10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q
       (Mark One)
            (X)   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                  THE SECURITIES EXCHANGE ACT OF 1934

                  For the Quarterly Period Ended March 31, 2001

                                       OR

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

                          Commission File Number 0-631

                            WEBFINANCIAL CORPORATION
             (Exact name of registrant as specified in its charter)

          Delaware                                        56-2043000
(State or other jurisdiction of                        (I.R.S. Employer
incorporation or organization)                        Identification No.)

                        150 East 52nd Street, 21st Floor
                            New York, New York 10022
              (Address and zip code of principal executive offices)

                                  877-431-2942
              (Registrant's telephone number, including area code)


         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 whether the  registrant  has filed all documents
and reports  required to be filed by Sections 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the  distribution of securities  under a plan
confirmed by a court. Yes (X) No ( )

         As of May 11,  2001,  4,366,866  shares of the issuer's  Common  Stock,
$.001 par value (the "Common Stock") were issued and outstanding.





                                TABLE OF CONTENTS

                                                                        PAGE NO.
                                                                        --------
                          PART I FINANCIAL INFORMATION

Item 1.     Consolidated Financial Statements:

            Consolidated Statements of Financial Condition
            March 31, 2001 (unaudited) and December 31, 2000                2

            Consolidated Statements of Operations
            for the three months ended March 31, 2001 and 2000 (unaudited)  4

            Consolidated Statements of Cash Flow
            for the three months ended March 31, 2001 and 2000 (unaudited)  5

            Notes to Consolidated Financial Statements (unaudited)          7

Item 2.     Management's Discussion and Analysis of Financial
            Condition and Results of Operations                             8

Item 3.     Quantitative and Qualitative Disclosures about Market Risk      9

                            PART II OTHER INFORMATION

Item 1.     Legal Proceedings                                              11

Item 2.     Changes in Securities                                          11

Item 3.     Defaults Upon Senior Securities                                11

Item 4.     Submission of Matters to a Vote of Security Holders            11

Item 5.     Other Information                                              11

Item 6.     Exhibits and Reports on Form 8-K                               11

Signatures                                                                 12






PART I  FINANCIAL INFORMATION

ITEM 1.  CONSOLIDATED FINANCIAL STATEMENTS

                    WEBFINANCIAL CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                  (Amounts in thousands except per share data)

                                                                        March 31, 2001     December 31, 2000
                                                                        --------------     -----------------
                                                                         (unaudited)
                        ASSETS
Cash and due from banks                                                      $ 5,645           $ 6,086
Fed funds sold                                                                 2,431                76
                                                                             -------           -------
      Total cash and cash equivalents                                          8,076             6,162

Investment securities
       Held-to-maturity (estimated fair value $33 and $32
            at March 31, 2001 and December 31, 2000)                              32                32
       Available-for-sale                                                        454               463
                                                                             -------           -------
            Total investment securities                                          486               495

Loans, net of deferred income                                                 13,608            12,131
Less allowance for loan loss                                                   1,650             1,077
                                                                             -------           -------
            Total loans, net                                                  11,958            11,054

Premises and equipment,
        net of accumulated depreciation and amortization                         100               110
Accrued interest receivable                                                       36               113
Goodwill, net of accumulated
        amortization of $306 in 2001 and $276 in 2000                          1,468             1,498
Other assets                                                                     915             5,363
                                                                             -------           -------

                                                                             $23,039           $24,795
                                                                             =======           =======

               LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
      Non interest-bearing demand                                            $   250           $   250
      Certificates of deposit                                                  8,940             9,882
                                                                             -------           -------
            Total deposits                                                     9,190            10,132

    Other liabilities                                                            347               779
                                                                             -------           -------
            Total liabilities before minority interests                        9,537            10,911

   Commitments and contingencies                                                --                --

   Minority interests                                                            431               460

                                                                         (continued)

                                       2



                    WEBFINANCIAL CORPORATION AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (continued)
                  (Amounts in thousands except per share data)

                                                                March 31, 2001          December 31, 2000
                                                                --------------          -----------------
                                                                (unaudited)
Stockholders' Equity
  Preferred stock, 10,000,000 shares authorized, none issued       --                         --
  Common stock, 50,000,000 shares authorized;
     $.001 par value, 4,366,866 and 4,354,280 shares issued
     and outstanding at March 31, 2001 and
     December 31, 2000, respectively                                  4                          4
  Paid-in capital                                                36,606                     36,559
  Accumulated deficit                                           (23,539)                   (23,139)
                                                               --------                   --------
        Total stockholders' equity                               13,071                     13,424
                                                               --------                   --------
                                                               $ 23,039                   $ 24,795
                                                               ========                   ========


          See accompanying notes to consolidated financial statements.

                                       3




                    WEBFINANCIAL CORPORATION AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                 (Amounts in thousands except per share amounts)

                                                                     For the Three Months Ended
                                                                 March 31, 2001       March 31, 2000
                                                                 --------------       --------------
Interest income
      Interest and fees on loans                                    $   396               $   303
      Interest on cash equivalents                                       69                    83
      Interest on federal funds sold                                     25                  --
      Interest on investment securities                                   7                    20
                                                                    -------               -------
            Total interest income                                       497                   406

Interest expense                                                        161                    94
                                                                    -------               -------
                  Net interest income before provision for
                  loan losses                                           336                   312

Provision for loan losses                                               577                    65
                                                                    -------               -------
                   Net interest income (loss) after provision for
                   loan losses                                         (241)                  247
                                                                    -------               -------

Noninterest income
      Gain on sale of loans                                             219                    22
      Fee income                                                        190                   307
      Miscellaneous income                                              180                    50
                                                                    -------               -------
            Total non interest income                                   589                   379

Noninterest expenses
Salaries, wages, and benefits                                           315                   472
Professional and legal fees                                             127                  --
Occupancy expense                                                        49                    38
Amortization of goodwill                                                 30                    30
Other general and administrative                                        247                   388
                                                                    -------               -------
      Total noninterest expenses                                        768                   928
                                                                    -------               -------
            Operating loss                                             (420)                 (302)

Income tax expense                                                        8                  --
                                                                    -------               -------

      Loss before minority interests                                   (428)                 (302)

Loss attributable to minority interests                                  29                    13
                                                                    -------               -------

      Net loss                                                      $  (399)              $  (289)
                                                                    =======               =======

Basic and diluted net loss per share                                $  (.09)              $  (.07)
Weighted average number of common shares and
  common share equivalents, basic                                     4,367                 4,353
Weighted average number of common shares and
  common share equivalents, diluted                                   4,367                 4,353

          See accompanying notes to consolidated financial statements.

                                       4





                    WEBFINANCIAL CORPORATION AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED)
                             (Amounts in thousands)

                                                                       For the Three Months Ended
                                                                   March 31, 2001        March 31, 2000
                                                                   --------------        --------------
Cash flows from operating activities:
Net loss                                                             $  (399)                $  (289)
Adjustments to reconcile net loss to net cash
 provided by (used in) operating activities:
      Minority interest                                                  (29)                     13
      Depreciation and amortization                                       10                       6
      Gain on sale of loans                                             (219)                    (22)
      Common stock granted in lieu of cash                                47                      24
      Provision for loan losses                                          577                      65
      Amortization/(accretion) of loan fees, net                         (28)                    154
      Amortization of goodwill                                            30                      29
      Amortization of servicing asset                                     20                      (5)
Changes in operating assets and liabilities:
      Accounts receivable                                               --                         9
      Prepaid expenses                                                  --                       (43)
      Accrued interest receivable                                         77                     (56)
      Other assets                                                       149                    (100)
      Other liabilities                                                 (431)                     77
                                                                     -------                 -------
          Net cash provided by (used in) operating activities           (196)                   (138)

Cash flows from investing activities:
      Principal payments received on available-for-sale securities        38                    --
      Purchase of available-for-sale securities                         --                      (115)
      Cash received on settlement of loan sale                         4,250                    --
      Loans originated and principal collections, net                 (1,236)                   (724)
                                                                     -------                 -------
          Net cash used in investing activities                        3,052                    (839)

Cash flows from financing activities:
      Net increase (decrease) in certificates of deposit                (942)                  1,207
      Net decrease in short term borrowings                             --                      (325)
                                                                     -------                 -------
         Net cash provided by (used in) financing activities            (942)                    882


                                   (continued)

                                       5




                    WEBFINANCIAL CORPORATION AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED)
                             (Amounts in thousands)

                                                            For the Three Months Ended
                                                        March 31, 2001       March 31, 2000
                                                        --------------       --------------



Net increase (decrease) in cash and cash equivalents       1,914                    (95)

Cash and cash equivalents at beginning of period           6,162                  7,266
                                                         -------                -------

Cash and cash equivalents at end of period               $ 8,076                $ 7,171
                                                         =======                =======



Supplemental disclosure of additional cash activities:
  Cash paid for interest                                 $   134                $    15


          See accompanying notes to consolidated financial statements.

                                       6




                    WEBFINANCIAL CORPORATION AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
          (All numbers except shares and per share data in thousands)

1.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         Basis of Presentation--The  accompanying interim consolidated financial
statements of WebFinancial  Corporation and its subsidiaries (the "Company") are
unaudited  and  have  been  prepared  in  conformity  with the  requirements  of
Regulations  S-X  promulgated  under the  Securities  Exchange  Act of 1934,  as
amended (the "Exchange Act"), particularly Rule 10-01 thereof, which governs the
presentation of interim financial statements.  Accordingly,  they do not include
all of the information and footnotes required by generally  accepted  accounting
principles  for  complete  financial   statements.   The  accompanying   interim
consolidated  financial  statements  should  be read  in  conjunction  with  the
Company's  significant  accounting  policies  as  set  forth  in  Note  1 to the
consolidated  financial  statements in the 2000 Annual Report on Form 10-K.  The
consolidated Statement of Financial Condition at December 31, 2000 was extracted
from the Company's audited  consolidated  financial  statements contained in the
2000 10-K, and does not include all disclosures  required by generally  accepted
accounting principles for annual consolidated financial statements.

         In the opinion of management,  all  adjustments are comprised of normal
recurring  accruals necessary for the fair presentation of the interim financial
statements.  Operating  results  for the  quarter  ended  March 31, 2001 are not
necessarily  indicative  of the results that may be expected for the year ending
December 31, 2001.

2.       ORGANIZATION AND RELATIONSHIPS

         The consolidated  financial statements include the financial statements
of  WebFinancial   Corporation  and  its  subsidiaries:   WebFinancial   Holding
Corporation,  a wholly owned  subsidiary  of the Company  ("Holdings"),  WebBank
("WebBank"),   Praxis  Investment  Advisers,   Inc.   ("Praxis"),   WebFinancial
Government Lending,  Inc.  ("Lending"),  and Web Film Financial,  Inc. ("Film"),
collectively referred to as the Company. WebBank is a Utah-chartered  industrial
loan corporation,  and is subject to comprehensive regulation,  examination, and
supervision by the Federal Deposit Insurance Corporation ("FDIC"), and the State
of Utah Department of Financial  Institutions.  WebBank provides  commercial and
consumer specialty finance services.

                                       7




ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

         The following discussion should be read in conjunction with the interim
consolidated financial statements of the Company and the Notes thereto.

CHANGES IN FINANCIAL CONDITION
MARCH 31, 2001 COMPARED TO DECEMBER 31, 2000

         Total assets  decreased by $1,756,000  between the two dates  primarily
due to the maturity of $942,000 of certificates  of deposit at WebBank.  WebBank
will continue to reduce its portfolio of brokered certificates of deposit during
the  second  quarter  of 2001 if loan  demand  remains  low.  Another  change in
liabilities  during the first  quarter  included a decrease of $432,000 in other
liabilities  consisting  mainly of the  payment of accounts  payable  accrued at
December  31,  2000.  The  decrease  of  $353,000  in  shareholders'  equity was
primarily  due to the  operating  loss  described  in  "Changes  In  Results  of
Operations."

         Significant changes in assets included a $4,448,000  reduction in other
assets.  A loan that was sold under  contract  a few days  before  year-end  was
settled a few days after year-end.  As a result, the amount of the loan proceeds
($4,250,000)  was recorded as a receivable as of December 31, 2000. Upon receipt
of the funds, the proceeds were invested in short-term cash equivalents. Federal
funds sold  increased by $2,255,000  during the first quarter  because of slower
than expected loan growth.  Loans, net of deferred income and before reserve for
loan losses, increased by $1,477,000 during the first quarter. The allowance for
loan losses  increased by $573,000  due to  downgrades  of several  loans in the
WebBank USDA B&I portfolio.  Nonaccrual loans, which had been nonexistent in
March 2000, increased to $1,844,000 at the end of March 2001.

CHANGES IN RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2001 COMPARED TO THREE MONTHS ENDED MARCH 31, 2000

         Net loss after  minority  interest  increased by $110,000 for the first
three months of 2000 compared to the first three months of 2001 primarily due to
an increase in the  provision  for loan losses of $512,000.  This resulted in an
increase in the loss per share from $.07 in the first quarter of 2000 to $.09 in
the first quarter of 2001. The increase in loan loss provision resulted from the
downgrade of eight existing loans and  establishment of initial reserves for two
new loans at WebBank in the first quarter of 2001.

         Noninterest  income increased by $210,000 from quarter to quarter.  The
gain on sale of loans  increased by $197,000 based on a guaranteed  loan sale by
WebBank in the current year.  Miscellaneous  income increased by $130,000 due to
several  minor items,  including a recovery on an operating  loss from the prior
year at WebBank.  Fee income  decreased  $117,000  between  quarters,  primarily
because of WebBank's exit from the payday loan business and lower volumes in the
private label credit card and structured settlement programs.

         Noninterest expense decreased by $160,000 between the two periods. Most
of the decrease was  attributable  to a reduction in the level of  operations of
Praxis  and  Lending.  Offsetting  the  decrease,  professional  and legal  fees
increased by $127,000 due to a large credit recorded at Praxis in the prior year
and  relatively  large legal  billings  at WebBank in the  current  year for new
product development.

                                       8




LIQUIDITY AND CAPITAL RESOURCES

         As of March 31, 2001 and December 31, 2000, the Company's cash and cash
equivalents  totaled $8,076,000 and $6,162,000  respectively.  Funding currently
comes primarily from certificates of deposit obtained through brokers and from a
$2,500,000 federal funds purchased line with a local correspondent bank. WebBank
is currently in the process of  establishing a medical  savings  account deposit
program in order to secure a less expensive and more dependable source of funds.
Management believes that the Company's current cash and cash equivalent balances
and expected  operating  cash flows and  available  credit lines are adequate to
meet its liquidity needs through at least the next 12 months.

         The Company continues to actively seek acquisition transactions.  There
can be no  assurance  that the  Company  will be able to locate or  purchase  an
additional  business,  or that such  business  will be  profitable.  In order to
finance  an  acquisition,  the  Company  may be  required  to  incur  or  assume
indebtedness or issue securities.

RECENT DEVELOPMENTS

         On February 20, 2001,  WebBank entered into an agreement with a Florida
marketing  agency to jointly provide  Medical  Savings  Accounts to companies or
individuals  desiring to participate in the program.  WebBank  intends to be the
depository for these  accounts,  which will be accessed via debit card.  WebBank
will  receive fee income for this service and also develop a source of low cost,
relatively stable deposits.

         On February 23, 2001, WebBank entered into an agreement to partner with
a Texas  financial  services  provider to originate  consumer auto loans via the
Internet.  WebBank  will fund the loans  and sell  them to its  partner  without
recourse. WebBank will receive fee income for participation in this program.


FORWARD-LOOKING STATEMENTS

         The  following  important  factors,  among  others,  could cause actual
results to differ materially from those indicated by forward-looking  statements
made  in  this  Quarterly  Report  of  Form  10-Q  and  presented  elsewhere  by
management.  All forward-looking  statements included in this document are based
on  information  available  to the Company on the date  hereof,  and the Company
assumes no obligation to update any such forward-looking statements. A number of
uncertainties  exist that could affect the Company's future  operating  results,
including, without limitation,  general economic conditions, changes in interest
rates, the company's ability to attract  deposits,  and the Company's ability to
control costs.  Because of these and other factors,  past financial  performance
should not be  considered an  indication  of future  performance.  The Company's
future quarterly operating results may vary significantly.  Investors should not
use historical  trends to anticipate future results and should be aware that the
trading price of the Company's Common Stock may be subject to wide  fluctuations
in response to  quarterly  variations  in operating  results and other  factors,
including those discussed above.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         The Company  maintains an investment  portfolio and  participates  with
other lenders in commercial loan programs.  Both of these activities are subject
to specific  policies  that are  focused on  preserving  principal,  maintaining
proper liquidity to meet operating needs, and maximizing yields.

         The Company's  operations  may be subject to a variety of market risks,
the most material of which is the risk of changing  interest  rates.  Generally,
interest rate risk is the volatility in financial  performance  attributable  to
changes in market interest rates,  which may result in either fluctuation of net
interest  income or changes to the economic  value of the equity of the Company.
The following  discusses certain factors that may affect the Company's financial
results and operations and should be considered in evaluating the Company.

                                       9





         Interest  Rates.  The  Company's  earnings  may be impacted by changing
interest  rates.  Changes in interest rates impact the level of loans,  deposits
and  investments,  the credit profile of existing  loans,  the rates received on
loans and securities and the rates paid on deposits and borrowings.  The Company
attempts to minimize  interest  rate risk through  various  means  including the
matching  of  interest  rate  volatility  of assets  and  liabilities.  However,
significant  fluctuations  in interest  rates may have an adverse  effect on the
Company's financial condition and results of operations.

         Government  Regulation  and Monetary  Policy.  The banking  industry is
subject to extensive federal and state  supervision and regulation.  Significant
new laws or changes in existing  laws, or repeals of existing laws may cause the
Company's  results  to differ  materially.  Further,  federal  monetary  policy,
particularly as implemented  through the Federal  Reserve System,  significantly
affects  credit  conditions  for the  Company  and a  material  change  in these
conditions  could  have a material  adverse  impact on the  Company's  financial
condition and results of operations.

         Competition.  The  banking and  financial  services  businesses  in the
Company's lines of business are highly competitive. The increasingly competitive
environment  is a result of changes in  regulation,  changes in  technology  and
product  delivery  systems,  and the accelerating  pace of  consolidation  among
financial  service  providers.   The  results  of  the  Company  may  differ  if
circumstances affecting the nature or level of competition change.

         Credit  Quality.  A source of risk  arises  from the  possibility  that
losses will be sustained because  borrowers,  guarantors and related parties may
fail to perform in  accordance  with the terms of their  loans.  The Company has
adopted  underwriting  and credit  monitoring  procedures  and credit  policies,
including the establishment and review of the allowance for credit losses,  that
management  believes are  appropriate  to minimize  this risk by  assessing  the
likelihood of  nonperformance,  tracking loan  performance and  diversifying the
Company's  credit  portfolio.  These policies and procedures,  however,  may not
prevent  unexpected  losses  that could have a  material  adverse  effect on the
Company's results.

         Non-banking Activities.  The Company may expand its operations into new
non-banking activities in 2001. Although the Company has experience in providing
bank-related  services,  this  expertise may not assist us in our expansion into
non-banking activities. As a result, we may be exposed to risks associated with,
among other things,  (1) a lack of market and product  knowledge or awareness of
other  industry  related  matters  and (2) an  inability  to attract  and retain
qualified employees with experience in these non-banking activities.

         Proposed  Legislation.  From time to time, various types of federal and
state legislation have been proposed that could result in additional  regulation
of, and modifications of restrictions on, the business of the Company. It cannot
be predicted whether any legislation  currently being considered will be adopted
or how such  legislation or any other  legislation  that might be enacted in the
future would affect the business of the Company.

                                       10




PART II  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

         In  January  2000,  a former  executive  officer  and  director  of the
Company's  subsidiary  Praxis (the  "officer")  filed a lawsuit in the  Superior
Court of the State of California, County of Napa against the Company, Praxis and
Holdings.  The lawsuit alleges that Praxis has breached its employment agreement
with the officer. The lawsuit also asserts claims for interference with contract
and unjust  enrichment  based upon the  purported  wrongful  termination  of the
officer's  employment  contract  with Praxis.  The lawsuit  seeks  damages of an
unspecified  amount  and  compliance  by  Praxis  with the  termination  pay out
provisions in the  officer's  employment  agreement  relating to purchase of the
officer's 10% interest in Praxis and WebBank (both 90% covered  subsidiaries  of
the Company) at their fair market value. The Company and Praxis deny that Praxis
wrongfully  terminated the officer's  employment and intend to vigorously defend
this  matter.  At the present  time,  the parties have agreed to have the matter
submitted to binding  arbitration  before three retired judges. The Company does
not  believe  that this  lawsuit  will have a material  impact on its  financial
condition, results of operations, or liquidity.

         The Company is also a defendant  in legal  actions  arising from normal
business  activities.  Management believes that the ultimate liability,  if any,
resulting from such actions will not materially  affect the Company's  financial
position.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.

         Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

         Not applicable.

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

         Not applicable.

ITEM 5.  OTHER INFORMATION.

         Not applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

         (a)         Exhibits
                     See exhibit index immediately following the signature page.

         (b)         Reports on Form 8-K during the quarter
                     None.

                                       11





                                   SIGNATURES


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


Date:  May 11, 2001                        WEBFINANCIAL CORPORATION


                                           By:  /s/ Warren G. Lichtenstein
                                                -----------------------------
                                                Warren G. Lichtenstein
                                                President and Chief Executive
                                                Officer



                                           By:  /s/ Glen M. Kassan
                                                -----------------------------
                                                Glen M. Kassan
                                                Vice President and Chief
                                                Financial Officer


                                       12





                                  EXHIBIT INDEX


11          Statement Regarding Computation of Net Loss Per Share

EX-11

                                   EXHIBIT 11
                                   ----------


                    WEBFINANCIAL CORPORATION AND SUBSIDIARIES
              STATEMENT REGARDING COMPUTATION OF NET LOSS PER SHARE
                 (Amounts in thousands except per share amounts)

                                                             For the Three Months Ended
                                                          March 31, 2001    March 31, 2000
                                                          --------------    --------------

Net loss                                                    $    (399)         $   (289)

Shares used in computation:

Weighted average number of common shares and
  common share equivalents, basic                               4,367             4,353

Common shares and common share equivalents,
  fully diluted                                                 4,367             4,353

Net loss per share-basic                                    $    (.09)         $   (.07)

Net loss per share-diluted                                  $    (.09)         $   (.07)



Common stock  equivalents  (stock  options and warrants)  that were  outstanding
during the three  month  periods  ending  March 31, 2001 and March 31, 2000 that
could  potentially  dilute  basic  earnings  per  share in the  future  were not
included in the  computation  of earnings per share because the net loss in both
periods makes them antidilutive.