States,  the  manufacturer  must obtain FDA  clearance  through a 510(k)
pre-market notification or approval of a premarket approval ("PMA") application.
If a medical device  manufacturer can establish that a device is  "substantially
equivalent"  to a legally  marketed  Class I,  Class II  device,  or a Class III
device  for  which  FDA has not  called  for  PMAs,  the  manufacturer  may seek
clearance  from  FDA  to  market  the  device  by  filing  a  510(k)  pre-market
notification.  The 510(k)  pre-market  notification will need to be supported by
appropriate  data  establishing  the  claim of  substantial  equivalence  to the
satisfaction of the FDA.

         If Maxxon cannot  establish  that its safety  syringe is  substantially
equivalent to a legally marketed  predicate device,  Maxxon must seek pre-market
approval of the proposed device through  submission of a PMA application.  A PMA
application   must  be  supported  by  valid  scientific   evidence,   including
pre-clinical  and  clinical  trial  data,  as well as  extensive  literature  to
demonstrate  a  reasonable  assurance  of the  safety and  effectiveness  of the
device.  The PMA represents  the most rigorous form of FDA regulatory  approval.
Management believes that it will be able to establish that the Safety Syringe is
substantially equivalent to FDA approved syringes.

         The Maxxon Safety Syringe is a  single-handed,  vacuum  operated safety
syringe. FDA currently regulates piston syringes as Class II devices, subject to
special  controls  embodied in  published  standards  relating  to syringes  and
require 510(k) clearance.

         We do not plan to package needles with our safety  syringe.  Our safety
syringe is designed to work with most standard  needles.  We will have to submit
performance  of data to the FDA for all needle  sizes and gauges  intended to be
used with our safety syringe.

         Our safety  syringe  meets the  definition  of a medical  device and is
subject  to  FDA  510(k)  pre-market  notification  clearance  before  it can be
commercialized  in the United  States.  No such  approval is required in foreign
jurisdiction,  though  such  foreign  jurisdiction  may have its own  requesting
equipment which must to met before the safety syringe can be sold there.  Maxxon
cannot begin to gather the data  necessary  for  submission  of the  application
until  an  effective   working  prototype  syringe  is  produced  in  sufficient
quantities to gather such data.

                                        8
<PAGE>
9.  Effect of Existing or Probable Governmental Regulation

         The safety  syringe field is relatively  new, and it is quite  possible
that  new  regulations  could be  proposed  and  adopted  which  could  restrict
marketing our Safety  Syringe.  We are not aware of any such pending or proposed
regulations, however, there is no assurance that they will not be imposed.

10.  Estimate of the Amount Spent on Research and Development

         During the past two years,  from  April 1, 1999 to March 31,  2001,  we
have incurred  approximately  $369,000 on research and development  costs. These
costs  include (1) $23,000 in cash for patent costs for the  Rippstein  syringe,
(2)  $27,000 in cash for  consulting  fees and  expenses of Mr.  Rippstein,  (3)
$152,000 for  compensation  cost  recorded  when a portion of the stock  options
granted to Mr. Rippstein and his associates became exercisable, and (4) $142,000
in cash and $25,000 in stock paid to Genesis Design Group for  development  fees
and expenses related to the Rippstein  syringe.  Of the $142,000 in cash paid to
Genesis, $69,500 was for the molds to be produced by Artistic Plastics.

         We have  committed  to pay $225,000 in cash to Mr.  Rippstein  upon the
occurrence  of  events  which are  described  in Item 7.  "Patents,  Trademarks,
Licenses,  Royalty Agreements or Labor Contracts," above. We have also committed
to pay $69,500 in cash to Artistic  Plastics upon delivery of a syringe.  If the
stock options granted to Mr.  Rippstein and to Genesis vest, then we will record
compensation  cost.  The amount of  compensation  cost to be recorded can not be
determined at this time. No customer,  current or future,  has or is expected to
bear any direct research and development expense.

11.  Costs and effects of environmental compliance

         Maxxon has incurred no costs associated with  environmental  compliance
and does not expect to be required to spend any sums on environmental compliance
in the future.

12.  Number of total employees and number of full time employees

         We have no full time employees.  We have five employees,  including our
sole officer and director,  who provide services to us on a part-time basis. Our
employees are each engaged in other business  activities and devote such time as
he or she feels is reasonably necessary to carry out our business. Our employees
are employed by the same four other  companies.  Although these other  companies
are engaged in business  activities that are different from our business,  there
may exist  potential  conflicts in the amount of time each person devotes to our
business. Consequently,  developing our business may require a greater period of
time than if our employees were employed by us on a full time basis.

         On January 3, 2001, we entered into written employment  agreements with
Gifford Mabie, Dr. Thomas Coughlin, Rhonda Vincent and Vicki Pippin. For details
about the  employment  agreements,  see Item 7. Patents,  Trademarks,  Licenses,
Royalty Agreements or Labor Contracts.

Item 2.  Description of Property

         Our executive  office is located at 8908 South Yale Avenue,  Suite 409,
Tulsa,  Oklahoma,  74137.  We lease our 2,700  square  feet  office  space  from
Oklahoma  National Bank. Our office is shared with other companies owned in part
by our sole officer and director and our employees.  The lease expires March 31,
2002.  Our portion of the present  $3,600  monthly  lease  payment is $2,200 per
month.

         We do not anticipate leasing or purchasing  manufacturing facilities to
produce the safety syringe. We plan to contract  manufacturing of the syringe to
a third party with facilities of their own.

Item 3.  Legal Proceedings.

         None

                                        4
<PAGE>
Item 4.  Submission of Matters to a Vote of Security Holders

         None


                                     Part II

Item 5.  Market Price of and Dividends on the Registrant's Common Equity

Market Information

         Our common  stock is traded over the counter  under the trading  symbol
"MXON".  The high and low  prices  for our  common  stock  during  the  calendar
quarters ended were:

          Quarter ended                         High                  Low
          -------------                         ----                  ---
          December 31, 2000                    $0.38                 $0.13
          September 30, 2000                   $0.50                 $0.15
          June 30, 2000                        $0.63                 $0.24
          March 31, 2000                       $0.85                 $0.24
          December 31, 1999                    $0.69                 $0.24
          September 30, 1999                   $1.13                 $0.38
          June 30, 1999                        $1.34                 $0.75
          March 31, 1999                       $1.75                 $0.75

         Quotations on the National Quotation Bureau Pink Sheets reflect bid and
ask  quotations,   may  reflect  inter-dealer  prices,  without  retail  markup,
mark-down or commission, and may not represent actual transactions

         (b)  Holders

         As of March 31, 2001, there were approximately 250 holders of record of
our common  stock.  This figure does not take into  account  those  shareholders
whose certificates are held in the name of broker-dealers or other nominees.  We
estimate there are approximately 3,000 owners who hold their shares in brokerage
accounts.

         (c)  Dividends

         We have not declared any  dividends in the past,  and we do not plan to
declare dividends in the future.

Item 6. Plan of Operation

1.  Plan of Operation for the Next Twelve Months

         We plan to produce  safety  syringes for use in gathering  data for our
FDA 510(k) application.  We expect to submit our application for FDA approval by
the end of 2001.

         We are  presently  seeking  strategic  alliances  to  provide  us  with
manufacturing,   marketing  and  distribution  capabilities.  We  have  no  such
agreements  at this time.  There is no assurance  that we will be  successful in
finding strategic partners.

(i)  Cash Requirements

Internal and External Sources of Liquidity
------------------------------------------
         To date our operations  have been funded through sales of common stock,
loans from shareholders and capital contribution. On December 31, 2000, we began
a private offering of up to 4,000,000  Units,  each Unit consisting of one share
of our common stock at $0.25 per share and one warrant to purchase an additional
share at $0.50 per share on or before  December 31, 2005.  As of March 31, 2001,
1,888,000 Units have been sold.

                                       10
<PAGE>

(ii)     Product  Development  and Research  Plan for the Next Twelve Months Our
         plan for the next twelve months is to use the proceeds from our
4,000,000 Unit offering as follows:

                                                  If 2,000,000    If 4,000,000
                                                Units are Sold  Units are Sold
                                                --------------- ---------------
     Syringe Development
       Aluminum Molds...........................      $200,000        $200,000
       Production - 100,000 unit................        20,000          20,000
                                                --------------- ---------------
                                                      $220,000        $220,000
                                                --------------- ---------------
     FDA Application
       Prototype Testing and Data Collection....       $50,000         $50,000
       FDA Application Costs....................        50,000          50,000
       Clinical Trials - Preliminary Testing ...             0          70,000
                                                --------------- ---------------
                                                      $100,000        $270,000
                                                --------------- ---------------
     Administrative
       Legal, Audit and Due Diligence...........       $45,000         $90,000
       Support Staff Salaries and Benefits......             0          50,000
       Working Capital..........................       $60,000         220,000
                                                --------------- ---------------
                                                      $105,000        $360,000
                                                --------------- ---------------

     Total Use of Net Proceeds..................      $425,000        $850,000
                                                --------------- ---------------

         We may have to obtain additional financing, depending upon actual costs
related to our FDA application.  There is no assurance that additional financing
will be available to us on acceptable terms, if at all.

(iii)  Expected Purchase or Sale of Plant and Significant Equipment.

         None.

(iv)  Expected Significant Changes in the Number of Employees

         We do not expect a significant change in the number of employees in the
near  future.  We plan to begin  searching  for a Chief  Executive  Officer once
production  of the safety  syringe  commences,  which we expect to occur  during
2001. We also plan to seek independent  outside  directors to serve on the Board
of Directors.

Item 7.  Financial Statements

         See Part F/S

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

         None

PART III

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

(a)      Identify of Directors and Executive Officers

         Gifford M. Mabie, age 60, is Chairman, CEO and a Director of Maxxon and
has served in such capacity since May 20, 1997. From 1982 to 1994, Mr. Mabie was
Senior  Vice  President  of CIS  Technologies,  Inc.  (NASD:  CISI),  a  leading
healthcare  information  company that was purchased by National Data Corporation
(NYSE:  NDC) in 1996. Mr. Mabie was  instrumental in raising over $40 Million in
capital that funded acquisitions and new product development.  As a result, that
company's revenues grew from $105,000 in 1987 to over $40 Million in 1995. Prior

                                       11
<PAGE>
to CIS, Mr. Mabie was with Honeywell Information Systems, Inc. and was Corporate
Controller  with W.B.  Dunavant and Company,  one of the world's  largest cotton
brokers.  He holds  degrees in  accounting  and  economics  from  Memphis  State
University and served for eight years in the U.S. Navy.

         Other  Directorships.  Gifford Mabie is the sole officer and a director
of Lexon,  Inc.,  (OTCBB:  LXXN), which is developing cancer screening test kits
for colon  cancer and certain  types of ovarian and  testicular  cancers and for
lung cancer and Centrex,  Inc., a private company that is developing a prototype
for almost instantaneous detection of E. coli and cryptosporidium.  Mr. Mabie is
also an officer and director of Nubar Enterprises,  Inc., a private company that
is developing a laminated carbon fiber  reinforcing bar for concrete  structures
and Image Analysis,  Inc., a private company that is developing a color magnetic
resonance imaging software.

         (b)  Key Employees and Technical Consultants

         The following persons are key employees or technical  consultants,  but
none of them is an officer or director:

         Thomas R.  Coughlin,  Jr.,  M.D.,  age 52, is Medical  Advisor  for the
Company. For 25 years prior to joining Lexon in January,  1999, Dr. Coughlin was
a  cardiovascular  surgeon.  From  1992 to  1995,  he was  Medical  Director  of
Cardiovascular  Surgical Services at Alexandria  Hospital in Alexandria Virginia
and  from  1991  to  1995,  was  Assistant  Clinical  Professor,   Thoracic  and
Cardiovascular  Surgery  at  George  Washington  University  Medical  Center  in
Washington,  D.C. He has received numerous professional honors and has published
25 research  papers.  He is a graduate of the University of Rochester  School of
Medicine and Dentistry,  Rochester, New York (M.D.) and of Seton Hall University
(B.S.). He is also Medical Advisor for Maxxon, Inc. and Centrex,  Inc. and is an
officer and director of Image Analysis, Inc. and Nubar Enterprises, Inc.

         Rhonda R. Vincent,  age 37, is Financial  Reporting Manager for Maxxon.
From  incorporation  until July 16,  1999,  when she  resigned as an officer and
director  of  the  Company,  Ms.  Vincent  was  Vice  President,  Secretary  and
Treasurer.  From  1994 to  1997,  Ms.  Vincent  was Vice  President,  Secretary,
Treasurer  and  Director  of  Corporate  Vision,  Inc.,  a  multimedia  software
development  company.  For five years prior  thereto,  Ms.  Vincent held various
accounting  and investor  relations  positions  with CIS  Technologies,  Inc., a
leading healthcare information processing company that was purchased by National
Data  Corporation in 1996.  She began her career as an audit  associate with the
public  accounting firm of Coopers & Lybrand.  Ms. Vincent is a Certified Public
Accountant  and holds a  Bachelor  of  Science  degree in  accounting  from Oral
Roberts University. She is also Financial Reporting Manager for Maxxon, Inc. and
Centrex, Inc., and is an officer and director of Image Analysis,  Inc. and Nubar
Enterprises, Inc.

         Vicki Pippin, age 41, is Administrative Manager for Maxxon. She is also
Administrative Manager for Lexon, Centrex, Image Analysis and Nubar. She has had
more than 20 years of executive  administration  experience  for various  public
companies  in  the  aerospace  and  healthcare  software  industries,  including
McDonnell Douglas, Burtek Industries and CIS Technologies, Inc.

         Wayland J. Rippstein, Jr., age 67, is a technical consultant to Maxxon.
He retired in 1983 from NASA as the Head of the Toxicology  Laboratory  where he
worked  extensively with syringes,  vacuums and other issues on the leading edge
of technology for more than 20 years.  Since his retirement,  Mr.  Rippstein has
been a consultant  to various  businesses.  He has testified  extensively  as an
expert witness in litigation  involving the  toxicological  chemical  effects of
fires,  explosions and other  catastrophic  events. Mr. Rippstein also owned and
operated a chemical  manufacturing firm for more than 7 years, selling primarily
agricultural chemicals. He holds a patent for an agricultural chemistry product.
He is a graduate  from the  University  of Texas with a  Bachelors  and  Masters
Degree in Chemistry.

(c)  Family Relationships

         None.

(d)  Involvement in Legal Proceedings of Officers, Directors, and Control
Persons

         None.

                                       12
<PAGE>


Item 10.  Executive Compensation
<TABLE>
                           SUMMARY COMPENSATION TABLE
<CAPTION>

                                                                       Securities
                                            Other                      Under-
Name and                                    Annual        Restricted   lying                     All Other
Principal                                   Compen-       Stock        Options/       LTIP       Compen-
Position          Year     Salary   Bonus   sation ($)    Award ($)    SARs(#)       Payouts     sation
--------          ----     ------   -----   ----------    ---------    -------       -------     ------
<S>               <C>      <C>      <C>     <C>           <C>          <C>           <C>         <C>

Gifford Mabie     2000     $0       $0      $0             $0          $0            $0          $0
CEO               1999     $0       $0      $0             $0          $0            $0          $0

</TABLE>

                               Aggregated Option/
         SAR Exercises in Last Fiscal Year and FY-End Option/SAR Values

                                           Number of
                                           Securities
                                           Underlying          Value of
                                           Unexercised         Unexercised
                                           Options/SARs at     Options/SARs at
                  Shares                   FY-End (#)          FY-End ($)
                  Acquired      Value      Exercisable/        Exercisable/
Name              on Exercise   Realized   Unexercisable       Unexercisable
----              -----------   --------   -------------       -------------
Gifford Mabie     None          None       300,000             None (1)

(1)  The closing  price of our common  stock at December  31, 2000 was $0.15 per
     share,  which  was less than the  $0.50  per  share  exercise  price of Mr.
     Mabie's options.

         From inception through December 31, 2000, our sole officer and director
worked  without being  compensated  in cash.  For those years ended December 31,
2000 and 1999,  we  estimated  the fair value of his services to be $100,000 and
$60,000,  respectively,  and recorded these values as an expense and an increase
to contributed capital. On January 3, 2001, we entered into a written employment
agreement with Mr. Mabie. The employment  agreement states that we will accrue a
salary payable to Mr. Mabie of $100,000 per year.

         During 1998, Mr. Mabie was granted an option to purchase 300,000 shares
of common stock at $0.50 per share.  The exercise price was equal to the closing
price of the Company's common stock on the date of grant. The options expire ten
years from the date of grant.

Item 11.  Security Ownership of Certain Beneficial Owners and Management

         The following  shareholders  are known to us to own more than 5% of our
18,818,110  shares of common stock issued and  outstanding as of March 31, 2001.
We have  also  included  the  number  of shares  owned by our sole  officer  and
director and by our employees and advisors.  Except where  indicated,  ownership
consists of sole voting and investment power:

                                       13
<PAGE>

<TABLE>
<CAPTION>

                                                                            Beneficial         Percentage of
                                                     Relationship to         Ownership          Outstanding
      Name and Address                                   Company          Common Stock(1)     Common Stock 2)
      ------------------------------------------- ---------------------- ------------------ --------------------
     <S>                                           <C>                   <C>                 <C>
      Gifford M. Mabie                              Sole Officer and       1,157,000 (4)           6.05%
                                                        Director
      Rhonda R. Vincent                                 Employee           1,487,400 (5)           7.78%
      Thomas R. Coughlin                                Employee           1,050,000 (6)           5.52%
      Vicki L. Pippin                                   Employee           1,050,000 (6)           5.52%
      Wayland Rippstein                                Consultant            320,000 (3)           3.29%
                                                                           -------------          -------
      Sole Officer and Director, Employees and
      Consultants as a Group (5 persons).................................  5,684,400              27.79%

</TABLE>
[FN]
(1)  Includes  shares of common stock issuable upon the exercise of options that
     are  currently  exercisable  or will become  exercisable  within 60 days of
     March 15, 2001.

(2)  For each  shareholder  listed above,  his or her  percentage of outstanding
     common stock was based on 18,818,110  shares issued and  outstanding  as of
     March 31,  2001,  plus the shares which each  shareholder  has the right to
     acquire within 60 days of March 31, 2001.

(3)  Consists of Mr. Rippstein's  exercisable options to purchase 320,000 shares
     of common  stock at $0.50 per share as of March 31, 2001.  The  exercisable
     options are part of the options granted  pursuant to the License  Agreement
     dated November 18, 1999..  The options granted can be exercised only if the
     performance criteria described in Item 7. Patents, Licenses, etc. are met.

(4)  Includes options to purchase 300,000 shares of common stock  exercisable at
     $0.50 per share. These options expire January 20, 2008.

(5)  Includes  98,000  shares  of  common  stock  owned  by  Investor  Relations
     Corporation,  of which  Ms.  Vincent  is the  sole  officer,  director  and
     shareholder,  and includes her options to purchase 300,000 shares of common
     stock  exercisable  at $0.50 per share.  These options  expire  January 20,
     2008.

(6)  Includes options to purchase 200,000 shares of common stock  exercisable at
     $0.50 per share. These options expire January 20, 2008.

</FN>
                                       14
<PAGE>
Common Stock Options and Warrants Outstanding
---------------------------------------------

         The  following  table shows the total common stock options and warrants
at March 31, 2001:
<TABLE>
<CAPTION>

                                            Number of       Number of
                                             Options         Options
                                             Granted/      Exercisable/
                                             Warrants        Warrants       Exercise        Date of       Expiration
Name                                        available         Issued          Price       Grant/Issue        Date
----------------------------------------- --------------- --------------- ------------ ---------------- -------------
<S>                                        <C>            <C>              <C>           <C>             <C>
Wayland Rippstein and Associates(1)            1,600,000         640,000        $0.50     11/18/99        10/31/09

Gifford Mabie(2)                                 300,000         300,000        $0.50     02/01/98        01/31/08

Rhonda Vincent(2)                                300,000         300,000        $0.50     02/01/98        01/31/08

Thomas Coughlin(2)                               200,000         200,000        $0.50     02/01/98        01/31/08

Vicki Pippin(2)                                  200,000         200,000        $0.50     02/01/98        01/31/08

Warrants(3)                                      724,000         724,000        $1.00     07/15/00        06/30/05

Warrants(4)                                    4,000,000       1,888,000        $0.50     12/31/00        12/31/05

Genesis Design (5)                               150,000               0        $0.25     02/21/01        12/31/02
                                          --------------- ---------------

Total Options and Warrants                     7,474,000       4,252,000
                                          --------------- ---------------
</TABLE>
[FN]

(1)  On November 18, 1999,  the Company  entered into a License  Agreement  with
     Wayland  Rippstein  and his  associates  pursuant  to  which an  option  to
     purchase up to 1,600,000 shares of our common stock was granted, subject to
     certain performance  criteria which are described in "Patents,  Trademarks,
     Licenses,  Royalty  Agreements or Labor  Contracts."  As of March 31, 2001,
     options to purchase 640,000 shares were exercisable.

(2)  Granted pursuant to the 1998 Incentive Stock Option Plan.

(3)  On July 15,  2000,  the  Company  commenced  a  private  offering  of up to
     1,000,000  Units,  each Unit consisting of one share of our common stock at
     $0.25 per share and one warrant to purchase  an  additional  share at $1.00
     per share on or before June 30, 2005.  The Company sold 724,000  Units.  On
     September 30, 2000, this Offering ended.

(4)  On December 31,  2000,  the Company  commenced a private  offering of up to
     4,000,000  Units,  each Unit consisting of one share of our common stock at
     $0.25 per share and one warrant to purchase  an  additional  share at $0.50
     per share on or before  December 31, 2005. As of March 31, 2001,  1,888,000
     Units have been sold.

(5)  On February 21, 2001, the Company entered into a consulting  agreement with
     Marty Smith and Stuart  Daley of Genesis  Design  Group,  pursuant to which
     they were granted an option to purchase up to 150,000  shares of our common
     stock at $0.25 per share,  subject to  performance  criteria  discussed  in
     "Patents, Trademarks, Licenses, Royalty Agreements or Labor Contracts."
</FN>

                                       15
<PAGE>

Item 12.  Certain Relationships and Related Transactions

         During the past two years,  from April 1, 1999 to March 31, 2001, there
were the following related party transactions in excess of $60,000:

         On January 3, 2001, Gifford Mabie, Thomas Coughlin,  Rhonda Vincent and
Vicki Pippin each  purchased  850,000 shares of common stock at $0.15 per share,
which was the closing price of our common stock on the date of the  transaction.
Each  person  gave the  Company an  unsecured  promissory  note in the amount of
$127,500.  The notes are due February 23, 2008 and accrue  interest at a rate of
8% per year.

Item 13.  Exhibits and Reports on Form 8-K

         None

                                    PART F/S


                                    Part III

Index to and Description of Exhibits

Ex.
No.      Description of Exhibit
----     ----------------------------------------------------------------------
10.11    Development Agreement between Genesis Design Group and Maxxon dated
         April 28, 2000
10.12    Broker-Dealer Selling Agreement between RichMark Capital Corporation
         and Maxxon dated December 18, 2000
10.13    Employment Agreement between Gifford M. Mabie and Maxxon dated
         January 3, 2001
10.14    Employment Agreement between Dr. Thomas Coughlin and Maxxon dated
         January 3, 2001
10.15    Employment Agreement between Rhonda Vincent and Maxxon dated
         January 3, 2001
10.16    Employment Agreement between Vicki Pippin and Maxxon dated
         January 3, 2001
10.17    Development Agreement between between Stuart Daley and Marty Smith of
         Genesis Design Group and Maxxon dated February 21, 2001
10.18    Consulting Agreement between Stuart Daley and Marty Smith of Genesis
         Design Group and Maxxon dated February 22, 2001





<PAGE>


                                   SIGNATURES

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



                            MAXXON, INC.


                            /s/ GIFFORD M. MABIE
                            --------------------------------------------------
                            By:  Gifford M. Mabie, Sole Officer and Director

April 16, 2001


<PAGE>

                                    Part F/S


                 INDEX TO FINANCIAL STATEMENTS AND RELATED NOTES


AUDITED FINANCIAL STATEMENTS

Independent Auditors' Report............................................... F-1

Balance Sheet at December 31, 2000......................................... F-2

Statement of Operations from inception (December 16, 1997)................. F-3
through December 31, 2000

Statement of Cash Flows from inception (December 16, 1997)................. F-4
through December 31, 2000

Statement of Stockholders' Equity from inception (December 16, 1997)
through December 31, 2000.................................................. F-5

Notes to Financial Statements from inception (December 16, 1997)
through December 31, 2000.................................................. F-6


<PAGE>




                          Independent Auditor's Report


To the Shareholders of
Maxxon, Inc.
Tulsa, Oklahoma

         We have  audited  the  accompanying  balance  sheet of Maxxon,  Inc. (a
development  stage  company) for the years ended December 31, 2000 and 1999, and
the related statements of operations,  shareholders'  equity, and cash flows for
the years ended  December 31, 2000 and 1999 and for the period from December 16,
1996  (inception)  to December  31, 1999.  These  financial  statements  are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audit.

         We conducted our audit 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 Maxxon,  Inc. as of
December 31, 2000 and 1999, and the results of its operations and its cash flows
for the years ended  December 31, 2000 and 1999 and for the period from December
16, 1996 (inception) to December 31, 1999 in conformity with generally  accepted
accounting principles.


/s/ SUTTON ROBINSON FREEMAN & CO.

Sutton  Robinson Freeman & Co., P. C.
Certified Public Accountants

April 2, 2001



                                      F-1

<PAGE>


                                  Maxxon, Inc.
                           A Development Stage Company

                                  Balance Sheet
                                December 31, 2000




                                                              December  31,
               ASSETS                                                  2000
                                                              -------------
Current assets
Cash                                                                $ 1,529
Notes receivable- related parties (Note 3)                           61,087
Prepaid consulting expenses                                           2,255
                                                              -------------
   Total current assets                                              64,871
                                                              -------------
Property and Equipment, net of depreciation (Note 9)                 14,218
                                                              -------------
Other assets
Patent Development                                                   10,000
Less amortization (Note 5)                                              838
                                                              -------------
      Total Patent Development                                        9,162
                                                              -------------
TOTAL ASSETS                                                       $ 88,251
                                                              =============
           LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities                           $ 34,222
Accrued Interest Payable                                                332
                                                              -------------
   Total current liabilities                                         34,554
                                                              -------------
Long-term debt
Note payable - related parties (Notes 6 and 15)                       6,369
                                                              -------------
   Total long-term liabilities                                        6,369
                                                              -------------
Total liabilities                                                    40,923
                                                              -------------
Shareholders' equity
Preferred stock, $0.001 par value,
   5,000,000 shares authorized;  no shares issued and
   no shares issued and outstanding at
December 31, 2000 and 1999, respectively                                  -
Common stock, $0.001 par value,
   25,000,000 shares authorized;
   13,180,125 shares and 12,317,349 shares issued and
   shares issued and outstanding at
December 31, 2000 and 1999, respectively                             13,180
Paid in capital                                                   5,776,320
Deficit accumulated during the development stage                 (5,742,172)
                                                              -------------
   Total shareholders' equity                                        47,328
                                                              -------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                         $ 88,251
                                                              =============


The accompanying notes are an integral part of the financial statements

                                      F-2
<PAGE>



                                  Maxxon, Inc.
                           A Development Stage Company

                            Statements of Operations
          From Inception (December 16, 1996) Through December 31, 2000
               and For The Years Ended December 31, 2000 and 1999


<TABLE>
<CAPTION>

              <S>                                      <C>                  <C>                  <C>
                                                  From inception
                                                   (December 16,
                                                   1996) through
                                               December 31, 2000     December 31, 2000     December 31, 1999
                                               -----------------     -----------------     -----------------
Revenue                                                      $ -                   $ -                   $ -

Expenses
Research and development                                 361,346                61,749                18,244
General and administrative                             5,332,226             1,258,448               985,197
                                               -----------------     -----------------     -----------------
   Total operating expenses                            5,693,572             1,320,194             1,003,441
                                               -----------------     -----------------     -----------------
Operating loss                                        (5,693,572)           (1,320,194)           (1,003,441)

Interest income                                           15,554                     -                     -

Interest expense                                          29,578                18,892                     -

Depreciation and amortization                             34,610                 8,773                11,114
                                               -----------------     -----------------     -----------------
Net loss from operations                            $ (5,742,206)         $ (1,347,859)         $ (1,014,555)
                                               -----------------     -----------------     -----------------
Weighted average shares outstanding (Note 10)         12,105,193            12,660,494            12,280,759

Net loss per share (Note 1)                              $ (0.47)              $ (0.11)              $ (0.08)


</TABLE>



The accompanying notes are an integral part of the financial statements



                                      F-3

<PAGE>

<TABLE>
<CAPTION>


                                  Maxxon, Inc.
                           A Development Stage Company

                            Statements of Cash Flows
          From Inception (December 16, 1996) Through December 31, 2000
               and For The Years Ended December 31, 2000 and 1999



                                                                From inception
                                                                 (December 16,
                                                                 1996) through           Year Ended           Year Ended
                                                             December 31, 2000    December 31, 2000    December 31, 1999
                                                             -----------------    -----------------    -----------------
<S>                                                             <C>                  <C>                <C>

Operating activities
Net loss                                                          $ (5,742,206)        $ (1,347,859)       $ (1,014,555)
Plus non-cash charges to earnings:
Depreciation and amortization                                           25,870                7,532               3,615
Common stock issued for services                                       856,657                    -             166,742
Expenses paid by third parties                                          49,634                    -                   -
Contribution of services by officer and employees                      799,154              405,000             280,000
Services by officer and employees
  paid for with non-cash consideration                                  87,500                    -                   -
Consulting services paid for with non-cash consideration               287,877                    -                   -
Write-off of organizational costs                                        3,195                3,195                   -
Write-off of zero value investments                                    785,418              640,418             145,000
Compensation costs for stock options and warrants
granted to non-employees                                             1,187,915              -                    89,728
Change in working capital accounts:
   (Increase) decrease in other receivables                            (41,200)             (29,200)                  -
   (Increase) decrease in prepaid expenses                              (2,255)              23,450              (5,000)
   (Increase) decrease in receivables from related parties            (196,464)                                 (40,592)
   (Increase) decrease in interest receivable                                -                    -                   -
   Increase (decrease) in accounts payable
     and accrued liabilities                                            87,464               17,520              26,621
                                                             -----------------    -----------------    -----------------
      Total operating activities                    `               (1,991,441)            (279,944)           (348,441)
                                                             -----------------    -----------------    -----------------
Investing activities
Purchase of equipment                                                  (34,719)                   -              (5,771)
Investment in syringe patent development                               (10,000)                   -             (10,000)
Investment in Ives Health Company                                     (251,997)                   -                   -
Investment in The Health Club                                          (10,000)                   -                   -
                                                             -----------------    -----------------    -----------------
      Total investing activities                                      (306,716)                   -             (15,771)
                                                             -----------------    -----------------    -----------------
Financing activities
Loans from shareholders                                                 13,907               19,369             (25,366)
Repayment of loans from shareholders                                    (5,000)              (5,000)
Sale of common stock for cash:
   To third-party investors (prior to merger)                          574,477                    -                   -
   To third-party investors                                            968,145              181,000             342,425
   From exercise of stock options by third-parties                     509,900                    -             150,000
   Less:  Issue Costs                                                  (16,743)                   -             (16,743)
Convertible debentures issued for cash                                 355,000                    -                   -
Payment of exclusive license note payable                             (100,000)                   -                   -
                                                             -----------------    -----------------    -----------------
      Total financing activities                                     2,299,686              195,369             450,316
                                                             -----------------    -----------------    -----------------
Change in cash                                                           1,529              (84,575)             86,104

Cash at beginning of period                                                  -               86,104                   -
                                                             -----------------    -----------------    -----------------
Cash at end of period                                                  $ 1,529              $ 1,529            $ 86,104
                                                             =================    =================    =================
Supplemental disclosure of cash flow information:
   Cash paid for interest and taxes during the period                   27,903               17,216                   -

Non-cash financing and investing activities:
Common stock issued to founders                                          7,000                    -                   -
Common stock issued in connection with merger
with Cerro Mining Corporation                                              300                    -                   -
Common stock issued in Ives merger                                     346,262                    -                   -
Common stock subscriptions                                              69,800                    -                   -
Common stock issued in exchange for promissory note                    129,000                    -                   -
Common stock issued for convertible debentures                         190,660                    -                   -
Common stock issued to pay Ives debt                                    27,000                    -                   -

</TABLE>
The accompanying notes are an integral part of the financial statements


                                      F-4
<PAGE>


                                  Maxxon, Inc.
                           A Development Stage Company

                       Statements of Stockholders' Equity
          From inception (December 16, 1996) through December 31, 2000
               and for the years ended December 31, 2000 and 1999

<TABLE>
<CAPTION>
                                                                                                Accumulated
                                                                      Common Stock               during the
                                                 Note       Price     -------------    Paid-In  Development  Subscription
                                            Reference   per Share     Shares Amount    Capital        Stage    Receivable     Total
                                            ---------   ---------     ------ ------    -------  -----------  ------------ ----------

<S>                                         <C>         <C>        <C>       <C>      <C>       <C>           <C>          <C>
Balance at Inception (December 16, 1996)                      -           -      -          -        -                            -

Cerro Mining/Maxxon-OK Merger:
   Cerro Mining                                           $0.001     531,000    531       (231)                                 300
   Maxxon-OK:
       Shares issued to founders                 9        $0.001   7,000,000  7,000                                           7,000
       Shares sold for cash to third-party       9    0.90-$1.00     578,000    578    573,899                              574,477
Ives Transactions:
     Investment in Ives Health Company           4         $1.57     311,240    311    310,951                              311,261
     Investment in The Health Club               4          1.57      35,000     35     34,965                               35,000
     Conversion of Ives Debt                     4          1.46      18,513     19     26,981                               27,000
Issuance of Common Stock for:
     Cash from third-party investors            12         $1.62     218,569    219    353,501                              353,720
     Cash from related party                 12,15
     Promissory Notes                         3,12         $2.00      64,500     65    128,935                              129,000
     Subscriptions Receivable                12,15    1.22-$1.49      52,757     53     69,747                (69,800)            -
     Services Rendered                          12    1.38-$3.42      90,499     90    173,337                              173,427
     Debentures Converted                       14         $0.73     102,673    103     74,897                               75,000
Net Income (Loss) at December 31, 1997                                                            (795,375)                (795,375)
                                            ---------   --------- ---------- ------  ---------  -----------   ----------- ----------
Balance at December 31, 1997                                       9,002,751  9,003  1,746,982    (795,375)   (69,800)      890,809

Issuance of Common Stock for:
     Conversion of Ives Debt                     4    1.22-$1.28      44,827     45     54,955                               55,000
     Cash from third-party investor             12          1.82      50,000     50     90,950                               91,000
     Options exercised by
        third-parties for cash               12,13    0.50-$0.75     545,867    546    359,354                              359,900
     Options exercised by third-parties
         for services                        12,13         $0.75      24,133     24     18,076                               18,100
     Services Rendered by third-parties         12    0.46-$1.43     988,007    988    573,560                              574,549
     Debentures Converted by third parties      14         $0.50     548,574    549    274,451                              275,000
     Settlement with related party              15                   350,000    350                                             350
Certificates canceled:                          12                   (91,572)   (92)   (40,173)                             (40,265)
Value of Services Contributed by Officer
      and Employees                              1                                     114,154                              114,154
Compensation Cost for Stock Options Granted
      to Non-Employees                          13                                     918,187                              918,187
Cancellation of Subscriptions Receivable
      from related party                     12,15                                                             69,800        69,800
Net Income (Loss) at December 31, 1998                                                            (2,584,383)            (2,584,383)
                                            ---------   --------- ---------- ------  ---------  -----------   ----------- ----------
Balance at December 31, 1998                                      11,462,587 11,463  4,110,497    (3,379,758)        0       742,202

Issuance of Common Stock for:
     Cash from third-party investor             12    $0.70-$1.19    390,693    390    342,034                              342,424
Less: Issue Costs                                                                       (16,743)                            (16,743)
     Options exercised by
        third-parties for cash               12,13          $0.50    300,000    300    149,700                              150,000
     Services Rendered by third-parties         12    $1.00-$1.19    164,069    164    166,579                              166,743
Value of Services Contributed by Officer
      and Employees                              1                                     280,000                              280,000
Compensation Cost for Stock
 Options Granted to Non-Employees               13                                      89,728                               89,728
Net Income (Loss) at December 31, 1999                                                            (1,014,555)            (1,014,555)
                                            ---------   --------- ---------- ------  ---------  -----------   ----------- ----------
Balance at December 31, 1999                                      12,317,349 12,317  5,121,795    (4,394,313)        0       739,799

Issuance of Common Stock for:
     Cash from third-party investor             12    $0.25-$0.50    862,776    863    249,525                              250,388
Less: Issue Costs                                                                                                                 0
     Options exercised by
       third-parties for cash                                                                                                     0
     Services Rendered by third-parties                                                                                           0
Value of Services Contributed by Officer
      and Employees                              1                                     405,000                              405,000
Net Income (Loss) at December 31, 1999                                                            (1,347,859)            (1,347,859)
                                            ---------   --------- ---------- ------  ---------  -----------   ----------- ----------
Balance at December 31, 2000                                      13,180,125 13,180  5,776,320    (5,742,172)        0        47,328
                                            =========   ========= ========== ======  =========  ===========   =========== ==========
</TABLE>

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


                                      F-5
<PAGE>



                                  Maxxon, Inc.
                          (A Development Stage Company)

                          Notes to Financial Statements
                           December 31, 2000 and 1999


Note 1 - Summary of Significant Accounting Policies

Organization and Nature of Operations
Maxxon,  Inc. ("Maxxon" or "the Company") owns the exclusive license to develop,
manufacture  and market a patented  disposable  safety syringe that retracts the
needle into the barrel of the syringe  after an  injection  has been given.  The
patent was  published by the U.S.  Patent and  Trademark  Office on February 27,
2001.  The safety  syringe  requires FDA  approval  before it can be sold in the
United  States.  The  Company  has not yet  submitted  its  application  for FDA
approval.

The Company was  incorporated in the state of Nevada on August 16, 1996 as Cerro
Mining Corporation ("Cerro").  On May 31, 1997, Cerro issued 7,578,000 shares of
its common stock for all of the issued and outstanding common stock of a Maxxon,
Inc., a privately-held Oklahoma corporation  ("Maxxon-OK").  Maxxon-OK ceased to
exist as a result of the transaction and Cerro changed its name to Maxxon, Inc.

Development Stage Company
Since its inception in 1996, the Company has been considered a development stage
enterprise for financial  reporting  purposes as  significant  efforts have been
devoted to raising capital and to research and development of a safety syringe.

Cash and Cash Equivalents
The Company considers highly liquid  investments  (those readily  convertible to
cash) purchased with original  maturity dates of three months or less to be cash
equivalents.

Compensation of Officers and Employees
At times since  inceptions,  the  Company's  officers and other  employees  have
served without pay or other non-equity compensation. The Company recognizes, for
financial reporting  purposes,  the estimated fair value of these services as an
expense and  contribution to capital.  For the years ended December 31, 2000 and
1999,  the value of these  services was  estimated to be $405,000 and  $280,000,
respectively.

Stock-based Compensation
The Company accounts for stock-based compensation  arrangements for employees in
accordance with Accounting  Principles Board ("APB") Opinion No. 25, "Accounting
for Stock Issued to Employees",  and complies with the disclosure  provisions of
Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation".   Under  APB  No.  25,  compensation  expense  is  based  on  the
difference,  if any,  on the  date of  grant,  between  the  fair  value  of the
Company's  stock and the exercise  price.  The Company  accounts for stock-based
compensation arrangements for non-employees in accordance with the provisions of
SFAS No. 123 and the Emerging Issues Task Force Consensus in Issue No. 96-18.

Income Taxes
The Company  uses the  liability  method of  accounting  for income taxes as set
forth in Statement of Financial  Accounting  Standards No. 109,  "Accounting for
Income Taxes." Under the liability  method,  deferred taxes are determined based
on the differences  between the financial  statement and tax bases of assets and
liabilities at enacted tax rates in effect in the years in which the differences
are expected to reverse.

Segment Information
Effective  January 1, 1998, the Company  adopted the provisions of SFAS No. 131,
"Disclosures  about  Segments of an  Enterprise  and Related  Information".  The
Company  identifies  its  operating  segments  based  on  business   activities,
management  responsibility  and  geographical  location.  During the years ended
December 31, 2000 and 1999, the Company  operated in a single  business  segment
engaged in developing and marketing selected healthcare products.

Earnings (Loss) per Share
The  Company  computes  net income per share in  accordance  with SFAS No.  128,
"Earnings per Share" and SEC Staff Accounting  Bulletin No. 98 ("SAB 98"). Under
the  provision  of SFAS No. 128 and SAB 98 basic net income  (loss) per share is
calculated by dividing net income (loss)  available to common  stockholders  for
the  period  by the  weighted  average  shares of  common  stock of the  Company
outstanding  during the  period.  Diluted  net income per share is  computed  by
dividing the net income for the period by the weighted  average number of common
and common equivalent shares  outstanding  during the



                                      F-6
<PAGE>

period. The calculation of fully diluted income (loss) per share of common stock
assumes the dilutive effect of stock options outstanding.  During a loss period,
the assumed exercise of outstanding  stock options has an anti-dilutive  effect.
Therefore,  the outstanding  stock options were not included in the December 31,
2000  and 1999  weighted  average  shares  of  12,660,494  and  12,280,759  used
respectively in the calculations of loss per share.

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

Fiscal Year End
The Company's fiscal year ends on December 31.

Reclassifications
Certain  reclassifications have been made to the prior year financial statements
to conform to the current period presentation.

Intangible Assets
Intangible  assets  are  stated at cost.  The  intangible  asset of  $10,000  at
December  31,  2000  is for  patent  costs  related  to the  Rippstein  syringe.
Amortization  of these  patent  costs is for a period of 17 years,  which is the
life of a U.S. Patent.

New Accounting Standards
The Company adopted SFAS No. 130, "Reporting  Comprehensive Income" and SFAS No.
131,  "Disclosures  about  Segments of an  Enterprise  and Related  Information"
during 1998. The Company had no comprehensive income items during 2000 and 1999.
Therefore,  net loss equals  comprehensive  income. The Company operates in only
one  business  segment.  The  Company  adopted  SFAS No.  133,  "Accounting  for
Derivative  Investments and Hedging  Activities" during 1999. As of December 31,
2000 the Company did not engage in hedging activities or transactions  involving
derivatives.

In  March  2000,   the   Financial   Accounting   Standard   Board  issued  FASB
Interpretation  No. 44,  "Accounting  for Certain  Transactions  Involving Stock
Compensation  - an  interpretation  of APB Opinion  No. 25" ("FIN  44").  FIN 44
clarifies the application of APB Opinion No. 25 and among other issues clarifies
the  following:  the  definition  of an employee  for  purposes of applying  APB
Opinion No. 25; the  criteria  for  determining  whether a plan  qualifies  as a
noncompensatory plan; the accounting consequence of various modifications to the
terms of previously  fixed stock options or awards;  and the  accounting  for an
exchange  of stock  compensation  awards in a  business  combination.  FIN 44 is
effective July 1, 2000, but certain  conclusions in FIN 44 cover specific events
that  occured  after either  December 15, 1998 or January 12, 2000.  The Company
does not  expect  the  application  of FIN 44 to have a  material  impact on the
Company's financial positions or results of operations.

Note 2 - Exclusive License

On November 18, 1999,  Maxxon entered into an Exclusive  License  Agreement with
Wayland J.  Rippstein,  Jr. and associates (the  "Rippstein  License"),  whereby
Maxxon acquired the exclusive  worldwide license to manufacture and market a new
proprietary  safety  syringe  that  retracts  the needle  into the barrel of the
syringe after use. In connection  with the Rippstein  License,  the Company paid
$10,000  for patent  costs and agreed to pay  $200,000  if all of the  following
events happen on or before September 30, 2001; (1) a U.S. patent is issued,  (2)
a fully  functional and working  prototype of the syringe is completed,  and (3)
FDA  approval  to sell  the  syringe  in the U.S is  obtained.  However,  if FDA
approval  is not  received  by  September  30,  2001,  but the Company has begun
selling  syringes in places that do not require FDA  approval,  then the Company
will  pay the  $200,000  out of the  first  net  profits  from the sale of those
syringes.

The  Rippstein  License also provides for Maxxon to pay royalties of 4% of gross
sales of syringes and minimum annual  royalties  ranging from $10,000 to $20,000
beginning  on the 4th  anniversary  after  both a working  prototype  syringe is
developed and a U.S. patent is issued.  Such royalties  continue for the life of
the last to  expire  patent.  Maxxon  also  granted  Mr.  Rippstein  and his two
associates  options to purchase a total of  1,600,000  shares of common stock of
Maxxon at $0.50 per share,  which was the closing price of Maxxon's common stock
on the day the Rippstein License was signed. The options expire October 31, 2009
and are subject to certain vesting conditions.  Details regarding the accounting
treatment of the options  granted and details  regarding the vesting  conditions
are described in Note 7, "Stock Options."


                                      F-7

<PAGE>


Note 3 - Investment in Ives Health Company and The Health Club

Ives Health Company
On August 18, 1997, the Company completed a share exchange transaction with Ives
Health Company,  Inc. ("Old Ives"), an Oklahoma  corporation that markets a line
of homeopathic and natural remedies to retail  pharmacies  throughout the United
States.  Maxxon issued 586,600 shares of its common stock in exchange for all of
the  outstanding  shares of Old Ives. The  shareholders of Old Ives consisted of
Keith Ives and 32 individual  investors.  Keith Ives received 320,360 shares and
the 32 individual  investors received a total of 266,240 shares. Old Ives became
a  wholly-owned  subsidiaries  of  Maxxon as a result  of the  transaction.  The
Company valued the 586,600 shares issued at $920,962,  or $1.57 per share, which
was  determined  by  Maxxon's  Board of  Directors  to be the fair  value of the
restricted stock issued in the transaction. The closing price of Maxxon's common
stock  on the  date of the  transaction  was  $2.50  per  share  and  the  Board
determined that a 35% discount was appropriate for the restricted  stock issued.
After trying unsuccessfully to raise the capital needed to complete the business
plan of Old Ives,  Maxxon  and Old Ives  entered  into a  Rescission  Agreement,
whereby Maxxon organized a new Oklahoma  corporation  named Ives Health Company,
Inc.  ("Ives") and  transferred Old Ives into Ives.  Maxxon  received  1,700,000
shares of Ives common stock, which at that time represented about 19.5% of Ives'
outstanding  common stock and Keith Ives received 7,000,000 shares (or 80.5%) of
Ives common stock. Keith Ives resigned as a director,  officer,  employee, agent
and representative of Maxxon and gave back to Maxxon 275,360 shares common stock
that he  received  in the August 1997 share  exchange.

Ives began  reporting  under the Securities Act of 1934 on November 22, 1999 and
its common stock began  trading on the OTC Bulletin  Board under the symbol IVEH
on May 25, 2000.  On June 2, 2000,  Maxxon  contacted  Ives'  transfer  agent to
remove the restrictive legend on the 1,000,000 shares of Ives common stock still
owned by Maxxon  (the other  700,000  shares were  transferred  in early 2000 to
Maxxon's  employees as payment for their services).  Maxxon believed that it had
satisfied Rule 144 requirements when it first contacted Ives' transfer agent. On
July 6, 2000,  Maxxon filed suit  against Ives and its transfer  agent to remove
the  restrictive  legend and to recover  damages caused by the delay in removing
the restrictions.  Ives countersued Maxxon alleging failure of consideration and
fraudulent  inducement.  On October 31, 2000,  Maxxon and Ives agreed to end the
litigation.  As part of the  settlement,  a total  of  500,000  of the  original
1,700,000  shares of Ives  common  stock  issued to Maxxon was  returned to Ives
(294,118  shares were  returned by Maxxon and  205,882  shares were  returned by
Maxxon's  employees).  Ives  agreed to drop its  countersuit  and to remove  the
restrictive  legend on the Ives shares.  To pay Maxxon's expenses related to the
Ives  litigation,  Maxxon  transferred  141,176 of its remaining  Ives shares to
Maxxon's legal counsel.  Upon Settlement and at December 31, 2000,  Maxxon owned
564,706 shares of Ives common stock.

From June 2, 2000 to December 31, 2000, the price of Ives' common stock declined
from $0.937 per share to $0.11 per share.  Subsequent to December 31, 2000,  the
Company  sold  397.500  shares of its Ives common  stock at an average  price of
$0.43 per share and  received  $169,030.46  in cash.  On March 5, 2001,  the SEC
suspended  trading in Ives common stock on the OTC Bulletin  Board until further
notice. As of March 30, 2001, Maxxon owned 167, 205 shares of Ives common stock.
Even  though Ives  common  stock  began  trading on the Pink Sheets on March 19,
2001,  there is no assurance  that there will ever be sufficient  trading volume
for  Maxxon to sell its  remaining  stock  position.  In  addition,  there is no
assurance that the price at which Maxxon sells its remaining stock position will
equal or exceed  the $0.43  average  per share  price  Maxxon  received  for the
397,500 shares it sold to date. Based on the uncertainty  surrounding the future
value of Ives common stock,  the Company  determined  that its ownership of Ives
common stock had no value at December 31, 2000.

The Health Club, Inc.
On August 18,  1997,  in  connection  with the Ives Health  Company  transaction
described above, the Company issued 35,000 shares of its common stock for all of
the issued and  outstanding  common stock of The Health Club, Inc.  ("THC"),  an
Oklahoma corporation  organized for the planned multi-level marketing operations
of Old Ives.  The sole officer,  director and  shareholder  was Keith Ives. As a
result of the  transaction,  THC  became a  wholly-owned  subsidiary  of Maxxon.
Maxxon  valued the stock  portion of the  transaction  at $54,950,  or $1.57 per
share,  which was determined by Maxxon's Board of Directors to be the fair value
of the restricted stock issued in the transaction. The closing price of Maxxon's
common  stock on the date of the  transaction  was $2.50 per share and the Board
determined that a 35% discount was appropriate for the restricted  stock issued.
Maxxon  also paid Keith Ives  $10,000 in  connection  with the  transaction.  On
December 31, 1997, Maxxon and IHC entered into a Rescission Agreement. The Board
determined that the value of THC was $45,000,  which  represented the $10,000 in
cash paid and 35,000  shares  issued at $1.00 per share,  the  closing  price of
Maxxon's common stock on the date of the Rescission. For two years following the
Rescission Agreement, Keith Ives had the right to unwind Maxxon's acquisition of
THC by paying  Maxxon  $10,000 and by returning  to Maxxon the 35,000  shares of
Maxxon common stock issued to Keith Ives in connection with Maxxon's acquisition
of THC. At December  31, 1999,  Keith Ives did not  exercise his right.  For the
year



                                      F-8
<PAGE>

ended December 31, 1999, the value of Maxxon's  investment in THC was reduced to
$0, after the Board determined THC had no future value to Maxxon.

Note 4 - Income Taxes

The  deferred  tax assets and  liabilities  at December 31, 2000 and 1999 are as
follows:

                                                  2000                 1999
                                         --------------        -------------

 Net operating loss carry-forward      $     1,723,000       $    1,320,000
 Less:  Valuation allowance                  1,723,000            1,320,000
          Net Deferred Tax Benefit     $           - -       $          - -

As of December 31, 2000, the Company had a net operating loss  carry-forward  of
approximately  $5,740,218.  Approximately  $800,000 will expire in 2012, and the
remaining  $4,940,218  will expire  beginning in 2013.  Deferred taxes reflect a
combined federal and state tax rate of approximately 30%.

Note 5 - Commitments and Contingencies

Future Royalty Obligations Under Exclusive License Agreement
In connection with the Rippstein License, the Company agreed to pay royalties of
4% of gross sales of syringes and minimum annual royalties  ranging from $10,000
to  $20,000  beginning  on the 4th  anniversary  of the date when both a working
prototype syringe is developed and a U.S. patent is issued.

Contingent Payment Obligation Under Exclusive License Agreement
In connection with the Rippstein License,  the Company agreed to pay $200,000 if
all of the following  events happen on or before  September 30, 2001; (1) a U.S.
patent is issued, (2) a fully functional and working prototype of the syringe is
completed,  and (3) FDA  approval  to sell the  syringe in the U.S is  obtained.
However,  if FDA approval is not received by September 30, 2001, but the Company
has begun selling syringes in places that do not require FDA approval,  then the
Company  will pay the  $200,000  out of the first net  profits  from the sale of
those syringes.  If the three events described above and the sale of syringes in
places that do not require FDA approval  have not all occurred by September  30,
2001, then Maxxon will not be obligated to pay the $200,000 contingent payment.

Future Payment Obligations Under Technical Consulting Agreement
On November 18, 1999, Maxxon entered into a Technical  Consulting Agreement with
Mr.  Rippstein  whereby Maxxon engaged him on a  non-exclusive  basis to provide
technical assistance and consulting services to achieve startup of production of
the new Maxxon Safety Syringe.  Maxxon paid Mr. Rippstein $12,500 upon execution
of the Agreement and agreed to pay him an additional $37,500 upon the occurrence
of various milestones in the development of the syringe as follows:  (1) $12,500
upon the manufacture of the first fully  operational  working syringe  prototype
and (2) $25,000 upon  production of syringes  from the steel molds.  On March 1,
2001,  subsequent to year end,  Maxxon paid Mr.  Rippstein  $12,500  because the
first operational working syringe prototype had been produced.

Patents
On February  27, 2001,  subsequent  to year end,  the U.S.  patent  covering the
safety syringe designed by Mr. Rippstein was published.  On January 13, 2001, an
application  was filed for  international  patent  protection,  pursuant  to the
Patent Cooperation Treaty. There is no assurance that any international  patents
will  issue.  There is no  assurance  that the patent  does not  infringe on the
rights of others.



                                      F-9
<PAGE>


Leases
Maxxon  leases  approximately  3,000 of  commercial  office space from  Oklahoma
National Bank under the terms of a five-year  lease which expires March 31 2002.
The remaining  minimum  annual lease  payments  under the lease are scheduled as
follows:

             For the Periods Ended
                    December 31             Amount
                        2001               $45,587
                        2002               $11,462

The office space is shared with other  companies owned in party by Maxxon's sole
officer and director. The value of the minimum lease payments is allocated among
the  companies  based on an estimate of usage and is recorded as a receivable to
Maxxon on a quarterly  basis. At December 31, 2000 and 1999,  Maxxon was owed $0
and $31,200, respectively, for rent.

For the years ended  December  31, 2000 and 1999,  Maxxon  paid  $45,073.64  and
$41,568.02,  respectively,  pursuant  to the  lease.  During  2000,  Maxxon  was
reimbursed $50,400 from the other companies for monthly rent for the years ended
December 31, 1998, 1999 and 2000.

Broker-Dealer Selling Agreement.
On December  18,  2000,  we signed a  Broker-Dealer  Selling  Agreement  on with
RichMark Capital Corporation, a registered broker-dealer. The Agreement provides
that  RichMark  receive a commission  of ten percent (10%) of the sales price of
shares sold, a three percent (3%)  non-accounted  expense  allocation  and a two
percent  (2%) due  diligent  fee. On  December  31,  2000,  we began an Offering
Regulation  D, Rule 506  offering  to sell up to  4,000,000  Units at a price of
$0.25 per Unit.  Each Unit  consists of one share of Common Stock and one Common
Stock purchase warrant that expires on December 31, 2005.

Employment Agreements.
On January 3, 2001, we entered into written  employment  agreements with Gifford
Mabie,  our sole officer and director,  and Rhonda Vincent,  Thomas Coughlin and
Vicki Pippin, our employees.  The material terms of their respective  employment
agreements are the same, except that Mr. Mabie's employment  agreement states he
will not  compete  with us for  one-year  after  he  resigns  voluntarily  or is
terminated for cause. If Mr. Mabie is terminated  without cause or if he resigns
because a change of control has  occurred,  then the  non-compete  clause of his
employment agreement will not be applicable.

The term of each  employment  agreement is for one year,  ending January 3, 2002
with an automatic and continuous renewal for consecutive two year periods.  Each
agreement  can be ended  either by us or by the employee  upon 30 days'  written
notice.  Each agreement  provides for an annual salary of at least $100,000 with
an annual salary  increase equal to no less than the percentage  increase in the
Consumer Price Index during the previous  calendar year. Each employee's  salary
will  be  accrued  by the  Company  and  paid  in  whole  or in  part as cash is
available.  If an employee  resigns or is terminated for any reason,  his or her
accrued and unpaid  salary plus  severance  pay ranging from three (3) months to
twenty-four (24) months, depending on the circumstances of his or her departure,
will be due and payable within 30 days of his or her resignation or termination.
Under each employment agreement, we provide certain fringe benefits,  including,
but not  limited  to,  participation  in pension  plans,  profit-sharing  plans,
employee stock ownership plans, stock appreciation  rights,  hospitalization and
health insurance,  disability and life insurance,  paid vacation and sick leave.
We will  reimburse  each  employee for any  reasonable  and  necessary  business
expenses,  including  travel and  entertainment  expenses  that are necessary to
carry out his or her duties. Each employee has the right to participate in other
businesses as long as those businesses do not compete with us and so long as the
employee  devotes the  necessary  working time, as determined in his or her sole
discretion,  to our business activities. We will indemnify each employee for all
legal  expenses and  liabilities  incurred  with any  proceeding  involving  the
employee by reason of his or her being an officer,  director,  employee or agent
of the Company. We will pay reasonable attorney fees and expenses as incurred in
the event  that,  in the  employee's  sole  judgment,  he or she needs to retain
counsel or otherwise expend personal


                                      F-10
<PAGE>


funds for his or her defense. If there is a change in control, each employee has
the right to resign.  A change in control is defined as a change in the majority
of Directors  within any twelve month period  without 2/3 approval of the shares
outstanding  and entitled to vote, or a merger where less than 50 percent of the
outstanding  common  stock  survives  and a majority  of the Board of  Directors
remains,  or the sale of substantially all of our assets, or if any other person
or group acquires more than 50 percent of the voting capital.


Note 6 - Common Stock and Paid-In Capital

Common Stock Transactions for the year ended December 31, 2000

During  2000,  the  Company  sold  724,000  shares of its  common  stock to five
existing  investors at a price of $0.25 per share for $181,000 in cash.  Each of
the 724,000 shares sold held a warrant to purchase an additional  share of stock
at an exercise price of $1.00 for each share  purchased.  The warrants expire on
June 30, 2005.

On July 1, 2000,  the Company issued 138,776 shares of its common stock at $0.50
per share, which was the closing price of the Company's common stock on the date
of issue,  to Gifford  Mabie and Vicki Pippin as repayment  for $69,388 in loans
they had made to the Company.

Common Stock Transactions for the year ended December 31, 1999
During 1999,  the Company sold 390,693  shares of its common stock to individual
investors  for $342,425 in cash,  issued  14,069 shares of its common stock to a
non-affiliate as a consulting fee in connection with the sale of common stock,

During  February,  1999,  Vicki  Pippin,  Thomas  Coughlin and Fred Slicker each
exercised options to purchase 100,000 shares of common stock at $0.50 per share,
which were  granted to them in  January,  1998.  A total of 300,000  shares were
issued and the Company received $150,000 in cash.

On January 20, 1999,  the Company  issued  150,000 shares of its common stock to
Morgan-Phillips,  Inc.,  an  investor  relations  firm,  at $1.00 per share,  as
payment for services  valued at  $150,000.  The closing  price of the  Company's
common stock on the date of the transaction was $0.937 per share.

On November  18, 1999,  in  connection  with the  Rippstein  License,  the Board
granted to Mr. Rippstein and associates options to purchase a total of 1,600,000
shares of Maxxon's  common stock at an exercise price of $0.50 per share,  which
was the closing  price of  Maxxon's  common  stock on the date of the  Rippstein
License.  The options expire  October 31, 2009 and become  exercisable in stages
upon the  occurrence  of certain  events.  Details  regarding the events and the
compensation cost recorded are discussed in Note 7. "Stock Options."

Common Stock Transactions for the year ended December 31, 1998
During  1998,  the Company  sold 50,000  shares of common  stock to a individual
investors  for $91,000 in cash,  issued 44,827 shares of common stock as payment
for  $55,000 in Ives  debts,  and  issued  548,574  shares of common  stock upon
conversion of debentures  purchased by a  third-party  investor  during 1997 for
$25,000 and during 1998 for $250,000.

On January 21, 1998,  the Company  entered into an  agreement  with  Stockbroker
Relations,  Inc., a third-party  investor relations firm, to provide services to
the Company in exchange  for 835,042  shares of common stock valued at $448,140.
The value  was equal to $0.54 per  share,  the  closing  price of the  Company's
common stock on the date of the agreement.

On January  1998,  the  Company  issued  77,691 to Texas  Applied  Biotechnology
Services,  Inc.  (TABS) as  payment  for  $35,660  in  services  related  to the
development  of a previous  safety  syringe.  During 1999,  development  of this
previous syringe was discontinued.



                                      F-11
<PAGE>

During 1998,  the Company also issued 75,274 shares valued at $90,748 as payment
for services  rendered by Maxxon's Medical Advisory Board and Com-Med  Strategic
Alliances,  which  coordinated  the Board's  activities.  The shares were valued
using the price of the Company's  common stock on the date of the  transactions.
The  Medical  Advisory  Board was  discontinued  in 1998  until such time as the
safety syringe receives FDA approval

During 1998,  the Company  canceled  91,572  shares  issued  during 1997 for the
performance of services by various third-party vendors. The services were valued
at $40,265  during  1997.  The  services  were not  performed,  and the  Company
canceled the shares during 1998. The cancelled shares were valued at $40,265. On
January 20, 1998, the Company's Board of Directors (the "Board") granted options
to purchase up to 1,750,000  shares of common stock at exercise  prices  ranging
from  $0.50 to $2.00  per  share to  Stockbroker  Relations,  Inc.  ("SRI"),  an
investor  relations firm.  During 1998, SRI exercised  500,000 options at prices
ranging from $0.50 and $0.75 per share which  resulted in the Company  receiving
$307,400 in cash and $18,100 in services.  The remaining  options were cancelled
when the contract with SRI ended in September, 1998.

In  September,  1998,  the Board  granted  options to purchase  70,000 shares of
common stock at $0.75 per share to Morgan-Phillips,  Inc., an investor relations
firm.  During  September and November,  1998,  Morgan-Phillips  exercised 40,000
options  and  30,000  options,  respectively.  The  Company  received a total of
$52,500 in cash from the options exercises.

In June 1998,  the Company issued 350,000 shares to Oasis Capital as a result of
a settlement  agreement.  Oasis Capital was owned by Sean Stanton,  a founder of
the Company.

Common Stock Transactions for the year ended December 31, 1997

During  1997 and 1998,  the  Company  issued  18,513  shares and 44,827  shares,
respectively,  as payment of Ives liabilities  amounting to $27,000 and $55,000,
respectively.

During  1998,  the  Company  issued  40,920  shares of its  common  stock to two
individuals who were shareholders of Old Ives. The shares were issued to them as
payment of $50,000 which they claimed to be owed by Old Ives during the time Old
Ives was Maxxon's subsidiary.

Description of Common Stock
Maxxon is authorized to issue up to  25,000,000  shares of common stock,  $0.001
par value. At December 31, 2000,  13,180,125  shares of common stock were issued
and outstanding.

Voting Rights
Holders  of  shares of common  stock are  entitled  to one vote per share on all
matters submitted to a vote of the  shareholders.  Shares of common stock do not
have cumulative voting rights. Therefore, persons voting a majority of the share
vote can elect all members of the Board of  Directors.  Holders of a majority of
the issued and  outstanding  shares of common  stock may take  action by written
consent without a meeting.

Dividend Rights
Holders of record of shares of common  stock are  entitled to receive  dividends
when and if declared  by the Board of  Directors.  To date,  the Company has not
paid any dividends on its common stock.  Holders of common stock are entitled to
receive  such  dividends  as may be  declared  and paid from time to time by the
Board of Directors out of funds legally available. The Company intends to retain
any  earnings  for the  operation  and  expansion  of its  business and does not
anticipate  paying  cash  dividends  in  the  foreseeable   future.  Any  future
determination  as to the  payment of cash  dividends  will  depend  upon  future
earnings, results of operations,  capital requirements,  the Company's financial
condition and such other factors as the Board of Directors may consider.

Liquidation Rights
Upon any  liquidation,  dissolution  or  winding up of the  Company,  holders of
shares of common stock are entitled to receive pro rata all of the assets of the
Company  available for distribution to shareholders  after  liabilities are paid
and distributions  are made to the holders of the Company's  preferred stock, if
any. There were no preferred shares issued and outstanding at December 31, 1999.



                                      F-12
<PAGE>

Preemptive Rights
Holders of common stock do not have any preemptive rights to subscribe for or to
purchase any stock, obligations or other securities of the Company.


Note 7 - Stock Options

Options  Granted  Pursuant to the  Rippstein  License.  On November 18, 1999, in
connection with the Rippstein License,  the Board of Directors of Maxxon granted
to Mr.  Rippstein and others options to purchase a total of 1,600,000  shares of
common  stock of Maxxon at an exercise  price of $0.50 per share.  The  exercise
price of $0.50 per share was  greater  than  $0.343 per share  closing  price of
Maxxon's common stock on the date of grant.  The options expire October 31, 2009
and are exercisable in stages upon the occurrence of the following  events:  (1)
Options to purchase 320,000 shares are exercisable  immediately;  (2) Options to
purchase  320,000 shares are exercisable  when a fully working safety syringe is
produced  (3) Options to purchase  320,000  shares are  exercisable  when a U.S.
Patent covering the Rippstein Syringe is issued; (4) Options to purchase 320,000
shares  are  exercisable  when  the  first  syringe  is  produced  from the hard
production molds and is ready for full scale production; (5) Options to purchase
320,000 shares are  exercisable  when FDA approval is obtained.  If Maxxon sells
the Rippstein  Syringe  Technology or if Maxxon is acquired by another  company,
options to purchase all 1,600,000 shares will be exercisable, even if the events
described in items (1) through (5) have not yet occurred.

As of December 31, 2000, options to purchase 640,000 shares were exercisable. Of
the exercisable  options,  320,000 were  exercisable  upon signing the Rippstein
License and 320,000 were  exercisable  on December 13, 2000,  the date the fully
working syringe prototype was produced. Compensation cost related to the 320,000
options that were exercisable upon signing the Rippstein License was based on an
estimated fair value of $0.2817 per share, or $90,144 . The estimated fair value
was calculated using the  Black-Scholes  option pricing model with the following
assumptions: exercise price of $0.50 per share; stock price on November 18, 1999
of $0.343 per share; risk-free interest rate of 6.0%; expected dividend yield of
0.0; expected life of 9.96 years; and estimated volatility of 81%.  Compensation
cost  related to the 320,000  options  that became  exercisable  on December 13,
2000, the date a fully working syringe  prototype was produced,  was based on an
estimated fair value of $0.1939 per share, or $62,048.  The estimated fair value
was calculated using the  Black-Scholes  option pricing model with the following
assumptions: exercise price of $0.50 per share; stock price on December 13, 2000
of $0.21 per share;  risk-free interest rate of 6.0%; expected dividend yield of
0.0; expected life of 8.89 years; and estimated volatility of 124%.

Options  Granted to  Employees.  On January 20, 1998,  the Board of Directors of
Maxxon granted options to purchase 300,000 shares of common stock at an exercise
price of $0.50 per share to each of the following employees pursuant to the 1998
Incentive Stock Option Plan: Gifford Mabie,  Rhonda Vincent,  Frederick Slicker,
Thomas Coughlin and Vicki Pippin.  The options expire ten years from the date of
grant. The Company did not record  compensation  cost because the exercise price
was equal to the price of the  Company's  common stock on the date of grant (See
"Stock-based  Compensation" in Note 1 to the Financial Statements).  On February
8, 1999, Mr.  Slicker,  Dr.  Coughlin and Ms. Pippin each  exercised  options to
purchase 100,000 shares of common stock.  The Company received  $150,000 in cash
as a result of the options exercised. On February 25, 2000, Mr. Slicker resigned
and forfeited his remaining 200,000 options. As of December 31, 2000, there were
1,000,000  options  outstanding in the Incentive Stock Option Plan. A summary of
the status of the  Company's  stock  options at December 31,  2000,  and changes
during the year then ended is presented below:

                                                             Weighted Average
                                                 Shares        Exercise Price
                                           ------------    ------------------
Employees (Incentive Stock Option Plan):
  Outstanding, December 31, 1999             1,200,000                $  0.50
         Granted                                    --                     --
         Exercised                                  --                     --
         Forfeited                           (200,000)                     --
                                           ------------    ------------------
  Outstanding, December 31, 2000             1,000,000                $  0.50
                                           ------------    ------------------
  Exercisable, December 31, 2000             1,000,000                $  0.50
                                           ------------    ------------------


                                      F-13
<PAGE>





Non-Employees:
  Outstanding, December 31, 1999              1,600,000                $  0.50
         Granted                                     --                     --
         Exercised                                   --                     --
         Forfeited                                   --                     --
                                           -------------    ------------------
  Outstanding, December 31, 2000              1,600,000                $  0.50
                                           -------------    ------------------
  Exercisable, December 31, 2000                640,000                $  0.50
                                           -------------    ------------------

The following table summarizes  information  about stock options  outstanding at
December 31, 2000:
<TABLE>
<CAPTION>

       <S>                    <C>            <C>            <C>           <C>             <C>
                                    Options Outstanding                    Options Exercisable
                        -----------------------------------------    ---------------------------
                                           Weighted
                                            Average      Weighted                      Weighted
                               Number     Remaining       Average          Number       Average
Range                     Outstanding   Contractual      Exercise     Exercisable      Exercise
of Exercise Prices        at 12/31/00          Life         Price    at 12/31/00          Price
------------------        -----------   -----------      --------    ------------      --------
Employees:
      $0.50                 1,000,000     7.13 Years       $0.50        1,000,000         $0.50
Non-Employees:
      $0.50                 1,600,000     8.83 Years       $0.50          640,000         $0.50

</TABLE>

Note 8 - Related Party Transactions

During 2000, the Company  recorded $19,200 in rent receivable from companies who
use Maxxon's  office space.  These other companies are owned in part by Maxxon's
sole officer and  director.  During 2000,  these  companies  paid Maxxon a total
$50,400  for rent for the years  ended  December  31,  1998,  1999 and 2000.  At
December 31, 2000, Maxxon's rent receivable from these companies was zero.

During 2000, the Company loaned its sole officer and director a total of $57,000
pursuant to three unsecured  promissory  notes for $36,000,  $4,000 and $17,000.
Each note bears  interest at an annual rate of 8% and is due  December 31, 2002.
During 2000, the note for $4,000 was repaid.

During  1998,  the  Company  received  $19,539  in loans  from a  non-affiliated
shareholder.  During 1998, the  non-affiliated  shareholder paid for expenses on
behalf of the Company,  and the Company recorded the $49,633 as an expense and a
payable to the non-affiliated shareholder (see Note 14).

During 2000 and 1999,  the Company  loaned  $47,852 each to Rhonda  Vincent,  an
employee, and Gifford Mabie, sole director of the Company. At December 31, 2000,
the balance of these notes was $7,605.

Note 9 - Long-lived Assets

Property, plant and equipment , including significant  improvements,  are stated
at cost.  Expenditures  for  maintenance  and repairs  are charged to  operating
expenses as incurred.  When properties are retired or otherwise disposed of, the
cost of the asset and the related accumulated  depreciation are removed from the
accounts  with  the  resulting  gain or  loss  being  reflected  in  results  of
operations.


                                      F-14
<PAGE>



Computer equipment                      5 Years      $5,442.30
     Less: Accumulated Depreciation                  (2,336.31)
                                                   -------------
                                                     $3,105.99
                                                   -------------

Furniture and fixtures                  5 Years      17,625.73
     Less: Accumulated Depreciation                 (10,295.66)
                                                   -------------
                                                     $7,330.07
                                                   -------------

Leasehold improvements                  5 Years      11,650.82
     Less: Accumulated Depreciation                  (7,868.63)
                                                   -------------
                                                     $3,782.19
                                                   -------------

Total Long-lived Assets                             $14,218.25
                                                   =============

Goodwill  arising from business  acquisitions is amortized over its useful life,
which is generally 40 years, on a straight-line basis. Intangible assets include
patents and  trademarks,  which are valued at  acquisition  through  independent
appraisals.  Debt  issuance  costs  are  being  amortized  over the terms of the
various   agreements.   Patents  and  trademarks   are  being   amortized  on  a
straight-line basis over periods varying from 7 to 40 years (see Note 1).

Management  assesses the  recoverability  of property and  equipment,  goodwill,
trademarks  and  other   intangible   assets   whenever  events  or  changes  in
circumstances  indicate  that  the  carrying  amount  of an  asset  may  not  be
recoverable from its future undiscounted cash flows. If it is determined that an
impairment  has  occurred,  an impairment  loss is recognized  for the amount by
which the carrying amount of the asset exceeds its estimated fair value.

Note 10 - Subsequent Events

On January 3, 2001, the Company entered into written employment  agreements with
its sole officer and director and its key employees. The terms of the employment
agreements are discussed in Note 5 to the financial statements.

On January 3, 2001,  we issued  Rhonda  Vincent,  an employee,  50,000 shares of
common  stock to repay her for $7,500 in expenses  she paid on behalf of Maxxon.
The closing  price of our common  stock on the date of  repayment  was $0.15 per
share. The shares were issued pursuant to an exemption from  registration  under
Section 4(2) of the Securities Act of 1933, as amended.

On January 3, 2001,  we sold to our  employees  a total of  3,650,000  shares of
common  stock at $0.15 per share,  the closing  price of our common stock on the
date of the transaction.  From each employee,  we received a promissory note due
January 3, 2008 at 8% interest per year.  The shares were issued  pursuant to an
exemption from registration under Section 4(2) of the Securities Act of 1933, as
amended.

Pursuant to the terms of our  Regulation  D, Rule 506 private  offering of up to
4,000,000 Units,  each Unit consisting of one share of common stock at $0.25 per
share and one warrant to purchase an additional  shares of common stock at $0.50
per share on or before  December 31,  2005,  we had the  following  transactions
during the first quarter of 2001.

During January, 2001, we sold 320,000 Units and received $80,000 in cash. During
February,  2001,  we sold 900,000  Units and received  $225,000 in cash.  During
March, 2001, we sold 668,000 Units and received $167,000 in cash.

During February,  2001, the Company sold 397,500 shares of its Ives common stock
at an average  price of $0.43 per share and  received  $169,030.46  in cash.  On
March 5, 2001,  the SEC suspended  trading in Ives common stock.  As of March 5,
2001,  Maxxon owned 167, 205 shares of Ives common stock.  There is no assurance
that trading in Ives common  stock will  resume.  Even if trading in Ives common
stock does resume there is no assurance that there will be sufficient volume for
Maxxon to liquidate  its  remaining  stock  position.  In addition,  there is no
assurance that the price at which Maxxon sells its remaining stock position will
equal or exceed the $0.43  average per share  price it received  for the 397,500
shares it has sold to date.


                                      F-15
<PAGE>

Agreements  with  Marty  Smith and  Stuart  Daley of Genesis  Design  Group.  On
February 21, 2001,  the Company  entered into an agreement  with Marty Smith and
Stuart Daley of Genesis  Design Group for their  assistance in  supervising  the
production of the molds and the testing of the syringes. The contract was valued
at $25,000 and in lieu of paying cash, the Company issued them 100,000 shares of
its common  stock at $0.25 per share,  the closing  price of our common stock on
the date of the  agreement.  As an  incentive  to  deliver  to Maxxon  assembled
syringes that are fully functional  within 12 weeks from the date the order with
the manufacturer is placed, the Company granted them an option to purchase up to
150,000  shares of Maxxon common stock at $0.25 per share,  exercisable in whole
or in part until December 31, 2002. The options are exercisable  only if Genesis
is successful in meeting the 12-week requirement.

On February 22, 2001, the Company entered into an agreement with Marty Smith and
Stuart  Daley of  Genesis  Design  Group to pay a  finders  fee to them if their
efforts result in bringing a financial  partner to invest in or acquire  Maxxon.
If such a transaction occurs as a result of their efforts, the Company agreed to
pay them  100,000  shares of Maxxon  common stock and one-half of one percent of
the total amount of the transaction.

Production Agreement with Artistic Plastics, Inc. On March 26, 2001, the Company
entered into a Production  Agreement with Artistic  Plastics,  Inc.,  located in
Anaheim,  California,  to  produce  the  injection  molds for the  syringe at an
estimated  cost of $139,000,  of which  $69,500 was paid on March 14, 2001.  The
remaining $69,500 will be payable upon delivery of the syringes.


                                      F-16