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

                                   FORM 10-K

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

                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999

                                   OR

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

                           FOR THE TRANSITION PERIOD
                       FROM  ____________ TO  ____________

                       COMMISSION FILE NUMBER: 000-25129

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

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<S>                                                    <C>
                       FLORIDA                                      65-0354269
-----------------------------------------------------  -----------------------------------
  (State or other jurisdiction of incorporation or
                     organization)                     (I.R.S. Employer Identification No.)
        2701 SOUTH BAYSHORE DRIVE, 5TH FLOOR
                   MIAMI, FLORIDA                                     33133
-----------------------------------------------------  -----------------------------------
      (Address of principal executive offices)                      (Zip Code)
</TABLE>

      REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:  (305) 285-2003

        SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE

          SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

                          COMMON STOCK, $.01 PAR VALUE

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein and will not 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-K or any amendment to this
Form 10-K [ ]

     The aggregate market value of the Common Stock held by non-affiliates of
the registrant as of March 10, 2000 was approximately $175,106,621 based on the
$36.75 closing bid price for the Common Stock quoted on the NASD over-the-
counter bulletin board on such date. For purposes of this computation, all
executive officers and directors of the registrant have been deemed to be
affiliates. Such determination should not be deemed to be an admission that such
directors and officers are, in fact, affiliates of the registrant.

     The number of shares of Common Stock of the registrant outstanding as of
March 10, 2000 was 6,423,806.

                      DOCUMENTS INCORPORATED BY REFERENCE

     The information called for by Part III is incorporated by reference to
specified portions of the registrant's definitive Proxy Statement to be issued
in conjunction with the registrant's 2000 Annual Meeting of Stockholders, which
is expected to be filed not later than 120 days after the registrant's fiscal
year ended December 31, 1999.
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<PAGE>   2

                                MAREX.COM, INC.

                               TABLE OF CONTENTS

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                                 PART I
Item 1.     Business....................................................    1
Item 2.     Properties..................................................    8
Item 3.     Legal Proceedings...........................................    8
Item 4.     Submission of Matters to a Vote of Security Holders.........    9

                                PART II
Item 5.     Market for Registrant's Common Equity and Related
            Stockholder Matters.........................................    9
Item 6.     Selected Consolidated Financial Data........................   11
Item 7.     Management's Discussion and Analysis of Financial Condition
            and Results of Operations...................................   12
Item 7A.    Quantitative and Qualitative Disclosures About Market
            Risk........................................................   15
Item 8.     Financial Statements and Supplementary Data.................   16
Item 9.     Changes in and Disagreements with Accountants on Accounting
            and Financial Disclosures...................................   34

                                PART III
Item 10.    Directors and Executive Officers of the Registrant..........   34
Item 11.    Executive Compensation......................................   34
Item 12.    Security Ownership of Certain Beneficial Owners and
            Management..................................................   34
Item 13.    Certain Relationships and Related Transactions..............   34

                                PART IV
Item 14.    Exhibits, Financial Statement Schedules and Reports on Form
            8-K.........................................................   35
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                                     PART I

ITEM 1. BUSINESS

     THE FOLLOWING DESCRIPTION OF OUR BUSINESS CONTAINS FORWARD-LOOKING
STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995, AS DO THE MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS SECTIONS OF THIS FORM 10-K, ALL OF WHICH RELATE TO SUCH
MATTERS AS ANTICIPATED FINANCIAL PERFORMANCE, BUSINESS PROSPECTS, TECHNOLOGICAL
DEVELOPMENTS, AND SIMILAR MATTERS. SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN
AND UNKNOWN RISKS, UNCERTAINTIES, AND OTHER FACTORS WHICH MAY CAUSE THE ACTUAL
RESULTS, PERFORMANCE, OR ACHIEVEMENTS OF THE COMPANY TO BE MATERIALLY DIFFERENT
FROM THOSE EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. FACTORS
INCLUDE, BUT ARE NOT LIMITED TO, THOSE DISCUSSED ELSEWHERE IN THIS REPORT IN THE
SECTION ENTITLED "RISK FACTORS" AND THE RISKS DISCUSSED IN OUR OTHER SECURITIES
AND EXCHANGE COMMISSION FILINGS.

COMPANY

     Marex.com, Inc. ("Marex.com" or the "Company") is a leading provider of
business to business ("B2B") e-commerce solutions for the marine industry. We
are developing a comprehensive set of procurement solutions for the automation
of business transactions on the Internet among suppliers, boat builders, boat
repairers, and dealers/distributors. We expect our solutions to offer our
members a medium for efficient procurement of goods and access to Internet
distribution channels.

     Our objective is to expand our position as the leading B2B e-commerce
solution for the marine industry. We are focused on developing our business to
provide the most efficient tools possible for the procurement of marine goods at
all stages of the purchasing lifecycle.

     The Exchange (the "Exchange"), the first procurement tool that we
developed, is an Internet based trading exchange for the marine industry. We
began registering members for the Exchange in November 1998. The Exchange allows
buyers to solicit quotes online from sellers for specific equipment, parts and
supplies. Buyers are displayed the best prices available, which are updated on a
real-time basis as bids are posted. Through the Exchange, we seek to provide a
worldwide search capability to buyers for equipment, parts and supplies and
create a lowest price forum for buyers to take advantage of spot market pricing
of sellers' overstocked and available inventory. Sellers utilizing the Exchange
will gain access to an expanded wholesale customer base and have greater
opportunity to resell slow moving inventory.

     Marex.com was originally incorporated in Florida in September 1992 under
the name of Florida Marine Management, Inc. In order to reflect our focus on
providing internet-based e-commerce solutions for the marine industry, we
changed our name on November 17, 1999 from Affiliated Networks, Inc. to
Marex.com, Inc.

INDUSTRY OVERVIEW

Growth of Business-to-Business Commerce on the Internet

     The Internet has emerged as a mass communications and commerce medium
enabling millions of people worldwide to share information, affiliate themselves
with others who share similar interests and conduct business electronically. The
Internet has created new opportunities for conducting commerce, such as B2B e-
commerce, that offers the potential for organizations to streamline complex
processes, lower costs and improve productivity. According to Forrester
Research, Internet-based B2B e-commerce sales surpass on-line business to
consumer ("B2C") sales. Forrester Research also estimates that B2B e-commerce
will expand over the next several years from $109 billion in 1999 to $2.7
trillion by 2004.

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     The dynamics of B2B e-commerce relationships differ significantly from
those of other e-commerce relationships. B2B e-commerce solutions frequently
automate or otherwise improve workflows or processes that are fundamental to a
business' operations by replacing various paper-based transactions with
electronic communications. In addition, B2B e-commerce solutions must often be
integrated with a company's existing information systems, a process that can be
complex, time-consuming and expensive. B2B e-commerce solutions that offer
improved efficiency through the automation of business processes and workflows
are being developed for a variety of industries.

The Marine Industry

     We feel that the marine market's highly fragmented supply chain coupled
with the inefficient purchasing methods being used by the industry make it
particularly well suited for B2B e-commerce. The marine industry utilizes
standard purchasing methods to buy and sell products. The current methods are
inefficient, costly and time consuming for both buyer and seller. Product orders
are traditionally handled through an internal, paper-based purchasing process
that requires searching for products in catalogs and manually preparing a
purchase order. Industry participants typically place orders by telephone or fax
and must place orders with multiple suppliers. While the traditional means of
telephone, facsimile and mail have historically served a valuable purpose in
facilitating commerce, information delivery, and communications between buyers
and sellers, they have inherent inefficiencies, in that they are slower, more
expensive in the long run and inefficient compared to Internet-related methods.
In addition, traditional purchasing methods present a number of challenges to
suppliers trying to reach small to medium sized boat builders and repair
companies with product information. Due to the high cost of printing and
distributing paper catalogs, suppliers cannot cost-effectively manage frequent
updates and distribution of time-sensitive information.

Opportunity for B2B E-commerce Solutions for the Marine Industry

     We believe that the fragmentation and complexities of the marine industry
create a need for B2B e-commerce solutions that seamlessly link suppliers and
buyers of marine products. To effectively address the needs of buyers, solutions
must be cost-effective, easily implemented, easy to use and provide
comprehensive product selection, in-depth product information, specialized
search capabilities and an efficient order and order tracking mechanism. To
effectively address the needs of suppliers, solutions must also offer a neutral
and fair marketplace with full catalog descriptions of products so as to attract
additional customers.

BUSINESS STRATEGY

     Our objective is to expand our position as the leading provider of B2B
e-commerce solutions for the marine industry. The key components of our strategy
to achieve this objective include:

Build the Marex.com Brand to Become Synonymous with E-commerce in the Marine
Industry

     We plan to capitalize on the fact that, to our knowledge, we are the first
company to offer multiple e-commerce solutions to problems unique to the marine
industry. We intend to pursue an aggressive brand development strategy through
targeted advertising and promotions, press coverage and participation in trade
associations and industry events to continue to develop industry awareness of
our solutions.

Increase Adoption of Our Exchange

     We intend to aggressively increase the base of members using our Exchange
and to increase its usage by current and future members. To encourage
implementation, we do not currently charge a membership fee. Additionally, we
intend to continue to educate existing and future users about the benefits of
our solutions and to provide training in their use, thereby accelerating
adoption and use.

Product Improvement and Development

     We plan to extend our market leadership by increasing the functionality of
the Exchange, and by rolling out new e-commerce solutions which will automate
the procurement process of marine businesses.
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Establish and Maintain Technological Leadership

     We will continue to expend substantial efforts to develop, purchase or
license technological advancements relating to our purchasing solutions. We
intend to focus on enhancing our system's reliability, functionality and ease of
integration with existing or newly developed purchasing systems.

Complete Strategic Relationships

     We continue to form strategic relationships with industry leaders such as
manufacturers, content and technology partners and other companies in the
industry that provide online services.

PRODUCTS AND SERVICES

The Exchange

     We began registering marine businesses as members of Marex.com in November
1998. Since that time, members have been utilizing our Exchange procurement tool
to find buyers and sellers in the marine trade for a wide variety of
wholesale-priced marine parts, supplies and equipment. We are in the process of
converting our Exchange into a truly automated auction and classified system.
The modified product, which will be called Classifieds and Auction, will provide
our members with the option to list items for a fixed price (Classifieds) or to
list items in an auction environment (Auction). We believe that this increased
functionality will serve to increase the flexibility and dynamics of the
products offered to our members.

Future Products

     We are currently developing e-commerce solutions that will automate
procurement for the marine industry. We expect our solutions to offer increased
procurement efficiency and access to Internet distribution channels.

MARKETING

     Our primary marketing efforts include advertising in industry publications.
We also utilize direct mail, telemarketing and presence at trade shows. We
concentrate these efforts on building brand recognition for our company,
positioning Marex.com as the "marine industry's online marketplace", and
educating our target market about the benefits of our e-commerce solutions. We
believe that such efforts encourage potential new members to have a positive
image and receptive mindset prior to our direct-selling effort.

PRODUCT DEVELOPMENT

     We dedicate a significant amount of our resources to developing and
enhancing our products. Expenses related to the development of our products
primarily consist of compensation for product development personnel, cost of
outside contractors, amortization of software development costs, and general
expenses associated with the development of our products. We incurred product
development expenses of approximately $1,132,000 and $90,000 for the years ended
1999 and 1998, respectively.

INTELLECTUAL PROPERTY

     We regard obtaining protection of our copyrights, service marks,
trademarks, trade dress and trade secrets as critical to our future success and
intend to rely on a combination of copyright, trademark, service mark and trade
secret laws and contractual restrictions to establish and protect our
proprietary rights in products and services. While we plan to pursue the
registration of our trademarks and service marks in the U.S. and
internationally, effective trademark, service mark, copyright and trade secret
protection may not be available in every country in which our services are made
available online.

     We have entered into confidentiality agreements with our employees and
certain vendors in order to limit access to and disclosure of our proprietary
information. There can be no assurance that these contractual

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arrangements or the other steps taken by us to protect our intellectual property
will prove sufficient to prevent misappropriation of our technology or to deter
independent third-party development of similar technologies.

     To date, we have not been notified that our technologies infringe the
proprietary rights of third parties, but there can be no assurance that third
parties will not claim infringement by us with respect to past, current or
future technologies. We expect that participants in our markets will be
increasingly subject to infringement claims as the number of services and
competitors in our industry segment grows. Any such claim, whether meritorious
or not, could be time-consuming, result in costly litigation, cause service
upgrade delays or require us to enter into royalty or licensing agreements. Such
royalty or licensing agreements might not be available on terms acceptable to us
or at all. As a result, any such claim could have a material adverse effect on
our business, results of operations and financial condition.

SOFTWARE DEVELOPMENT

     We have developed proprietary software for both our internal needs and
those of our e-commerce products. To date, we have developed several internal
proprietary software programs that include a full suite of administrative, data
collections, sorting, and marketing management tools. All of these programs are
maintained in-house. We have also developed a proprietary electronic commerce
software program. The software has been designed to enable the easy migration to
other industry platforms with relatively few, if any, changes.

COMPETITION

     The market for B2B e-commerce and Internet ordering and purchasing is new
and rapidly evolving. We perceive existing competition to be intensive and
expect it to increase significantly in the future. We also think that barriers
to entry are relatively insubstantial. We believe that the critical success
factors for companies seeking to create Internet B2B e-commerce solutions
include the following: brand recognition; quality and reliability of the
Internet purchasing solution; breadth and depth of product offerings; base of
customers; and ease of use and convenience. We face competition from other
companies with e-commerce offerings, traditional suppliers and distributors of
marine products and marine manufacturers that have developed their own
purchasing solutions. We may also face further competition in the future from
traditional suppliers and distributors that enter into B2B e-commerce over the
Internet either on their own or by partnering with other companies. In addition,
we face competition from current online B2C companies.

GOVERNMENT REGULATION

     Due to the increasing popularity and use of the Internet and other online
services, it is possible that a number of laws and regulations may be adopted
with respect to the Internet or other online services covering issues such as
user privacy, freedom of expression, pricing, content and quality of products
and services, taxation, advertising, intellectual property rights and
information security. The nature of such legislation and the manner in which it
may be interpreted and enforced cannot be fully determined and, therefore,
legislation could be enacted which could subject us and/or our customers to
potential liability, which in turn could have an adverse effect on our business,
results of operations and financial condition. The adoption of any such laws or
regulations might also decrease the rate of growth of Internet use, which in
turn could decrease the demand for our services or increase the cost of doing
business or in some other manner have a material adverse effect on our business,
results of operations and financial condition. In addition, applicability to the
Internet of existing laws governing issues such as property ownership,
copyrights and other intellectual property issues, taxation, libel, obscenity
and personal privacy is uncertain. The vast majority of such laws were adopted
prior to the advent of the Internet and related technologies and, as a result,
do not contemplate or address the unique issues of the Internet and related
technologies.

     Numerous states, including the State of Florida, in which our headquarters
is located, have regulations regarding the manner in which "auctions" may be
conducted and the liability of "auctioneers" in conducting such auctions. Due to
the fact that these laws were promulgated prior to the advent of the Internet
and exchanges in the nature of the Exchange, it is not clear, and there is
little guidance from the courts and the

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legislature as to, whether a system like the Exchange would fall within their
purview. While we are in the process of seeking a determination as to the
applicability of the Florida laws to our business, there can be no assurance
that the State of Florida, or any other state, will not attempt to impose these
regulations upon us or that such imposition will not have a material adverse
effect on our business, results of operations and financial condition.

     Several states have also proposed legislation that would limit the uses of
personal user information gathered online or require online services to
establish privacy policies. The Federal Trade Commission has also recently
settled a proceeding with one online service regarding the manner in which
personal information is collected from users and provided to third parties.
Changes to existing laws, or the passage of new laws intended to address these
issues, could create uncertainty in the marketplace that could reduce demand for
our services or increase the cost of doing business as a result of litigation
costs or increased service delivery costs, or could in some other manner have a
material adverse effect on our business, results of operations and financial
condition. In addition, because our services are accessible worldwide, and we
facilitate sales of goods to users worldwide, other jurisdictions may claim that
we are required to qualify to do business as a foreign corporation in a
particular state or foreign country. We are currently only qualified to do
business in the State of Florida, and our failure to qualify as a foreign
corporation in a jurisdiction where it is required to do so could subject us to
taxes and penalties for the failure to qualify and could result in our inability
to enforce contracts in such jurisdictions. Any such new legislation or
regulation, or the application of laws or regulations from jurisdictions whose
laws do not currently apply to our business, could have a material adverse
effect on our business, results of operations and financial condition.

EMPLOYEES

     As of December 31, 1999, we had 33 full-time employees. None of our
employees is represented by a collective bargaining agreement, nor have we
experienced any work stoppage. We consider our relations with our employees to
be good. We believe our future success depends in part on our continued ability
to attract, integrate, retain and motivate highly qualified technical and
managerial personnel, and upon the continued service of our senior management
and key technical personnel. We only have an employment agreement with our
President and CEO. Competition for qualified personnel in our industry and
geographical location is intense, and there can be no assurance that we will be
successful in attracting, integrating, retaining and motivating a sufficient
number of qualified personnel to conduct our business in the future.

RISK FACTORS

     The following risk factors, together with all information in this Form
10-K, should be carefully considered in evaluating Marex.com and its business.
Due to the significant impact that the risk factors set forth below may have on
Marex.com's business, results of operations and financial condition, actual
results could differ materially from those expressed or implied by any
forward-looking statement.

We have a Limited Operating History

     Marex.com, Inc. was founded in 1992 but did not launch the Exchange until
November 1998. Thus we have a limited operating history on which to base an
evaluation of our e-commerce business and prospects. Our prospects must be
considered in light of the risks, uncertainties, expenses and difficulties
frequently encountered by companies in their early stages of development,
particularly companies in new and rapidly evolving markets such as B2B
e-commerce. Many of these risks are described in this "Risk Factors" section.
There can be no assurance that we will be able to address these risks.

We have a History of Losses

     We have incurred losses from operations in each period since our inception.
We expect to incur substantial operating losses and have continued negative cash
flows from operations for the foreseeable future. We expect to significantly
increase our spending on sales and marketing, product development, and general

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and administrative expenses. In addition, we have no material revenues to date.
If our revenue does not increase substantially or if our expenses increase
further than we expect, we may not become profitable.

Our Quarterly Operating Results are Volatile and Difficult to Predict

     Due to our limited operating history, we believe that period-to-period
comparisons of revenues and results of operations are not meaningful. The
fluctuations in our operating results may fall below the expectations of
investors and securities analyst. Our failure to meet these expectations will
likely cause a significant decline in the market price of our stock.

The Business to Business E-commerce Model is Not Proven

     Our B2B e-commerce model is based on the expansion of the Exchange and the
launch of our other procurement solutions for B2B e-commerce within the marine
industry. This business model is new and not proven and depends upon our ability
to, among other things: sell purchasing solutions to marine industry
participants; achieve high rates of adoption by customers; and generate
significant revenues from the use of our Internet-based solutions. We cannot be
certain that the business model will be successful, that it can achieve or
sustain revenue growth, or that it can generate any profits. The success of this
business model will require, among other things, that we develop and market
solutions with broad market acceptance by users and strategic partners. We
cannot be certain that B2B e-commerce on the Internet, our e-commerce solution,
or our services and brand in particular, will achieve broad market acceptance.

If We Fail to Release New E-commerce Solutions on a Timely Basis, Our Business
Would be Adversely Affected

     We plan to introduce new e-commerce solutions to service the requirements
of marine industry participants and to increase the potential transaction
volumes. If we fail to introduce new products on a timely basis, we may
experience supplier and buyer dissatisfaction which will adversely affect our
business. In addition, any new product that does not achieve market acceptance
may cause damage to our reputation or brand name.

We Face Intense Competition

     We perceive competition to be intense and we expect it to increase
significantly in the future. We face competition from other companies with
e-commerce offerings as well as traditional suppliers and distributors of marine
products and marine companies that have or may develop their own online
solutions. In addition, providers of online marketplaces and online auction
services that currently focus on other industries may expand their services to
include marine products. Our competitors and potential competitors may develop
superior Internet solutions that achieve greater market acceptance than the
Marex.com solution. In addition, substantially all of our prospective customers
have established long-standing relationships with some competitors and potential
competitors. We cannot be certain that we can compete successfully against
current and future competitors.

Our Solution and Services are New and Face Rapid Technological Changes

     The Internet market for the Marex.com solution is characterized by rapid
technological advances, evolving standards in the Internet and software markets,
changes in customer requirements and frequent new product and service
introductions and enhancements. As a result, we believe that our future success
depends upon our ability to enhance current Internet-based solutions and
services, to develop and introduce new solutions and services that will achieve
market acceptance, and where necessary, to integrate Internet-based solutions
with customers' systems. If we do not adequately respond to the need to develop
and introduce new solutions or services, then our business will be negatively
affected. Further, we may incur significant expense to integrate purchasing
solutions with customers' systems and to maintain this integration as customers'
systems evolve. Failure to provide this integration may delay or altogether
dissuade the marine market or a particular customer from adopting our
Internet-based solutions.

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We Will Need to Manage Our Expanding Business

     Our growth has placed, and is expected to continue to place, a significant
demand on our sales, marketing, managerial, operational, information technology
and other resources. If we cannot manage our growth effectively, our business
will be adversely affected. We expect to need a significant number of new
employees to expand our business. Our current information systems, procedures
and controls may not support expanded operations and may hinder our ability to
take advantage of the market for e-commerce purchasing solutions to the marine
industry.

We Depend on Key Personnel

     Our performance is substantially dependent on the performance of the
executive officers and other key employees. Failure to successfully manage
personnel requirements would have a negative effect on the business. We have
experienced difficulty from time to time in hiring the personnel necessary to
support the growth of our business, and we may experience similar difficulty in
hiring and retaining personnel in the future. Competition for senior management,
experienced sales and marketing personnel, software developers, and other
employees is intense, and we cannot be certain that we will be successful in
attracting and retaining personnel. The loss of the services of any executive
officers or key employees could have a negative effect on the business. Failure
to obtain or retain the services of necessary executive officers or key
employees may not support existing or expanded operations, and may hinder our
ability to take advantage of the market for e-commerce purchasing solutions to
the marine industry.

We Expect the Price of Our Common Stock to Be Volatile

     The market price of the Common Stock may fluctuate significantly in
response to a number of factors, some which are beyond our control, including
the following: quarterly variations in operating results; changes in market
valuation of Internet commerce companies; announcements of significant
contracts, acquisitions, strategic partnerships, joint ventures or capital
commitments; loss of a major customer or strategic partner, or failure to
complete a sale to a significant customer; additions or departures of any key
personnel; future sales of our Common Stock; and stock market price and volume
fluctuations, which are particularly common among highly volatile securities of
Internet companies.

Security Problems May Inhibit the Growth of Internet-Based Purchasing Solutions

     A significant barrier to the adoption of e-commerce is the secure
transmission of confidential information over public networks. Users generally
are concerned with security and privacy on the Internet and any publicized
security problems could inhibit the growth of the Internet, and therefore
inhibit the Marex.com solution as a means of conducting transactions. If there
is a breach in our security system, we may be required to make significant
expenditures to protect against security breaches and to alleviate problems
caused by such breaches.

System Failure May Cause Interruption of Services

     The performance of our server and networking hardware and software
infrastructure is critical to our business and reputation, and affects our
ability to process transactions, provide high quality customer service and
attract and retain customers, suppliers, users and strategic partners. Currently
the infrastructure and systems are located at one site at our headquarters in
Miami, Florida. We are in the process of adding a mirror site at a different,
distant location. Until then, we depend on single-site infrastructure. Any
disruption to this infrastructure resulting from a natural disaster or other
event could result in an interruption in service, fewer transactions and, if
sustained or repeated, could impair our reputation and the attractiveness of the
services.

We May Require Additional Capital for Operations

     We currently anticipate that current financing arrangements, together with
existing borrowing arrangements and available funds will be sufficient to meet
anticipated needs for working capital and capital expenditures for at least the
next 12 months. We will need to raise additional funds in the future in order to
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fund rapid expansion, to develop new or enhanced solutions and services, to
respond to competitive pressures or to acquire complementary businesses,
technologies or services.

We Depend on Intellectual Property Rights

     Our intellectual property is important to us. We seek to protect
intellectual property through copyrights, trademarks, trade secrets,
confidentiality provisions in customer, supplier and strategic relationship
agreements, nondisclosure agreements with third parties, employees and
contractors. We cannot assure that measures we take to protect intellectual
property will be successful or that third parties will not develop alternative
purchasing solutions that do not infringe upon our intellectual property. In
addition, we could be subject to intellectual property infringement claims by
others. Failure to protect against misappropriation of intellectual property, or
claims that we are infringing the intellectual property of third parties could
have a negative effect on our business.

Regulation or Taxation of the Internet or Transacting Business Over the Internet

     Due to the increasing popularity and use of e-commerce, it is possible that
a number of taxes, laws and regulations may be adopted in the U.S. and abroad
with particular applicability to the Internet and e-commerce transactions. It is
possible that governments will adopt taxes and enact legislation that may be
applicable in areas such as content, product distribution, network security,
encryption and the use of key escrow, data and privacy protection, electronic
authentication or "digital" signatures, illegal and harmful content, access
charges and re-transmission activities. Moreover, the applicability to the
Internet of existing laws governing issues such as property ownership, content,
taxation, defamation and personal privacy is uncertain. Taxes, laws or
regulations may limit the growth of the Internet, dampen e-commerce and reduce
the number of transactions, increase the cost of doing business or increase
legal exposure. Any of these factors could have a negative effect on our
business.

SEASONALITY

     Our business is seasonal due to the impact of the buying and selling
patterns of the members that utilize our system. We believe that the second and
third quarters are the peak periods for the recreational marine industry. In
addition, the recreational marine industry is highly cyclical and is highly
affected by a number of factors. Some of those factors are: (i) economic
conditions, (ii) consumer confidence levels, and (iii) weather conditions.

ITEM 2.  PROPERTIES

     The Company leases office space (11,800 sq. ft.) in Miami, Florida,
pursuant to a lease agreement that expires June 30, 2004.

ITEM 3.  LEGAL PROCEEDINGS

     We are not aware of any pending material legal proceedings to which we are
a party or which our property is the subject.

                                        8
<PAGE>   11

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

     On November 16, 1999, Marex.com held a special meeting of stockholders at
the Company's offices at 2701 South Bayshore Drive, 5th Floor, Miami, Florida
33133. The matters voted upon and their results were as follows:

Proposal 1

     To approve an amendment to the Company's Amended and Restated Articles of
Incorporation, to change the Company's name to "Marex.com, Inc."

     Proposal 1 was approved based on the following results:

<TABLE>
<CAPTION>
   FOR      AGAINST    ABSTAIN
---------  ---------  ---------
<S>        <C>        <C>
4,533,724    1,050        0
</TABLE>

Proposal 2

     To approve the amendment and restatement of the Company's Amended and
Restated 1997 Stock Option Plan, to increase the maximum number of shares which
may be subject to options granted under the Restated Plan by 2,000,000 shares.

     Proposal 2 was approved based on the following results:

<TABLE>
<CAPTION>
   FOR      AGAINST    ABSTAIN
---------  ---------  ---------
<S>        <C>        <C>
3,716,432   45,200      2,515
</TABLE>

                                    PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND
         RELATED STOCKHOLDER MATTERS

     Our Common Stock is traded on the NASD over-the-counter bulletin board
under the symbol "MRXX". Prior to changing our name, we commenced our trading on
February 4, 1998 under the symbol "AFNT". The following table sets forth the
high and low bid quotations for our Common Stock for the periods indicated.
These quotations reflect prices between dealers retroactively adjusted for a
3-for-1 stock split on March 24, 1998. Prices do not include retail mark-ups,
mark-downs, commissions and may not necessarily represent actual transactions.

<TABLE>
<CAPTION>
                                                               HIGH      LOW
                                                              ------    -----
<S>                                                           <C>       <C>
1998
First Quarter (commencing February 4).......................  $ 6.00    $5.50
Second Quarter..............................................    5.28     5.25
Third Quarter...............................................    5.00     4.50
Fourth Quarter..............................................   14.00     4.00

1999
First Quarter...............................................  $11.50    $8.50
Second Quarter..............................................   12.13     9.25
Third Quarter...............................................   10.38     7.50
Fourth Quarter..............................................   10.19     6.75
</TABLE>

     As of March 10, 2000, there were approximately 128 holders of record of our
Common Stock, of which 6,423,806 shares were issued and outstanding. The closing
bid price for the Common Stock was $36.75 per share.

     We have never paid cash dividends on our Common Stock. We intend to retain
future earnings, if any, to finance the expansion of our business and do not
anticipate that any cash dividends will be paid in the

                                        9
<PAGE>   12

foreseeable future. The future dividend policy will depend on our earnings,
capital requirements, expansion plans, financial condition and other relevant
factors.

PRIVATE PLACEMENTS OF COMMON STOCK

     During the second quarter of 1999, we raised $6,892,465 from the sale of
1,122,047 shares of Common Stock and after deducting $872,074 in commissions and
$31,208 in other costs related to the financing. The shares were primarily sold
to overseas investors and were issued pursuant to Rule 505 and 506 under
Regulation D of the Securities Exchange Act of 1933.

     As of December 31, 1999, proceeds from our 1999 private placements had been
used as follows: $2,892,000 was used towards operating expenses; $726,000 was
invested in property, plant and equipment, and a trademark; $403,000 was used to
pay-off debt; and $151,000 was used to fund the discontinued operations of
Sovereign.

                                       10
<PAGE>   13

ITEM 6.  SELECTED CONSOLIDATED FINANCIAL DATA

     The following selected consolidated financial data should be read in
conjunction with the consolidated financial statements and the notes to the
consolidated financial statements and "Management's Discussion and Analysis of
Financial Condition and Results of Operations", which are included elsewhere in
this Form 10-K. The selected financial data of Marex.com as of and for each of
the four years in the period ended December 31, 1999, have been derived from
Marex.com's audited consolidated financial statements. The selected financial
data of Marex.com as of and for the year ended December 31, 1995, have been
derived from unaudited consolidated financial statements.

<TABLE>
<CAPTION>
                                                          YEAR ENDED DECEMBER 31,
                                     -----------------------------------------------------------------
                                        1999          1998          1997         1996         1995
                                     -----------   -----------   ----------   ----------   -----------
                                                                                           (UNAUDITED)
<S>                                  <C>           <C>           <C>          <C>          <C>
STATEMENT OF OPERATIONS DATA:
Revenues...........................  $     7,277   $        --   $       --   $       --   $       --
                                     -----------   -----------   ----------   ----------   ----------
Operating expenses:
  Product development..............    1,132,179        89,952           --           --           --
  Selling and marketing............    1,137,554       166,699           --           --           --
  General and administrative.......    1,385,027        24,799           --           --           --
                                     -----------   -----------   ----------   ----------   ----------
          Total operating
            expenses...............    3,654,760       281,450           --           --           --
                                     -----------   -----------   ----------   ----------   ----------
Loss from operations...............   (3,647,483)     (281,450)          --           --           --
                                     -----------   -----------   ----------   ----------   ----------
Other income (expense):
  Interest income..................      106,411            --           --           --           --
  Interest expense.................       (6,909)      (45,208)     (32,800)     (16,800)          --
  Other............................       (1,406)         (912)     (23,213)          --           --
                                     -----------   -----------   ----------   ----------   ----------
          Total other income
            (expense)..............       98,096       (46,120)     (56,013)     (16,800)          --
                                     -----------   -----------   ----------   ----------   ----------
Loss from continuing operations....   (3,549,387)     (327,570)     (56,013)     (16,800)          --
                                     -----------   -----------   ----------   ----------   ----------
Discontinued operations:
  Loss from discontinued
       operations..................     (100,167)     (827,483)    (599,844)    (308,568)     (20,480)
  Loss on disposal, including
       $11,869 for operating losses
       during the phase out
       period......................      (40,200)           --           --           --           --
                                     -----------   -----------   ----------   ----------   ----------
          Total discontinued
            operations.............     (140,367)     (827,483)    (599,844)    (308,568)     (20,480)
                                     -----------   -----------   ----------   ----------   ----------
Net loss...........................  $(3,689,754)  $(1,155,053)  $ (655,857)  $ (325,368)  $  (20,480)
                                     ===========   ===========   ==========   ==========   ==========
Net loss per share, basic and
  diluted:
  Continuing operations............  $     (0.62)  $     (0.07)  $    (0.01)  $    (0.02)  $       --
  Discontinued operations..........        (0.03)        (0.17)       (0.15)       (0.27)       (0.02)
                                     -----------   -----------   ----------   ----------   ----------
  Net loss.........................  $     (0.65)  $     (0.24)  $    (0.16)  $    (0.29)  $    (0.02)
                                     ===========   ===========   ==========   ==========   ==========
Weighted average shares of Common
  Stock outstanding................    5,700,306     4,752,975    3,995,719    1,127,869    1,000,000
                                     ===========   ===========   ==========   ==========   ==========
BALANCE SHEET DATA:
Cash and equivalents...............  $ 3,434,036   $   350,042   $   28,778   $   69,058   $       --
Working capital (deficit)..........    2,922,218        13,821     (226,200)    (253,201)    (209,460)
Total assets.......................    4,315,458       596,596      447,826      454,795      221,121
Long-term liabilities..............        6,734        28,647       92,215      113,017       35,229
Accumulated deficit................   (5,889,943)   (2,200,189)  (1,045,136)    (389,279)     (63,911)
Total stockholders' equity
  (deficit)........................    3,704,104       222,093      (27,836)     (72,279)     (46,911)
</TABLE>

                                       11
<PAGE>   14

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

     The following discussion should be read in conjunction with the
consolidated financial statements and the notes to the consolidated financial
statements, which are included elsewhere in this Form 10-K. It contains
forward-looking statements that involve risks and uncertainties. Our actual
results could differ materially from those anticipated in these forward-looking
statements as a result of various factors, including those discussed below and
elsewhere in this Form 10-K, particularly under the heading "Risk Factors".

OVERVIEW

     Marex.com is a provider of e-commerce solutions for the marine industry.
The Exchange, the first procurement tool that we developed, is an Internet based
trading exchange for the marine industry. We began registering members for the
Exchange in November 1998. The Exchange allows buyers to solicit quotes online
from sellers for specific equipment, parts and supplies. Buyers are displayed
the best prices available, which are updated on a real-time basis as bids are
posted. Through the Exchange, we seek to provide a worldwide search capability
to buyers for equipment, parts and supplies and create a lowest price forum for
buyers to take advantage of spot market pricing of sellers' overstocked and
available inventory. Sellers utilizing the Exchange will gain access to an
expanded wholesale customer base and have greater opportunity to resell slow
moving inventory.

     In addition to the Exchange, we are developing e-commerce solutions that
will automate the procurement process of marine businesses. We expect our
solutions to offer increased procurement efficiency and access to Internet
distribution channels.

DISCONTINUED OPERATIONS

     On August 24, 1999, our Board of Directors approved a plan to discontinue
the operations of its non-core business subsidiary, Sovereign Financial
Information Services, Inc. ("Sovereign"), in order to focus its business towards
its Internet-based services and products for the marine industry. Sovereign was
engaged in the publishing of research reports, stock handbooks and global
industry guides. Sovereign ceased operations on September 30, 1999. The
estimated loss on the disposal of Sovereign was $40,000, consisting of a
write-down of Sovereign assets totaling $28,000 and a provision of $12,000 for
the estimated operating losses until the date of disposal. In 1999, our loss
from discontinued operations was $100,000, compared to $827,000 in 1998. The
decrease resulted from greater resources and efforts allocated towards our
continuing operations in 1999.

     The financial information in "Management's Discussion and Analysis of
Financial Condition and Results of Operations" refers to our continuing
operations and excludes the operations of Sovereign.

RESULTS OF OPERATIONS

COMPARISON OF YEARS ENDED DECEMBER 31, 1999 AND 1998

  Revenues

     The Exchange generates revenues by charging a transaction fee for completed
transactions. The fee is based on a sliding scale ranging from approximately 10%
for smaller transactions to 4% for larger transactions. Revenues are recognized
at the completion of a transaction. A transaction is considered completed when
the buyer has received and approved the merchandise that was purchased through
the Exchange, and we have remitted the purchase price, less the transaction fee,
to the seller. For the year ended December 31, 1999, we recorded revenues of
$7,000 generated from $194,000 of completed transactions through the Exchange.
The Exchange, which was not operational until November 1998, did not generate
any revenues in 1998.

  Product Development

     Product development expenses consist primarily of compensation for product
development personnel, cost of outside contractors, amortization of software
development costs, and other costs associated with the operations and
enhancements of the website. Product development expenses increased to
$1,132,000 for the
                                       12
<PAGE>   15

year ended December 31, 1999, compared to $90,000 for the same period in 1998.
The change related primarily to increases of $623,000 in personnel and personnel
related costs, $114,000 in outside contractor costs, and $59,000 in depreciation
and amortization. The balance was comprised of overhead and operating costs
directly associated with the development and maintenance of the website. We
expect product development expenses to continue to increase as we develop and
enhance the functionality of the website.

  Selling and Marketing

     Selling and marketing expenses consist primarily of compensation for sales
and marketing personnel, advertising, trade shows and related marketing costs.
Selling and marketing expenses increased to $1,138,000 for the year ended
December 31, 1999, compared to $167,000 for the same period in 1998. The change
is primarily due to increases of $497,000 in personnel and personnel related
costs, $297,000 in advertising and marketing costs, and $54,000 in professional
fees. The balance was comprised of overhead and operating costs directly
associated with selling and marketing activities. We expect selling and
marketing expenses to continue to increase as we increase awareness about our
company and improve our positioning within the market.

  General and Administrative

     General and administrative expenses consist primarily of compensation for
administrative personnel, facilities expenses, professional fees, and general
corporate expenses. General and administrative expenses increased to $1,385,000
for the year ended December 31, 1999, compared to $25,000 for the same period in
1998. The change related primarily to increases of $618,000 in personnel and
personnel related costs, $276,000 in professional fees and $140,000 relating to
the fair value of warrants issued to consultants. The balance was comprised of
corporate charges directly associated with the administrative functions of our
company. We expect general and administrative expenses to continue to increase
as we add personnel and incur additional corporate expenses associated with the
evolution of our business.

  Other Income and Expense

     We recorded $106,000 of interest income for the year ended December 31,
1999, as a result of our investments in marketable securities which were derived
from the net proceeds of the private placements completed in 1999. Interest
expense for the year ended December 31, 1999 was $7,000, compared to $45,000 in
the prior year as a result of the decrease in our notes payable and loan from
related party balances.

  Loss from Continuing Operations

     Our loss from continuing operations increased to $3,549,000 for the year
ended December 31, 1999, from $328,000 in the prior year. The change resulted
from the increase in costs, as described above, associated with the launch of
the Exchange which was in the development stage until November 1998 and the
development of other e-commerce products.

COMPARISON OF YEARS ENDED DECEMBER 31, 1998 AND 1997

  Revenues

     The Exchange, which was not operational until November of 1998, did not
generate any revenues during 1998 and 1997.

  Product Development

     In 1998, we recorded $90,000 of product development expenses related
primarily to personnel and personnel related costs. We did not incur any product
development expenses in 1997.

  Selling and Marketing

     Selling and marketing expenses consist primarily of compensation for sales
and marketing personnel, advertising, and related marketing costs. In 1998, we
recorded selling and marketing expenses of $167,000

                                       13
<PAGE>   16

consisting primarily of $15,000 in personnel and personnel related costs and
$141,000 in advertising and marketing costs. The balance was comprised of
overhead and operating costs directly associated with selling and marketing
activities. We did not incur any selling and marketing expenses in 1997.

  General and Administrative

     In 1998, we recorded general and administrative expenses of $25,000
consisting primarily of $15,000 in personnel and personnel related costs. The
balance was comprised of corporate charges directly associated with the
administrative functions of our company. We did not incur any general and
administrative expenses in 1997.

  Other Income and Expense

     Interest expense during the year ended December 31, 1998 was $45,000,
compared to $33,000 for the same period in 1997. The increase was primarily due
to the balances outstanding during 1998 under the loan from related party. Other
expense decreased from $23,000 in 1997, to $900 in 1998 as a result of decreased
losses relating to trading securities.

  Loss from Continuing Operations

     Our loss from continuing operations was $328,000 during the year ended
December 31, 1998, compared to $56,000 for the same period in 1997. The change
resulted from the increase in costs, as described above, associated with the
launch of the Exchange which was in the development stage until November 1998.

LIQUIDITY AND CAPITAL RESOURCES

     Since our inception, we have financed our operations primarily through the
private sale of Common Stock, short-term borrowings from banks, and borrowings
from our Chief Executive Officer who is also President, Director and a
shareholder.

     Net cash used in operating activities was $2.9 million in 1999, primarily
as a result of a net loss from continuing operations of $3.5 million. The net
loss was offset by an increase of $523,000 in accounts payable and accrued
expenses and a charge of $140,000 to reflect the fair value of warrants issued
to consultants.

     Net cash used in investing activities was $748,000 in 1999, primarily due
to leasehold improvements relating to the new office, the purchase of computer
and office equipment, and the purchase of furniture and fixtures.

     Net cash provided by financing activities was $6.9 million, which was
primarily due to the issuance of Common Stock and borrowings. The issuance of
Common Stock and borrowings was partially offset by payments of notes payable
balances and amounts due to a related party.

     At December 31, 1999, our cash and cash equivalents totaled $3.4 million,
while our working capital was $2.9 million. In comparison, as of December 31,
1998, cash and cash equivalents totaled $350,000, while our working capital was
$14,000. The increase was primarily due to the issuance of $6.9 million of
Common Stock during 1999. To date, our primary uses of cash have been in
operating activities to fund the development and promotion of our e-commerce
solutions.

     In March 2000, the Company entered into an agreement for the sale of
430,000 shares of Series A1 Convertible Preferred Stock ("Series A1 Preferred
Stock") at $100 per share. The sale, consisting of two tranches, results in
gross cash proceeds of $43 million. The first tranche, completed on March 3,
2000, consisted of 210,000 shares of Series A1 Preferred Stock amounting to cash
proceeds of $21 million. The second $22 million tranche will close upon the
earlier of 60 days following the date of the first issuance, or the date at
which the Common Stock of the Company is listed on Nasdaq, assuming the
satisfaction of certain conditions.

     We expect to experience significant growth in our operating expenses during
the foreseeable future in order to execute our business plan. We anticipate that
such operating expenses, as well as planned capital
                                       14
<PAGE>   17

expenditures, will constitute a material use of our cash resources. We believe
that the net proceeds from our sale of Series A1 Preferred Stock will be
sufficient to meet our working capital and operating resources requirements for
at least the next year. In the event that our working capital and operating
resources requirements during the next year exceed our cash proceeds from our
sale of Series A1 Preferred Stock, we may not be able to raise additional
capital on acceptable terms or at all.

RECENT PRONOUNCEMENT

     In June 1999, the FASB issued SFAS No. 137, "Accounting for Derivative
Instruments and Hedging Activities-Deferral of Effective Date of FASB Statement
No. 133". SFAS No. 137 defers for one year the effective date of SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities". SFAS No. 133
will now apply to all fiscal quarters of all fiscal years beginning after June
15, 2000. SFAS No. 133 will require us to recognize all derivatives on the
balance sheet at fair value. Derivatives that are not hedges must be adjusted to
fair value through income. We will adopt SFAS No. 133 as required for our first
quarterly filing of fiscal year 2001. We believe the adoption of this Statement
will not have a material effect on our results of operations and financial
position.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Not applicable.

                                       15
<PAGE>   18

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                                MAREX.COM, INC.

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                              PAGE
                                                              ----
<S>                                                           <C>
Report of Independent Certified Public Accountants..........   17

Independent Auditors' Report................................   18

Consolidated Balance Sheets as of December 31, 1999 and
  1998......................................................   19

Consolidated Statements of Operations
  For the Years Ended December 31, 1999, 1998 and 1997......   20

Consolidated Statements of Shareholders' Equity
  For the Years Ended December 31, 1999, 1998 and 1997......   21

Consolidated Statements of Cash Flows
  For the Years Ended December 31, 1999, 1998 and 1997......   22

Notes to Consolidated Financial Statements..................   23
</TABLE>

                                       16
<PAGE>   19

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Shareholders and Board of Directors of
Marex.com, Inc.:

     We have audited the accompanying consolidated balance sheet of Marex.com,
Inc., (a Florida Corporation) and Subsidiary (formerly Affiliated Networks,
Inc.) as of December 31, 1999, and the related consolidated statements of
operations, shareholders' equity and cash flows the year then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

     We conducted our audit in accordance with generally accepted auditing
standards in the United States. 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 consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Marex.com,
Inc. and Subsidiary as of December 31, 1999 and the results of its operations
and its cash flows for the year then ended, in conformity with generally
accepted accounting principles in the United States.

/s/ Arthur Andersen LLP

Miami, Florida,
  February 21, 2000 (except with respect
  to the matter discussed in Note 12, as to
  which the date is March 7, 2000).

                                       17
<PAGE>   20

                          INDEPENDENT AUDITORS' REPORT

The Board of Directors and Shareholders of
Marex.com, Inc. and Subsidiary, formerly
  Affiliated Networks, Inc. and Subsidiary
Miami, Florida

     We have audited the accompanying consolidated balance sheet of Marex.com,
Inc. and Subsidiary, formerly Affiliated Networks, Inc. and Subsidiary, as of
December 31, 1998, and the related consolidated statements of operations,
shareholders' equity (deficit), and cash flows for the years ended December 31,
1998 and 1997. Our responsibility is to express an opinion on these financial
statements based on our audits.

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

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Marex.com, Inc. and
Subsidiary, formerly Affiliated Networks, Inc. and Subsidiary, as of December
31, 1998 and the results of their operations, changes in their shareholders'
equity, and their cash flows for the years ended in December 31, 1998 and 1997
in conformity with generally accepted accounting principles.

/s/ McClain & Company, L.C.

Miami, Florida
January 18, 1999 except for Note 3,
as to which the date is February 21, 2000

                                       18
<PAGE>   21

                         MAREX.COM, INC. AND SUBSIDIARY

                          CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                     DECEMBER 31,
                                                              --------------------------
                                                                 1999           1998
                                                              -----------    -----------
<S>                                                           <C>            <C>
                           ASSETS
Current assets:
  Cash and cash equivalents.................................  $ 3,434,036    $   350,042
  Prepaid expenses and other current assets.................       70,602             --
  Loan to shareholder.......................................       22,200             --
  Net current assets of discontinued operations.............           --          9,635
                                                              -----------    -----------
          Total current assets..............................    3,526,838        359,677
                                                              -----------    -----------
Property and equipment, net.................................      692,335         71,270
                                                              -----------    -----------
Other assets:
  Trademark, net............................................       23,021             --
  Software development costs, net...........................       71,668         89,954
  Deposits..................................................        1,596          1,596
  Net non-current assets of discontinued operations.........           --         74,099
                                                              -----------    -----------
          Total other assets................................       96,285        165,649
                                                              -----------    -----------
               Total assets.................................  $ 4,315,458    $   596,596
                                                              ===========    ===========
            LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Notes payable.............................................  $        --    $   116,206
  Capital lease obligations.................................        6,845         11,296
  Accounts payable and accrued expenses.....................      534,552        106,307
  Customer deposits.........................................       63,223         76,297
  Due to related party......................................           --         35,750
                                                              -----------    -----------
          Total current liabilities.........................      604,620        345,856
                                                              -----------    -----------
Long-term liabilities:
  Notes payable, net of current portion.....................           --         23,521
  Capital lease obligations, net of current portion.........        6,734          5,126
                                                              -----------    -----------
          Total long-term liabilities.......................        6,734         28,647
                                                              -----------    -----------
               Total liabilities............................      611,354        374,503
                                                              -----------    -----------
Shareholders' equity:
  Preferred Stock, par value $.01 per share, 1,000,000
     shares authorized, none issued and outstanding.........           --             --
  Common Stock, par value $.01 per share,
     25,000,000 shares authorized, 6,396,806 and
     4,928,180 shares issued and outstanding as of December
     31, 1999 and December 31, 1998, respectively...........       63,968         49,282
  Additional paid-in capital................................    9,530,079      2,373,000
  Accumulated deficit.......................................   (5,889,943)    (2,200,189)
                                                              -----------    -----------
          Total shareholders' equity........................    3,704,104        222,093
                                                              -----------    -----------
               Total liabilities and shareholders' equity...  $ 4,315,458    $   596,596
                                                              ===========    ===========
</TABLE>

                 See Notes to Consolidated Financial Statements
                                       19
<PAGE>   22

                         MAREX.COM, INC. AND SUBSIDIARY

                     CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                  YEAR ENDED DECEMBER 31,
                                                           -------------------------------------
                                                              1999          1998         1997
                                                           -----------   -----------   ---------
<S>                                                        <C>           <C>           <C>
Revenues.................................................  $     7,277   $        --   $      --
                                                           -----------   -----------   ---------
Operating expenses:
     Product development.................................    1,132,179        89,952          --
     Selling and marketing...............................    1,137,554       166,699          --
     General and administrative..........................    1,385,027        24,799          --
                                                           -----------   -----------   ---------
          Total operating expenses.......................    3,654,760       281,450          --
                                                           -----------   -----------   ---------
Loss from operations.....................................   (3,647,483)     (281,450)         --
                                                           -----------   -----------   ---------
Other income (expense):
     Interest income.....................................      106,411            --          --
     Interest expense....................................       (6,909)      (45,208)    (32,800)
     Other...............................................       (1,406)         (912)    (23,213)
                                                           -----------   -----------   ---------
          Total other income (expense)...................       98,096       (46,120)    (56,013)
                                                           -----------   -----------   ---------
Loss from continuing operations..........................   (3,549,387)     (327,570)    (56,013)
                                                           -----------   -----------   ---------
Discontinued operations:
     Loss from discontinued operations...................     (100,167)     (827,483)   (599,844)
     Loss on disposal, including $11,869 for operating
       losses during the phase out period................      (40,200)           --          --
                                                           -----------   -----------   ---------
          Total discontinued operations..................     (140,367)     (827,483)   (599,844)
                                                           -----------   -----------   ---------
Net loss.................................................  $(3,689,754)  $(1,155,053)  $(655,857)
                                                           ===========   ===========   =========
Net loss per share, basic and diluted:
     Continuing operations...............................  $     (0.62)  $     (0.07)  $   (0.01)
     Discontinued operations.............................        (0.03)        (0.17)      (0.15)
                                                           -----------   -----------   ---------
     Net loss............................................  $     (0.65)  $     (0.24)  $   (0.16)
                                                           ===========   ===========   =========
Weighted average shares of Common Stock outstanding......    5,700,306     4,752,975   3,995,719
                                                           ===========   ===========   =========
</TABLE>

                 See Notes to Consolidated Financial Statements
                                       20
<PAGE>   23

                         MAREX.COM, INC. AND SUBSIDIARY

                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                                            ADDITIONAL                     TOTAL
                                                  COMMON     PAID-IN     ACCUMULATED   SHAREHOLDERS'
                                                   STOCK     CAPITAL       DEFICIT        EQUITY
                                                  -------   ----------   -----------   -------------
<S>                                               <C>       <C>          <C>           <C>
BALANCE, DECEMBER 31, 1996......................  $39,000   $  278,000   $  (389,279)   $   (72,279)

Issuance of 360,200 shares of Common Stock......    3,602      696,698            --        700,300

Net loss........................................       --           --      (655,857)      (655,857)
                                                  -------   ----------   -----------    -----------
BALANCE, DECEMBER 31, 1997......................   42,602      974,698    (1,045,136)       (27,836)

Issuance of 668,000 shares of Common Stock......    6,680    1,398,302            --      1,404,982

Net loss........................................       --           --    (1,155,053)    (1,155,053)
                                                  -------   ----------   -----------    -----------
BALANCE, DECEMBER 31, 1998......................   49,282    2,373,000    (2,200,189)       222,093

Exercise of stock options.......................    3,466      135,534            --        139,000

Issuance of 1,122,047 shares of Common Stock....   11,220    6,881,245            --      6,892,465

Fair value of warrants issued to consultants....       --      140,300            --        140,300

Net loss........................................       --           --    (3,689,754)    (3,689,754)
                                                  -------   ----------   -----------    -----------
BALANCE, DECEMBER 31, 1999......................  $63,968   $9,530,079   $(5,889,943)   $ 3,704,104
                                                  =======   ==========   ===========    ===========
</TABLE>

                 See Notes to Consolidated Financial Statements
                                       21
<PAGE>   24

                         MAREX.COM, INC. AND SUBSIDIARY

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                   YEAR ENDED DECEMBER 31,
                                                              ----------------------------------
                                                                 1999         1998        1997
                                                              -----------   ---------   --------
<S>                                                           <C>           <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Loss from continuing operations...........................  $(3,549,387)  $(327,570)  $(56,013)
  Adjustments to reconcile loss from continuing operations
     to net cash used in continuing operations
       Depreciation.........................................       71,006       2,594         --
       Amortization.........................................       27,765       1,482         --
       Fair value of warrants issued to consultants.........      140,300          --         --
       Loss on disposal of fixed assets.....................        1,406          --         --
       Increase in prepaid expenses and other current
          assets............................................      (70,602)         --         --
       Increase in accounts payable and accrued expenses....      522,614      11,937         --
       Decrease in customer deposits........................      (13,074)         --         --
       Decrease (increase) in trading securities............           --      34,875    (34,875)
                                                              -----------   ---------   --------
          Net cash used in operating activities.............   (2,869,972)   (276,682)   (90,888)
                                                              -----------   ---------   --------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchases of property and equipment.......................     (693,477)    (36,906)    (6,811)
  Acquisition of trademark..................................      (32,500)         --         --
  Additions to software development costs...................           --      (8,158)   (83,278)
  (Increase) decrease in loan to shareholder................      (22,200)     61,038    (50,820)
                                                              -----------   ---------   --------
          Net cash (used in) provided by investing
            activities......................................     (748,177)     15,974   (140,909)
                                                              -----------   ---------   --------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from related party borrowings....................      224,551     438,862     65,000
  Proceeds from exercise of stock options...................      139,000          --         --
  Principal payments on due to related party................     (260,301)   (403,112)   (65,000)
  Principal (payments) borrowings under notes payable.......     (139,727)    (76,112)    41,933
  Principal payments on capital lease obligations...........       (2,843)    (10,749)    (9,306)
  Proceeds from issuance of Common Stock....................    6,892,465   1,404,982    700,300
                                                              -----------   ---------   --------
          Net cash provided by financing activities.........    6,853,145   1,353,871    732,927
                                                              -----------   ---------   --------
Net cash provided by continuing operations..................    3,234,996   1,093,163    501,130

Net cash used in discontinued operations....................     (151,002)   (771,899)  (541,410)
                                                              -----------   ---------   --------
Net increase (decrease) in cash and cash equivalents........    3,083,994     321,264    (40,280)

CASH AND CASH EQUIVALENTS, beginning of year................      350,042      28,778     69,058
                                                              -----------   ---------   --------
CASH AND CASH EQUIVALENTS, end of year......................  $ 3,434,036   $ 350,042   $ 28,778
                                                              ===========   =========   ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
     Cash paid during the year for interest.................  $     5,988   $  45,200   $ 31,000
                                                              ===========   =========   ========
</TABLE>

                 See Notes to Consolidated Financial Statements
                                       22
<PAGE>   25

                         MAREX.COM, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -- ORGANIZATION

     Marex.com (the "Company"), formerly known as Affiliated Networks, Inc., is
a provider of business to business (B2B) e-commerce solutions for the marine
industry. The Company has developed a comprehensive set of procurement solutions
for the automation of business transactions on the Internet among suppliers,
boat builders, boat repairers, and dealers/distributors. The Company's solutions
offer its members a medium for efficient procurement of goods and access to
Internet distribution channels.

     Marex.com was originally incorporated in Florida in September 1992 under
the name of Florida Marine Management, Inc. In order to reflect the Company's
focus on providing Internet-based e-commerce solutions for the marine industry,
it changed its name on November 17, 1999 from Affiliated Networks, Inc. to
Marex.com, Inc.

NOTE 2 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION

     Sovereign Financial Information Services, Inc. ("Sovereign"), a wholly
owned subsidiary of Marex.com, Inc., ceased operations on September 30, 1999 and
is reported as a discontinued operation in the accompanying consolidated
financial statements (see Note 3).

     The accompanying consolidated financial statements include the accounts of
Marex.com, Inc. and Sovereign. All intercompany accounts and transactions have
been eliminated in the consolidated financial statements.

CASH AND CASH EQUIVALENTS

     The Company considers all highly liquid investments purchased with an
original maturity of 90 days or less to be cash equivalents.

PROPERTY AND EQUIPMENT

     Property and equipment are stated at cost less accumulated depreciation and
amortization. Depreciation and amortization are computed using the straight-line
method over the estimated useful lives of the assets or lease term as follows:

<TABLE>
<CAPTION>
                                                                YEARS
                                                        ----------------------
<S>                                                     <C>
Computer hardware and software........................            3
Office equipment and furniture........................            5
Leasehold improvements................................            5
Equipment held under capital leases...................     Life of Lease or
                                                        Estimated Useful Life,
                                                              if Shorter
</TABLE>

SOFTWARE DEVELOPMENT COSTS

     The Company has capitalized certain costs associated with the development
of the Exchange (the "Exchange"), the first of the Company's e-commerce
procurement solutions. The Company was following the guidance promulgated by
SFAS No. 86, "Accounting for the Costs of Computer Software to be Sold, Leased,
or Otherwise Marketed" until SOP 98-1, "Accounting for Software Developed for
Internal Use", became effective on January 1, 1999. As prescribed by SFAS No.
86, all costs incurred to establish technological feasibility of a computer
software product to be sold, leased, or otherwise marketed were expensed as
incurred.

                                       23
<PAGE>   26
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     In January 1997, once technological feasibility was determined, the
subsequent costs for coding and testing were capitalized until the software was
available for general release to members in November of 1998.

     Amortization of the Exchange is computed using the straight-line method
over the remaining estimated useful life of five years. Amortization expense was
approximately $18,000 and $1,500 for the years ended December 31, 1999 and 1998,
respectively.

TRADEMARK

     The cost of the trademark acquired is being amortized using the
straight-line method over two years. Amortization of trademarks included in
"Product Development" in the accompanying consolidated statement of operations
commenced in 1999 and totaled approximately $9,000 for the year ended December
31, 1999.

LONG-LIVED ASSETS

     The Company evaluates its long-lived assets for impairment whenever events
or changes in circumstances indicate that the carrying amount of such assets may
not be recoverable. Recoverability of assets to be held and used is measured by
a comparison of the carrying amount of any asset to future net cash flows
expected to be generated by the asset. If such assets are considered to be
impaired, the impairment to be recognized is measured by the amount by which the
carrying amount of the assets exceed the fair value of the assets. Assets to be
disposed of are reported at the lower of the carrying amount or fair value less
costs to sell. There were no impairment charges recorded in the year ended
December 31, 1999.

INCOME TAXES

     The Company utilizes an asset and liability approach to financial
accounting and reporting for income taxes. Deferred income tax assets and
liabilities are computed annually for differences between the financial
statement and tax basis of assets and liabilities that will result in taxable or
deductible amounts in the future based on enacted tax laws and rates applicable
to the periods in which the differences are expected to effect taxable income.
Valuation allowances are established when necessary to reduce deferred tax
assets to the amount expected to be realized. Income tax expense is the tax
payable or refundable for the period plus or minus the change in deferred tax
assets and liabilities and the change in any valuation allowance during the
year.

REVENUE RECOGNITION

     The Company generates revenues by charging a transaction fee for completed
transactions. The fee is based on a sliding scale ranging from approximately 4%
to 10% of the sales price. Revenues are recognized at the completion of a
transaction. A transaction is considered completed when the buyer has received
and approved the merchandise that was purchased through the Exchange, and the
Company has remitted the purchase price, less the transaction fee, to the
seller.

ESTIMATES

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

                                       24
<PAGE>   27
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

FAIR VALUE OF FINANCIAL INSTRUMENTS

     The following assumptions were used to estimate the fair value of each
class of financial instruments for which it is practical to estimate that value:

Cash and Cash Equivalents

     The carrying amounts of cash and cash equivalents approximate their fair
value.

Notes Payable, Capital Lease Obligations and Due to Related Party

     The fair values of the notes payable, capital lease obligations and due to
related party are estimated based upon current rates offered to the Company for
debt of the same remaining maturities. Carrying amounts of notes payable,
capital lease obligations and due to related party are reasonable estimates of
their fair values.

ACCOUNTING FOR STOCK-BASED COMPENSATION

     As permitted by SFAS No. 123, "Accounting for Stock-Based Compensation",
the Company continues to account for stock-based compensation using the
intrinsic value method prescribed in Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" and has made the pro forma
disclosures required by SFAS No. 123 for each of the three years ended December
31, 1999 (see Note 11).

WARRANTS

     As required by SFAS No. 123, the Company accounts for warrants issued to
non-employees not issued in conjunction with debt by amortizing the
Black-Scholes value of such warrants over the vesting period. The Black-Scholes
value of warrants issued in conjunction with debt is amortized over the life of
the loan agreement as interest expense. In 1999, expense related to warrants was
$140,300 and is included in "General and Administrative Expenses" in the
accompanying consolidated statement of operations.

EARNINGS PER SHARE

     SFAS No. 128, "Earnings Per Share", requires two presentations of earnings
per share--"basic" and "diluted". Basic earnings per share is computed by
dividing income available to common stockholders (the numerator) by the weighted
average number of common shares (the denominator) for the period. The
computation of diluted earnings per share is similar to basic earnings per
share, except that the denominator is increased to include the number of
additional common shares that would have been outstanding if the potentially
dilutive common shares had been issued.

     The following options and warrants to purchase shares of common stock were
outstanding at the end of each year, but were not included in the computation of
diluted earnings per share because the Company reported a net loss for all years
presented and, therefore, the effect would be antidilutive:

<TABLE>
<CAPTION>
                                            1999         1998         1997
                                         ----------   ----------   ----------
<S>                                      <C>          <C>          <C>
OPTIONS
Outstanding............................   2,416,000    1,911,000    1,932,000
Weighted average exercises.............  $     5.00   $     1.38   $     1.37

WARRANTS
Outstanding............................     436,971       33,000       33,000
Weighted average exercises.............  $     9.19   $     1.83   $     1.83
</TABLE>

                                       25
<PAGE>   28
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     For the Company, earnings per share under SFAS No. 128 for each of the
three years ended December 31, 1999 was the same as if it were computed in
accordance with the prior rule due to the antidilutive nature of the potential
common stock equivalents. See Note 11 for more information regarding options to
purchase Common Stock.

COMPREHENSIVE INCOME

     SFAS No. 130, "Reporting Comprehensive Income", establishes standards for
the reporting and display of comprehensive income and its components in a full
set of general purpose financial statements. Comprehensive income is defined as
the change in equity during the financial reporting period of a business
enterprise resulting from non-owner sources. The Company had no comprehensive
income items to report outside of its statements of operations for the years
ended December 31, 1999, 1998 and 1997.

RECENT PRONOUNCEMENT

     In June 1999, the FASB issued SFAS No. 137, "Accounting for Derivative
Instruments and Hedging Activities-Deferral of Effective Date of FASB Statement
No. 133". SFAS No. 137 defers for one year the effective date of SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities". SFAS No. 133
will now apply to all fiscal quarters of all fiscal years beginning after June
15, 2000. SFAS No. 133 will require the Company to recognize all derivatives on
the balance sheet at fair value. Derivatives that are not hedges must be
adjusted to fair value through income. The Company will adopt SFAS No. 133 as
required for its first quarterly filing of fiscal year 2001. The Company
believes the adoption of this Statement will not have a material effect on its
results of operations and financial position.

NOTE 3 -- DISCONTINUED OPERATIONS

     On August 24, 1999, the Company's Board of Directors approved a plan to
discontinue the operations of its non-core business subsidiary, Sovereign, in
order to focus its business towards its Internet-based e-commerce solutions for
the marine industry. Sovereign was engaged in the publishing of research
reports, stock handbooks and global industry guides. Sovereign ceased operations
on September 30, 1999. The estimated loss on the disposal of Sovereign is
$40,200, consisting of a write-down of Sovereign assets totaling $28,331 and a
provision of $11,869 for operating losses until the date of disposal.

     The accompanying consolidated balance sheets, consolidated statements of
operations, and consolidated statements of cash flows have been reclassified to
report separately the discontinued operations in the prior periods. Selected
results of the discontinued operations were as follows:

<TABLE>
<CAPTION>
                                                1999        1998        1997
                                              ---------   ---------   ---------
<S>                                           <C>         <C>         <C>
Revenues....................................  $      --   $  90,227   $ 385,765
                                              =========   =========   =========
Gross profit................................         --      38,376     257,292
                                              =========   =========   =========
Selling, general and administrative.........    140,367     865,859     857,136
                                              =========   =========   =========
Net loss....................................  $(140,367)  $(827,483)  $(599,844)
                                              =========   =========   =========
</TABLE>

                                       26
<PAGE>   29
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 4 -- PROPERTY AND EQUIPMENT, NET

     Property and equipment consist of the following:

<TABLE>
<CAPTION>
                                                             DECEMBER 31,
                                                       ------------------------
                                                         1999          1998
                                                       --------    ------------
<S>                                                    <C>         <C>
Computer hardware and software.......................  $528,935      $69,913
Office equipment and furniture.......................   212,016       10,368
Leasehold improvements...............................    41,867           --
Equipment held under capital leases..................    25,033       60,800
                                                       --------      -------
                                                        807,851      141,081
Less accumulated depreciation and amortization.......  (115,516)     (69,811)
                                                       --------      -------
Property and equipment, net..........................  $692,335      $71,270
                                                       ========      =======
</TABLE>

     Depreciation expense charged to operations for the years ended December 31,
1999, 1998 and 1997 was approximately $71,000, $3,000 and $0, respectively.

NOTE 5 -- NOTES PAYABLE

     At December 31, 1998, notes payable consisted of the following:

<TABLE>
<S>                                                           <C>
Note payable to bank, interest at 11.7%, payable in monthly
  installments including interest of $1,657 through December
  1999, secured by accounts receivable, equipment, and
  general intangibles of the Company, personally guaranteed
  by the Chief Executive Officer who is also President,
  Director and a shareholder................................  $  21,798
Note payable to bank, interest at prime plus 2.5%, payable
  in monthly installments of $1,388 plus interest through
  November 1999, secured by accounts receivable, equipment,
  and general intangibles of the Company, personally
  guaranteed by the Chief Executive Officer who is also
  President, Director and a shareholder.....................     16,667
$50,000 line of credit with bank, interest at prime plus
  3.0% payable monthly, principal due on demand, secured by
  accounts receivable, equipment, and general intangibles of
  the Company, personally guaranteed by the Chief Executive
  Officer who is also President, Director and a
  shareholder...............................................     50,000
$25,000 line of credit with finance company, interest at
  prime plus 6.75%, payable in minimum monthly installments
  of 2% of outstanding balance plus interest, cancelable at
  any time, personally guaranteed by the Chief Executive
  Officer who is also President, Director and a
  shareholder...............................................     24,955
Note payable to bank, interest at 12.5%, payable in monthly
  installments including interest of $1,677 through March
  2000, secured by accounts receivable, equipment and
  general intangibles of the Company, personally guaranteed
  by the Chief Executive Officer who is also President,
  Director and a shareholder................................     26,307
                                                              ---------
          Total.............................................    139,727
          Less current portion..............................   (116,206)
                                                              ---------
                                                              $  23,521
                                                              =========
</TABLE>

                                       27
<PAGE>   30
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Interest expense charged to operations on these notes payable was
approximately $3,000, $21,000 and $27,000 for the years ended December 31, 1999,
1998 and 1997, respectively.

NOTE 6 -- CAPITAL LEASES

     The Company is the lessee of certain equipment under capital leases
expiring in various years through the year 2004. The assets and liabilities
under capital leases are recorded at the lower of the present value of the
minimum lease payments or the fair value of the asset and are included in
property and equipment, net. The assets are depreciated over the lesser of their
estimated useful lives or the term of the lease. Depreciation of assets under
capital leases is included in depreciation expense.

     Minimum future lease payments under capital leases for the next five years
and in the aggregate as of December 31, 1999 are as follows:

<TABLE>
<S>                                                           <C>
2000........................................................  $ 8,055
2001........................................................    2,316
2002........................................................    2,316
2003........................................................    2,316
2004........................................................      965
                                                              -------
Total minimum lease payments................................   15,968
Less amount representing interest...........................   (2,389)
                                                              -------
Present value of net minimum lease payment..................  $13,579
                                                              =======
</TABLE>

     Interest rates on capitalized leases vary from 9.5% to 13% and are based on
the Company's incremental borrowing rate. Interest expense for the years ended
December 31, 1999, 1998 and 1997 was approximately $2,000, $4,000 and $6,000,
respectively.

NOTE 7 -- CUSTOMER DEPOSITS

     Customer deposits primarily represent unearned fee income from Sovereign.
As of December 31, 1999 and 1998, customer deposits totaled approximately
$63,000 and $76,000, respectively.

NOTE 8 -- INCOME TAXES

     The Company has recorded a 100% valuation allowance on the deferred tax
assets due to the uncertainty of the realization of the deferred tax assets.

     At December 31, 1999 and 1998, the significant components of the Company's
deferred tax assets are as follows:

<TABLE>
<CAPTION>
                                                          1999         1998
                                                       -----------   ---------
<S>                                                    <C>           <C>
Allowance for doubtful accounts......................  $        --   $  50,155
Depreciation.........................................       12,344          --
Accrual to cash adjustment...........................       24,972      18,168
Other................................................       (9,529)         --
Net operating loss carryforwards.....................    2,209,411     763,550
                                                       -----------   ---------
Total................................................    2,237,198     831,873
Less valuation allowance.............................   (2,237,198)   (831,873)
                                                       -----------   ---------
                                                       $        --   $      --
                                                       ===========   =========
</TABLE>

                                       28
<PAGE>   31
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The provision for income taxes differs from the amount computed by applying
the statutory federal and state income tax rates to income before income taxes.
The sources and tax effects of the difference are as follows:

<TABLE>
<CAPTION>
                                                   1999        1998       1997
                                                ----------   --------   --------
<S>                                             <C>          <C>        <C>
Expected tax benefit at 39.5%.................  $1,457,452   $456,246   $259,064
Non-deductible expenses.......................     (52,127)    (4,937)    (8,064)
Change in valuation allowance.................  (1,405,325)  (451,309)  (251,000)
                                                ----------   --------   --------
                                                $       --   $     --   $     --
                                                ==========   ========   ========
</TABLE>

     As of December 31, 1999, the Company's net operating loss carryforwards for
income tax purposes amounted to approximately $5,593,446 and expire at various
dates from 2011 through 2019.

NOTE 9 -- COMMITMENTS AND CONTINGENCIES

Operating Leases

     The Company leases its office space under an operating lease, which expires
on June 30, 2004. Minimum future lease payments under operating leases for the
next five years and in the aggregate as of December 31, 1999 are as follows:

<TABLE>
<S>                                                           <C>
2000........................................................  $  223,950
2001........................................................     225,848
2002........................................................     229,644
2003........................................................     233,440
2004........................................................     116,720
                                                              ----------
                                                              $1,029,602
                                                              ==========
</TABLE>

     During the years ended December 31, 1999, 1998 and 1997, rental expense for
all operating leases was approximately $84,000, $43,000 and $55,000,
respectively.

Employment Agreement

     As of December 31, 1999, the Company had an employment agreement with its
Chief Executive Officer. Future minimum payments under the employment agreement
are as follows:

<TABLE>
<S>                                                           <C>
2000........................................................  $  160,000
2001........................................................     225,000
2002........................................................     265,000
2003........................................................     265,000
2004........................................................     265,000
                                                              ----------
                                                              $1,180,000
                                                              ==========
</TABLE>

     The employment agreement became effective on January 1, 1999. For the year
ended December 31, 1999, salary and bonus expense for the Chief Executive
Officer totaled $295,000.

NOTE 10 -- RELATED PARTY TRANSACTIONS

     During the year ended December 31, 1997, certain shareholders paid $25,000
of professional services and commissions on behalf of the Company.

                                       29
<PAGE>   32
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     In July of 1999, the Company loaned the Chief Executive Officer, who is
also the President, Director and a shareholder, $22,200. The loan matures in
July of 2000 and bears interest at 1% over the prime rate. During 1999, interest
income earned by the Company from this loan was approximately $900.

     The Chief Executive Officer, who is also the President, Director and a
shareholder owns another company which made loans to the Company pursuant to a
revolving loan agreement. The loan agreement specified interest at 2.5% over the
prime rate, with principal due upon demand. The loan, which had a balance of
$35,750 as of December 31, 1998, was paid during 1999. The Company incurred
$2,000 and $19,000 of interest expense under the revolving loan agreement for
the years ended December 31, 1999 and 1998, respectively.

NOTE 11 -- SHAREHOLDERS' EQUITY

     The Company effected a three-for-one stock split to stockholders of record
as of the close of business on March 24, 1998. Share and per share amounts
presented have been retroactively adjusted to reflect the stock split.

STOCK OPTION PLAN

     In January 1997, the Company approved a 1996 and 1997 Incentive Stock
Option Plan (ISO). The 1996 and 1997 Incentive Stock Option Plans, as amended,
provide options for 900,000 and 4,000,000 shares, respectively, to be purchased
for the greater of $.33 or the fair market value on the date of grant. In
general, options become exercisable over a four year period from the date of
grant and expire 5 years after date of grant. Shares available for future option
grants at December 31, 1999 totaled 2,112,000. As of December 31, 1999, the
Company had granted options to purchase 3,170,000 shares of Common Stock to
employees and directors of the Company. The following is a summary of stock
option activity during the years ended December 31, 1999, 1998 and 1997:

<TABLE>
<CAPTION>
                                                                 WEIGHTED AVERAGE
                                                      SHARES      EXERCISE PRICE
                                                     ---------   ----------------
<S>                                                  <C>         <C>
Outstanding at January 1, 1997.....................    420,000        $0.37
Granted............................................  1,680,000         1.57
Exercised..........................................         --           --
Canceled...........................................   (168,000)        0.87
                                                     ---------
Outstanding at December 31, 1997...................  1,932,000         1.37
Granted............................................         --           --
Exercised..........................................         --           --
Canceled...........................................    (21,000)        0.33
                                                     ---------
Outstanding at December 31, 1998...................  1,911,000         1.38
Granted............................................  1,070,000         9.65
Exercised..........................................   (372,000)        1.06
Canceled...........................................   (193,000)        2.57
                                                     ---------
Outstanding at December 31, 1999...................  2,416,000         5.00
                                                     =========
</TABLE>

                                       30
<PAGE>   33
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The following table summarizes information about stock options outstanding
at December 31, 1999:

<TABLE>
<CAPTION>
                                       OUTSTANDING OPTIONS            VESTED OPTIONS
                                 --------------------------------   ------------------
                                             WEIGHTED
                                              AVERAGE    WEIGHTED             WEIGHTED
                                             REMAINING   AVERAGE              AVERAGE
 EXERCISE                                      LIFE      EXERCISE             EXERCISE
PRICE RANGE                       NUMBER      (YRS.)      PRICE     NUMBER     PRICE
-----------                      ---------   ---------   --------   -------   --------
<S>                              <C>         <C>         <C>        <C>       <C>
$0.33-$0.37....................    711,000      2.0       $0.36     594,600    $0.36
$1.83..........................    510,000      2.1       $1.83     306,000    $1.83
$5.50-$11.16...................  1,195,000      4.2       $9.12     531,000    $9.29
</TABLE>

     As permitted by SFAS No. 123, the Company accounts for options issued to
employees under Accounting Principles Board Opinion No. 25 "Accounting for Stock
Issued to Employees". Consequently, no compensation cost has been recognized on
options issued to employees because the exercise price of such options was not
less than the market value of the Common Stock on the date of grant.

     Had compensation cost for options issued to employees been determined
consistent with SFAS No. 123, the Company's net loss and net loss per share
would have been the pro forma amounts shown in the following table:

<TABLE>
<CAPTION>
                                              1999          1998         1997
                                           -----------   -----------   ---------
<S>                                        <C>           <C>           <C>
Net loss:
     As reported.........................  $(3,689,754)  $(1,155,053)  $(655,857)
     Pro forma...........................   (4,469,977)   (1,164,110)   (665,217)
Net loss per share, basic and diluted:
     As reported.........................  $     (0.65)  $     (0.24)  $   (0.16)
     Pro forma...........................        (0.78)        (0.24)      (0.17)
</TABLE>

     The weighted average fair values of options at their grant date during 1999
and 1997, were $6.24 and $0.35, respectively. The estimated fair value of each
option granted is calculated using the Black-Scholes option-pricing model. The
weighted average assumptions used in the model were as follows:

<TABLE>
<CAPTION>
                                                         RISK-FREE               EXPECTED
GRANT                                                    INTEREST    EXPECTED      TERM
DATE                                       VOLATILITY      RATE      DIVIDENDS   (YEARS)
-----                                      -----------   ---------   ---------   --------
<S>                                        <C>           <C>         <C>         <C>
1997.....................................      --         6.25%          0%         4
1998 (*).................................      --            --         --         --
1999.....................................      80%        5.50%          0%         4
</TABLE>

(*) No options were granted during 1998.

PREFERRED STOCK

     During 1998, the articles of incorporation of the Company were amended. The
amendment authorized 1,000,000 shares of preferred stock of $.01 par value with
preferences to be determined by the Board of Directors upon issuance. No
preferred stock has been issued as of December 31, 1999. See Note 12 for
information regarding the sale of preferred stock subsequent to December 31,
1999.

WARRANTS

     During 1997, the Company received two loans from entities owned or
controlled by current shareholders in the amounts of $15,000 and $50,000,
respectively. Effective July 28, 1997, the Company issued 6,000 warrants to
these lenders as partial consideration for the loans. Each warrant is
convertible into one share of

                                       31
<PAGE>   34
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

the Company's Common Stock and is exercisable at $1.83 per share. The warrants
expire 5 years from the effective date.

     The Company has issued warrants to consultants in consideration of having
acted as agents for the Company's private placements. The Company issued
warrants to purchase 353,971 and 27,000 shares of Common Stock to placement
agents in 1999 and 1997, respectively. The weighted average exercise price of
warrants issued to placement agents in 1999 and 1997 was $9.48 and $1.83,
respectively. Each warrant was exercisable at the date of grant and expires 5
years from such date. The costs of warrants issued in conjunction with private
placements were costs of raising capital and thus were deducted from additional
paid in capital. The fair value of the warrants, which was determined in
accordance with SFAS No. 123, offset the deductions to additional paid in
capital.

     On October 27, 1999 the Company granted 50,000 warrants to a consultant as
consideration for general corporate services. The warrants expire in October of
2002 and had a weighted average exercise price of $12.00. The Company used the
Black-Scholes model to calculate the fair value of these warrants by using the
following weighted average assumptions: Volatility, 80%; Risk-free Interest
Rate, 5.80%; Expected Dividends, $0; and Expected Term, 2 years. Based on these
assumptions, the computed fair value of warrants issued to consultants was
$140,300 and is charged to expense in the accompanying Consolidated Statement of
Operations.

     All warrants issued by the Company were outstanding at December 31, 1999.
The following is a summary of warrant activity during the years ended December
31, 1999, 1998 and 1997:

<TABLE>
<CAPTION>
                                                      NUMBER OF   WEIGHTED AVERAGE
                                                      WARRANTS     EXERCISE PRICE
                                                      ---------   ----------------
<S>                                                   <C>         <C>
Outstanding at January 1, 1997......................        --         $  --
Issued..............................................    33,000          1.83
                                                       -------
Outstanding at December 31, 1997....................    33,000          1.83
Issued..............................................        --            --
                                                       -------
Outstanding at December 31, 1998....................    33,000          1.83
Issued..............................................   403,971          9.79
                                                       -------
Outstanding at December 31, 1999....................   436,971          9.19
                                                       =======
</TABLE>

NOTE 12 -- SUBSEQUENT EVENTS

Sale of Preferred Stock

     In March 2000, the Company entered into an agreement for the sale of
430,000 shares of Series A1 Convertible Preferred Stock ("Series A1 Preferred
Stock") at $100 per share. The sale, consisting of two tranches, results in
gross cash proceeds of $43 million.

     Each share of the Series A1 Preferred Stock is convertible into 7.69 shares
of Common Stock at the option of the holder at any time. Automatic conversion
occurs upon either of the following: completion by the Company of a public
offering which raises gross proceeds of at least $50 million, at an effective
price per share to the public of at least $26.00 as adjusted for stock splits,
stock dividends or other similar transactions; or, upon the event that the
market price per share of Common Stock exceeds $26, subject to adjustments for
stock splits, stock dividends, or other similar transactions, for a consecutive
twenty day period following the one-year anniversary of the effective date of a
registration statement of the issued Common Stock of the Company.

     The holders of the Series A1 Preferred Stock are entitled to a number of
votes equal to a number of shares of Common Stock into which such Preferred
Stock is convertible.

                                       32
<PAGE>   35
                         MAREX.COM, INC. AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Upon declaration by the Board of Directors, holders of Series A1 Preferred
Stock shall be entitled to receive dividends ratably in an amount per share
equal to that which the holders would have been entitled had they converted
their Series A1 Preferred Stock into shares of Common Stock.

     Upon any liquidation of the Company, holders of record of the Series A1
Preferred Stock shall be entitled to receive, out of the assets of the Company
and before any distribution or payment is made upon any class of security of
lesser rank, an amount per share equal to the lesser of $100 per share or the
assets of the Company available for distribution to its stockholders,
distributed ratably among holders of the outstanding Series A1 Preferred Stock.

     After the distribution to the holders of Series A1 Preferred Stock has been
made, the remaining assets of the Company available for distribution to
shareholders shall be distributed pro rata solely among the holders of Common
Stock.

     Holders may redeem shares of Series A1 Preferred Stock in the event that
the Company does not honor a conversion. In such a case, the redemption amount
is equal to, at the option of the holder, the market value of the Common Stock
that the shares of Series A1 Preferred Stock would otherwise have been
convertible into or $100 per share.

                                       33
<PAGE>   36

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
         ON ACCOUNTING AND FINANCIAL DISCLOSURES

     On August 24, 1999, we dismissed McClain & Company, L.C. ("McClain") as our
independent public accountant and engaged Arthur Andersen LLP as our independent
public accountant. Both of these decisions were approved by our Board of
Directors and the audit committee of our Board of Directors.

     McClain's report on our financial statements for the three most recent
fiscal years did not contain an adverse opinion or a disclaimer of opinion and
were not qualified or modified as to uncertainty, audit scope, or accounting
principles. In addition, during our three most recent fiscal years and through
August 24, 1999, there were no disagreements with McClain on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure, which disagreements, if not resolved to the satisfaction of
McClain, would have caused McClain to make reference to the subject matter of
the disagreement in connection with its report.

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The information required in response to this item is incorporated by
reference to the registrant's Proxy Statement to be filed with the Securities
and Exchange Commission pursuant to Regulation 14A not later than 120 days after
the end of the fiscal year covered by this report.

ITEM 11. EXECUTIVE COMPENSATION

     The information required in response to this item is incorporated by
reference to the registrant's Proxy Statement to be filed with the Securities
and Exchange Commission pursuant to Regulation 14A not later than 120 days after
the end of the fiscal year covered by this report.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
         AND MANAGEMENT

     The information required in response to this item is incorporated by
reference to the registrant's Proxy Statement to be filed with the Securities
and Exchange Commission pursuant to Regulation 14A not later than 120 days after
the end of the fiscal year covered by this report.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information required in response to this item is incorporated by
reference to the registrant's Proxy Statement to be filed with the Securities
and Exchange Commission pursuant to Regulation 14A not later than 120 days after
the end of the fiscal year covered by this report.

                                       34
<PAGE>   37

                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.

(a) EXHIBITS

<TABLE>
<CAPTION>
EXHIBITS                          DESCRIPTION OF DOCUMENT
--------                          -----------------------
<S>        <C>  <C>
3.1        --   Form of Amended and Restated Articles of Incorporation of
                the Company (1)
3.2        --   Form of Amended and Restated Bylaws of the Company (1)
3.3        --   Articles of Amendment to Amended and Restated Articles of
                Incorporation of Affiliated Networks, Inc. (4)
4.1        --   Form of Warrant (1)
4.2        --   Certificate of Designation for the Series A1 Convertible
                Preferred Stock, par value $.01 (4)
4.3        --   Securities Purchase Agreement among Marex.com, Inc. and
                Certain Purchasers, dated March 2, 2000 (4)
4.4        --   Registration Rights Agreement among Marex.com, Inc. and
                Certain Purchasers, dated March 2, 2000 (4)
10.1       --   1996 Incentive Stock Option Plan, as amended (1)
10.2       --   1997 Incentive Stock Option Plan, as amended (1)
10.3       --   Amended and Restated 1997 Stock Option Plan (3)
10.4       --   Revolving Note to DAS Consulting, Inc. (1)
10.5       --   Company's Office Lease, as amended (5)
10.6       --   Employment Agreement of David A. Schwedel (5)
21         --   Subsidiary of the Small Business Issuer (2)
27.1       --   Financial Data Schedule (5)
</TABLE>

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

(1) Previously filed as an exhibit to the Company's Form 10-SB and Amendment No.
    1 to Form 10-SB.
(2) Previously filed as an exhibit to the Company's Form 10-KSB for the year
    ended December 31, 1998.
(3) Previously filed as part of the Company's Form DEFS14A filed on October 19,
    1999.
(4) Previously filed as an exhibit to the Company's Form 8-K filed on March 8,
    2000.
(5) Filed herewith.

(b) REPORTS ON FORM 8-K

     No reports on Form 8-K were filed in the last quarter of the period covered
by this report.

                                       35
<PAGE>   38

                                   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.

                                          MAREX.COM, INC.

                                          By:     /s/ DAVID A. SCHWEDEL
                                            ------------------------------------
                                                     David A. Schwedel
                                                  Chief Executive Officer
Date: March 23, 2000

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

<TABLE>
<CAPTION>
                      SIGNATURE                                     TITLE                    DATE
                      ---------                                     -----                    ----
<C>                                                    <S>                              <C>

                /s/ DAVID A. SCHWEDEL                  Director, Chairman of the        March 23, 2000
-----------------------------------------------------  Board, President and Chief
                  David A. Schwedel                    Executive Officer

                  /s/ KENBIAN A. NG                    Chief Financial Officer          March 23, 2000
-----------------------------------------------------  (Principal Financial and
                    Kenbian A. Ng                      Accounting Officer)

                  /s/ DAN GALLAGHER                    Director                         March 23, 2000
-----------------------------------------------------
                    Dan Gallagher

                  /s/ GEORGE GLAZER                    Director                         March 23, 2000
-----------------------------------------------------
                    George Glazer

                /s/ ROGER A. TROMBINO                  Director                         March 23, 2000
-----------------------------------------------------
                  Roger A. Trombino
</TABLE>

                                       36