SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

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

                   FOR  THE  FISCAL  YEAR  ENDED  DECEMBER  31,  1999
                           Commission  File  No.  0-22919

                             PRIME  COMPANIES,  INC.
                 (Name  of  small  business  issuer  in  its  charter)

         Delaware                                                 52-2031531
         --------                                                 ----------
(State  or  other  jurisdiction  of                           (I.R.S.  Employer
incorporation  or  organization)                            Identification  No.)


  409  Center  Street,  Yuba  City,  CA.                               95991
----------------------------------------------                      -----------
(Address  of  principal  executive  offices)                        (Zip  Code)

  Issuer's  telephone  number:                                   (530)  755-3580

Securities  Registered  Pursuant  to  Section  12(b)  of  the  Act:
  None

Securities  Registered  Pursuant  to  Section  12(g)  of  the  Act:


                                                       NAME  OF  EACH  EXCHANGE
TITLE  OF  EACH  CLASS                                   ON  WHICH  REGISTERED
----------------------                                   ---------------------
Common  Stock,  $.0001                                         NASD
                                                          OTC  Bulletin  Board

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     No X

Check  if  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  Yes  No  X

State  issuers  revenues  for  the  most  recent  fiscal  year. . .. . .$547,466

As  of  May  16, 2000 there were 31,030,429 shares of the Company's Common Stock
outstanding.  The  aggregate market value of voting stock held by non-affiliates
of  the  registrant  on  May  16,  2000  was  $20,500,701.

Documents  incorporated  by  reference:

None


<PAGE>
                                     PART I

ITEM  1.   DESCRIPTION  OF  BUSINESS

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
--------------------------------------------------------------------------------

Certain  statements  made  herein  or elsewhere by, or on behalf of, the Company
that  are  not  historical  facts  are intended to be forward-looking statements
within  the  meaning  of  the  safe  harbor provisions of the Private Securities
Litigation  Reform  Act  of  1995.  Forward-looking  statements  are  based  on
assumptions  about  future  events  and  are  therefore  inherently  uncertain.

The Company cautions readers that the following important factors, among others,
could  affect  the  Company's  consolidated  results:

1     Whether  acquired  businesses  perform at levels used by management in the
      valuation  process  and  whether,  and  the rate at which, management is
      able to increase  the  profitability  of  acquired  businesses.

2.    The  ability of the Company to manage its growth in terms of implementing
      internal controls and information gathering systems, and retaining or
      attracting key  personnel,  among  other  things.

3.    The  amount  and  rate  of  growth in the Company's corporate general and
      administrative  expenses.

4.    Changes  in interest rates, which can increase or decrease the amount the
      Company  pays  on  borrowings.

5.    Changes  in  government  regulation,  including tax rates and structures.

6.    Changes  in  accounting  policies  and  practices  adopted voluntarily or
      required  to  be  adopted  by  generally accepted  accounting  principles.

The Company cautions readers that it assumes no obligation to update or publicly
release  any  revisions  to  forward-looking statements made herein or any other
forward-looking  statements  made  by,  or  on  behalf  of,  the  Company.

                        BUSINESS HISTORY, AND DEVELOPMENT

                                    BACKGROUND
                                    ----------

Prior  to  February 1999, the Company operated as a sole proprietorship operated
by Norbert J. Lima, the Company's CEO.  The Company began operations in February
1998  when  it acquired certain assets of Pagers Plus, Inc. (an entity for which
the  Company's  current  CEO served as an officer) in exchange for assumption of
specified  liabilities. In February 1999, management formed Woldnet Tel.com Inc.
(Worldnet),  a  Delaware corporation, and WNTC Holdings, Inc. (WNTC), a Delaware
corporation  and  a  wholly-owned  subsidiary  of  Worldnet,  and NACC-Tel Corp.
(NACC-Tel),  a  Delaware  corporation and a wholly-owned subsidiary of WNTC.  At
that  time  the  operations  of  the  Company  were  contributed  to  NACC-Tel.

Prepaid  Tel.com  Inc. (Prepaid), a Delaware corporation, was formed in February
1999  as  a  wholly-owned  subsidiary  of  WNTC.  Prepaid is a Competitive Local
Exchange Carrier ("CLEC") certified by the California Public Utility Commission.
Prepaid  had  no  substantial  operations  during  1999.

                                       1
<PAGE>

LMDS  Communications Inc. (LMDS), a Delaware corporation, was formed in February
1999 as a wholly-owned subsidiary of WNTC.  LMDS is a telecommunications company
with  interests in the fixed broadband wireless sector.  LMDS had no substantial
operations  during  1999.

Pursuant  to  a Stock Purchase Agreement         (the "Agreement") between Prime
Companies,  Inc.  (Prime),  a Delaware Corporation, a nonoperating public shell,
and  Worldnet,  Worldnet was merged into Prime through a merger effective August
11,  1999.  Prior  to  the  merger,  Prime  had 6,507,742 shares of common stock
outstanding  held  by  various individuals.  Pursuant to the agreement, Worldnet
was  issued  14,500,000  shares of Prime common stock.  As a result of the stock
exchange, the former shareholders of Worldnet hold 69% of the outstanding shares
of  common  stock  of Prime. Pursuant to the Agreement, on the effective date of
the  merger,  the  officers  and  directors  of Worldnet became the officers and
directors  of  Prime.

Prior  to December 30, 1998 Prime operated as a long-haul temperature-controlled
truckload  carrier  through  its  wholly-owned subsidiary, Mid-Cal Express, Inc.
Prime  also  provided  logistics operations through its wholly-owned subsidiary,
Mid-Cal  Express  Logistics,  Inc. Effective December 30, 1998, Prime terminated
the  operations  of  these subsidiaries through the sale of substantially all of
the  operating assets of Mid-Cal Express, Inc. to  Gulf Northern Transport, Inc.
for  400,000  shares  of US Trucking, Inc., the parent company of Gulf Northern.
The  transaction  closed  on  April  14, 1999, and on April 30, 1999 the Company
entered into an agreement with Credit Managers Association of California for the
orderly  liquidation  and  payment  of  the  outstanding  liabilities  of  the
subsidiaries.  These  liabilities  are  to  be paid by the collection of Mid-Cal
Express,  Inc.'s  accounts  receivable  and  by the liquidation of up to 400,000
shares of US Trucking (traded on the OTC Bulletin Board symbol USTK), which have
been placed in escrow for the benefit of the creditors of Mid-Cal Express, until
the  stock  is  sold  on  the  open  market.

Zenith  Technologies  Inc.  (Zenith),  a  Delaware  Corporation,  was  formed in
December 1998 as a wholly-owned subsidiary of Prime Companies, Inc.  To date, it
has  had  no  operations.

In  October  1999,  the  Company  acquired  Olive  Tree Image Engineers, a small
Internet  Service  Provider located in Sacramento, California.  In December 1999
the  Company  completed  the  acquisition  of  Marathon  Telecommunications,  a
commercial  telephone interconnect business based in Sacramento, California. The
Company  is  currently  reviewing  several  telecommunications  acquisition
opportunities  that  have  come  to  its  attention.

                                  THE BUSINESS
                                  ------------

The  Corporation's  mission  is  to  provide a single source for a wide range of
telecommunications  services  to  both  the  consumer  and  commercial  markets.

The  Corporation's  principals comprise an experienced management team with over
50  years of experience in the telecommunications industry. It is this unusually
broad  scope  of  skills  and  experience  which  will enable the Corporation to
establish  a  balanced  and efficient organization, and to forge strong supplier
relationships  with  major  industry  manufacturers,  such  as Ericsson, Pacific
Telephone,  Samsung,  and Texas Instruments, as well as established distributors
who  intend to market the Corporation's services.  Thus, the Corporation is well
positioned  to offer its clients the depth of knowledge and experience necessary
to  reach  their personal and/or corporate needs and to execute each transaction
efficiently  and  successfully.

The Corporation will derive the majority of its revenues from sales generated by
its  3  specialized  subsidiary  corporations.

Prepaid  Tel.com  Inc. currently operates as a "reseller" of "prepaid" services,
---------------------
including  prepaid  wireline  (residential  local  telephone  and long distance)
services,  in  the  State  of  California.

                                       2
<PAGE>

The  customer base for prepaid telecommunications services is large and diverse,
including:  credit-impaired  customers,  who  generally  cannot meet the initial
deposit  requirements for telecommunications services; individuals who prefer to
pay  in  cash;  and  individuals  who  want  to  re-establish  credit.

LMDS  Communications,  Inc.  The  Corporation  intends  to  capitalize  on  the
---------------------------
broadband  fixed  wireless  communications  revolution  by providing LMDS (Local
Multipoint  Distribution  Systems)  services  to various markets in which it has
purchased  exclusive  spectrum  licenses  from  the  Federal  Communications
Commission.  LMDS  is  the  broadband wireless technology used to deliver voice,
data,  Internet,  and  video  services  in  the  28  to  31  GHz  spectrum.  The
Corporation  intends  to  build,  install,  and  implement the telecommunication
systems  and  offer  some  or  all  of  the  following one and two-way broadband
services:


-     High-speed  Internet  access
-     Video  teleconferencing
-     Wireless  local  loop  telephony
-     Alternative  cable  television  service
-     High-speed  data  transmission  (i.e.  ATM)

The  flexibility  offered  by LMDS will allow the Corporation to offer a turnkey
package  of  services,  including  Internet and video teleconferencing, which is
what  US  customers  desire:  "one-stop  shopping"  for their telecommunications
needs.

NACC-Tel Corp. The Company sells, installs, and services business communications
--------------
systems  and  provides paging and voicemail services. The Company also maintains
these  systems  under  service  agreements  with  its  commercial  and municipal
customers.


                                   COMPETITION
                                   -----------

Small-  and  medium-sized  businesses  currently  face  a  limited  choice  of
alternatives  for  high-speed  Internet access. Over the last few years, digital
subscriber  line  technologies,  cable  modems,  T-1-based  solutions  and
fixed-wireless  connections  have  emerged  as  alternative  technologies  for
high-speed,  always-on  service  in  our  country's  major  metropolitan  areas.
However,  these  technologies  have  not yet reached the country's secondary and
tertiary  markets;  this fact reinforces the viability of the company's strategy
to  initially  target  businesses  in  the  markets where we have LMDS licenses.

We  believe  that  our  solution  will  receive  wide  acceptance  by our target
customers  because  our  network  will  provide:

-     consistent  speed  and  quality  of  signal;
-     rapid,  relatively uncomplicated provisioning of new customers that is not
      dependent  on  another  provider  of  local  connectivity;
-     symmetrical  broadband  capacity  that  will  allow  us  to offer enhanced
      business  communication  services  such as full motion video conferencing;
-     scaleable,  competitive  pricing  schemes which are based on the number of
      desktops  connected  to  the  network;  and
-     substantially  higher  speeds  and  an  easy  path to increased bandwidth.


                                       3
<PAGE>

                             MARKETING AND CUSTOMERS
                             -----------------------

The  growth  of the Internet is leading to a global society where every business
must  obtain  access  to  the  Internet, or World Wide Web, and utilize "online"
functionality  in  order  to  fulfill  its  information  needs. The Company will
capitalize  on  this  need  by  providing  these  services  in  its  markets.

LMDS  now  provides vital communications services to regions that heretofore did
not  justify  wireline services, typically because the inherent costs outweighed
the  potential  revenues.  With the old method, it was difficult to actually lay
the  wire and install these systems.  With LMDS, the wireless technology enables
easy  implementation  at  any  business, requiring installation at the business'
building  only.

LMDS  offers  the  ability to provide various, vital telecommunications services
via  one,  efficient,  cost-effective medium.  Through the Company's licenses in
its various territories, it will deliver a better "package" for these businesses
and thus provide them with greater value, as opposed to the need to sign up with
several  different  suppliers.  The  company's  Nacc-Tel subsidiary will readily
support  and  provide  business  telephone interconnect services, voicemail, and
paging  services  to our LMDS customers. In some markets we may also provide ISP
services  such  as  Internet  web  site  hosting  for  our  LMDS  customers.


                                    EMPLOYEES
                                    ---------

The  Company had nine full-time employees and one part-time employee at December
31,  1999


ITEM  2.  DESCRIPTION  OF  PROPERTIES

The  Company  rents the following facilities as general office, engineering, and
retail  space  on  a  month-to-month  basis:

<TABLE>
<CAPTION>

Location                          Type                         Size           Annual
-------------------------------------------------------------------------------------
<S>                             <C>                          <C>            <C>
Yuba City, California*           Office, Engineering, Retail  1,100 sq. ft.  $11,058
Concord, California              Office                         700 sq. ft.  $ 8,400
Sacramento, California           Office                       1,200 sq. ft.  $ 6,205
Sacramento, California           Storage                        200 sq. ft.  $   900
Sacramento, California           Office                         250 sq. ft.  $ 3,600

*An officer and director of the Company is the landlord of this property.
</TABLE>



ITEM  3.  LEGAL  PROCEEDINGS

The  Company  is  the  defendant in a lawsuit with a former officer and director
claiming  payment of $32,000 due for advances made on behalf of the Company. The
Company  has  filed a cross-complaint seeking to recover 4,500,000 shares of its
common  stock held by the plaintiff, and to be reimbursed for legal fees arising
from this action. Management believes the outcome of this matter will not have a
material  adverse  effect  on  the  Company's  financial  position or results of
operations.

The  Company  is  exposed to routine litigation incidental to it's operations in
the  telecommunications  industry.  The  Company is also peripherally exposed to
routine  litigation  incidental  to  its  former  trucking  business,  primarily
involving  claims  for  personal  injuries  and  property damage incurred in the
transportation  of  freight.  The  Company  has turned these matters over to its
insurance carrier and management believes these matters will not have a material
adverse  effect  on  the  Company's financial position or results of operations.
                                       4
<PAGE>

In January 2000 the Company purchased Directors and Officers Liability Insurance
with  coverage that the Company's Board of Directors deems sufficient to attract
and  retain  talented  and  experienced  personnel.


ITEM  4.  SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS

None.


                                     PART II

ITEM  5.  MARKET  FOR  COMMON  EQUITY  AND  RELATED  STOCKHOLDER
MATTERS

                                     MARKET
                                     ------

The Company's Common stock has traded on the NASDAQ OTC Bulletin Board under the
symbol  PRMC since May 17,1998. The following table presents high and low prices
for the Company's common stock published by the National Quotation Service, Inc.
The  quotations  represent prices in the over-the-counter-market between dealers
in  securities  and do not include retail markup, markdown or commissions and do
not  necessarily  represent  actual  transactions.  Quarterly  market  price
information  for  the  Company's  shares  of  common  stock  is  as  follows:


QUARTER  ENDING         HIGH      LOW
----------------       ------    ------
June  30,  1998         3.00      3.00
September  30, 1998     3.25      0.31
December  31,  1998     3.50      1.00
March  31,  1999        2.50      0.125
June  30,  1999         0.56      0.125
September  30,  1999    0.50      0.22
December  31,  1999     0.50      0.25
March  31,  2000        4.31      0.30


                                  SHAREHOLDERS
                                  ------------

As  of  April  30,  2000  the  number of shareholders of record of common stock,
excluding  the  number  of beneficial owners whose securities are held in street
name  was  approximately  575.

                                 DIVIDEND POLICY
                                 ---------------

The  Company  had  not paid dividends on its common stock.  The Company plans to
retain  future  earnings,  if  any, for use in its business and, accordingly the
Company  does  not  anticipate  paying  dividends in the foreseeable future. Any
earnings  are  expected  to  be  reserved for the operation and expansion of the
Company's  business.  Payment  of  dividends  is  within  the  discretion of the
Company's  Board  of  Directors  and  will depend, among other factors, upon the
Company's  earnings,  financial  condition  and  capital  requirements.
                                       5
<PAGE>


ITEM  6.  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL  CONDITION  AND
RESULTS  OF  OPERATION

Results  of  Operations
-----------------------

During  the  year  ended  December  31,  1999,  sales  revenue  from  continuing
operations  increased  to $547,466 from $209,823 for the corresponding period of
the prior year.  The increase in revenue is attributed to increased marketing by
the  Company  and greater demand as customers continued to upgrade systems to be
Y2K  compliant.

The gross margin as a percent of revenues increased to 63% for the year December
31, 1999 from 43% in the corresponding period of the prior year. The improvement
in the gross margin is due to additional discounts for volume purchases provided
to  the  Company  by  its  telephone  vendors.

The  Company's  selling,  general and administrative expenses for the year ended
December  31,  1999  increased  to  $472,537 from $143,002 for the corresponding
period  of  the  prior  year.  The increase is attributed to increased marketing
efforts  and additional corporate overhead costs associated with the merger with
Prime.

As  a  result  of  the  reverse  merger  in  August 1999, the Company recorded a
one-time charge of $428,194 for the cost of the merger, representing Prime's net
liabilities  in  excess  of  assets  immediately  prior  to  the  merger.

Interest expense for the year ended December 31, 1999 increased to $199,089 from
$14,796  for  the  corresponding  period  of  the  prior  year.  The increase is
attributed  to  the  increased  debt  assumed  in  the  merger  with  Prime.

Liquidity  and  Capital  Resources
----------------------------------

At  December  31,  1999,  the Company had cash of $237,403 and a working capital
deficit of $60,750.  The primary cause of the deficit position resulted from the
assumption  of  net  liabilities  in  the  merger  with  Prime.

Cash  used  in  operations  was  $132,920  for  the year ended December 31, 1999
compared  to  $24,986  in  1998.  The  cash  used  in  operations  was primarily
attributed  to  the  net  loss  offset  by noncash charges for depreciation, the
one-time,  noncash  charge  related  to  the  merger, and an increase in accrued
interest.

Cash provided by investing activities, consisting primarily of proceeds from the
sale  of  property held for sale, was $1,068,161 for the year ended December 31,
1999. Cash used in investing activities, consisting of purchases of property and
equipment,  was  $7,635  for  the  period  ended  December  31,  1998.

Cash  used  in financing activities was $701,317 for the year ended December 31,
1999 and consisted of $740,565 paid on notes payable (with the proceeds from the
sale of property held for sale) offset by $39,248 of proceeds from notes payable
(used  for  operating  expenses).  Cash  provided  by  financing  activities was
$36,100  for  1998  and  consisted  of  capital  contributions.

The  Company's  ability  to  develop  its  Local Multipoint Distribution Service
business  is  dependent  upon its ability to obtain additional financing for the
infrastructure   equipment   and  working   capital   to   develop   the  market
opportunities.  Subsequent  to  December  31,  1999,  the Company sold 6,569,444
shares of its common stock in private placement offerings, raising $2.4 million.
Additionally,  in  February 2000 creditors holding $1,307,187 (balance due as of
February  28,  2000)  of notes payable accepted the Company's offer to converted
their  debt  into  2,904,860 common shares of the Company. In March 2000 another

                                       6
<PAGE>

creditor converted $252,500 of short term debt into 561,111 common shares of the
Company.  Management  believes the actions taken to convert outstanding debt and
raise  additional  capital will be sufficient to sustain operations for at least
the  next  twelve  months.

Impact of Recently Issued Standards

In June 1998, the Financial  Accounting  Standards  Board  issued  Statement  of
Financial Accounting Standards No. 133  (FASB133),  "Accounting  for  Derivative
Instruments and Hedging Activities."   This  statement  requires  that an entity
recognize all derivatives as assets or liabilities in the statement of financial
position and measure those instruments at fair value. This statement was amended
by FASB 137, issued in June 1999, such that it is effective  for  the  Company's
financial statements for the year ending December 31,  2001.  The  Company  does
not believe  the  adoption  of  FASB133  will  have a material impact on assets,
liabilities or equity.

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin  No. 101,  entitled "Revenue Recognition in Financial Statements."  SAB
101A  was  issued by  the  SEC  on  March  24,  2000  and  delays  the  required
implementation  date  of  SAB  101  until  the  second quarter of 2000.  SAB 101
provides guidance on the recognition, presentation and  disclosure of revenue in
the financial statements of public companies.  The Company does not believe that
the adoption of SAB 101 will have a material effect on its financial position or
results of operations.

Seasonality and Inflation

Management  does not believe the Company's operations are significantly affected
by seasonality or inflation.

Year 2000 Compliance

The Company has experienced no disruption in its operations that management can
attribute to Year 2000 issues.  In addition, the Company has seen no Year 2000-
related problems itself or received any reports of such problems from entities
with which it transacts business.





ITEM  7.  FINANCIAL  STATEMENTS

The  Company's  consolidated  financial  statements  are  attached  as pages F-1
through  F-14.


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

Certain information about directors and executive officers of the Company is set
forth  below:

                             OFFICERS AND DIRECTORS
                             ----------------------

The following table sets forth the names, ages and positions with the Company as
of  December 31, 1999 of all of the officers and directors (the "Named Executive
Officers")  of  the  Company.  Also  set  forth  below  is information as to the
principal  occupation  and  background  for  each  person  in  the  table.

 a)  Directors  and  Executive  Officers  of  the  Company



NAME             AGE  DIRECTOR SINCE              POSITION
---------------  ---  --------------  ---------------------------------
Norbert Lima      54       1999       Chief Executive Officer, Director


Stephen Goodman   56       1999       Chief Financial Officer,
                                      Corporate Secretary, Director

Adrian Lima       29                  Vice President - Engineering

Eric Bergmann     46       2000       Director

Michael Gilbert   45       2000       Director

William Turley    62       2000       Director


                                       7
<PAGE>


The following is a brief description of the business background of the executive
officers  and  directors  of  the  Company.

Norbert  Lima  has  been  President  and  CEO and Director for the Company since
August  1999.  Mr.  Lima has over thirty years of telecommunications experience,
and  will  be  responsible  for  implementing  the Company's operational systems
across  multiple markets.   Mr. Lima founded and operated NACC-Tel, a California
interconnect  company,  from  1984-1994,  where  he  served  as  Sales  Manager,
Technical  Services  Engineer,  and  Installation Manager.  NACC-Tel merged with
Pagers  Plus  Cellular  in  1994,  whereby  Mr. Lima served as Vice President of
Engineering,  responsible for RF engineering and construction of 220 MHz systems
throughout  the  US.  Under  Mr.  Lima's  direction,  Pagers  Plus  successfully
constructed  150  five-channel  220  MHz  systems throughout various states.  In
early  1998, Mr. Lima re-purchased NACC-Tel, along with certain assets of Pagers
Plus  Cellular, which was subsequently acquired by the Company in 1999, and will
remain  in  operation  as  its  wholly-owned  subsidiary.


Mr.  Lima  worked in various positions for Pacific Telephone for nineteen years,
most  recently  as Engineering Manager from 1981-1983.  From 1979-1981, Mr. Lima
was  District  Manager  of  Construction,  where  he  was  responsible  for five
construction  divisions  with  275  subordinates  and  an  operating  budget  of
approximately  US$16,000,000 per annum.  Mr. Lima's career has taken him through
multiple  levels  of  the large telecom company, as he also spent eight years as
Outside  Plant Engineer, where he had responsibilities of planning and designing
pole  lines,  conduit  structures,  and underground/building cables.  Mr. Lima's
success  enabled  his  promotion  to  Engineering  Manager,  where  he  became a
supervisor  for  several  Outside  Plant  Engineers, and then Staff Manager from
1978-1979,  where  he  was  responsible for conducting Outside Plant Engineering
Reviews  throughout  the states of California and Nevada.  Mr. Lima received his
BS in Industrial Technology-Electronics and his BA in Public Administration from
Fresno  State  University  in  1970.

Stephen  Goodman  has  been Chief Financial Officer, Treasurer, and Director for
the Company since August 1999.  Mr. Goodman has worked in the telecommunications
industry  for  over  eight years, serving as President for both Secure Cellular,
Inc.  and  Pagers  Plus Cellular, of San Francisco, from 1992-1999.  Mr. Goodman
had  been  responsible for the strategic direction of the companies, and led the
company  to  be  named the 25th fastest-growing company in the San Francisco Bay
area in 1996.  Mr. Goodman developed, structured, and negotiated the majority of
the  business  for  the  company,  which  provides  prepaid  cellular  telephone
services,  prepaid wireless services, and telephone systems to both consumer and
corporate  customers  throughout  California.

Mr.  Goodman  is  skilled in banking and finance, having accumulated over thirty
years  working  for  various organizations.  Mr. Goodman was President of Contra
Costa  Financial  Services, Inc. from 1989-1992, where he owned and managed this
commercial  and  residential  mortgage  brokerage/banking firm.  Mr. Goodman was
involved  with the FCC while at CCFS, applying to participate in the lottery for
a  new  spectrum  of  Specialized  Mobile  Radio  licenses.  From 1985-1989, Mr.
Goodman  worked  for  various  savings  &  loan companies, and from 1977-1985 he
served  as  President  of Bay Capital Corporation & House of Money.  Mr. Goodman
worked  in  financial  public  relations  on Wall Street from 1969-1970 and as a
stockbroker  for  Loeb, Rhoades & Company from 1965-1966.  Mr. Goodman served as
Lieutenant  Junior  Grade  in  the  US  Coast Guard from 1966-1969.  Mr. Goodman
received  his  JD  from  William  Howard  Taft  University  in 1995, passing the
California  Baby Bar in 1992.  Mr. Goodman received his BS in Economics from the
University  of  Pennsylvania-Wharton  School  in 1965, and received his MBA with
distinction  in  Finance  from  New  York  University  in  1969.

Eric  Bergman was elected a director at the annual shareholder's meeting held in
January  2000.  He  has  been involved in qualitative and quantitative marketing
research  and  project  administration for over 20 years. Since 1988 he has been
president  of  California  Agri-Marketing Research Associates. He graduated Kent
State  University  with  his  BA degree in 1975. He is a member of the Company's
audit  committee.
                                       8
<PAGE>

Michael  Gilbert is the Managing Partner/Owner of Gilbert & Co., a San Francisco
based Certified Public Accounting firm. He was the CPA for Prime Companies, Inc.
prior  to  the  time  Prime became a publicly owned company. He has an extensive
client base ranging from revenues of $1 million to $35 million annually, and has
experience  in  litigation  support,  mediation  and  arbitration  services, and
business  valuation  analysis.  He  is  the  Chairman  of  the  Company's  Audit
Committee. He obtained his MBA degree with honors from Wilkes University in 1977
and  his  BA  in  Economics  from Wilkes University in 1976. He is licensed as a
Certified  Public  Accountant  in  California,  Colorado,  and  Pennsylvania.

William  Turley  is  President  of Communications Engineering Inc. (CEI), a well
established  provider  of  telecommunications  products  and  services including
turnkey  Voice  and Data Solutions. He has extensive experience in construction,
operations,  and  engineering in the telephone industry dating from 1952 both in
the private and public sectors. He holds a Class A & C-7 California Contractor's
License  and  is a member in good standing of the Building Industrial Consulting
Society  International  (BICSI).  Prior to establishing his business in 1977, he
was  a  science educator at Cal State University, San Diego City College, and at
Kirchenpaur  Gymnasium  in  Hamburg,  Germany.  He  obtained  his M.A. degree in
Physical Science in 1971 and his B.S. degree in Physics in 1969, from California
State  University  in  San  Diego.

Adrian  Lima  has  been  Vice President of Engineering for the Company since its
merger  in  1999.  Adrian Lima is the son of Norbert Lima, the Company's CEO and
Chairman  of the Board of Directors.  Mr. Lima has accumulated over ten years of
technical  skills and experience while working for NACC-Tel, installing hundreds
of  telecommunications systems manufactured by several different companies.  Mr.
Lima  is  adept  at  each  aspect  of  interconnect installation, including wire
running, termination, hardware programming, troubleshooting, and training.  Upon
NACC-Tel's  merger  with  Pagers  Plus  Cellular  in  1994,  Mr.  Lima  obtained
experience  in wireless technologies, enabling him to spearhead the installation
of  some  750  channels  of two-way 220 MHz radio systems.  Mr. Lima's technical
experience will be instrumental in implementing the Company's expansion plans in
the  future.


ITEM  10.  EXECUTIVE  COMPENSATION

The  following  table  sets  forth  the  aggregate cash compensation paid to all
officers  of  the Company.  The officers received no other compensation from the
Company:


<TABLE>
<CAPTION>


Name and Principal Position . . . . . .  Year  Salary
---------------------------------------  ----  -------
<S>                                      <C>   <C>

Norbert Lima, CEO . . . . . . . . . . .  1999  $28,850
                                         1998    6,752
Stephen Goodman, CFO. . . . . . . . . .  1999    5,500
Adrian Lima, Vice President-Engineering  1999   54,347
                                         1998   37,642
</TABLE>



                              EMPLOYMENT AGREEMENTS
                              ---------------------

In  accordance  with  the  Commission  Rules,  the  following  is  a list of all
Compensatory  Plans  or  Arrangements  of  the  Company:

                    Prime  Companies  401(k)
                    Prime  Companies,  Inc.  Incentive  Stock  Option  Plan
On  January 14, 2000, the Company approved compensation for its CEO and CFO each
at  the  rate  of $8,333 per month for the year 2000.  In April 2000 the Company
approved compensation for its Vice-President - Engineering at the rate of $6,000
per month.  Employment of officers may be terminated by the Company at any time.

                                       9

<PAGE>

                                  STOCK OPTIONS
                                  -------------

There  are  outstanding options on 2,555,209 shares to various individuals. Each
option  provides the right to purchase one share of common stock at either $1.00
per  share  or  $3.00  per share or $6.00 per share. All of these options expire
December  31, 2000. There are no other warrants, rights, conversion, privileges,
or  other  rights  pursuant to which Mr. Goodman, Mr. Adrian Lima or Mr. Norbert
Lima  or  any other current Officer or Director has the right to acquire further
Shares  in  the  Corporation.

There  were  no  stock  options  granted  in  1999.

In  March  2000 the Board of Directors approved an employee stock option program
for  all employees on staff as of Jan 31, 2000, whereby each employee is granted
the  right  to  purchase  the  number of shares equal to 1999 gross earnings (at
Prime or any of its subsidiaries) at $1.00 per share; options to expire December
31, 2002, and are immediately exercisable.

In  March  2000  the  Board  of Directors also approved an employee stock option
program  for  all employees  employed by Prime in 2000, whereby each employee is
granted  the right to purchase the number of shares equal to 2000 gross earnings
(at  Prime  or  any  of  its subsidiaries) at $1.50 per share; options to expire
December  31,  2003, and do not vest until December 31, 2000.

In  March  2000  the  Board  of  Directors  also approved a stock option program
whereby each outside director was granted an option for the year 2000, to expire
December  31,  2002,  on  20,000  shares at $1.00 per share. The options vest on
January 1, 2001 to each current outside director who is still a director on that
date.

                              DIRECTOR COMPENSATION
                              ---------------------

The  Company's  directors  will  be  reimbursed  for  any out-of-pocket expenses
incurred  by  them  for  attendance  at  meetings  of  the Board of Directors or
committees  thereof.  The Company compensates directors $500 for each meeting of
the  Board  attended  by  such  director.

ITEM  11.  SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS  AND
MANAGEMENT

The  following  table  sets forth certain information about the ownership of the
Company's  Common  Stock as of April 30, 2000, by (i) those persons known by the
Company  to  be the beneficial owners of more than 5 percent of the total number
of  outstanding  shares  of  any  class entitled to vote; (ii) each director and
officer;  and  (iii)  all  directors and officers of the Company as a group. The
table  includes  Common  Stock  issuable  upon  the exercise of Options that are
exercisable  within  60 days. Except as indicated in the footnotes to the table,
the  named  persons  have  sole  voting and investment power with respect to all
shares  of the Company Common Stock shown as beneficially owned by them, subject
to  community property laws where applicable. The ownership figures in the table
are  based  on  the  books  and  records  of  the  Company.


                                       10
<PAGE>

<TABLE>
<CAPTION>
                          Name of            Amount and
Title of Class       Beneficial Owner    Nature of Interest  Percentages           Address
------------------  -------------------  ------------------  ------------  -----------------------
<S>                 <C>                  <C>                 <C>           <C>
Common Stock -                                                             109 Harrison Lane,
Par Value $0.0001.  Ron Gallagher                 4,500,000           14%  Bethlehem, CT 06751

Common Stock -                                                             2975 Treat Blvd #C8,
Par Value $0.0001.  Stephen Goodman               4,518,900           14%  Concord, CA 94518

Common Stock -                                                             409 Center Street, Yuba
 Par Value $0.0001  Adrian Lima                   1,072,413            3%  City, CA 95991

Common Stock -                                                             409 Center Street, Yuba
 Par Value $0.0001  Norbert Lima                  3,600,000           11%  City, CA 95991

Common Stock -                                                             155 Montgomery Street,
Par Value $0.0001.  Irving Pfeffer          (a)   3,866,602           12%  San Francisco, CA 94105

Common Stock -                                                             120 W 45 Street, New
Par Value $0.0001.  David Shaw              (b)   2,711,227            8%  York, NY 10036

Common Stock - . .  All Directors and
Par Value $0.0001.  Officers as a Group           9,416,313           30%
------------------  -------------------  ------------------  ------------  -----------------------
<FN>
(a)     Includes  options  to purchase 563,708  common  shares, which are currently exercisable.
(b)     Includes  options  to purchase  33,333  common  shares, which are currently exercisable.
</TABLE>


ITEM  12.  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS

Norbert  Lima,  a  Director and the Company's CEO, owns the real estate in which
the  Company's headquarters is located. The Company paid rent of $11,000 in 1999
and  1998  on  its headquarters. There is no long term lease arrangement between
the  Company  and  Mr.  Lima.


ITEM  13.  EXHIBITS,  REPORTS  ON  FORM  8-K  AND  SUPPLEMENTAL
INFORMATION

(a)   INDEX  TO  EXHIBITS
4.1      1999  Proxy
4.2*     Summary  of  401(K)  plan
4.3*     Sample  Stock  certificate
27        Financial  Data  Schedule

*  Previously  filed

(b)  No  reports  on  Form  8-K  were  filed during the last quarter of the year
covered  by  this  report.

                             SHAREHOLDER INFORMATION
                             -----------------------

Form  10-KSB  Availability:
A copy of the 1999 Form 10-KSB filed with the Securities and Exchange Commission
will  be  forwarded  preferably  by  email,  upon  request,  to any shareholder.
Requests  should  be  directed  to:

Norbert  Lima,  CEO
Prime  Companies,  Inc.
409  Center  Street
Yuba  City,  CA  95991

Or  by  email  to  adminpri@primecompanies.com

Transfer  Agent  and  Registrar:

Continental  Stock  Transfer  and  Trust  Company
2  Broadway,  19th  Floor
New  York,  New  York  10004

Independent  Auditors:

Hein  +  Associates  LLP
333  City  Blvd.  West,  Suite  2100
Orange,  CA  92868

Corporate  Offices:  Prime  Companies,  Inc.
Mailing  Address:  409  Center  Street,  Yuba  City,  CA  95991
Telephone:  (530)  755-3580
                                       11
<PAGE>

                                   SIGNATURES
                                   ----------

Pursuant  to  the  requirements  of  Section  13  or  15(d)  of  the  Securities
Exchange  Act  of  1934,  the  registrant  has  duly  caused  this  report to be
signed  on  its behalf by the undersigned, thereunto duly authorized. Dated this
22nd  day  of  May,  2000.

                                   Prime  Companies,  Inc.
                                   By:  /s/  Norbert  J.  Lima
                                        -------------------------------
                                        Norbert  J.  Lima
                                        Chief  Executive  Officer
                                        (Principal  Executive  Officer)
                                         Director

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has  been  signed  below by the following persons on the above date on behalf of
the  registrant  and  in  the  capacities  indicated.

By:      /s/  Stephen  Goodman
         -----------------------------------
         Stephen  Goodman
         Director,  Chief  Financial  Officer

By:      /s/  Eric  Bergmann
         ------------------------------------
         Eric  Bergmann
         Director

By:      /s/  Michael  Gilbert
         -------------------------------
         Michael  Gilbert
         Director

By:      /s/  William  Turley
         -------------------------------
         William  Turley
         Director


                                       12
<PAGE>







                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>




                                                                                            PAGE
                                                                                          --------
<S>                                                                                       <C>
INDEPENDENT AUDITOR'S REPORT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  F-2

CONSOLIDATED BALANCE SHEET - December 31, 1999. . . . . . . . . . . . . . . . . . . . . . .  F-3

CONSOLIDATED STATEMENTS OF OPERATIONS - For the year ended December 31, 1999 and the period
 from inception (February 20, 1998) to December 31, 1998. . . . . . . . . . . . . . . . . .  F-4

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)  - For the period from inception
(February 20, 1998) to December 31, 1999. . . . . . . . . . . . . . . . . . . . . . . . . .  F-5

CONSOLIDATED STATEMENTS OF CASH FLOWS - For the year ended December 31, 1999, and
the period from inception (February 20, 1998) to December 31, 1998. . . . . . . . . . . . .  F-6

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS. . . . . . . . . . . . . . . . . . . . . . . . .  F-7
</TABLE>




                                      F-1
<PAGE>




                          INDEPENDENT AUDITOR'S  REPORT




To  the  Board  of  Directors  and  Stockholders
Prime  Companies,  Inc.
Yuba  City,  California



We  have audited the accompanying consolidated balance sheet of Prime Companies,
Inc.  (a Delaware corporation) and subsidiaries as of December 31, 1999, and the
related  consolidated  statements of operations, stockholders' equity (deficit),
and  cash  flows  for  the  year  ended  December  31,  1999 and the period from
inception (February 20, 1998) to December 31, 1998. These consolidated financial
statements  are  the  responsibility  of  the  Company's  management.  Our
responsibility  is  to  express  an  opinion  on  these  consolidated  financial
statements  based  on  our  audits.

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

In  our opinion, the consolidated financial statements referred to above present
fairly,  in  all  material  respects, the financial position of Prime Companies,
Inc.  and subsidiaries at December 31, 1999, and the results of their operations
and  their  cash  flows for the year ended December 31, 1999 and the period from
inception  (February 20, 1998) to December 31, 1998 in conformity with generally
accepted  accounting  principles.

/s/Hein  +  Associates  LLP


Hein  +  Associates  LLP
Certified  Public  Accountants

Orange,  California
April  20,  2000

                                      F-2
<PAGE>







                                  PRIME COMPANIES, INC. AND SUBSIDIARIES

                                       CONSOLIDATED BALANCE SHEET
                                             DECEMBER 31, 1999


<TABLE>
<CAPTION>



<S>                                                                                               <C>
                                    ASSETS
                                 -----------
CURRENT ASSETS:
  Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $  237,403
  Accounts receivable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      28,405
  Inventory. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      13,850
  Deposits and other current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      31,700
           Net assets held for sale. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     661,702
                                                                                                  -----------
       Total current assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     973,060

PROPERTY AND EQUIPMENT, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     104,722
LICENSES, net of accumulated amortization of $30,774 . . . . . . . . . . . . . . . . . . . . . .     584,698

EXCESS OF PURCHASE PRICE OVER NET ASSETS ACQUIRED, net of accumulated amortization of $10,017. .     190,318
                                                                                                  -----------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $1,852,798
                                                                                                  ===========

                     LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
                    -------------------------------------------------

CURRENT LIABILITIES:
  Current portion of notes payable to related parties. . . . . . . . . . . . . . . . . . . . . .  $  180,500
  Convertible notes payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     496,220
  Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     159,717
  Accrued interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     167,110
  Other accrued expenses and liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . .      30,263
                                                                                                  -----------
       Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   1,033,810

NOTES PAYABLE TO RELATED PARTIES, less current portion . . . . . . . . . . . . . . . . . . . . .   1,240,216
                                                                                                  -----------
       Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   2,274,026

COMMITMENTS AND CONTINGENCIES (Notes 3 and 12)

STOCKHOLDERS' EQUITY (DEFICIT):
  Preferred stock, $.0001 par value, 10,000,000 shares authorized, none issued and outstanding .           -

  Common stock, $.0001 par value, 50,000,000 shares authorized, 21,582,125 issued and outstanding.     2,158
  Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   282,244
  Unrealized gain on available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . .   125,000
  Accumulated deficit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    (830,630)
                                                                                                  -----------
       Total stockholders' equity (deficit) . . . . . . . . . . . . . . . . . . . . . . . . . .     (421,228)
                                                                                                  -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) . . . . . . . . . . . . . . . . . . . . . .  $1,852,798
                                                                                                  ===========

</TABLE>


       SEE ACCOMPANYING NOTES TO THESE CONSOLIDATED FINANCIAL STATEMENTS.



                                      F-3
<PAGE>


                                    PRIME COMPANIES, INC. AND SUBSIDIARIES

                                     CONSOLIDATED STATEMENTS OF OPERATIONS


<TABLE>
<CAPTION>
                                                                                           FOR THE PERIOD
                                                                                            FROM INCEPTION
                                                                   FOR THE YEAR ENDED   (FEBRUARY 20, 1998) TO
                                                                      DECEMBER 31,           DECEMBER 31,
                                                                          1999                  1998
                                                                   --------------------   -------------------
<S>                                                               <C>                   <C>
SALES REVENUES                                                    $           547,466            $  209,823
                                                                   --------------------   -------------------
COSTS AND EXPENSES:
  Cost of sales                                                               203,835              121,166
  Selling, general, and administrative expenses                               472,537              143,002

  Expense recognized for net liabilities assumed in reverse merger            428,194                    -
                                                                   --------------------   -------------------
  Total costs and expenses                                                  1,104,566              264,168
                                                                   --------------------   -------------------
OPERATING LOSS                                                               (557,100)              (54,345)
                                                                   --------------------   -------------------
OTHER EXPENSE:
  Interest expense                                                           (199,089)              (14,796)
                                                                   --------------------   -------------------
LOSS BEFORE TAXES                                                            (756,189)              (69,141)
  Provision for taxes                                                           5,300                     -
                                                                   --------------------   -------------------
NET LOSS                                                          $          (761,489)           $  (69,141)
                                                                   ====================   ===================

BASIC AND DILUTED LOSS PER SHARE                                  $             (0.05)           $    (0.02)
                                                                   ====================   ===================
WEIGHTED AVERAGE SHARES OUTSTANDING                                        16,680,764             4,500,000
                                                                   ====================   ===================

</TABLE>


       SEE ACCOMPANYING NOTES TO THESE CONSOLIDATED FINANCIAL STATEMENTS.



                                      F-4
<PAGE>

                                    PRIME COMPANIES, INC. AND SUBSIDIARIES

                        CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
                         FOR THE PERIOD FROM INCEPTION (FEBRUARY 20, 1998) TO
                                           DECEMBER 31, 1999
<TABLE>
<CAPTION>

                                                                                          UNREALIZED
                                                                                           GAIN ON                     TOTAL
                                                        COMMON STOCK         ADDITIONAL  AVAILABLE-FOR              STOCKHOLDERS'
                                                   ------------------------   PAID-IN       -SALE      ACCUMULATED    EQUITY
                                                     SHARES       AMOUNT      CAPITAL     SECURITIES     DEFICIT     (DEFICIT)
                                                   -----------  -----------  -----------  -----------  ----------   ----------
<S>                                              <C>          <C>          <C>          <C>          <C>          <C>
BALANCES, February 20, 1998. . . . . . . . . . .            -  $         -   $        -     $      -  $       -    $        -

  Capital contributions. . . . . . . . . . . . .    4,500,000          450       35,650            -          -        36,100
  Net loss . . . . . . . . . . . . . . . . . . .            -            -            -            -    (69,141)      (69,141)
                                                   -----------  -----------  -----------  -----------  ----------   ----------
BALANCES, December 31, 1998. . . . . . . . . . .    4,500,000          450       35,650            -    (69,141)      (33,041)

  Stock issued for services. . . . . . . . . . .   10,000,000        1,000       23,840            -          -        24,840
  Stock issued in merger transaction . . . . . .    6,507,742          651         (651)           -          -             -
  Stock issued in acquisitions . . . . . . . . .      574,383           57      223,405            -          -       223,462
  Comprehensive loss:
     Net Loss. . . . . . . . . . . . . . . . . .            -            -            -            -   (761,489)

     Unrealized gain on available-for-
                 sale securities                            -            -            -      125,000          -
     Total comprehensive loss                                                                                        (636,489)
                                                   -----------  -----------  -----------  -----------  ----------   ----------
BALANCES, December 31, 1999. . . . . . . . . . .   21,582,125       $2,158     $282,244     $125,000  $ (830,630)   $(421,228)
                                                   ===========  ===========  ===========  ===========  ==========   ==========

</TABLE>
            SEE ACCOMPANYING NOTES TO THESE CONSOLIDATED FINANCIAL STATEMENTS.
                                      F-5
<PAGE>




                      PRIME COMPANIES, INC. AND SUBSIDIARIES

                       CONSOLIDATE STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>

                                                                       FOR THE PERIOD
                                                         FOR THE       FROM INCEPTION
                                                        YEAR ENDED   (FEBRUARY 20, 1998)
                                                        DECEMBER 31,  TO DECEMBER 31,
                                                            1999           1998
                                                         -----------   -----------
<S>                                                    <C>             <C>
CASH FLOW FROM OPERATING ACTIVITIES:
  Net loss                                             $    (761,489)   $  (69,141)
  Adjustments to reconcile net loss to net cash used in
    operating activities:
    Depreciation and amortization                             59,522        11,526
    Stock issued for services                                 24,840             -
    Noncash expense recognized upon reverse merger           428,194             -
    Changes in operating assets and liabilities:
       Accounts receivable                                   (17,247)      (10,158)
       Inventory                                               4,880        12,779
       Deposits and other current assets                     (22,878)         (350)
       Accounts payable                                      (36,246)       30,358
       Accrued liabilities                                   187,504             -
                                                         -----------   -----------
         Net cash used in operating activities              (132,920)      (24,986)
                                                         -----------   -----------

CASH FLOW FROM INVESTING ACTIVITIES:
  Purchases of property and equipment                         (6,794)       (7,635)
  Sale of property held for sale                           1,074,955             -
                                                         -----------   -----------
         Net cash provided by (used in) investing
         activities                                        1,068,161      (7,635)
                                                         -----------   -----------

CASH FLOW FROM FINANCING ACTIVITIES:
  Capital contributions                                            -        36,100
  Proceeds from notes payable                                 39,248             -
  Principal payments on notes payable                       (740,565)            -
                                                         -----------   -----------
         Net cash provided by (used in) financing
         activities                                         (701,317)       36,100
                                                       --------------  -----------

INCREASE IN CASH AND CASH EQUIVALENTS                        233,934         3,479

CASH AND CASH EQUIVALENTS, beginning of year                   3,479             -
                                                         -----------   -----------
CASH AND CASH EQUIVALENTS, end of year                 $     237,403    $    3,479
                                                        ============   ============
SUPPLEMENTAL CASH FLOW INFORMATION:
  Cash payments for:
       Interest                                        $      31,979    $   14,796
                                                        ============   ============
       Income taxes                                    $           -    $        -
                                                        ============   ============

SUPPLEMENTAL DISCLOSURE OF NON-CASH TRANSACTIONS:
  Assets acquired for assumption of debt               $           -    $   94,573
                                                        ============   ============
  Notes payable issued to acquire licenses             $     615,472    $        -
                                                        ============   ============
  Note payable issued to acquire property
  and equipment                                        $      10,076    $        -
                                                        ============   ============
  Net assets acquired in exchange for stock            $     223,462    $        -
                                                        ============   ============
</TABLE>
            SEE ACCOMPANYING NOTES TO THESE CONSOLIDATED FINANCIAL STATEMENTS.





                                      F-6
<PAGE>
                     PRIME COMPANIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



1.     Organization  and  Nature  of  Operations:
       -----------------------------------------

The  consolidated  financial statements include the accounts of Prime Companies,
Inc.  and  its  wholly  owned  subsidiaries  (collectively,  "the Company"). The
Company  operates  in  one  segment and began operations on February 20, 1998 as
NACC-Tel,  a sole proprietorship operated by Bert Lima (the Company's CEO), when
it  acquired  certain  assets of Pagers Plus, Inc. (an entity for which Mr. Lima
served  as  an  officer)  in  exchange  for assumption of specified liabilities.
NACC-Tel provides paging services and installation and servicing of interconnect
and  business  communication  systems.

In  February  1999, Mr. Lima, along with three other principals, formed Worldnet
Tel.com,  Inc.  (Worldnet),  a Delaware corporation, to form the legal structure
for  the  Company's further development.  Mr. Lima, subsequently contributed the
operations  of  NACC-Tel  to Worldnet, with interests in the Company assigned to
the  other  three  principals  in  exchange  for services to be provided for the
further  development  of  the  Company's  operations.  Worldnet  contributed the
operations  of  NACC-Tel  to  NACC-Tel Corp., a Delaware corporation formed as a
wholly-owned  subsidiary  of  WNTC  Holdings,  Inc.,  which  was  formed  as  a
wholly-owned  holding  company  subsidiary of Worldnet.  For financial statement
purposes, the operations of NACC-Tel are considered the business of Worldnet and
the  financial  statements reflect the historical financial position and results
of  operations  and  cash  flows  of  NACC-Tel.

Pursuant  to  a  Stock  Purchase  Agreement  (the  "Agreement")  between  Prime
Companies,  Inc. ("Prime"), a Delaware Corporation, a nonoperating public shell,
and  Worldnet Tel.com, Inc. (Worldnet), Worldnet was merged into Prime through a
merger  effective  August  11,  1999.

For financial statement purposes, Worldnet was considered the acquiring company,
and  this  transaction  has been treated as an acquisition of Prime by Worldnet.
For  legal  purposes,  however, Prime remained the surviving entity.  Therefore,
the  combined  entity  retained Prime's capital structure.  Prior to the merger,
Prime  had  6,507,742  shares  of  common  stock  outstanding  held  by  various
individuals.  Pursuant  to  the agreement, Worldnet was issued 14,500,000 shares
of  Prime  common  stock.  As  a  result  of  the  stock  exchange,  the  former
shareholders  of  Worldnet hold 69% of the outstanding shares of common stock of
Prime.  At the time of the merger, Prime had liabilities in excess of net assets
of  $428,194.  This  amount  has  been  charged to operations on the date of the
merger  as  a  cost  of  the  reorganization.

The  accompanying  financial statements of the Company reflect the operations of
Worldnet  and  its  subsidiaries and consolidate the operations of Prime and its
subsidiaries  commencing  on  the  date  of  the  merger.

The  Company's  other  wholly-owned  subsidiaries  are  as  described  below:

Prepaid  Tel.com  Inc. (Prepaid), a Delaware corporation, was formed in February
1999  as  a  wholly-owned  subsidiary  of  WNTC.  Prepaid is a Competitive Local
Exchange Carrier ("CLEC") certified by the California Public Utility Commission.
Prepaid  had  no  substantial  operations  during  1999.

                                      F-7
<PAGE>

LMDS  Communications Inc. (LMDS), a Delaware corporation, was formed in February
1999 as a wholly-owned subsidiary of WNTC.  LMDS is a telecommunications company
with  interests in the fixed broadband wireless sector.  LMDS had no substantial
operations  during  1999.

Mid-Cal  Express,  Inc.  and  Mid-Cal  Express  Logistics,  Inc.  (collectively,
Mid-Cal)  are  wholly-owned subsidiaries of Prime.  Mid-Cal ceased operations in
December  1998  (prior  to the acquisition by Worldnet) and is in the process of
liquidating  its  assets  and  settling  outstanding  liabilities.

Zenith  Technologies  Inc.  (Zenith),  a  Delaware  Corporation,  was  formed in
December 1998 as a wholly-owned subsidiary of Prime Companies, Inc.  To date, it
has  had  no  operations.


2.     Summary  of  Significant  Accounting  Policies:
       ----------------------------------------------

Principles  of Consolidation - The consolidated financial statements include the
----------------------------
accounts  of  Prime  Companies,  Inc.  and  its  wholly  owned  subsidiaries
(collectively,  "the  Company").  All  significant  intercompany  balances  and
transactions  have  been  eliminated  in  consolidation.

Cash  and  Cash  Equivalents - For purposes of the statements of cash flows, the
----------------------------
Company  considers all highly liquid debt instruments purchased with an original
maturity  of  three  months  or  less  to  be  cash  equivalents.

Inventories  - Inventories of installation equipment and materials are stated at
-----------
the  lower  of  cost  (first-in,  first-out  method)  or  market.

Property  and  Equipment  -  Property  and  equipment  are  stated  at  cost.
------------------------
Depreciation  of  property  and  equipment is calculated using the straight-line
method  over  the  estimated  useful  lives  (ranging  from 5 to 7 years) of the
respective  assets.  The  cost  of  normal maintenance and repairs is charged to
operating  expenses  as incurred.  Material expenditures which increase the life
of  an asset are capitalized and depreciated over the estimated remaining useful
life  of  the asset.  The cost of properties sold, or otherwise disposed of, and
the  related  accumulated  depreciation  or  amortization  are  removed from the
accounts,  and  any  gains  or  losses  are  reflected  in  current  operations.

Intangibles  -  Intangibles  include  the  amounts  paid  to the FCC to purchase
-----------
licenses  for  Local  Multipoint  Distribution Services in certain markets.  The
licenses  are  being amortized on a straight-line basis over the initial term of
the  license,  which  is  ten  years.

Excess  of  purchase price over net assets acquired represents the excess of the
cost  of  acquiring  Marathon  Telecom  (see  Note  4) over the net tangible and
identifiable  intangible  assets of the acquired business.  This amount is being
amortized  on  a  straight-line  basis, over the future periods to be benefited,
estimated  to  be  five  years.

Impairment  of  Long-Lived  and  Intangible Assets - In the event that facts and
--------------------------------------------------
circumstances  indicate  that  the cost of long lived assets may be impaired, an
evaluation  of  recoverability would be performed. If an evaluation is required,
the  estimated future undiscounted cash flows associated with the asset would be
compared  to  the asset's carrying amount to determine if a write-down to market
value  or  discounted  cash  flow  value  is  required.

Revenue  Recognition-  Revenue  is generated from installation of business phone
--------------------
systems  and  is  recognized  as  installations  are  completed.

                                      F-8
<PAGE>
                   PRIME COMPANIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Income  Taxes - The Company accounts for income taxes under the liability method
-------------
which  requires  recognition  of  deferred  tax  assets  and liabilities for the
expected  future  tax  consequences  of  events  that  have been included in the
financial  statements or tax returns. Under this method, deferred tax assets and
liabilities  are  determined,  based  on  the  difference  between the financial
statements  and  tax  basis of assets and liabilities using enacted tax rates in
effect  for  the  year  in  which  the  differences  are  expected  to  reverse.

Net  Assets  Held  for Sale - Net assets held for sale include 400,000 shares of
-----------------------------
common  stock  of  US  Trucking,  Inc.,  and  cash of Mid-Cal Express, Inc. (the
Company's  inactive  trucking subsidiary) net of payables to unsecured creditors
of  Mid-Cal  Express  Inc.  The assets are pledged as security for the unsecured
creditors  and  are being held in escrow pending final settlement of the claims.

Earnings  Per Share - Basic earnings per share excludes dilution and is computed
-------------------
by  dividing  income  available  to  common stockholders by the weighted average
number  of  common shares outstanding for the period. Diluted earnings per share
reflects  the  potential  dilution  that  could  occur  if  securities  or other
contracts to issue common stock were exercised or converted into common stock or
resulted in the issuance of common stock that then shared in the earnings of the
entity.  Common stock equivalents as of December 31, 1999 were anti-dilutive and
excluded  from  the  earnings  per  share  computation.

Accounting  Estimates  -  The  preparation of financial statements in conformity
---------------------
with  generally  accepted  accounting  principles  requires  management  to make
estimates  and  assumptions  that  affect  the amounts reported in the financial
statements  and  the  accompanying  notes.  The actual results could differ from
those  estimates.

The  Company's  financial  statements  are  based  upon  a number of significant
estimates  including the allowance for doubtful accounts, the estimated lives of
property  and  equipment,  licenses,  and  intangibles, and the realizability of
deferred  tax  assets.  Due  to  the  uncertainties  inherent  in the estimation
process, it is at least reasonably possible that these estimates will be further
revised  in  the  near  term  and  such  revisions  could  be  material.

Investments  -  The  U.S. Trucking stock included in net assets held for sale is
-----------
considered  available for sale.  These securities are carried at fair value with
unrealized  gains  or  losses,  net  of tax, reported as a separate component of
stockholders'  equity.

Stock-Based  Compensation  -  The  Company  has  elected  to  follow  Accounting
-------------------------
Principles  Board  Opinion  No.  25,  "Accounting for Stock Issued to Employees"
(APB25)  and  related  interpretations  in  accounting  for  its  employee stock
options.  In  accordance with FASB Statement No. 123 "Accounting For Stock-Based
Compensation"  (FASB123),  the  Company will disclose the impact of adopting the
fair  value  accounting  of  employee  stock  options.  Transactions  in  equity
instruments  with  non-employees  for  goods or services have been accounted for
using  the  fair  value  method  prescribed  by  FASB123.

                                      F-9
<PAGE>
                   PRIME COMPANIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Concentrations  of Credit Risk - Credit risk represents the accounting loss that
------------------------------
would be recognized at the reporting date if counterparties failed to perform as
contracted. Concentrations of credit risk (whether on or off balance sheet) that
arise  from  financial  instruments  exist  for groups of customers or groups of
counterparties  when they have similar economic characteristics that would cause
their  ability  to  meet  contractual  obligations  to  be similarly effected by
changes  in  economic or other conditions. In accordance with FASB Statement No.
105,  "Disclosure  of  Information  about  Financial  Instruments  with
Off-Balance-Sheet Risk and Financial Instruments Concentrations of Credit Risk,"
financial  instruments  that  subject  the  Company to credit risk are primarily
accounts receivable.  The credit risk amounts shown do not take into account the
value  of  any  collateral  or  security.

The  customers  of  the  Company's  1999  operations  are  located  primarily in
California. At December 31, 1999 approximately $13,800 representing 48% of trade
receivables  was  due from two customers.  No other customers accounted for more
than  10%  of  the  Company's  trade  receivables  at  December  31,  1999.

Fair  Value  of  Financial Instruments - The estimated fair values for financial
--------------------------------------
instruments  under  FASB  Statement  No.  107,  "Disclosures about Fair Value of
Financial  Instruments,"  are  determined  at  discrete  points in time based on
relevant market information. These estimates involve uncertainties and cannot be
determined  with  precision.

The following methods and assumptions were used in estimating the indicated fair
values  of  the  Company's  financial  instruments:

     Cash  and  cash  equivalents:  The  carrying amount approximates fair value
     because  of  the  short  maturity  of  those  instruments.

     Investments:  Investments  included  in  net assets held for sale are
     Considered available-for-sale  and  are  carried  at  market  value  based
     on quoted market prices.

     Long-term  and  other  debt:  The  fair value of the Company's debt is
     Estimated based  on  current  rates offered to the Company for debt with
     similar terms and maturities  and  approximates  carrying  value.

Impact  of  Recently  Issued  Standards - In June 1998, the Financial Accounting
---------------------------------------
Standards  Board  issued  Statement  of  Financial  Accounting Standards No. 133
(FASB133), "Accounting for Derivative Instruments and Hedging Activities."  This
statement  requires  that  an  entity  recognize  all  derivatives  as assets or
liabilities in the statement of financial position and measure those instruments
at fair value. This statement was amended by FASB 137, issued in June 1999, such
that  it is effective for the Company's financial statements for the year ending
December  31,  2001.  The  Company does not believe the adoption of FASB133 will
have  a  material  impact  on  assets,  liabilities  or  equity.

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin  No. 101,  entitled  "Revenue  Recognition  in  Financial  Statements."
SAB 101A  was  issued  by  the  SEC  on  March  24, 2000 and delays the required
implementation date of SAB 101  until  the  second  quarter  of  2000.  SAB  101
provides guidance on the recognition,  presentation and disclosure of revenue in
the financial statements of public companies.  The Company does not believe that
the adoption of SAB 101 will have a material effect on its financial position or
results of operations.


3.     Basis  of  Presentation:
        ------------------------

The  accompanying  financial  statements  have  been prepared on a going concern
basis,  which  contemplates  the  realization  of assets and the satisfaction of
                                      F-10
<PAGE>
                   PRIME COMPANIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

liabilities  in  the  normal  course  of business.  As shown in the accompanying
consolidated  financial  statements,  the  Company  has  recorded losses for the
periods ended December 31, 1999 and 1998, resulting in an accumulated deficit of
$830,630  as of December 31, 1999.  Cash used in operations during 1999 and 1998
was  $132,920  and  $24,986,  respectively.

Management  expects  to  achieve  profitable operations as its CLEC and internet
subsidiaries  begin  operations during 2000.  Until profitable operations can be
achieved,  management  had  taken steps to obtain additional working capital for
the  Company.  Subsequent  to  December  31,  1999,  the  Company  converted
approximately  $1.6  million  of  debt  and accrued interest to common stock and
completed  a private placement of an additional 6,569,444 shares of common stock
for  net  proceeds of $2.4 million (see note 13).  Management believes, based on
its  current  and  planned  level  of  operations it has sufficient resources to
continue  as  a  going  concern  for  at  least  the  next  twelve  months.


4.     Acquisitions
        ------------

In  September  1999,  the Company acquired all of the assets of Olive Tree Image
Engineers  (a sole proprietorship) (Olive Tree) in exchange for 57,142 shares of
the Company's common stock. This stock issuance was valued at the average of the
closing  bid  and ask prices for three days before and after the acquisition was
agreed to by the Company and Olive Tree.  The transaction was accounted for as a
purchase  and  the  resulting purchase price of $26,910 was assigned to property
and  equipment  acquired.  Olive Tree had no substantial operations prior to the
acquisition  by  the  Company.

In  October  1999, the Company acquired all of the assets of Marathon Telecom (a
sole  proprietorship  operated  by Adrian Lima the son of the Company's CEO), in
exchange  for  517,241  shares  of the Company's Common Stock plus assumption of
$25,283  in  liabilities.  This  stock issuance was valued at the average of the
closing  bid  and ask prices for three days before and after the acquisition was
agreed  to  by  the Company and Marathon Telecom.  The transaction was accounted
for  as  a purchase and accordingly, the inclusion of the operations of Marathon
Telecom  in  the consolidated operations commenced on the acquisition date.  The
resulting purchase price was $221,835 which resulted in $200,335 being allocated
to  excess  of  purchase  price over net assets acquired. The excess of purchase
price  over  net  assets  acquired  will be amortized over a period of 60 months
beginning October 1999.  Adrian Lima acquired the operations of Marathon Telecom
in February 1999 from an unrelated individual.  Financial information related to
Marathon Telecom prior to February 1999 is not available.  From February 1999 to
October  1999 (the date of acquisition by the Company), Marathon had revenues of
approximately  $64,000  (unaudited)  and  operating  income (and  net income) of
approximately $30,000 (unaudited).


5.     Net  Assets  Held  For  Sale:
        -----------------------------

Mid-Cal  Express,  Inc.   ceased operations in December 1998 and its assets have
been  pledged  as  security  for  the  settlement  of  claims  by  its unsecured
creditors.  The  assets  are held by the Credit Managers Association of Southern
California  who  is  in  the  process of liquidating the assets and making final
distribution  to  the  creditors.  The net assets held for sale consisted of the
following  at  December  31,  1999:


Assets:
   Cash  in  escrow                                    $  83,079
   Investments                                         1,425,000
  -----------
      Total  Assets                                    1,508,079
   Unsecured  Creditors                                  846,377
  -----------
   Net  Assets  of  Discontinued  Operations          $  661,702
                                                      ==========
                                      F-11
<PAGE>
                   PRIME COMPANIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


6.     Property  and  Equipment
       ------------------------

Property  and  equipment  at  December  31,  1999,  consisted  of:

                                               Estimated
                                             Useful Lives
                                             ------------
 Offices furniture and equipment  $ 46,745        3 years
 Vehicles. . . . . . . . . . . .    16,470        3 years
 Paging terminals. . . . . . . .    71,764        7 years
                                 ----------
   Total Property and equipment.   134,979
 Less accumulated depreciation .   (30,257)
                                 ----------
                                  $104,722
                                 ==========





7.     Notes  Payable  to  Related  Parties:
       ------------------------------------

In  connection  with  the merger between Prime and Worldnet, the Company assumed
notes  payable  to  related  parties.  At December 31, 1999, the Company had the
following  notes  payable  outstanding  to  related  parties:




   Unsecured notes payable to shareholders; interest at 10%
   accruing through January 15, 2000, thereafter interest
   payments due monthly beginning January 15, 2000; principal
   due July 31, 2001 . . . . . . . . . . . . . . . . . . . . . .  .  $1,240,216

   Unsecured notes payable to a shareholder, former officer and
   director; interest at 10%; principal and interest due at various
   dates throughout 2000 . . . . .  . . . . . . . . . . . . . . . .     155,000

   Note payable to relative of the Chief Executive Officer; non-
   interest bearing; due April 15, 2000. . . . . . . . . . . . . . .     25,500
                                                                     ----------
                                                                      1,420,716
   Current Portion . . . . . . . . . . . . . . . . . . . . . . . . .   (180,500)
                                                                      ----------
   Long Term Portion . . . . . . . . . . . . . . . . . . . . . . . . $1,240,216
                                                                     ===========


Accrued interest on notes payable to related parties was $55,830 at December 31,
1999.  Interest  expense  on  these  notes  was  $60,954  in  1999.

In  February  2000,  notes  in  the principal amount of $1,240,216, plus accrued
interest  of $47,197 and interest accrued subsequent to year end of $19,774 were
settled  by  the  issuance  of  2,904,860  shares of the Company's common stock.


                                      F-12
<PAGE>
                   PRIME COMPANIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

8.     Convertible  Notes  Payable:
       ---------------------------

During  1999,  the  Company  issued unsecured notes payable to an individual for
cash  and  licenses.  At  December  31,  1999, principal of $496,220 and accrued
interest  of  $111,280  were  due  on  these  notes.  In March 2000, the Company
settled  notes  in  the principal amount of $396,220 and accrued interest in the
amount of $108,750 with cash payments of $252,500 and issuance of 561,111 shares
of  the  Company's  common  stock.  The  remaining principal balance of $100,000
accrues  interest at 10% and is due October 1, 2000.  The note is convertible to
312,500  shares  of  the  Company's  common  stock  on  October  1,  2000.


9.     Stock  Options:
       ---------------

At  the  time  of the merger, Prime had outstanding options to acquire 2,555,209
shares  of  common  stock.  At  December 31, 1999, options to purchase 1,396,375
shares  were  exercisable  at  the price of $1.00, options to purchase 1,038,834
shares  were  exercisable at the price of $3.00, and options to purchase 120,000
shares  were  exercisable  at  the  price  of  $6.00  per  share,  and  all were
exercisable  through  December 31, 2000. No options were granted or exercised in
1999  or  1998.


10.     Income  Taxes:
        --------------

The  provision for taxes for 1999 consists of state franchise taxes.  The actual
income  tax expense differs from the "expected" tax expense computed by applying
the U.S. federal corporate income tax rate of 34% because of the state taxes and
changes  in  the  valuation  allowance  of  deferred  tax  assets.

The  components  of  the  net deferred tax assets are as follows at December 31,
1999:

Noncurrent  deferred  tax  assets:
  Depreciation                                 $     3,000
  Net  operating  loss  carryforward             3,210,000
                                               ------------
                                                 3,213,000
  Valuation  allowance                          (3,213,000)
                                               ------------
      Net  noncurrent  deferred  tax  assets   $         -
                                               ============

As  of  December  31,  1999,  the  Company  has  available  net  operating  loss
carryforwards  for  income tax purposes of $8,338,000 which expire through 2019.
The  Company  has  state  net  operating  loss carryforwards of $4,033,000 which
expire  through 2004.  Due to the change in control of Prime, the benefit of the
net operating losses generated by Prime  prior  to  the  acquisition by Worldnet
will  be   limited   by  certain  consolidated  return  filing  regulations  and
limitations under  Section   382.   This  limitation  would  prevent  the use of
pre-acquisition   net   operating  losses  against  the  activities  of Worldnet
Tel.com, Inc. or any of its subsidiaries.


11.     Employee  Defined  Contribution  Plan:
        -------------------------------------

Effective  January  1, 1998, the Company adopted a 401K Profit Sharing Plan (the
"Plan")  covering  all  employees.  To  be  eligible to participate in the Plan,
employees  must  be age 21 and must complete at least 83.33 hours of service per
month  for  at  least  6  months.  Contributions to the Plan are invested at the
direction  of the participant. The Company made no matching contributions to the
Plan  during  the  years  ended  December  31,  1999  or  1998.

                                      F-13
<PAGE>
                   PRIME COMPANIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

12.     Commitments  and  Contingencies:
        -------------------------------

Leases
------

The  Company's  headquarters  is located on property owned by the Company's CEO.
The  Company  paid rent of $11,000 during 1999 and 1998 to the Company's CEO for
use  of  this  space.

All  of  the Company's office space was rented on a month-to-month basis. During
2000,  the  Company  intends to enter into lease agreements for a term of one or
more  years  with  its  various  landlords.

Litigation  and  other  claims
------------------------------

The  Company  is  the  defendant in a lawsuit with a former officer and director
seeking  payment  of $32,000 due for advances made on behalf of the Company. The
Company  has  filed  a  cross-complaint  claiming  the  advances  were  capital
contributions  and  is  seeking  to recover 4,500,000 shares of its common stock
held  by  the  plaintiff  and  to be reimbursed for legal fees arising from this
action. The Company believes the outcome of this matter will not have a material
adverse  effect  on  the  Company's financial position or results of operations.


13.     Subsequent  Events
        ------------------

In  March  2000 the Company completed a private placement offering of its common
stock  and  sold  6,569,444  shares  for  $2.4  million  (net  of commissions of
approximately  $547,000).

In  March  2000 the Board of Directors approved an employee stock option program
for  all employees on staff as of Jan 31, 2000, whereby each employee is granted
the  right  to  purchase  the  number of shares equal to 1999 gross earnings (at
Prime or any of its subsidiaries) at $1.00 per share; options to expire December
31, 2002, and are immediately exercisable..

In  March  2000  the  Board  of Directors also approved an employee stock option
program  for  all employees  employed by Prime in 2000, whereby each employee is
granted  the right to purchase the number of shares equal to 2000 gross earnings
(at  Prime  or  any  of  its subsidiaries) at $1.50 per share; options to expire
December  31,  2003, and do not vest until December 31, 2000.

In  March  2000  the  Board  of  Directors  also approved a stock option program
whereby each outside director was granted an option for the year 2000, to expire
December  31,  2002,  on  20,000  shares at $1.00 per share. The options vest on
January 1, 2001 to each current outside director who is still a director on that
date.


                                      F-14
<PAGE>