Earthfirst Technologies Inc – ‘SB-2/A’ on 6/25/99

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Pre-Effective Amendment to Registration of Securities by a Small-Business Issuer   —   Form SB-2
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SB-2/A      Registration Statement                                62±   265K 

Document Table of Contents

SB-2/A
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     File Number 333-70531 as filed with the Securities and Exchange  Commission
on June 23, 1999                                                                

 U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
   Form SB-2/A
 REGISTRATION STATEMENT UNDER the Securities Act of 1933

TOUPS TECHNOLOGY LICENSING, INC.
(Name of small business issuer in its charter)

    Florida                     3990                        59-3462501
(State or jurisdiction         (Primary Standard             (I.R.S. Employer 
  of incorporation or             Industrial               Identification No.)
organization)           Classification                        
Code Number)

 7887 Bryan Dairy Road, Suite 105, Largo, Florida 33777 (813)-548-0918
 (Address and telephone number of principal executive offices)

Mark Clancy, Corporate Secretary
7887 Bryan Dairy Road, Suite 105, Largo, Florida 33777
(813)-548-0918 (Name, address and telephone number
 of agent for service)

Approximate date of proposed sale to the public:

    As soon as practicable after the registration statement becomes effective.

     If this Form is filed to  register  additional  securities  for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list  the  Securities  Act  registration  statement  number  of the  earlier
effective registration statement for the same offering. ( )                     

     If this Form is a post-effective amendment filed pursuant to Rule 462 under
the  Securities  Act,  check  the  following  box and  list the  Securities  Act
registration statement number of the earlier effective registration statement of
the same offering. ( )                                                          

     If delivery of the  prospectus is expected to be made pursuant to Rule 434,
please check the following box ( )                                              

 CALCULATION OF REGISTRATION FEE
Title of each       Dollar          Proposed       Proposed                     
class of         Amount          maximum        maximum        Amount of  
securities        to be           offering       aggregate    registration  
to be         registered         price         offering         fee(2)  
registered(1)                     per share         price                     
-------------     ---------        ---------       ---------        ------      
Common         $11,624,291        $1.96         $11,624,291       $3,231  
$.001 par value                                                                 

(1)  A portion of the Shares registered pursuant to this Registration  Statement
     were  issued  between  October  and  December,  1998  pursuant to a Private
     Offering made in reliance on Section 4(2) or 3(b) of the  Securities Act of
     1933, as amended (the "Act") according to the Rules contained in Regulation
D, Rule 506 of that Act.                                              
(2)  Calculated  pursuant to Rule 457(c).  The closing "bid" price of the shares
     of common stock being registered  hereby as quoted on the  over-the-counter
     Bulletin  Board  market  was $1.96 on  January  11,  1999,  the date of the
initial filing of this Form SB-2.                                     

 This registration statement relates to 5,682,520 shares which are being
offered for sale by Selling Security Holders.                                   

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 CROSS-REFERENCE
REGISTRATION STATEMENT                                      LOCATION OR CAPTION 
ITEM NUMBER AND HEADING                                       IN PROSPECTUS     

1.   Front of Registration Statement and Outside Front Cover Page of Prospectus 
2.   Inside Front and Outside Back Cover Pages of Prospectus                    
3.   Summary Information and Risk Factors                                       
4.   Use of Proceeds                                                            
5.   Determination of Offering Price                                            
6.   Selling Security Holders                                                   
7.   Plan of Distribution                                                       
8.   Legal Proceedings                                                          
9.   Directors, Executive Officers, Promoters and Control Persons               
10.  Security Ownership of Certain Beneficial Owners and Management             
11.  Description of Securities                                                  
12.  Interest of Named Experts and Counsel                                      
13.  Description of Business                                                    
14.  Management's Discussion and Analysis or Plan of Operation                  
15.  Description of Property                                                    
16.  Certain Relationships and Related Transactions                             
17.  Market for Common Equity and Related Stockholder Matters                   
18.  Executive Compensation                                                     
19.  Financial Statements Part F/S                                              
20   Changes in and  disagreements  of  Accountants  on  accounting or financial
disclosure                                                            

Part II - Information not required in Prospectus                                
1  Indemnification  of  Directors  &  Officers                                  
2 Other  Expenses  of  Issuance  and Distribution                               
3 Recent sales of unregistered securities                                       
4 Exhibits                                                                      
5 Undertakings                                                                  
6 Signatures                                                                    

PROSPECTUS                                                                      

TOUPS TECHNOLOGY LICENSING, INC.

5,682,520 SHARES OF COMMON STOCK

 OFFERED BY CERTAIN SELLING SECURITY HOLDERS
----------------------------------

     This  Prospectus  relates to the sale of 5,682,520  shares of common stock,
$.001 par value (the "Common Stock"), of Toups Technology Licensing,  Inc., (the
"Company"),  all of which are  offered  by the  holders  thereof  identified  as
"Selling Security Holders" in this Prospectus. See "SELLING SECURITY HOLDERS."  

     The Company will not receive any proceeds from the sale of shares of Common
Stock by the Selling  Security  Holders.  Sales of shares of Common Stock may be
made from time to time (in transactions which may include block transactions) by
or for the  account of the  Selling  Security  Holders  in the  over-the-counter
market or in negotiated transactions,  or otherwise, at market prices prevailing
at the time of sale or at  negotiated  prices.  The  Company  has  informed  the
Selling Security Holders that the  anti-manipulative  rules under the Securities
Exchange Act of 1934,  Regulation  M, may apply to their sales and has furnished
each of the Selling  Stockholders  with a copy of these  Rules.  The Company has
also informed the Selling Security Holders of the need for delivery of copies of
this Prospectus. See "SELLING SECURITY HOLDERS" and "PLAN OF DISTRIBUTION."     
------------------------
 THE SECURITIES OFFERED INVOLVE A HIGH DEGREE OF RISK.
SEE "RISK FACTORS"

THESE  SECURITIES  HAVE NOT BEEN APPROVED OR  DISAPPROVED  BY THE SECURITIES AND
EXCHANGE  COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS.  ANY  REPRESENTATION  TO THE CONTRARY IS A CRIMINAL OFFENSE.
ALL OF THE  5,682,520  COMMON  SHARES  REGISTERED  HEREIN  ARE BEING  OFFERED BY
SELLING  SECURITY  HOLDERS.  THE COMPANY WILL NOT RECEIVE ANY PROCEEDS  FROM THE
SALE OF SHARES BY THE SELLING SECURITY HOLDERS. SEE PAGE 4 RELATING TO THE RISKS
INVOLVED IN THIS OFFERING.                                                      

                                                               PROCEEDS TO
                   PROPOSED      UNDERWRITING  PROCEEDS TO     THE SELLING
CLASS OF SECURITY  OFFERING PRICE    DISCOUNTS    THE COMPANY   SECURITY HOLDERS
-------------------------------------------------------------  ---------------- 
$.001 par value     $11,624,291(1)      $0(2)         $0           $11,624,291  
Common Stock                                                                    

(1)  Represents the anticipated  sale price by the Selling  Security  Holders at
     $1.96 per share which was the closing bid price on January 11, 1999.  There
     can be no assurances,  however,  that the Selling  Security Holders will be
     able to sell their shares of Common  Stock at this price,  or that a liquid
market will exist for the Company's Common Stock.                     
(2)  Does not give effect to ordinary  brokerage  commissions or to the costs of
sale that will be borne solely by the Selling Security Holders.       

INSIDE FRONT COVER

Available Information                                                           

     The Company is subject to the reporting  requirements of the Securities and
Exchange Act of 1934, as amended,  and provides  quarterly and annual reports to
the  Securities  and Exchange  Commission.  The Company's  annual report on Form
10-KSB, when filed, shall contain audited financial statements.  The reports and
other information filed by the Company may be inspected and copied at the public
reference  facilities  of  the  Securities  and  Exchange  Commission  (SEC)  in
Washington,  D. C.,  and at some of its  Regional  Offices,  and  copies of such
material  can be  obtained  from  the  Public  Reference  Section  of  the  SEC,
Washington, DC 20549 at prescribed rates. The Company is an electronic filer and
the SEC  maintains  a Web site that  contains  reports,  proxy  and  information
statements and other information regarding issuers that file electronically. The
SEC Web site address is http://www.sec.gov. The Company will provide a report to
stockholders,  at least annually,  which report will include  audited  financial
statements of the Company.                                                      

Incorporation of Documents by Reference.                                        

     All materials  incorporated  by reference  throughout  this  Prospectus are
available (not including  exhibits to the  information  that is  incorporated by
reference  unless the  exhibits  are  themselves  specifically  incorporated  by
reference)  without  charge  from the  Company  to each  person  who  receives a
Prospectus,  upon written or oral  request of such person.  Any request for such
material should be directed to the Corporate  Secretary,  if in writing, to 7887
Bryan  Dairy Road,  Suite 105,  Largo,  Florida  33777,  or, if by phone,  (813)
548-0918.                                                                       

     The Registrant is subject to the informational  and reporting  requirements
of Sections 13(a),  13(C) and 14 and 15(d) of the Securities and Exchange Act of
1934,  as  amended  (the  "Exchange  Act") and in  accordance  therewith,  files
reports, proxy statements and other information with the Securities and Exchange
Commission ("SEC"). The following documents,  which are on file with the SEC are
incorporated in this Registration Statement by reference:                       

(a)    The  Registrant's  Securities  and Exchange  Commission  Forms 8-K,  14A,
       10-SB,   10-QSBs  and  SB-2  which   contain,   either   directly  or  by
       incorporation  by  reference,   audited   financial   statements  of  the
       Registrant's  latest  fiscal  year for which  such  statements  have been
filed.                                                            

(b)    The  description of the Common Stock which are contained in  registration
       statements  filed under the  Exchange  Act,  including  any  amendment or
report filed for the purpose of updating such description.        

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Prospectus                           SUMMARY                                    

     The  following  Summary is qualified in its entirety by other more detailed
information throughout this Registration Statement.  Statements in this document
which  are  not  purely  historical  facts,   including   statements   regarding
anticipations,  beliefs,  expectations,  hopes, intentions or strategies for the
future, may be  forward-looking  statements within the meaning of Section 27A of
the  Securities  Act of 1933,  as amended  and  Section  21.E of the  Securities
Exchange Act of 1934, as amended.  All  forward-looking  statements  within this
document are based upon information available to the Company on the date of this
Registration  Statement.  Any  forward-looking   statements  involve  risks  and
uncertainties  that could cause  actual  events or results to differ  materially
from  the  events  or  results  described  in  the  forward-looking  statements,
including  the timing  and nature of  independent  test  results;  the nature of
changes in laws and  regulations  that govern  various  aspects of the Company's
business;   the  market  acceptance  of  the  Company's  licensed  technologies;
retention and  productivity  of key employees;  the  availability of acquisition
candidates and  proprietary  technologies  at prices the Company  believes to be
fair market; the direction and success of competitors; management retention; and
unanticipated  market changes.  The Company undertakes no obligation to publicly
update or revise  any  forward-looking  statements,  whether  as a result of new
information,  future  events or  otherwise.  Readers are  cautioned not to place
undue reliance on these forward-looking statements.                             

The Company                                                                     

   The following highlights the Company's business. This section is followed
by a more detailed  discussion  relating to each of our nine divisions  which is
immediately  followed  by an  overview  of the  marketplace  for  the  Company's
products  and  services.  Beginning  on page  F-1 is the  Company's  Independent
Auditor's Report and audited  financial  statements for the year ending December
31, 1998.                                                                       

     Toups Technology  Licensing,  Inc. was incorporated in the state of Florida
on July 28, 1997.  The Company was formed to improve,  enhance or remediate  the
environment  through  technologies  and  services.   Led  by  its  Environmental
Solutions  Division,  the Company works to achieve its business  purpose through
three major divisions:                                                          

     Toups Technology  sells  Environmental  Solutions  equipment and techniques
principally through its Village Concept of converting municipal solid waste into
useable energy.                                                                 

     The Company's  Manufactured  Products division is the manufacturing  source
for the Balanced Oil Recovery System,  Tunnel Bat Culvert Vehicles and a host of
high tech radio frequency power supplies.                                       

     The  Company's  E-Commerce  division  features  TTLOnline.com,  an internet
retail marketing  program and InterSource  HealthCare,  an internet  marketer of
medical equipment, supplies and pharmaceuticals.                                

     Results of 1998 (first full year)  Operations  - The  following  discussion
should be read in conjunction with the Company's  audited  financial  statements
for the years ended  December 31, 1998 and 1997 which begin on page F-1. For the
period ending  December 31, 1998,  the Company  posted  revenues of  $3,132,001,
compared with  $1,196,169  for the fiscal year ending  December 31, 1997.  Gross
profit for 1998 was $1,147,071 or 37% of revenues, which was up from $373,799 or
31% of revenues  for 1997.  Net income for the period  ending  December 31, 1998
reflects  a loss of  $(5,039,766)  or a loss of ($0.22)  per share  based on the
22,217,299  shares  outstanding  at  December  31, 1998 or a loss of $(0.41) per
share on a fully-weighted  average compared with net income of $49,101 or $0.005
per share for the year ending December 31, 1997.                                

     The Company  attributes  71% or  $3,580,123  of its losses during 1998 to a
one-time  charge  against  earnings  relating to the  issuance  of common  stock
attract and retain key pesonnel, to acquire various license agreements,  to make
acquisitons  and for  other  develomental  needs.  The  Company  attributes  the
remaining 29% or  $1,459,463  of its losses to earnings at the full-year  ending
December 31, 1998 to first year  operational  losses incurred in the development
and market introduction of its various technologies. (See "Independent Auditor's
Report  and  accompanying   consolidated  balance  sheets  of  Toups  Technology
Licensing,  Incorporated  and subsidiaries as of December 31, 1998 and 1997, and
the related  consolidated  statements of operations,  stockholders'  equity, and
cash  flows  for the  years  then  ended"  which  begin on Page F-1 of this Form
10-KSB).                                                                        

     For the year ended  December  31,  1998,  the Company  had total  assets of
$5,312,840 as compared with $562,054 for the period ending December 31, 1997 and
stockholders equity grew from $256,484 at December 31, 1997 to $3,360,798 at the
year ending December 31, 1998.                                                  

     The Company envisions growth during 1999 will be approximately 80% internal
and  20%  from  the  licensing/acquisitions  of new  technologies.  The  Company
estimates it will derive  revenues during 1999 from all current  divisions.  The
Company  intends to acquire  technologies  through  licensing,  joint  ventures,
acquisitions,  manufacturing rep agreements and other similar means. The Company
intends to  commercialize  its  technologies  through joint ventures;  strategic
alliances; sub-licenses;  providing services; and through the direct manufacture
and sale of products.                                                           

     Business Method - TTL enters  worldwide  exclusive  license  agreements for
developed technologies, which are at or near the market-entry stage. The Company
also makes acquisitions of existing companies,  which add to or compliment TTL's
technology  mix.  TTL  commercializes  the  technologies  by folding each into a
seasoned,   entrepreneurial-minded   corporate   infrastructure   housed   in  a
state-of-the-art  manufacturing  facility.  The combination results in a turnkey
process wherein  emerging  technologies  can mature into marketable  products or
services and the Company's  shareholders  can participate in a  multi-technology
approach at the development/market introduction stage.                          

     Management  - The  Company's  management  team is led by  President,  Chief
Executive  Officer and  Chairman of the Board,  Leon H. Toups.  Mr.  Toups' past
associations  include ten years serving as President and Chief Executive Officer
of  Chromalloy  American.  Prior to its sale and during the period of Mr. Toups'
association,  Chromalloy American was a 600 company  international  conglomerate
serving six major market  segments  with revenues of  approximately  $2 billion.
Co-founders of Toups Technology include Chief Executive Officer and Chairman Mr.
Leon Toups,  Executive  Vice  President  and  Director Mr. Mark Clancy and Chief
Financial  Officer and Director Mr. Michael Toups.  (See  "Directors,  Executive
Officers,  Promoters and Control  Persons;  Compliance with Section 16(a) of the
Exchange Act").                                                                 

     Operating structure - In addition to the above named Officers, at the staff
level to support all technologies, the Company has a Safety Officer, Engineering
Coordinator,  Sales Manager,  Compliance/Quality Control Director and Purchasing
Coordinator.   At  the  line   level,   the   Company   typically   engages   an
industry-experienced  professional as Division Manager. This structure preserves
the  single-minded,  entrepreneurial  spirit of each  project  while  providing 
managerial  support in matters  relating  to  operations,  sales and  marketing,
finance and business development.                                               

     Operating  facilities  -  The  Company's   headquarters  and  manufacturing
facility occupies  approximately 50,000 (fifty thousand)  square-feet within the
96-acre Pinellas Science  Technology and Research Center ("STAR Center") located
at 7887 Bryan Diary Road, Largo,  Florida.  The Company also has leased a 10,000
(ten thousand)  square foot  stand-alone  building  within which is housed TTL's
AquaFuel(a)  Division.  The Company  also  maintains  its  Balanced Oil Recovery
System (BORS) Lift Engineering office in Claremore,  Oklahoma. (See "Description
of Property").                                                                  

     Employees  - The  Company  provides  medical  insurance,  vacations,  stock
incentives and other,  similar employee benefit programs.  None of the Company's
employees are represented by collective bargaining  agreements.  At December 31,
1998,  the Company had 88  full-time  and 0 part-time  employees  engaged in the
following areas:                                                                

                          Executive                          5
                          Engineering/technical             11
                          Manufacturing                     59
                          Sales                              9
                          Administrative                     4
                          Total                             88

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     1999  capital  financing  programs.  During the first  quarter,  1999,  the
Company  completed  agreements  for the sale of $1,500,000  of its  Subordinated
Convertible  Notes (the " Notes")  and the sale of  $750,000  of its Series A 7%
Convertible Preferred Stock (the "Preferred").  Each transaction was done with a
domestic US fund. Both placements were conducted to provide for capital expenses
estimated to occur  throughout  1999. (See "Market for Common Equity and Related
Shareholder Matters").                                                          

Divisional Summary:                                                             

     Environmental  Solutions  Division - represents  the focus of the Company's
business purpose and encompasses proprietary  waste-to-energy equipment designed
to treat all hydrocarbon-based waste in a closed, non-polluting environment. The
equipment includes:                                                             

i.  Pyrolytic Carbon Extraction(a),                                   
ii. Pyrolytic Tire Reclamation and the                                
iii.Hot Plasma Destructive Distillation(a)                            

     In  addition,   the  Environmental   Solutions   division  features  three,
clean-burning alternative fuels including:                                      

i.  Phoenix 777(a);                                                   
ii. AquaFuel(a), and;                                                 
iii.Magnagas(a).                                                      

     Manufactured  Products  Division - supports the Company's  business purpose
through the fabrication and assembly of the environmental  equipment cited above
as well as acting as the  manufacturer  for the Company's  Balanced Oil Recovery
System Lift,  Tunnel Bat Culvert  Reclamation  Vehicles  and a complete  line of
high-tech radio frequency powered generators. The Manufactured Products Division
earns  revenues  through the sale of proprietary  manufactured  products for the
Company and as an  outsource  provider  for a host of  third-party  manufactured
parts and products.                                                             

     E-Commerce  Division - supports  the  Company's  business  purpose  through
conducting secured transactions through the internet for both the Company's line
of products as well as on a fee basis for third party merchants. At present, the
E-Commerce Division featuring InterSource HealthCare,  markets medical equipment
as well as a host of medical products and  pharmaceuticals.  TTLOnline.com  came
on-line  during  June,  1999 to  serve  as the  marketplace  for our  E-Commerce
Division  allowing  the Company to now stock our shelves with a host of products
which  will be  offered  for  sale on a  shared-revenue  basis.  The  E-Commerce
Division earns revenues  through the sale of both  proprietary  and  third-party
products on the internet.                                                       

     1998 into 1999.  During 1998,  the Company grew from 5 to 88 employees  and
from occupying 5,000  square-feet in a single location to now operating a 50,000
square foot manufacturing,  precision  micro-welding  facility,  a 10,000 square
foot off site location, a national engineering office in Claremore, Oklahoma and
a national sales office in Garden City, Kansas.                                 

     Also during 1998,  the Company  acquired  the rights to four  technologies,
made three  acquisitions  and increased  assets from  approximately  $562,054 to
$5,312,840.  The Company continues to operate with minimal debt and normal trade
payables and has seen meaningful  revenue growth from the last quarter,  1998 to
the first  quarter,  1999.  With the maturing of the  Company's  nine  divisions
coupled with the recently completed private  securities sale of $2,250,000,  the
Company is confident it can expand  operations  for the  remainder of 1999.     

     Research and development.  As a facilitator of  technologies,  a portion of
the  Company's  cash will be used to finance the  development  of its  products,
particularly  its Tunnel Bat  technologies.  The Company  also  estimates it may
incur additional  research and development costs in relation to AquaFuel.  As of
this writing,  the Company  estimates such 1999 research and  development  costs
would be approximately: Tunnel Bat vehicles - $72,000 and; potentially, AquaFuel
- $300,000.                                                                     

RISK FACTORS

     The  securities  offered  hereby  involve  a high  degree  of risk and each
prospective  investor  should consider  certain risks and  speculative  features
inherent in and affecting the business of the Company  before  purchasing any of
the securities offered hereby. In considering the following risk and speculative
factors, a prospective purchaser should realize that there is a substantial risk
of  losing  his  entire  investment.   Among  these  speculative  factors  which
management considers pose the greatest risk to prospective investors include the
following.                                                                      

Risks relating to the Offering                                                  

Limited,  early-stage public trading market for the Company's Common Shares. The
Company's  Shares began trading  through the NASD OTC Electronic  Bulletin Board
under the symbol TOUP during June, 1998. Accordingly,  there can be no assurance
that a trading market will continue. Each purchaser should view their investment
in these securities for long-range  investment purposes only and not with a view
to resell or otherwise dispose of their shares in the near future. If and when a
registration  statement  becomes  effective  relating to the Shares sold herein,
purchasers who desire to liquidate their shares may have difficulty selling them
considering  the early stage nature of the Company's  public market,  should any
such market develop. Accordingly, shares should only be purchased as a long-term
investment.                                                                     

Shares  Eligible  for Future Sale May  Adversely  Affect the Market.  Should the
Company be successful in the registration of the Shares described  herein,  such
an event may have a depressive effect on the then trading price of the Company's
common  shares.  Further,  the  Company's  business  purpose is the licensing of
rights relating to patents or otherwise  protected devices and processes in part
with the Company's  Common Shares that,  upon  issuance,  would be  unregistered
securities  and,  in the  future,  may be sold  upon  compliance  with Rule 144,
adopted under the Act of 1933.  Further,  in SEC Release No. 33-7390 Revision of
Holding  Period  Requirements  in Rules 144 and 145 the SEC  amended the holding
period  contained  in Rule 144 to  permit  the  resale  of  limited  amounts  of
restricted  securities  by  qualified  persons  after a one-year,  rather than a
two-year,  holding  period.  Also, the amendments  permit  unlimited  resales of
restricted  securities  held by  non-affiliates  of the Company  after a holding
period of two years, rather than three years. In the future, the Company intends
to enter into licensing and other agreement(s) which may provide for an exchange
of the Company's Common Shares. Accordingly, there is the possibility that sales
of Common Shares  issued in such a manner may, in the future,  have a depressive
effect  on the  price of the  Company's  Common  Stock in any  market  which may
develop.                                                                        

Risks relating to Toups Technology                                              

Recent  Organization.  The Company was organized  during July 1997 and should be
considered as still in the  development  and  promotional  stage.  The Company's
initial  success is predicated on the success of AquaFuel,  BORS Lift, AMW Metal
Fabricators,  Tunnel Bat, Electromagnetic Tire Recycling,  Brounley & Associates
and InterSource. The Company has not relied upon anything other than the opinion
of management in developing  the business plan for of AquaFuel,  BORS Lift,  AMW
Metal  Fabricators,  Tunnel  Bat,  Electromagnetic  Tire  Recycling,  Brounley &
Associates and InterSource.  The Company is, therefore, subject to all the risks
inherent  in any  start-up  venture,  many of which are  beyond  the  control of
management.                                                                     

Concentration of Stock Ownership.  Upon completion of this Offering, the present
directors  and  officers  will  beneficially  own  approximately  35.0%  of  the
outstanding Common Stock. As a result,  current management will be substantially
able to exercise  significant  influence over all matters requiring  stockholder
approval,  including  the  election of  directors  and  approval of  significant
corporate transactions.                                                         

Reliance on Forward  Looking  Statements.  Statements in this document which are
not purely  historical  facts,  including  statements  regarding  anticipations,
beliefs,  expectations,  hopes,  intentions or strategies for the future, may be
forward looking  statements  within the meaning of section 27A of the Securities
Act of 1933, as amended and Section 21.E of the Securities Exchange Act of 1934,
as amended.  All forward looking  statements within this document are based upon
information  available to the Company on the date of this  release.  Any forward
looking  statements  involve  risks and  uncertainties  that could cause  actual
events or results to differ  materially from the events or results  described in
the forward looking  statements,  including the timing and nature of independent
test results;  the nature of changes in laws and regulations that govern various
aspects of the  Company's  business;  the  market  acceptance  of the  Company's
licensed  technologies;   retention  and  productivity  of  key  employees;  the
availability of acquisition  candidates and  proprietary  technologies at prices
the  Company  believes  to  be  fair  market;   the  direction  and  success  of
competitors; management retention; and unanticipated market changes. The Company
undertakes  no  obligation  to  publicly  update or revise any  forward  looking
statements, whether as a result of new information,  future events or otherwise.
Readers are  cautioned  not to place undue  reliance  on these  forward  looking
statements.                                                                     

Risks relating to the Company's proposed operations                             

Reliance  on  Future  Licensing  Agreements  and  Acquisitions.   The  Company's
long-term growth strategy envisions licensing or acquiring through  acquisition,
a continual  flow of  products,  processes  or devices  which are  derived  from
patents or other similarly protected intellectual properties.  Accordingly, once
a particular  aquisition is identified or patent-use is determined,  the Company
must negotiate an acquisition or License Agreement on terms and under conditions
which are favorable to profitable operations.  In the course of such activities,
a number of factors can  contribute  to a lack of  success,  including a lack of
availability  of patents,  inability of management to  successfully  negotiate a
favorable  license or, if  negotiated,  an inability to  profitably  deliver the
intended  device or  process  to the  market.  Further,  until  such time as the
Company obtains  sufficient  assets to offset any potential loss, the failure of
any one of the Company's  technologies  could result in an inability to continue
as a going  concern.  Except  in the  case of the  acquisition  of an  operating
entity, Toups Technology business strategy is equivalent to a continual cycle of
operating  start-up or development stage entities with all the risks inherent to
any start-up or development stage entity. Accordingly, there can be no assurance
that the  Company  can  initially  accomplish  its  business  objectives  or, if
accomplished, that the Company can continue profitable operations.              

Competition and No formal feasibility or marketing studies. Numerous firms, also
located in South Florida as well as throughout the United States, compete or may
compete  vigorously  with the  Company  for the  licensing  of patented or other
intellectually protected processes and devices and for acquisitions. The Company
will  be at a  competitive  disadvantage  in  the  pursuit  of  possible  target
acquisitions or licensing agreements because of the inexperience of the Company.
No independent feasibility or marketing studies have been performed to determine
the demand for the Company's  services.  Accordingly,  there can be no assurance
that any market  exists or will  develop for the  Company's  services or, if any
market does develop, there can be no assurance that the Company can successfully
complete its business purpose.                                                  

Vulnerability  to  fluctuation  in  economy.   Demand  for  technologies  to  be
commercialized  by the Company is dependent  upon,  among other things,  general
economic conditions which are historically cyclical in nature.                  
Prolonged recessionary periods may be damaging to the Company.                  

No  assurance  of  commercial  success.  Even if the  Company is  successful  in
conducting its affairs in the manner described herein as it relates to AquaFuel,
BORS Lift, AMW Metal Fabricators,  Tunnel Bat,  Electromagnetic  Tire Recycling,
Brounley & Associates  and  InterSource,  market  acceptance  and the ability to
expand market  penetration of these  products and related  services is driven by
the demand for such  products or  services.  As such,  there can be no assurance
that the AquaFuel, BORS Lift, AMW Metal Fabricators, Tunnel Bat, Electromagnetic
Tire Recycling,  Brounley & Associates and InterSource product/service line will
either  achieve  initial  market  acceptance  or,  if  achieved,  will  maintain
sufficient market share to conduct profitable operations.                       

Dependence upon key personnel.  The Company's  continued success will be heavily
dependent  upon  the  services  of key  personnel  and the  Corporate  Board  of
Directors  who founded the Company.  These key  personnel are expected to remain
with the  Company,  however the loss of one or more of these  individuals  could
have an  adverse  effect  on the  operations  of the  Company  until a  suitable
replacement can be found. As the Company expands,  the continued  success of the
business will increasingly  depend on the Company's ability to retain and add to
the  existing  management  team.  At  present,  the  Company  does  not  provide
employment agreements for its Officers.  Accordingly,  there can be no assurance
given  that the  Company's  current  Officers  will  continue  to serve in their
respective roles.                                                               

Limited  liability of Officers  and  Directors.  The  Company's  Certificate  of
Incorporation and by-laws provide that a Director's liability to the Company for
monetary  damages will be limited.  In addition,  the Company is obligated under
the  Certificate  of  Incorporation  and by-laws to indemnify  its Directors and
Officers  against  certain  liabilities  incurred  with  their  service  in such
capacities.  The Company will in the future execute  indemnification  agreements
which will indemnify each Director and Officer against certain liabilities which
they may incur. Each of these measures could reduce the legal remedies available
to the Company and the shareholders against such individuals.                   

 USE OF PROCEEDS

 The Company  will not realize any  proceeds  from the sale of shares of
 Common  Stock by the Selling  Security Holders. See "SELLING SECURITY HOLDERS."

 DETERMINATION OF OFFERING PRICE

     The  offering  price of the  securities  described  herein  was  calculated
pursuant  to Rule  457(c) of the Act and was not  computed  based on the assets,
historical  operating  performance or other conventional means and should not be
construed to indicate any  relationship  thereto.  In establishing  the offering
price,  the  Company  relied on the  closing  "bid"  price as  reflected  in the
over-the-counter  (OTC)  marketplace.  On June 16, 1998,  the  Company's  Common
Shares were  cleared for trading  through the OTC under the symbol  TOUP.  Since
that date,  the  Company's  Common  Shares  have traded at prices  ranging  from
$1.37-$3.  On  January  11,  1999,  the  closing  "bid"  price of the  Company's
securities was $1.96                                                            

SELLING SECURITY HOLDERS

     The shares of Common Stock of the Company  offered by this  Prospectus  are
being sold for the account of the Selling  Security  Holders  identified  in the
table indicated below (the "Selling  Security  Holders").  The Selling  Security
Holders are offering for sale an aggregate of 5,930,761  shares of the Company's
Common Stock.                                                                   

     The following table sets forth the number of Shares being held of record or
beneficially  (to the extent  known by the  Company)  by such  Selling  Security
Holders and provides (by footnote reference) any material  relationship  between
the  Company  and such  Selling  Security  Holders,  all of which is based  upon
information currently available to the Company.                                 

                      Number of          Number of   Number of
                      Shares of          Shares of   Shares of
                      Common             Common       Common
                              stock    Percent    Stock       Stock  Percent
Name                            Before    Before  to be sold    After    After  
                              Offering  Offering in Offering Offering Offering

Arabaje, C. Isdaias(10)......  500,000       2.2%   500,000         0        0% 
Aubin, Brian St. (1) .........  10,000       (11)    10,000         0        0% 
Augustine Fund(5) ............ 842,696       3.7%   842,696         0        0% 
Augustine Warrants(5) ......   125,000       (14)   125,000         0        0% 
Ayers, Gregory S. Ayers(2) .    15,000       (11)    15,000         0        0% 
Bailey, Sandra(1) ..........     1,000       (11)     1,000         0        0% 
Bartolacci, Rhonda (1) .....    50,000       (12)    50,000         0        0% 
Bartolacci, Tiffany (1) ....    50,000       (12)    50,000         0        0% 
Belhassan, Mehdi (1) .......    10,000       (11)    10,000         0        0% 
Blauvelt, Tom(1) ...........     3,750       (11)     3,750         0        0% 
Boyer, Michael(1) ..........    10,000       (11)    10,000         0        0% 
Bracciale, Steve(1) ........    72,500       (13)    72,500         0        0% 
Bramscher, Craig (1) .........    75,000       (13)    75,000       0        0% 
Burleson, Linda(1) ...........     2,000       (11)     2,000       0        0% 
Butler, Mike(1) ..............     5,000       (11)     5,000       0        0% 
Calyanis, Beth (1) ...........    10,000       (11)    10,000       0        0% 
Calyanis, Bill (1) ...........     5,000       (11)     5,000       0        0% 
Calyanis, Jon (1) ............     2,500       (11)     2,500       0        0% 
Calyanis, Paul (1) ...........    10,000       (11)    10,000       0        0% 
Caveny, John F. (1) ..........    15,000       (11)    15,000       0        0% 
Cardinal Capital(8) .........     50,000       (12)    50,000       0        0% 
CG Capital(1) ................   100,000       (13)   100,000       0        0% 
Cianciolo, Michael W. (2) ....    30,000       (12)    30,000       0        0% 
Collins, Barbara(1) ..........    25,000       (11)    25,000       0        0% 
Conrotto, Giuseppe and .......    30,000       (12)    30,000       0        0% 
Loner, Graziella(1)                                                       
Crossman, Dan(1) .............    10,000       (11)     3,000   7,000     .001% 
D'Angelo, George(1) ..........    75,000       (13)    75,000       0        0% 
DeCara, Dave (4) .............   200,000       (14)    50,000 150,000    .0067% 
Deheart, Ryler(1) ............     2,500       (11)     2,500       0        0% 
Disparti, Joseph L. (1) ......    10,000       (11)    10,000       0        0% 
Dixon, Peter B.(1) ...........    35,000       (12)    35,000       0        0% 
Dowdy, Greg & Carol (1) ......     2,500       (11)     2,500       0        0% 
Dowdy, Susan P. (1) ..........    10,000       (11)    10,000       0        0% 
Dryer, James(1)..............     10,000       (11)    10,000       0        0% 
Dudley, Thomas(4) ............    20,000       (11)    20,000       0        0% 
Eschenroeder, Dana(1) ........    25,000       (11)    25,000       0        0% 
Eschenroeder, Edward(1) ......    25,000       (11)    25,000       0        0% 
Eschenroeder, Roger(1) .......    25,000       (11)    25,000       0        0% 
Eschenroeder, Scott(1) .......    25,000       (11)    25,000       0        0% 
Famiglietti, Klaus(1)........      5,517       (11)     5,517       0        0% 
Farina, Gerri (1) ............     4,000       (11)     4,000       0        0% 
Feeney, Susan L. (1) .........    10,000       (11)    10,000       0        0% 
Ficocelli, Bob(1) ............     4,000       (11)     4,000       0        0% 
First New York(9) ............    50,000       (12)    50,000       0        0% 
Flex, A. Scott(1) ............    50,000       (12)    50,000       0        0% 
Fritze  George  T. & Carol J(1).  15,000       (11)    15,000       0        0% 
Frueh, Richard A. (1) ........    15,000       (11)    15,000       0        0% 
Garvey, Daniel(1) ............    60,000       (13)    60,000       0        0% 
GFC Communications(3) ........   175,000       (14)   175,000       0        0% 
GFC Communications(3).........   112,000       (14)   112,000       0        0% 
Gloyer, M. Katherine(1) ......     1,250       (11)     1,250       0        0% 
Goldstein, Michelle(4) .......    22,260       (11)    22,260       0        0% 
Gouge, Shirley A.(3) .........    10,000       (11)    10,000       0        0% 
Green, David E.(1) ...........    10,000       (11)    10,000       0        0% 
Guidry, Sybil(1) .............       500       (11)       500       0        0% 
Hackman, Darrel(3).............    3,000       (11)     3,000       0        0% 
Harris, Calvin(1) ............    25,000       (11)    25,000       0        0% 
Hedges, Burke(1) .............    29,500       (12)    29,500       0        0% 
Hillel, Doron(1) .............   100,000       (13)   100,000       0        0% 
Hornstrom, Carole (1) ........    10,000       (11)    10,000       0        0% 
Hornstrom, Joseph (1) ........     4,000       (11)     4,000       0        0% 
Hornstrom, Meghan (1) ........    20,000       (11)    20,000       0        0% 
Hornstrom, Nicole (1) ........     2,000       (11)     2,000       0        0% 
Hornstrom, Richard N. (1) ....    20,000       (11)    20,000       0        0% 
Jenkins, Tom(1) ..............    20,000       (11)    20,000       0        0% 
Johnson, Richard(1) ..........     1,200       (11)     1,200       0        0% 
Kempka, Daniel (1) ...........   100,000       (13)   100,000       0        0% 
Kilgore, Julie(1) ............    10,000       (11)    10,000       0        0% 
Klimek, Maryann (1) ..........    10,000       (11)    10,000       0        0% 
Koehler, Jerry and Noreen(1) .    25,000       (11)    25,000       0        0% 
Krauthamer, Gary(1) ..........    50,000       (12)    50,000       0        0% 
Kudelko, Robert (2) ..........    15,000       (11)    15,000       0        0% 
Lorenzen, Sandra(1) ..........       750       (11)       750       0        0% 
Luttrell, Scott D.(1) ........   100,000       (13)   100,000       0        0% 
Maloney, Doris, F.(1)........     10,000        (1)    10,000       0        0% 
Matherley, Ann(1) ............    50,000       (12)    50,000       0        0% 
Mathison, Steve & Carrie(1)...    63,000       (12)    63,000       0        0% 
McBee, Michael (3) ...........     5,000       (11)     5,000       0        0% 
McFadden, Robert (1) .........     8,000       (11)     8,000       0        0% 
Morgan, William(1) ...........   450,000       2.0%   300,000 150,000        0% 
Murphy, Martha(1) ............     1,000       (11)     1,000       0        0% 
Nelsen, Keith J. (1) .........    26,500       (11)    26,500       0        0% 
Novak, Michael R. (1) ........    10,000       (11)    10,000       0        0% 
O'Donnell, Michael, J.(1)....    125,000       (11)   125,000       0        0% 
O'Malley, James Joseph (1) ...    20,000       (11)    20,000       0        0% 
O'Malley, James(1) ...........     5,000       (11)     5,000       0        0% 
O'Malley, Matthew Joseph (1)      20,000       (11)    20,000       0        0% 
O'Malley, Robert E.(1)             4,000       (11)     4,000       0        0% 
O'Malley, Ryan(1) ...........     20,000       (11)    20,000       0        0% 
O'Malley, Thomas  Robert           5,000       (11)     5,000       0        0% 
Lisa Marie (1)                                                            
Parago, Jewel(1) ............      750      (11)          750       0        0% 
Patteri,  Carla J.,  Trustee,   15,000      (11)       15,000       0        0% 
U.T.A., 3-3-98(2)                                                         
Pennington, Jackqueline(1) ..   20,000      (11)       20,000       0        0% 
Pennington, Les(1) ..........   25,000      (11)       25,000       0        0% 
Plavnick, Kim(1) ............      850      (11)          850       0        0% 
Price, Steve(1) .............    10,000       (11)     10,000       0        0% 
Rappa, Phil(4) ..............    15,000       (11)     15,000       0        0% 
Reagin, Leslie(1)...........    103,448       (11)    103,448       0        0% 
Ricciardi, Lino P(1).........    13,794       (11)     13,794       0        0% 
Rigis, John (1) .............   100,000       (13)    100,000       0        0% 
Rivera, John(3) .............   200,000       (13)    200,000       0        0% 
Rosenthal, Monroe and Andrea     50,000       (12)     50,000       0        0% 
Family Trust(1)                                                           
Rowe, Kevin S. (2) ..........    15,000       (11)     15,000       0        0% 
Sabag, Rafael (1) ...........    75,000       (13)     75,000       0        0% 
Scanlon, Bill(1) ............    21,250       (11)     21,250       0        0% 
Shaar Fund, Ltd, The (6) ....   312,500       1.4%    312,500       0        0% 
Shaar Fund, Ltd., The (7) ...    93,750       (13)     93,750       0        0% 
Shelton, Estate of Richard ..     6,000       (11)      6,000       0        0% 
L. (1)                                                                    
Sider, Revocable Living          15,000       (11)     15,000       0        0% 
Trust of Todd &  Katherine(2)                                             
Silverman, Richard N. (1) ...    10,000       (11)     10,000        0       0% 
Slaughter, Mary(4) ..........    11,130       (11)     11,130        0       0% 
Sloan, Peter M. (1) .........     5,000       (11)      5,000        0       0% 
Soudan, Mary (1) ............    25,000       (12)     40,000        0       0% 
Soudan, Elizabeth 1998 Trust(1).  5,000       (12)      5,000        0       0% 
Soudan, Joseph 1998 Trust(1).     5,000       (12)      5,000        0       0% 
Soudan, Thomas 1998 Trust(1).     5,000       (12)      5,000        0       0% 
Soudan, Peter (1) ...........    25,000       (11)     25,000        0       0% 
Spackman, Troy(1) ...........    10,000       (11)     10,000        0       0% 
Stahl, Brent G. (1) .........     9,375       (11)      9,375        0       0% 
Stern, Mark S. & Ellen as ...    30,000       (12)     30,000        0       0% 
Tenants by the Entirety(2)                                                
Stern, Mark  S. and              15,000       (11)     15,000         0      0% 
Irrevocble  Children's                                                    
Trust for (1/3 Elliot                                                     
Benjamin, 1/3 Lennie                                                      
Beth, 1/3 Zachary Adam)(2)                                                
Steves, Kelly................     1,000       (11)      1,000         0      0% 
Suton, Larry(1) .............    50,000       (12)     50,000         0      0% 
Swaim, Denelle..............      1,000       (11)      1,000         0      0% 
Terry, Arthur(1) ............   150,000       (14)    150,000         0      0% 
Terry, James L. (1) .........    10,000       (11)     10,000         0      0% 
Terry, Maude D. (1) .........    10,000       (11)     10,000         0      0% 
Todd, Virgil & Theresa, .....    30,000       (12)     30,000         0      0% 
Joint Tenant with Right                                                   
of Survivorship(2)                                                        
Trinske, Mark(3) ............    10,000       (11)     10,000         0      0% 
Ungar, Merrick (1) ..........    48,750       (12)     48,750         0      0% 
Ungar, Scott (1) ............    48,750       (12)     48,750         0      0% 
Wainrib, Andrew(1) ..........     5,000       (11)      5,000         0      0% 
Widelitz Family Trust .......   100,000       (13)    100,000         0      0% 
4/15/94(1)                                                                
Witkov, Bruce A. (1) ........     2,000       (11)      2,000         0      0% 
Wolfe, Jason E. (1) .........     2,500       (11)      2,500         0      0% 
Wong, Jody (1) ..............    10,000       (11)     10,000         0      0% 
Wong, Wa-She Grandmother's ..    50,000       (12)     50,000         0      0% 
Trust(1)                                                                  
Wong, Wa-She(1) .............    31,250       (12)     31,250         0      0% 
Wood, Stephen R. and Diane ..    30,000       (12)     30,000         0      0% 
M. (2)                                                                    
Worden, Darlin(1) ...........    15,000       (11)     15,000         0      0% 
Worldbridge Financial Ltd(1)    250,000        1.1%   250,000         0      0% 

Total ....................... 6,114,761      27.07%  5,957,761  157,000   .007% 

(1)  Share issued pursuant to an Accredited  Investor  Offering made in reliance
     on Section 4(2) or 3(b) of the Act according to Regulation D, Rule 506. See
"Recent Sales of Unregistered Securities."                            
(2)  Shares issued as a part of the acquisition of InterSource Health Care, Inc.
(3)  Shares issued as compensation  for various  marketing and sales  consulting
services, contract coordination and technical internet support.       
(4)  Mr.  Dudley is  engaged  by the  Company  as  technical  assistant  for the
     Electromagnetic  Tire  Recycling  Process and Mr.  DeCara is engaged by the
     Company as corporate  Sales Manager.  Ms.  Slaughter and Ms.  Goldstein are
     both  employees  of the  Company  and  received  their  shares  in  lieu of
     compensation.  Mr.  Rappa serves as  President  of the  Company's  Brounley
division.                                                             
(5)  Issued pursuant to the sale of convertible  subordinate Notes  representing
     the  first  $750,000  received.  Upon  effectiveness  of this  registration
     statement,  the  Company  shall  receive  an  additional  $750,000  and has
     undertaken  to  register an  additional  421,348  shares and 75,000  shares
     underlying  warrants  in  connection   therewith.   See  "Recent  Sales  of
Unregistered Securities."                                             
(6)  Represents  Common Shares  underlying the Company's Series A 7% Convertible
Preferred Shares issued to The Shaar Fund, Ltd.                       
(7)  Represents 93,750 shares underlying Warrants issued to The Shaar Fund, Ltd.
     in  connection  with the  sale of the  Company's  Series  A 7%  Convertible
     Preferred stock. The 93,750 Warrants,  if fully exercised,  would result in
the Company receiving an additional $225,000.                         
(8)  Represents 50,000 shares underlying Warrants issued to Robert Rosenstein as
     part of a finder's fee in connection with the sale of the Company's  Series
A 7% Convertible Preferred stock.                                     
(9)  Shares issued for services.                                                
(10) Shares issued pursuant to the AquaFuel-Dominicana Joint-Venture.           
(11) Represents less than 0.125% of the Company's issued and outstanding shares 
(12) Represents less than 0.25% of the Company's issued and outstanding shares  
(13) Represents less than 0.5% of the Company's issued and outstanding shares   
(14) Represents less than 1% of the Company's issued and outstanding shares     
(15) Represents less than 2% of the Company's issued and outstanding shares     

PLAN OF DISTRIBUTION                                                            

Selling Security Holders                                                        

     The Selling  Security Holders are offering shares of Common Stock for their
own account and not for the account of the Company. The Company will not receive
any proceeds from the sale of the shares of Common Stock by the Selling Security
Holders.                                                                        

     Each Selling  Security  Holder will,  prior to any sales,  agree (a) not to
effect  any  offers or sales of the  Common  Stock in any  manner  other than as
specified  in this  Prospectus,  (b) to inform the Company of any sale of Common
Stock at least one  business  day prior to such sale and (c) not to  purchase or
induce  others to purchase  Common Stock in violation of  Regulation M under the
Exchange Act.                                                                   

     The  shares  of Common  Stock  may be sold from time to time to  purchasers
directly by any of the Selling  Security  Holders acting as principals for their
own accounts in one or more  transactions in the  over-the-counter  market or in
negotiated  transactions  at market prices  prevailing at the time of sale or at
prices otherwise  negotiated.  Alternatively,  the shares of Common Stock may be
offered  from time to time  through  agents,  brokers,  dealers or  underwriters
designated from time to time, and such agents, brokers,  dealers or underwriters
may receive  compensation  in the form of commissions  or  concessions  from the
Selling Security Holders or the purchasers of the Common Stock.                 

     Under the Exchange Act, and the regulations thereunder,  any person engaged
in a distribution  of the shares of Common Stock of the Company  offered by this
Prospectus  may not  simultaneously  engage in  market  making  activities  with
respect to the Common Stock of the Company during the  applicable  "cooling off"
periods prior to the commencement of such distribution. In addition, and without
limiting  the  foregoing,  each  Selling  Security  Holder  will be  subject  to
applicable  provisions  of the  Exchange  Act  and  the  rules  and  regulations
thereunder,  including,  without limitation,  Regulation M, which provisions may
limit the timing of purchases and sales of Common Stock by the Selling  Security
Holder.  There are possible limitations upon trading activities and restrictions
upon broker-dealers  effecting transactions in certain securities which may also
materially  affect the value of, and an  investor's  ability to dispose  of, the
Company's securities.                                                           

     The Company will use its best  efforts to file,  during any period in which
offers or sales are being made,  one or more  post-effective  amendments  to the
Registration  Statement,  of which this  Prospectus  is a part,  to describe any
material  information  with respect to the plan of  distribution  not previously
disclosed in this Prospectus or any material change to such  information in this
Prospectus.                                                                     

LEGAL PROCEEDINGS                                                               

   The Company is not subject to any legal proceedings. The Company is unaware
of any governmental  authority that is contemplating  any procedure to which the
Company is a participant.                                                       

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.                   

     The  following  Directors  and  Executive  Officers  have  served  in their
respective  capacities  since July 28, 1997 (date of  inception).  The Directors
were  re-elected  for the current  term at a Meeting of  Shareholders  conducted
January  5,  1998.  On May 26,  1999 the  Company  held its  annual  meeting  of
shareholders  at which meeting the following  individuals  stood for election to
the Company's Board of Directors.  Of the total common shares eligible to cast a
vote,  approximately  82% so voted.  Of the 82% that  cast a vote,  99% voted in
favor  of the  following  five  directors,  three of whom  are  founders  of the
Company.  None of the Directors  hold similar  positions in any other  reporting
company.  The Company  intends to conduct its next  election of Directors at its
next Annual Meeting of Shareholders.                                            

     Chairman of the Board of Directors,  President and Chief Executive Officer:
Leon H. Toups (60). Mr. Toups' past professional  experiences include, from 1980
to present,  that of  President  and  Chairman of the Board of Directors of DMV,
Inc., Clearwater, Florida. Prior thereto, from 1973 to 1980, Mr. Toups served as
President and Chief Operating  Officer,  as a Member,  of the Board of Directors
and as a Member of the Executive Committee of Chromalloy  American  Corporation,
St. Louis,  Missouri,  and as President of Chromalloy Natural Resources Company,
Houma,  Louisiana.  Chromalloy  American was an international  conglomerate with
sales of approximately  $2.0 billion which employed 45,000 people world-wide and
traded its capital  stock on the New York Stock  Exchange.  Mr.  Toups holds the
following  degrees:  M.S.  Aerospace  Engineering,  University of Florida;  M.S.
Mechanical Engineering, Georgia Tech; B.S. Mechanical Engineering, Georgia Tech.
From 1968 to 1969, Mr. Toups attended M.I.T. on a NASA Hugh Dryden Fellowship.  

     Director,  Corporate  Secretary and Executive Vice  President:  Mark Clancy
(43).  Mr.  Clancy's past business  experiences  include:  from 1993 to present:
Compliance Officer, DMV, Inc., Largo, Florida; 1996 to present: President, Total
Kids, Incorporated,  Tampa, Florida. Prior thereto, Mr. Clancy served as General
Sales Manager of WRCC FM Radio, Cape Coral,  Florida, and as Sales Consultant to
WIZD  FM  Radio,  West  Palm  Beach,  Florida.  Mr.  Clancy  holds  an  AA  from
Hillsborough  Community  College,  Tampa,  Florida  and  currently  attends  the
University of South Florida.                                                    

     Director,  Vice-President,  Finance,  Chief Financial  Officer:  Michael P.
Toups (33).  Mr.  Toups' past  professional  experiences  include,  from 1996 to
present:  a Director and  Vice-President,  Finance for InterSource  Health Care,
Inc., Clearwater, Florida; 1992 through the present: Vice-President, Finance and
Operations,  DMV, Inc., Clearwater,  Florida. Mr. Toups holds an MBA, University
of Notre Dame with  concentrations  in finance and  marketing and a BA degree in
Business Administration from Texas Christian University.                        

     Director,  Errol J. Lasseigne (57).  Proposed  Director.  Mr.  Lasseigne is
currently an  owner/Officer  of Senior Life  Management,  a New York corporation
which provides  psychological  services and is an  owner/Officer of Garden State
Hospice,  a New Jersey  corporation  which provides  hospice services and family
counseling.  Mr.  Lasseigne  is also an  owner/Officer  of L & G  Management,  a
Florida  corporation  which  provides  health  care  consulting  and  management
services.   Prior  thereto,  Mr.  Lasseigne  spent  24  years  with  the  Eckerd
Corporation  serving in various  retail  pharmacy  management  positions  and in
development of  institutional  pharmacies.  Mr. Lasseigne spent 2 years with the
Dell Crane Corporation as Executive Vice President and Chief Operating  Officer.
Mr.  Lasseigne is currently  affiliated with the American  Society of Consultant
Pharmacist,  American Pharmaceutical  Association and the Florida State Chapter.
He has served as Chairman of various professional committees in six States where
he is registered to practice pharmacy.                                          

     Director,  Leslie D. Reagin, III (55). Proposed Director. Mr. Reagin is the
current  President/Owner  of the L.DR. Group, an investment  management  company
established  in 1993.  Prior  thereto,  Mr.  Reagin  was  engaged  by the Eckerd
Corporation for 32 years of which he served in various  executive  positions for
22 years.  Mr. Reagin is currently  affiliated with the following  organization:
Board  Chairman for Webber  College (18 year member);  Board Chairman for Career
Options Inc,; Board member and Member of the Executive Committee of Abilities of
Florida,  Inc; Board member of the Florida Chamber  Foundation;  Board member of
the Morton  Plant Mease  Foundation  and Board  Member of the YMCA,  Clearwater,
Florida. Mr. Reagin's previous affiliations include serving as a Board member of
the Florida  Chamber of Commerce;  Vice President of Finance and Chairman of the
Chamber Management Corporation; Member o the Board of Overseers for the Southern
College of Pharmaceutical  Sciences,  Miami, Florida; Past Board Chairman of the
Pinellas Private Industry Council;  Member of the National  Association of Chain
Drug Stores.                                                                    

     The  Company's  Chief  Financial  Officer,  Vice  President,   Finance  and
Director,  Michael Toups, is the son of the Company's President, Chief Executive
Officer and Chairman of the Board of Directors, Leon H. Toups.                  

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.                 

     At December 31, 1998, the Company has 22,217,299 shares of its Common Stock
issued and  outstanding.  The following table sets forth, as of January 1, 1999,
the beneficial  ownership of the Company's  Common Stock (i) by the only persons
who are known by the Company to own  beneficially  more than 5% of the Company's
Common Stock;  (ii) by each director of the Company;  and (iii) by all directors
and officers as a group.                                                        

Beneficial ownership of the Company's Common Stock:                             

(1)                   (2) 
Name and              Amount and
Address of             Nature of
               Beneficial              Beneficial            (3)
Title of Class           Owner                    Owner        Percent of Class 

Common              Leon H. Toups                 3,356,680(5)        15%       
418 Harbor View Lane                    
Largo, Florida 33770                    

Common              Mark Clancy                   1,733,340(5)        7.8%      
417 Barrett Court                       
Tampa, Florida 33617                    

Common              Michael Toups                  1,733,340(5)        7.8%     
400 Palm Drive                          
Largo, Florida 33770                    

Common              Errol J. Lasseigne               188,263            0.8%    
2364 Violet Place                       
Palm Harbor, Florida 34685              

Common              Leslie D. Reagin, III            469,873            2.1%    
720 Bluffview Drive                     
Belleair, Florida 34640                 

Common              Officers and Directors         7,481,496            33.6%   
(three persons)                         

Common               Jerry Kammerer              1,660,000(4)           7.4%    
1421 Water View Drive                 
Largo, Florida 33771                  

(1)  Mr. L. Toups serves as the Company's President, Chief Executive Officer and
     Chairman of the Board of Directors.  Mr. Clancy serves as a Director and as
     the Corporate  Secretary and Executive Vice President.  Mr. M. Toups serves
     as a  Director  and as the  Company's  Chief  Financial  Officer  and  Vice
President, Finance.                                                   
(2)  None of the named  persons  or Officer  and  Directors  are  holders of any
options, warrants, right conversion privileges or similar items.      
(3)  There are no  provisions  which allow for a change in control of the issuer
     beyond the annual  election  of  Directors.  The  Company is unaware of any
voting trusts or similar agreements among its Shareholders.           
(4)  Mr. Jerry Kammerer is a former  Director of the Company.  Mr.  Kammerer was
     terminated as an Officer and Director of the Company on August 20, 1998. As
     of January  19,  1999,  of the  1,750,000  shares  originally  owned by Mr.
Kammerer, 180,000 were eligible for resale pursuant Rule 144.         
(5)  In lieu of compensation, during September, 1998 Messrs. L. Toups, M. Clancy
     and M.  Toups were each and all  granted  options,  which,  for a period of
     three years  following,  entitles each to purchase 650,000 of the Company's
common stock at $0.639 per share.                                     

DESCRIPTION OF SECURITIES                                                       

     The Company is authorized to issue up to 50,000,000 shares of Common Stock,
par value $.001 per share,  and 10,000,000  shares of Preferred Stock, par value
$1.00 per  share.  As of the date  hereof, 750 of the  Preferred  Shares  were  
outstanding and there were 22,217,299 Common Shares outstanding.                

     At the conclusion of this Offering of the  22,217,299  Common Shares issued
and outstanding,  10,325,482 Common Shares are unregistered securities,  and, in
the future,  said unregistered shares may only be sold upon compliance with Rule
144,  adopted  under the  Securities  Act of 1933.  In  Securities  and Exchange
Commission (SEC) Release No. 33-7390, Revision of Holding Period Requirements in
Rules 144 and 145, the SEC amended the holding  period  contained in Rule 144 to
permit the  resale of limited  amounts of  restricted  securities  by  qualified
persons after a one-year,  rather than a two-year,  holding  period.  Also,  the
amendments   permit   unlimited   resales  of  restricted   securities  held  by
non-affiliates  of the Company after a holding period of two years,  rather than
three years. There are no promoters,  underwriters or persons or firms acting in
any similar capacity associated with the Company.                               

     Holders of Common  Shares are  entitled to one vote per Common Share on all
matters to be voted on by Shareholders. The Common Shares do not have cumulative
voting  rights.  Holders of a majority of the Common  Shares are also members of
the Board of Directors.  A majority  vote is  sufficient  for most other actions
requiring the vote or concurrence of  Shareholders.  The Company's  Officers and
Directors as a group (three  persons)  own directly  approximately  39.3% of the
Issuer's capital stock.                                                         

     All Shares are entitled to share equally in dividends  when and if declared
by the  Board  of  Directors  out of funds  legally  available  therefor.  It is
anticipated  that the Company  will not pay cash  dividends on its Shares in the
foreseeable  future.  In the event of liquidation or dissolution of the Company,
whether  voluntary or  involuntary,  holders of the Shares are entitled to share
equally in all assets of the  Company  legally  available  for  distribution  to
Shareholders.  The holders of Shares have no  preemptive  or other  subscription
rights to acquire  authorized  but unissued  capital  stock of the Company,  and
there are no conversion  rights or redemption  or sinking fund  provisions  with
respect to such Shares. All of the outstanding Shares and those Shares issued in
accordance with this offering will be fully paid and non- assessable.           

INTEREST OF NAMED EXPERTS AND COUNSEL                                           

No such interest.                                                     

DESCRIPTION OF BUSINESS.                                                        

Background                                                                      

     Toups Technology Licensing,  Inc., was incorporated in the state of Florida
on July 28, 1997 ("Toups  Technology",  "TTL" or the  "Company").  The Company's
business  plan is to pursue the  commercialization  of  late-stage  technologies
through obtaining license  agreements and acquisitions.  The Company operates in
the energy, environmental and natural resource market segments.                 

  The Company earns its revenues primarily through the sale and service of
the following product lines.                                                    

Environmental Solutions:                                              

Equipment:                                                    

Pyrolytic Carbon Extraction(a)(PCE) Processor       
Hot Plasma AquaFueler(a) 1500                       
Pyrolytic Tire Reclamation Process                  

Alternative Fuels:                                            

AquaFuel(a)                                         
Phoenix 777(a)                                      
Magnagas(a)                                         

Manufactured Products                                                 

Balanced Oil Recovery System Lift                             
Tunnel Bat Culvert Reclamation Vehicle                        
Brounley Radio Frequency CO2 Lasers and Power Generators      

E-Commerce Division                                                   

InterSource HealthCare                                        
TTLOnline.com                                                 

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 Pyrolytic Carbon Extraction (PCE) Processor

     The Company's Pyrolytic Carbon Extraction Process or PCE treats both liquid
and solid  hydrocarbon-based  waste in a closed system without releasing harmful
emissions,  fluids  or  solids  into  the  environment.  The  industrial  system
transforms  about 40% of the waste into carbon black.  The  remainder  becomes a
clean-burning gas named Phoenix 777(a) which demonstrates exhaust and combustion
properties  superior to natural gas. The combustion of Phoenix 777(a) emits less
than half of the carbon dioxide of natural gas and virtually no carbon  monoxide
or  hydrocarbons,  is  lighter  than  air and has a  distinct  odor  which is an
important safety feature..                                                      

 (Picture Omitted)

     The PCE refinery or  fuel-processing  unit provides for both mechanical and
electrical  output.  The unit operates on wastes ranging from household garbage,
tires,  vegetable matter, manure of all types, waste oils (fossil or vegetable),
animal fat and a host of other hydrocarbon-based waste.                         

     The PCE unit is a dual-fuel  unit. The PCE unit is designed to be activated
with propane and once in operation,  the dual-fuel capability allows the unit to
switch from propane to its own Phoenix  777(a).  The unit will consume about 20%
of the Phoenix 777(a) produced in the course of its operation.                  

System Features:                                                                

       Fuel:       Waste material such as paper, plastic, tires, animal fat,
used motor oil, cloth, bio-mass       

    Power Plant:  4-cylinder internal combustion engine carbureted for
            propane and Phoenix 777@ - (diesel or gasoline
configuration optional)           

Automatic operation  using embedded controller                

System Benefits:                                                                

          o Produces drinking and potable water with optional  evaporator unit o
          Waste  disposal  solution  with  short-term  payback   capabilities  o
          Generation  of  electricity  when put in  series  with a  generator  o
          Environmentally clean - no emissions, no landfill waste o Carbon black
          extraction  affords additional revenue stream o Minimal global warming
contribution o No fuel or electric costs for operation      

Manufacturing:                                                                  

The Company  fabricates  and assembles  the PCE equipment at its Largo,  Florida
based plant.                                                                    

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 Hot Plasma AquaFueler1500

     TTL's Hot  Plasma  AquaFueler  1500 is  designed  to  recycle a variety  of
materials  into a clean  burning,  combustible  fuel.  Some of the materials for
which this unit was designed to convert to a useful, combustible gas include:   

   -   Chemical/hydrocarbon contaminated soil, PCP contaminated transformer oil,
       Water/land-based  oil spills,  Refinery  pit oil,  Antifreeze,  Solvents,
       Processing oils, Hazardous runoff water, Paint sludge,  Crankcase sludge,
       Bilge water,  Processing  oils,  Tank  bottoms,  Parts  washer  solvents,
Chemical wash water                                               

The AquaFueler                                                                  

     The AquaFueler 1500 makes up to 3,000 cubic feet of clean-burning  AquaFuel
per hour for about five cents per cubic foot.  Three  one-by-twelve-inch  carbon
rods are automatically fed into the liquid-filled  AquaFuel  generation chamber.
Liquids  used in the  process  can range  from  salt  water to raw  sewage.  The
AquaFueler 1500 is the only safe, reliable and effective way to make AquaFuel.  

 (Picture Omitted)

Manufacturing:                                                                  

     The Company  fabricates  and assembles  the AquaFuel 1500  equipment at its
Largo, Florida based plant.                                                     

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Pyrolytic Tire Reclamation (PTR) Process

     The  Company's  PTR Process  was  developed  to recover the oil,  steel and
carbon black used in the  manufacture of tires.  The process is  self-contained,
using scrap tires as the  feed-source,  fed in through  the PTR  equipment  as a
means to reduce the tires to their basic elements.  As a percent of weight,  the
by-products of each tire are 10% steel; 25% fuel gas; 25% Petro-chemicals,  and;
40% carbon black.  The PTR  technology  reclaims  these  products which are then
offered for sale.                                                               

     The PTR technology  differentiates  from  competition  because there are no
emissions  and,  therefore,  no residue from  combustion.  The PTR technology is
further  differentiated from competition in its modular design, which allows for
a tire "plant" to be a single unit up through a full-scale, multi-unit plant.   

 (Picture Omitted)

PTR Research  and  Development  - The final  commercial  development  of the PTR
equipment will take a two-pronged path through (i) the fabrication of the actual
PTR module and;  (ii) a detailed  analysis of materials  resulting  from the PTR
equipment including carbon black, oils and  Petro-chemicals.  The purpose of the
Company's  testing  program is to  determine  the quality and  character  of the
materials produced by the equipment such that a market demand  determination can
be made.                                                                        

Manufacturing                                                                   

     As a part of its  development  agreement  with a national heat rod company,
the Company intends to outsource  portions of the fabrication  aspect of its PTR
technology                                                                      

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AquaFuel

     AquaFuel is produced as a result of recycling  liquid waste.  AquaFuel is a
non-fossil,  combustible  gas that results from the  introduction of an electric
arc  under  water  in  the  presence  of  carbon.   The  resulting  fuel  is  so
clean-burning  that it gives off as much carbon monoxide in 24 years as the same
engine on gasoline does in 24 minutes.                                          

     At present,  the only device able to manufacture  AquaFuel in  commercially
viable quantities is the AquaFueler 1500.                                       

     AquaFuel can be used to power  everything  from cooking  stoves to electric
generators to replacing acetylene for metal cutting.                            

     The various studies  completed until now have identified the following main
characteristics:                                                                

   1)    AquaFuel is cost  competitive  even neglecting its free production as a
         byproduct of sewage  recycling,  it has dramatically less pollutants in
         the combustion exhaust,  and can be more easily and safely produced and
stored than any other combustible gas, ;                      

   2)    In view of the above  characteristics,  AquaFuel  is clearly  among the
         best fuels available at this writing for automotive and other uses on a
         world wide basis, with particular  reference to consumer,  but also for
municipal, industrial and military applications;              

   3)    The AquaFuel  process  provides a basically  novel method for recycling
         liquid waste which produces  AquaFuel as a usable gas, water usable for
irrigation and solids usable for fertilization;               

4)   AquaFuel  is  an  excellent  gas  for  the   production   of   electricity,
     particularly  in the free form  obtained from the recycling of liquid waste
from cities and municipalities.                                       

   5)    Systematic  scientific  experimentation  and theoretical studies of the
         chemical and particulate behavior have identified a number of anomalies
         in AquaFuel which are applicable to all other gases,  thus permitting a
         new gas technology with implications and applications to the entire gas
  industry and consequentially vast, additional economic horizons.

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Phoenix 777(a)

     Phoenix 777(a) is derived through the operation of the Company's  Pyrolytic
Carbon Extraction equipment.                                                    

     Phoenix 777(a)  demonstrates  unique properties with exhaust and combustion
properties superior to natural gas.                                             

     Combustion  emits  less  carbon  dioxide  emissions  than  natural  gas and
virtually  no carbon  monoxide  (as  measured by  percentage  of  emissions)  or
unburned hydrocarbons (as measured by parts per million).                       

     It also contains a concentration of oxygen higher than 7% plus water vapor.
And, like natural gas (methane), it is lighter than air and has a distinct odor.

Measurements to date reflect in combustion, Phoenix 777(a) emits:     

CO2        7%                                                 
O2         9%                                                 
CO         0.02%                                              
the balance of the emissions contain water vapor              

     Phoenix  777(a) has also been found to  contain  approximately  800 Btu per
cubic foot.                                                                     

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Manufactured Products Division

The Company's Manufactured Products Division is the manufacturing source of:    

Balanced Oil Recovery System Lift                             
AquaFueler 1500                                               
Pyrolytic Carbon Extractor                                    
Pyrolytic Tire Reclamator                                     
Tunnel Bat Culvert Reclamation Vehicles                       
         Radio Frequency Plasma Generators and associated  proprietary  products
including:                                                                      

     The Company's  manufacturing  division incorporates state of the art custom
metal fabrication and machining.  The Company's metal  fabrication  capabilities
allow TTL to build to print products for a wide range of industrial and business
needs. With its in-house  equipment,  TTL can fabricate a wide range of material
including stainless and carbon steel,  aluminum,  copper,  titanium and incanel.
TTL's machine stop is equipped to do prototype, customer or production work. TTL
has the  latest in CNC  technology  with A Hass Hl-4 30hp  Lathe and a Haas VF-4
vertical milling center.  The equipment is efficient for production runs and the
Company also has several  vertical mills,  tooling lathes and drill presses.  In
addition,  TTL's Manufactured  Products Division offers a total range of welding
capabilities  including  inert  gas or CO2,  plasma,  laser  and  electron  beam
welding.                                                                        

1.     It is an excellent source of revenues;                                   

2.     It  provides  for  increased  efficiencies  resulting  from  distributing
overhead, operating costs and providing additional buying power;  

3.     Exposure to potential business and strategic partners;                   

4.     Real-time   control  over  quality,   timing  and   workmanship  for  all
       proprietary   products.   New  inventions  often  require   one-of-a-kind
       specialty  parts.  Given  the  unique  nature  of many  TTL  manufactured
       products,  exact attention to  specifications  is assured while retaining
flexibility mindful of changing designs and invention.            

     The  manufacturing  facility  occupies  50,000  square feet in the Pinellas
Science  Technology and Research  Center.  Formerly  occupied by Lockheed Martin
Specialty  Components as a high-tech parts provider to the Department of Energy,
the 96-acre center has been converted to a home for private technology firms and
manufacturers.                                                                  

     The following  highlights  the  Company's  Manufactured  Products  Division
market-ready product line.                                                      

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The Balanced Oil Recovery System (BORS) Lift

     The BORS Lift is a turnkey device that more economically  produces oil from
shallow,  low-volume  "stripper"  wells (10 barrels per day or less). By lifting
oil  rather  than  pumping,  the BORS Lift also  eliminates  conventional  rods,
tubing, downhole pumps or pumping units, and related maintenance costs. Standing
just 4 ft tall and 8 ft long, it is capable of producing  from a gas driven well
with a maximum fluid-balance level of 2,500 feet.                               

 (Picture Omitted)

     The operating  concept is based on a balanced  technology of extracting oil
through a collection tube and dumping it into a collection tank without bringing
up water.  Using the BORS lift,  wells that were expelling 25 barrels or more of
salt water every day are now pulling up only oil, saving on salt water disposal.
Installations of the BORS lift have demonstrated an average 387 percent increase
in oil  production  and a decrease  in per barrel  electric  costs from $3.50 to
$0.035.                                                                         

Manufacturing                                                                   

     The  Company   manufactures   the  BORS  device  in-house  except  for  the
galvanizing process. The Company purchases the computers and motors for the BORS
device from national suppliers.  Based on current equipment and facilities,  the
Company is able to manufacture 125 BORS units per month on a single-shift  basis
and can manufacture up to 500 BORS units per month on a three-shift  basis.  The
Company currently maintains storage facilities in Claremore,  Oklahoma which can
inventory BORS units pending sale and delivery.                                 

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Tunnel Bat Culvert Reclamation Vehicle

     The Tunnel Bat  technology  refers to a vehicle  specifically  designed  to
mobilize the removal of silt, debris, vegetation, soil, rock, and other types of
blockage  from inside a box  culvert.  Box  culverts  relate to a sewer or drain
running under a road or  embankment.  Invented by Dave  Richardson in 1994,  the
Tunnel Bat vehicle  represents  a solution  to the  growing  problem of removing
blockage from box culverts.  The unit is driven by a person,  moves both forward
and backward at about 3 to 5 mph with attachments are on both front and rear.   

 (Picture Omitted)

     The  Tunnel Bat  equipment  is able to turn a slow,  unpleasant  job into a
reliable,   thorough  professional  approach  to  desilting  box  culverts.  The
equipment is fully mobilized  allowing for the maximum removal of blockage while
providing a safe working  environment.  Toups Technology is unaware of any other
product on the market that is designed to address the  thousands of box culverts
throughout the United States.                                                   

Before the Tunnel Bat           After The Tunnel Bat                      

(picture omitted)                      (picture ommitted)                       

     The  Company  has  now  completed  preliminary  production  designs  and is
ordering  parts  components  necessary  to construct  the first mass  production
Tunnel Bat vehicle.  The Tunnel Bat Licensor,  Mr. David Richardson,  operates a
Tunnel Bat service  company  within the State of Florida and  operates  with two
Tunnel Bat vehicles.                                                            

     Brounley  Engineering  &  Associates.  On September  30, 1998,  the Company
acquired Brounley Associates,  Inc. in an exchange of common shares in which TTL
issued 900,000 unregistered common shares in exchange for 100% of the issued and
outstanding common shares of Brounley. The Company agreed to register 125,000 of
the 900,000 common shares issued in the  acquisition of Brounley.  Brounley is a
wholly owned subsidiary of Toups Technology.                                    

                                                 (PICTURE OMITTED)

     Brounley  Technology - Brounley is engaged in the design and manufacture of
RF (radio  frequency) and related  circuits,  particularly in the field of solid
state  power  generation.  Brounley's  integrated  and modular  design  concepts
competitively  differentiate their product line of high-powered RF generators in
small packages.  In 1993,  Brounley added  production  facilities to build a new
line of generators for Lasers and for the Plasma Etching & Sputtering  industry.
In addition to Integrated RF Generators, Brounley offers clients a full range of
services from original design to a final product.                               

                                                 (PICTURE OMITTED)

     Brounley  Product Line - Brounley offers a full line of RF Power Generators
for the laser and plasma  industries  which  includes a power  range from 50W to
10,000W.  In  addition,  Brounley  also offers solid state tuners for the plasma
industry.  Other  Brounley  products  include  power  supplies,  RF pre &  power
amplifiers and a variety of designs to support Military communications programs.

     Viperstrike RF Power Generators.  Brounley offers its own brand of RF power
generators  dubbed  Viperstrike.  The  Company's  Viperstrike  RF  Generators is
available in size from the PB300 laser  mounted  model with 300W output power up
through the 8X2 with 10,000W  output  power.  The  Viperstrike  line of RF power
generators  can be  controlled  by an existing  system or with the addition of a
Brounley digital or analog controller. The user can combine or divide the output
power from Viperstrike RF power generators using Brounley's line of RF combiners
and dividers.                                                                   

     International  Organization  for  Standardization  (ISO) 9000.  Brounley is
currently  engaged in a top to bottom quality program designed to lead to an ISO
9000  Certification  during  the  fourth  quarter,  1999.  ISO  is  a  worldwide
federation of national standards bodies, from some 90 countries. It promotes the
development  of  standardization   and  related  activities  to  facilitate  the
international   exchange  of  goods  and  services,  and  develop  intellectual,
scientific, technological and economic cooperation. The ISO consists of some 170
technical committees, 640 subcommittees, 1800 working groups and 10 ad hoc study
groups.  These  represent the  viewpoints of  manufacturers,  vendors and users,
engineering  professions,  testing laboratories,  public services,  governments,
consumer groups and research organizations in each of the 90 member countries.  

     As an ISO 9000 certified  manufacturing  facility,  Brounley's product line
achieves a heighten  level of client  receptivity  resulting  from a  verifiable
design, testing and manufacturing techniques.  The ISO 9000 is recognized as the
guidelines for selection and use of quality  management and assurance  standards
for both supplier and customer. ISO 9000 elaborates on the general philosophy of
quality systems standards, their characteristics,  the existing types, where and
when they are best used, and describes what elements  quality  assurance  models
should   incorporate.   It  also  deals  with  demonstration  and  documentation
requirements, pre-contract assessment and contract preparation.                 

     Brounley  Research and Development - Brounley's  engineering  department is
working to further  reduce the overall size of the  Company's  generators  while
preserving  and  increasing  the  power.  Brounley  is also  engaged in a Plasma
generator  design  which is slated  for  market  introduction  during the fourth
quarter,  1999  through  the  first  quarter,  2000.  As a part  of its  overall
development,  Brounley  is  evaluating  all aspects of its  operations  so as to
become an ISO 9000 certified manufacturing facility by the fourth quarter, 1999.

     InterSource  Health  Care.  On December  18,  1998,  the  Company  acquired
two-year  old  InterSource  Healthcare,  Inc. in an  exchange  of common  shares
agreement in which the Company issued  1,203,241  unregistered  common shares in
exchange for 100% of the issued and  outstanding  common shares of  InterSource.
The Company agreed to register  225,000 of the 1,203,241 common shares issued in
the course of the acquisition. InterSource is a wholly owned subsidiary of Toups
Technology                                                                      

                                                 (PICTURE OMITTED)

     InterSource Business - InterSource seeks to match buyers and sellers of new
and used  (refurbished)  medical equipment and consumables  through its internet
site  located at  www.intersourcenet.com.  For the seller of new or  refurbished
medical equipment and/or consumables,  InterSource offers a secure internet site
coupled with a  professionally  staffed  in-house sales force.  For the buyer of
medical  equipment and/or  consumables,  InterSource  offers a one-stop means to
comparatively shop through the convenience of the internet.                     

     InterSource  Marketing -  InterSource  offers its  equipment  and  products
through a secure  internet  home page and  through  an  in-house,  direct  sales
program.  The staff of  InterSource's  direct sales program  includes a licensed
medical  doctor,  a registered  pharmacist,  a  registered  nurse and the former
principal of Alpha Laboratories Corporation.                                    

     An  InterSource  Transaction - Contact is made with a prospective  customer
that  became  aware  of  available  equipment  and/or  products  either  through
InterSource's  internet  home-page or from direct  selling  efforts.  A detailed
investigation  is done to assure the supply of the proper  product at the proper
cost to meet an individual need of the customer.  Once  completed,  the customer
places an order.  InterSource  then  procures the needed  item(s),  receives and
inspects the  products,  and ships direct to the  customer.  Payment  terms vary
dependant  of the  product(s)  ordered,  however,  95% of the  payments are made
between  time of order and time of  delivery.  The other 5% are net 30-day terms
for  smaller  orders  of  consumable   products  to  credit  worthy   customers.
InterSource maintains a minimal inventory of items; most items are purchased for
direct  resale after an actual order is received  from a customer.  InterSource,
under the terms of a wholesale  broker  license can only broker  pharmaceuticals
and cannot  take  possession  of same.  All  pharmaceutical  sales are done on a
letter of credit basis payable at time of delivery.                             

     InterSource  Marketplace - The Company  estimates the  marketplace  for its
InterSource   division  is  the  general   medical   equipment   marketplace  of
approximately $100 billion annually.  InterSource also operates in a limited way
in the United States pharmaceutical  marketplace.  Both the new and used medical
equipment and pharmaceutical  industries are highly competitive.  The Company is
unaware  of other  entities  engaged in a  business  purpose  similar to that of
InterSource.  However,  given the size and scope of the  medical  industry,  the
Company  expects to encounter  competition  more than likely from companies with
greater financial and marketing resources than TTL.                             

Municipal Solid Waste                                                           

     The municipal  solid waste (MSW) industry has four  components:  recycling,
composting,  landfilling,  and  combustion.  The U.S.  Environmental  Protection
Agency  defines MSW to include  durable goods,  containers  and packaging,  food
wastes,  yard  wastes,  and  miscellaneous  inorganic  wastes from  residential,
commercial, institutional, and industrial sources. It excludes industrial waste,
agricultural  waste,  sewage  sludge,  and all  categories of hazardous  wastes,
including  batteries and medical  wastes.  More than 209 million tons of MSW was
generated in 1994.  Paper and  paperboard  accounted for 81.3 million tons (38.9
percent)  of the total  waste  stream,  yard  wastes  30.6  million  tons  (14.6
percent),  plastics  19.8 million tons (9.5  percent),  metals 15.8 million tons
(7.6  percent),  food 14.1 million tons (6.7  percent),  glass 13.3 million tons
(6.3 percent), and other 34.2 million tons (16.4 percent).                      

Type of Process and Capacity - Competitive answers to MSW                       

     Generally,  WTE facilities can be divided into two process types: mass burn
and refuse-derived fuel (RDF). Mass burn facilities process raw waste; it is not
shredded,  sized,  or  separated  before  combustion.  Very large  items such as
refrigerators  or stoves and  batteries/hazardous  waste  materials  are removed
before combustion. Noncombustible materials such as metals can be removed before
or after  combustion,  but they are usually separated from the ash with magnetic
separators.  The waste is usually deposited in a large pit and moved to furnaces
with overhead cranes.                                                           

     Combusting  waste usually reduces its volume by  approximately  90 percent.
The  remaining  ash is  buried  in  landfills.  The  ash  is  divided  into  two
categories: bottom ash and fly ash. Bottom ash is deposited at the bottom of the
grate or  furnace.  Fly ash is  composed  of small  particles  that rise  during
combustion  and are  removed  from  the  flue  gases  with  fabric  filters  and
scrubbers.   Fly  ash  is  usually   considered  to  be  the  more   significant
environmental problem.                                                          

     Waste is  preprocessed  at RDF  facilities.  Noncombustible  materials  are
removed,  increasing  the  energy  value  of  the  fuel.  The  extent  to  which
noncombustible  materials are removed  varies.  Most systems  remove metals with
magnetic  separators;  glass,  grit, and sand may be removed through  screening.
Some  systems  utilize air  classifiers,  trommel  screens,  or rotary  drums to
further refine the waste.                                                       

     Modular  facilities  are  small  mass  burn  facilities;  they are  usually
prefabricated  and shipped  fully  assembled  or in modules to the  construction
site. Mass burn waterwall facilities are usually custom-designed and constructed
at the  site.  Waterwall  furnaces  contain  closely  spaced  steel  tubes  that
circulate water through the sides of the combustion chamber. The energy from the
burning waste heats the water and produces steam. Some waterwall facilities also
use  rotary  combustors  to  rotate  the  waste,   resulting  in  more  complete
combustion.                                                                     

     The overall majority of WTE facilities  employ mass burn processes.  Of the
101 facilities reporting the type of process employed in 1996, 86 were mass burn
facilities  and  15  were  RDF  facilities.  Two  of the  mass  burn  facilities
codisposed  their waste with sludge.  Although only 22 percent of the facilities
were of the smaller  modular type, 6 of the 13  facilities  located in the North
Central region were modular . Over half of the facilities were of the mass burn,
waterwall  type.  More than 40  percent  of the  facilities  are  located in the
Northeast and another one-third in the South. Only 22 percent are located in the
West and North Central regions, where landfill space is relatively less scarce. 

     The average  capacity of U.S. WTE  facilities is almost 1,000 tons per day.
RDF  facilities,  on  average,  have more than twice the  capacity  of mass burn
facilities  (almost 1,900 tons per day versus 850 tons per day).  The facilities
in the Northeast and South regions have an average  capacity  greater than 1,000
tons per day. The average  capacity of the  facilities  in the North Central and
West regions is between 700 and 800 tons per day (Table 11). Modular  facilities
are by far the smallest, ranging from an average of 89 tons per day in the North
Central region to 256 tons per day in the Northeast.                            

Primary Energy Form                                                             

     Over 80 percent of the 102 facilities produce electricity. Twenty of the 84
facilities that produce electricity cogenerate steam and electricity. Only 18 of
the facilities  produce just steam; 12 of those facilities are modular.  None of
the RDF  facilities  produce  steam  only,  compared  with more than half of the
modular facilities, most of which are older facilities.                         

     In recent years most of the  installations  have generated  electric power.
The guaranteed  market for electricity  under PURPA minimizes the financial risk
for  facilities   generating   electricity.   This  condition  could  change  if
electricity  prices drop as a result of  restructuring  in the electric  utility
market.                                                                         

Air Pollution Control Equipment                                                 

     Various  types and designs of air pollution  control  equipment are used by
most WTE facilities.  Dry scrubbers and baghouse filters used in combination are
more efficient than most electrostatic  precipitators in removing acid gases and
particulates from stack gases. Nitrogen oxide and mercury emissions must also be
controlled in most regions of the United States.  Modular  facilities  that have
exclusively used after-burn or two-chamber combustion systems can no longer rely
on those systems for adequate  pollution  prevention in many parts of the United
States. As a result, some have been retrofitted.  Others have permanently closed
down.                                                                           

Participants                                                                    

Waste-to-Energy Facilities                                                      

     As of the fall of 1996,  there were 102 WTE facilities  marketing energy in
the United States. The number of facilities has declined by more than 10 percent
during the past few years.  Most of the WTE  facilities in the United States are
located in the East,  where landfill space is the most scarce.  WTE capacity has
declined  by  approximately  2  percent  over the last year or so,  from  almost
101,000 tons per day to approximately 99,000 tons per day.                      

     Almost half (48) of the WTE  facilities  in the United States are privately
owned;  3 are joint  public/private  ventures;  and the  remainder  are publicly
owned.  Twenty-five of the facilities owned by the public sector are operated by
private sector.  Thus, 70 percent of all U.S. WTE facilities are operated by the
private sector.                                                                 

Trends in Municipal Solid Waste Generation                                      

     The  generation of MSW has increased  from 88 million tons in 1960 to 209.1
million tons in 1994.  During that time, per capita  generation of MSW increased
from 2.7 pounds per person per day to 4.4 pounds per person per day. Per capital
generation  is  expected  to  remain  constant  through  2000,  when  total  MSW
generation is expected to 223 million tons.                                     

     In 1960,  approximately  30 percent (27 million  tons) of MSW generated was
incinerated,  most without energy recovery or air pollution controls. During the
next two decades, combustion declined steadily, to 13.7 million tons by 1980, as
old incinerators were closed. Less than 10 percent of the total MSW generated in
1980 was combusted. With the enactment of the Public Utility Regulatory Policies
Act of 1978, (PURPA) and the emergence of a guaranteed energy market, combustion
of MSW increased to 31.9 million tons or 16 percent of  generation by 1990.  All
of the major new  waste-to-energy  facilities  are designed  with air  pollution
controls and have energy recovery.  During the 1990s, the absolute amount of MSW
combusted and converted into energy remained fairly constant, although the share
declined slightly.  By the year 2000, the amount of MSW combusted is expected to
reach 34 million tons.                                                          

PCE differentiates from alternative MSW solutions                               

     At  present,  approximately  57% of  Municipal  Solid  Waste is  placed  in
landfills  while  16% is  used  in  combustion  and  27% is  recovered.  What is
important to note here is that of the  estimated 16% of MSW which burned or used
in  combustion,  produces  two  grades of ash  which  must then be buried at the
landfill.                                                                       

 (GRAPHIC OMITTED)

     The reasons for the  predominate  use of landfills is  understandable  when
considering the trend in tipping fees. Note the tipping fees for waste-to-energy
facilities  have  grown to in excess of $62 per ton while the  tipping  fees for
landfill  disposal of MSW have remained constant since 1994 at approximately $31
per ton.                                                                        

 (GRAPHIC OMITTED)

     The most  practical  entry into the MSW  marketplace,  as it relates to the
Company's  Environmental  Solution as delivered through TTL's Village Concept is
by focusing on the use of Landfill for municipal solid waste. This becomes clear
when  considering the large market share currently held by Landfill and the many
negative factors which accompany this type of MSW disposal.                     

 (GRAPHIC OMITTED)

     MSW  contains  significant  portions of organic  materials  that  produce a
variety of gaseous  products  when dumped,  compacted  and covered in landfills.
Anaerobic  bacteria  thrive  on the  oxygen-free  environment  resulting  in the
degradation  of the organic  materials and the  production  of primarily  carbon
dioxide  and  methane.  Carbon  dioxide  is likely to leach out of the  landfill
because  it is  soluble  in water.  Methane,  on the other  hand,  which is less
soluble  in water  and  lighter  than air,  its  likely  to  migrate  out of the
landfill. Of interesting note is a type of gas called Landfill gas or LFG.      

     In the United States,  there are 133 facilities  that convert  landfill gas
into energy at landfill sites that are either  operational  or temporarily  shut
down. The LFG-to-energy  facilities appear to be evenly  distributed  throughout
the regions of the country. The West region has the largest number,  followed by
the Northeast,  North Central and South.  Almost  on-third of all the facilities
are located in California and New York has the second largest number.  The first
LFG-to-energy  facilities began operations in 1979 and  approximately 70 percent
of the 133 facilities that are in existence  today began operation  during the 7
year period 1984 to 1990.                                                       

     To collect LFG,  wells are usually  drilled 30 to 100 feet into a landfill.
Key  characteristics  of a landfill  that  determine the amount of gas available
include the type and compactness of the refuse buried, the length of time is has
been burned and the amount of rainfall in the area.                             

     Historically,  LFG has been  collected  and flared at sites  because it was
uneconomical to convert to energy.  Energy application include the use of low to
medium Btu gas to generate  electricity or as a boiler fuel. The LFG can also be
upgraded for use in natural gas  pipelines and small amounts of LFG are used for
soil remediation or synthetic fuels.                                            

     Most  LFG-to-energy  facilities  create  medium-Btu  gas by  filtering  out
particulate  matter and removing  water  vapor.  This gas has an energy value of
approximately 500 Btu per cubic foot. Pipeline-quality gas (100 percent methane)
can be created by further  refinement  to remove most of the carbon  dioxide and
other  contaminants.  However,  in recent  years the  percentage  of  facilities
producing  pipeline-quality  gas has  declined  as a result of low  natural  gas
prices.                                                                         

     Approximately  75 percent  of the  LFG-to-energy  facilities  in the United
States produce  electricity.  Prices for the sale of electricity from LFG plants
in 1994 were  reported for 82 facilities  (existing  and  planned).  The average
prices (in cent per  kilowatthour)  were 6.81,  5,76, 4.98 and 4.39 in the West,
Northeast, South and North Central regions, respectively. Many of the facilities
receive peak and off-peak rates.                                                

MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

Results of Operations for the Year Ended December 31, 1998            

     The following  discussion and analysis  should be read in conjunction  with
the financial  statements  and related  notes,  as well as the discussion in the
Form 10-KSB,  which  provide  additional  information  concerning  the Company's
financial activities and condition.                                             

Overview:                                                                       

     Toups Technology  Licensing,  Incorporated ("TTL" or "The Company) business
purpose is commercializing  late-stage technologies,  which are acquired through
license agreements and acquisitions. The Company's technologies and acquisitions
to date are in the energy, environmental, natural resource and healthcare market
segments.  At the end of 1998, the Company was comprised of nine divisions,  six
of which earned revenues during 1998.                                           

Results of Operations                                                           

Fiscal Year Ended December 31, 1998,  Compared to Fiscal Year Ended December 31,
1997                                                                            

     Sales for 1998 were  $3,132,001,  an  increase  of  $1,935,832  or 62% from
$1,196,169  in 1997.  The  increase in revenues was  attributable  to the market
launch and acceptance of the Company's BORS Lift units during the Fourth Quarter
of 1998,  as well as sales growth in the TTL  Manufacturing  division,  formerly
Advanced   Micro-Welding,   Inc.   ("AMW"),   and  Brounley   Associates,   Inc.
("Brounley"),  a  wholly-owned  subsidiary  of TTL.  AMW and  Brounley  were two
acquisitions  accounted  for as a pooling of  interest  by TTL during  April and
October 1998, respectively. Since TTL did not commence operations until November
1997,  figures for the year ended  December 31,  1997,  reflect less than a full
year's  transactions  (subsidiaries  accounted  for by the  pooling of  interest
method  reflect the full year's  transactions  for the year ended  December  31,
1997).  The  Company's  third   acquisition,   InterSource   Health  Care,  Inc.
("InterSource"),  was accounted for by the purchase  method of accounting  for a
business combination.  Accordingly,  the accompanying  statements do not reflect
revenues or expenses  related to the  acquisition  prior to the closing  date of
November 30, 1998.                                                              

     Gross profit for 1998 was $1,147,071 or 37% of revenues,  which was up from
$373,799  or 31% of  revenues  for  1997.  The  increase  in gross  profit  as a
percentage  of revenues in 1998 was the result the strong  profit  margin of the
in-house manufactured BORS Lift.                                                

     The  Company's  selling,  general  and  administrative  (SG&A)  expenses of
$3,276,932  were  comprised  of  development  expenses,   salaries,   consulting
services,  and other operating costs in 1998, up from $315,893 during 1997. As a
percentage of revenues, SG&A increased to 105% in 1998 up from 26% in 1997. SG&A
expenses  increased  in 1998 to  support  further  technology  development,  new
product introductions and future business expansion. In 1998, $728,351 or 33% of
SG&A expenses were non-cash  expenses paid for through  capital stock issued for
services to further the Company's technologies.                                 

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     The Company incurred increased  personnel expenses and development costs to
build its infrastructure,  assembling a team of engineers,  scientists and other
professionals,  and prepare its  technologies  for market  applications.  During
1998,  the  Company  completed  its  independent  testing  for  AquaFuel  market
applications  and  scalability  results  including  its  first   production-unit
contract for the Dominican  Republic.  In addition,  the Company completed field
tests of BORS Lifts and began  full-scale  production  placing  100 units in the
field,  developed  applications  for  its  tire  recycling  process  technology,
completed  design for and began  production of Tunnel-Bat  units,  completed the
acquisition of AMW,  Brounley and  InterSource  and furthered  discussions  with
potential acquisition candidates,  as well as candidates for technology licenses
that fit with the Company's business purpose.                                   

     As a result of these  activities,  the Company had a 1998 operating loss of
$2,129,861, a decrease from an operating profit of $57,906 for 1997.            

     Net interest expense for 1998 was $14,373,  up from $664 in 1997.  Interest
expense related to borrowings of wholly-owned subsidiaries prior to acquisition.

Liquidity and Capital Resources                                                 

     Net cash used by operating  activities of $2,422,529  related  primarily to
the  Company's  operating  loss and the  increase  in  accounts  receivable  and
inventories  from BORS lifts sales in the fourth  quarter of 1998.  The Company,
however,  had a net  working  capital  surplus  of  $1,545,580  at year end,  an
increase of $1,331,762  from December 31, 1997. The increase in working  capital
was principally the result of an increase in accounts receivable  resulting from
Fourth Quarter BORS Lift sales and financing  activities through the issuance of
$3.8 million in common stock through private equity  offerings.  At December 31,
1998 the Company had $5,312,840 in assets and $3,360,798 in stockholders' equity
up from $562,054 and $256,484 respectively at December 31, 1997.                

     As of December  31, 1998,  the Company had $49,574  drawn on a $50,000 bank
line  of  credit  for  InterSource  and  $388,237  in  capital  leases  for  TTL
Manufacturing. The Company had no other bank financing or other debt obligations
outstanding other than trade payables,  accrued expenses, and other expenses due
during the normal course of business.                                           

     Through the  acquisitions of AMW,  Brounley and InterSource the Company has
significant production  capabilities available without the requirement for large
plant and equipment capital expenditures.  The InterSource  acquisition added in
excess of $2 million in fair market value of equipment purchased and refurbished
by  InterSource  under its  facility  lease.  The  equipment  remained  from the
facility's former tenant, a large defense  contractor,  and included  computers,
milling  equipment,  lathes,  shelving  and  storage  units,  precision  welding
equipment and other  production  machinery.  InterSource held this equipment for
resale  but  TTL  has  chosen  to  maximize  the  equipment   through   internal
utilization.  This equipment  combined with AMW's,  Brounley's and InterSource's
technical  resources  will  allow  TTL to  fully  utilize  its  development  and
production capabilities 1999.                                                   

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     The Company  has also  completed  agreements  for two  financing  offerings
subsequent to year end for a total of $2,250,000.  The financings are structured
as $1,500,000  subordinated  convertible Note and $750,000 convertible preferred
stock.  The proceeds of the sale of these  offerings  are  available for capital
expenditures  related to  technology  development  costs,  future  acquisitions,
working capital, and general corporate purposes.                                

     The Company believes its existing cash,  together with projected cash flows
from operations and the availability of future equity and/or offerings,  will be
sufficient to meet the Company's cash requirements in 1999.                     

The Company  recognizes  revenues  under the accrual basis of  accounting  where
revenues are recognized when earned. Revenues are considered earned when product
has been shipped. The Company accounts for all of its operating  subsidiaries in
this manner.                                                                    

At fiscal year-end 12-31-98,  the Company had $1,768,999 in accounts  receivable
which  represents 56% of total sales at that time. The accounts  receivable were
derived  primarily  from sales of our Balanced  Oil Recovery  System Lift in the
fourth quarter of 1998. For certain BORS  customers,  the Company carries 90-day
terms. The Company  considers all of its accounts  receivable to be collectible.
However,  the Company has recorded a $79,237 write-off for doubtful accounts for
the year  ending  December  31,  1998.  The  Company  does not  anticipate  this
condition  to  continue  in  future  years for two  reasons:  (i) the BORS was a
development  product for the first  three  quarters  of 1998.  For that  reason,
meaningful  sales did not begin  until the  fourth  quarter  and (ii) 1998 was a
development-stage  year for the Company and we are already  seeing a maturing of
our  divisions  and expect our accounts  receivable to reflect this balance as a
percentage of total sales for this year.                                        

The Company did not consider  segment  reporting to be either cost  effective or
practical at year end 1998.  Up to this point,  the Company has not used segment
reporting for internal use. At the close of 1998, the Company's "divisions" were
aggregated  with  revenues  primarily  derived  from  manufacturing  operations.
Further,  those "division" which out of this realm (InterSource) were not a part
of the Company until the end of the year. The Company intends to use the segment
accounting  approach  for its annual  audit for the period  ending  December 31,
1999.                                                                           

As a part of its  joint-venture  project,  the  Company  is  obligated  to issue
2,000,000   of   its   unregistered   common   stock   to   the   President   of
AquaFuel-Dominicana and such shares shall become fully vested upon formalization
and initial  payments  relating to the Company's  joint-venture  agreement.  The
Company  anticipates these shares will all become fully vested during the course
of 1999.  When said shares  become fully  vested,  the Company shall account for
such shares  strictly  according to their fair market value at date of issuance.
"Fair market value" is an amount equal to 100% of the cash-price received by the
Company for any stock sales or 100% of the  average  closing  "bid" price of the
Company's shares for the thirty-days  immediately preceding the issuance/vesting
of such shares.                                                                 

     As a part of the Company's joint-venture, TTL is now a 9% owner of a Public
Urban Development (PUD) project within the Dominican  Republic.  Key elements of
the Company's PUD project are:                                                  

Location:                           Rancho La Regina                            

Purpose:                            To build to  process  all  types of  organic
                                    material  including,  but  not  limited  to,
                                    tires, waste food and packaging,  waste oils
                                    (fossil  and  vegetable),   paper,  plastic,
                                    leaves and other similar waste streams.  The
                                    plant must be able to  generate an output of
                                    approximately   15   mega   watts   (MW)  of
                                    electricity   from  gas   produced   in  the
                                    pyrolysis  and 160  tons  per day of  carbon
black.  

Equipment:                          400 tons per day pyrolytic carbon extraction
plant   

Timing First prefabricated home assemblies to begin in August, 1999.            

Status of Agreement:                Plant Quote dated June 16, 1999 - issued and
accepted
                                    PUD  Agreement  by and  between  Mr.  Isaias
                                    Arbaje, CEO of Arbaje  Agroindustrial SA and
                                    Vice  President of AquaFuel  Dominicana  and
                                    Newton  Equities  Dominicana,  S.A.,  by its
                                    President Joseph J. Territo was executed May
13, 1999

As a part of its joint-venture  agreement,  the Company will negotiate a license
agreement  for  the  exclusive  rights  to  commercialize  AquaFuel  in  certain
geographic  areas.  At this time,  the  Company  has not  negotiated  any of the
specific  terms  to  such an  exclusivity  and  cannot  estimate  what,  if any,
additional obligations would be incurred by either party.                       

     During the  course of the  Company's  development  year,  1998,  TTL issued
unregistered shares of its stock to attract and retain key employees, to acquire
various license  agreements,  to make acquisitions and for other,  developmental
needs. At the mid-year point, the Company's  financial  statements  reflected an
expense  equal to par value or $0.001 per share.  At year end,  the  Company had
issued a total of 5,602,697  which were  reflected as an expense  equal to $0.13
per share or a total  charge to earnings of  $728,351.  During  May,  1999,  the
Securities and Exchange  Commission advised the Company that these shares should
have been recorded at a price  approximately  equal to the then cash-sales price
of the  Company's  securities  or an  average  price of $0.639  per share  which
represents the average  cash-price  paid per share of $0.71 minus a 10% discount
for lack of liquidity.  This finding by the Securities  and Exchange  Commission
therefore required to the Company to restate its annual financial  statements to
reflect a total charge to earnings of  $3,580,123  or an increase of  $2,851,772
over the previously  reported  charge to earnings of $728,351.  This charge is a
non-cash compensation expense under General and Administrative Expense.         

     The effect of this non-cash,  one-time  event  increases the Company's 1998
losses  from  ($2,187,994)  to  ($5,039,766).  As a result of this  action,  all
persons receiving a part of the 5,602,697 shares shall be issued appropriate tax
forms  relating  to the value of the shares  which is  considered  income to the
individual.                                                                     

     Further,  the Balance  Sheet  impact of the non-cash  compensation  expense
increases  Additional  Paid-In Capital  $2,851,772 from $5,484,950 to $8,336,722
and decreases  Retained  Earnings  (Deficit)  $2,851,772  from  ($2,146,369)  to
($4,998,141).  The cumulative effect to the Balance Sheet  Stockholders'  Equity
section is $0.                                                                  

     Of the 5,602,697 unregistered shares, 1,950,000 were issued to Officers and
Directors in lieu of compensation. In light of the higher valuation and inherent
tax consequences, the Company's officers and Directors have opted to convert the
issuance of these  shares to treasury  shares in exchange  for an option for the
purchase of these 1,950,000  unregistered  shares at the rate cited as the "fair
market  value" or $0.639  per share.  The option  rights  will  provide  for the
exercise of these  options  anytime  during a three-year  period  following  the
granting of the option, September 1, 1998 - September 1, 2001.                  

     Accordingly,  had the Company issued options versus the shares, the Company
would have been required to record the issuance of only 3,652,697  shares at the
rate of  $0.639  per share or a total  charge  to  earnings  of  $2,334,073,  an
increase of $1,605,722 above the previously  reported $728,351.  Therefore,  had
the Company been allowed to value the issuance of options versus the issuance of
shares,  total  losses for the  year-ending  December  31,  1998 would have been
($3,793,716)  or ($0.31) per share on a weighted  average  basis or ($0.172) per
share based on the number of shares outstanding at December 31, 1998.           

     As a result of the  conversion  of the  shares  issued to  options  for the
purchase of shares,  the company will realize a gain  corresponding  to the loss
reported at year end 1998 through the recapture of the  compensation  expense of
$1,246,050 in 1999 which is attributed to the 1,950,000 shares described above. 

Forward Looking Statements                                                      

     This  Management's  Discussion  and  Analysis of  Financial  Condition  and
Results of Operations contains certain  "forward-looking  statements" as defined
in the Private  Securities  Litigation  Reform Act of 1995.  Such statements are
based on management's  estimates,  assumptions,  and projections.  Major factors
that could cause results to differ  materially from those expected by management
include,  but are not  limited  to: the timing  and nature of  independent  test
results;  the nature of  changes in laws and  regulations  that  govern  various
aspects of the Company's business;  retention and productivity of key employees;
the  availability  of acquisition  candidates and  proprietary  technologies  at
purchase  prices the Company  believes to be a fair market;  the  direction  and
success of competitors; management retention; and unanticipated market changes. 

Year 2000 Compliance                                                            

     The Company has completed a  prelimanary  assessment  concerning  Year 2000
issues and has determined that its  technologies,  manufacturing  factilites and
internal  operatins  will not be  impacted  or  affected.  The  Company  made no
material  expenditures  in 1998 with regard to Year 2000 issues and  anticipates
that  expenditures  in 1999  will have no  material  effect  to its  results  of
operations  and capital  resources.  In addition,  the Company's  stock transfer
agent,  Continental  Stock Transfer % Trust  Company,  has been certified as Y2K
compliant                                                                       

DESCRIPTION OF PROPERTY                                                         

     The   Company's    headquarters   and   manufacturing   facility   occupies
approximately  50,000  (fifty-thousand)  square-feet within the 96-acre Pinellas
Science  Technology and Research  Center ("STAR  Center")  located at 7887 Bryan
Diary Road, Largo, Florida.                                                     

     Formerly used by Lockheed Martin Specialty  Components,  Inc. as a provider
for the Department of Energy ("DOE"),  the STAR Center has been converted into a
technology incubator for engineering firms and specialty manufacturers. The STAR
Center is a 739,873 square-foot complex,  comprised of 17 separate buildings;  a
150,000 square-foot,  16-foot high bay manufacturing area, and approximately 100
separate areas, including laboratories, production space and offices.           

     The Company also maintains a 10,000 square-foot  facility wherein is housed
its   AquaFuel(a)   division.   The  Company  also  maintains  an   engineering,
installation  and field  service  office in  Claremore,  Oklahoma and a national
sales office in Garden City, Kansas relating to its BORS device.                

     The Company  does not invest in real estate or real estate  mortgages,  nor
does the Company invest in the  securities of or interests in persons  primarily
engaged in real estate activities.                                              

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                                  

     Mr. Michael Toups, who serves as the Company's Chief Financial  Officer and
as a Director,  is the son of the Company's President and Chairman of the Board,
Leon H. Toups.                                                                  

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS                        

     Since activation of operations in November,  1997, the Company has provided
for its venture funding  requirements  through sales of its securities at prices
ranging from $0.62 to $1.25 per share.  As a result of these sales,  the Company
issued  securities  to various  persons and firms and all such  securities  were
acquired  directly  from the Company in  transactions  not  involving any public
offering. All securities were sold in reliance on Section 4(2) of the Securities
Act of 1933. All purchasers  executed a Subscription  Agreement  indicating they
have such knowledge and experience in financial and business matters that either
alone or with a purchasers representative,  are capable of evaluating the merits
and risks of the investment.                                                    

     The  Company  has not relied on an  underwriter  or  similar  person in the
course of selling its securities or the subsequent trading thereof.  The Company
has made use of its  securities  counsel,  independent  auditor and  independent
transfer agent as needed. As a part of its Private Placement  Memorandum used by
the  Company  for the  initial  sale of its  securities  during  late 1997,  TTL
undertook  certain  specific steps  necessary to effect a public trading market.
The  following  relates to the tasks  completed,  which relate to the  Company's
undertakings assured in the initial sales of its securities.                    

EXECUTIVE COMPENSATION                                                          

     The following table depicts all-plan and non-plan  compensation awarded to,
earned by or paid to the named  executive  officer of the Company for the period
indicated:                                                                      

                            Annual         Long Term
                           Compensation     Compensation
(a)                   (b)      (c)       (d)       (e)          
                                          Restricted
                                                     Stock       Total
Name and Principal                   Salary     Bonus    award(s)  Compensation 
Position                    Year      ($)        ($)       ($)         ($)      
Leon H. Toups               1998    $63,666       $0       $0        $63,666    
President                                                                       
Chief Executive Officer                                                         

Mark Clancy                 1998    $62,997       $0       $0        $62,997    
Executive Vice President                                                        
Corporate Secretary                                                             

Michael P. Toups            1998    $61,958        $0       $0       $61,958    
Vice President, Finance                                                         
Chief Financial Officer                                                         

Jerry Kammerer              1998(f) $48,000        $0        $0      $48,000    

(a)  All named  executive  Officers have served in their  respective  capacities
     since  formation  of the Company  during July 1997 except Mr.  Kammerer who
served through August, 1998.                                          
(b)  The  Company was  incorporated  during  July 1997.  The  Company  activated
     operations  on  November  1,  1997  and all  three  current  officers  were
     compensated  at the rate of $3,000 per month for the months of November and
December, 1997.                                                       
(c)  Any increase in Officer  compensation  would be  predicated  on  prevailing
     industry standards and the existing financial situation of the Company. The
     Board of Directors  may  authorize an increase in the  compensation  of the
Company's executive officers without a vote of Shareholders.          
(d)  The Company did not make any bonus cash payments to its executive  officers
     since  inception  except a Christmas  bonus equal to one weeks salary which
     was also given to all of the Company's employees. However, the Company may,
in the future, develop programs which may include bonus payments.     
(e)  During the course of 1998, the Company  granted options for the purchase of
     650,000  unregistered  common  shares  to each of its  then  Officers.  The
     Company's three Officers also received TTL unregistered shares as a part of
the acquisition of InterSource Health Care.                           
(f)  Mr.  Kammerer  served as a Director and as the  Company's  Vice  President,
Business Development from January through August, 1998.               

The Company does not compensate its Directors for their participation.

Part F/S

lNDEPENDENT AUDITORS' REPORT

Board of Directors and Stockholders                                             
Toups Technology Licensing, lncorporated                                        
(A Development Stage Company)                                                   
Largo, Florida                                                                  

     We have  audied  the  accompanying  consolidated  balance  sheets  of Toups
Technolgy Licensing,  Incorporated and subsidiaries (the Company) as of December
31,  1998 and  1997,  and the  related  consolidated  statemsnf  of  operations,
stockholders'  equity and cash flows for the years 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 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 audt also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as weII as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.          

     In our opinion,  the consolidated  financial  statements  referred to above
present fairly, in all material respects, the consolidated financial position of
Toups  Technology  Licensing,  Incorporated  and subsidiaries as of December 31,
1998 and 1997, and the results of their  operations and their cash flows for the
years then ended in conformity with generally accepted accounting principals.   

February 2, 1999 (except for notes 18, 19, 20                                   
and 21 as to which the date is June 21, 1999)                               

Harper,  Van Scoik & Company,  L. L. P.                                         

A WORLDWlDE ORGANIZATION OF ACCOUNTlNG FlRMS AND BUSlNESS ADVlSORS              

TOUPS TECHNOLOGY LICENSING, INC.
AND SUBSIDIARIES

 CONSOLIDATED BALANCE SHEETS
December 31, 1998 and 1997

                                                          1997
                                                     1998   (Note 2)
                                                      ----    --------

ASSETS

Current assets:                                                                 
Cash                                                $772,080    $104,580  
Accounts receivalbe - trade (net of allowance                             
of $74,237 and $5,000, respectively)             1,768,999      88,384
Inventory                                            542,555     237,682  
Prepaid royalties                                     89,000      11,000  
Other current assets                                   2,776         800  
                                               -----------    --------

  Total current assets                           3,175,510     442,446
                                               -----------     -------

Property, plant and equipment:                                                  
Property, plant and equipment                      2,170,072     174,488  
Less:  Accumulated depreciation and amortization     152,159      65,775  
                                                ----------    --------

  Net property, plant and equipment              2,017,913     107,713
                                                ----------    --------

Other assets:                                                                   
Security deposits                                     31,932       5,000  
Related party receivables                             87,485           0  
Other assets                                               -       5,895  
                                                  --------      ------

  Total other assets                               119,417      10,895
                                                 ---------      --------
   Total assets                                  $5,312,840     $562,054
                                                 ==========     ========

See Auditor's Report and accompanying financial statements and Notes thereto

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TOUPS TECHNOLOGY LICENSING, INC.
AND SUBSIDIARIES

 CONSOLIDATED BALANCE SHEETS
December 31, 1998 and 1997

                                                                      1997
                                                               1998   (Note 2)
                                                              ----   -------

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities                                                             
  Accounts payable and accrued expenses                   $1,391,826  $109,748
Royalties payable                                           42,843        
  Income taxes payable                                        40,562         -
  Deposits                                                    39,000    73,540
  Current portion of notes payable - stockholder                   -    15,325
  Current poriton of capital lease obligations                66,125    24,324
  Line of credit                                              49,574         -
  Other current liabilities                                        -     5,691
                                                            ------   ---------

    Total current liabilities                              1,629,930   228,628
                                                         -----------   -------

Long-term debt:                                                                 
  Capital lease obligation, net of current portion           322,112    49,452
  Notes payable - stockholder, less current portion                -    27,490
                                                            --------   -------

    Total long-term debt                                     322,112    76,942
                                                           ---------  --------

    Total liabilities                                      1,952,042   305,570
                                                          ----------   -------

Stockholders' equity:                                                           
  Capital stock                                               22,217    10,030
  Additional paid-in capital                               8,336,722   197,237
  Retained earnings (deficit)                             (4,998,141    49,217
                                                          -----------   ------

    Total stockholders' equity                             3,360,798   256,484
                                                          ----------   -------

    Total liabilities and stockholders' equity            $5,312,840  $562,054
                                                         ===========  ========

See Auditor's Report and accompanying financial statements and Notes thereto

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TOUPS TECHNOLOGY LICENSING, INC.
AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF OPERATIONS
  For the years ended December 31, 1998 and 1997

                                                              1997
                                                  1998        (Note 2)
                                                  ----        --------

Revenue                                              $3,132,001      $1,196,169 

Cost of goods sold                                    1,984,930         822,370 
                                                    -----------     ----------

Gross profit                                           1,147,071        373,799 

General and administrative expenses                    6,128,704        315,893 
                                                      ----------     ---------

Total operating earnings (deficit)                    (4,981,633)        57,906 

Other income (expense):                                                         
Interest income                                            6,861            543 
Interest expense                                         (21,234)       (1,207) 
Other income                                                   -           155  
Other expense                                                  -          (325) 
                                                      -----------     --------

Total other income (expenses)                             (14,373)        (834) 
                                                       ----------    ---------

Earnings (deficit) before income taxes                  (4,996,006)      57,072 

Income taxes                                                43,760        7,971 
                                                        ----------   ---------

Net income (loss)                                      $(5,039,766)    $ 49,101 
                                                      ===========     ========

Weighted average number of                                                      
shares outstanding                                      12,167,182    9,781,751 

Net income (loss) per share                             $  (0.4142)   $   0.005 
                                                      ============    ========

See Auditor's Report and accompanying financial statements and Notes thereto

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TOUPS TECHNOLOGY LICENSING, INC.
AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended Decmeber 31, 1998 and 1997

                                                                  1997
                                                         1998     (Note 2)
                                                         ----     --------

Cash flows from operating activities:                                           
  Net income (loss)                                    $(5,039,766)  $  49,101
Adjustments to reconcile net income (loss) to                             
net cash provided (used by operating activities:                      
      (Gain) loss on sale of assets                               -      (155)
      Depreciation and amortization expense                  81,634     21,840
      Bad debt expense                                       76,312      5,000
      Capital stock issued for services                   3,580,123      8,470
      (Increase) decrease in accounts receivable         (1,656,051)  (11,933)
      (Increase) decrease in inventory                     (291,042)  (54,403)
     (Increase) decrease in other current assets            (1,976)        -
     (Increase) decrease in security deposits              26,932)   (5,000)
      (Increase) decrease prepaid royalties                 (78,000)  (11,000)
      (Increase) decrease in other assets                     5,895    (5,195)
      (Increase) decrease in accounts payable               565,382     56,334
      (Increase) decrease in royalties payable               42,843          -
      (Increase) decrease accrued expenses                  350,218         74
      (Increase) decrease in income taxes payable            40,562          -
      (Increase) decrease in other current liabilities      (71,731)         -
                                                           ---------   -------

      Net cash provided (used) by operating activities    (2,422,529)   53,133

Cash flows from investing activities:                                           
  Acquisition of cash from investing                           3,715         -
  Acquisiton of property, plant and equipment               (507,047) (15,690)
  Proceeds from sale of equipment                                  -       750
 Loans to related party                                     (18,428)       -
 Loans to subsidiary prior to acquisition                  (164,297)       -
                                                           ----------   ------

      Net cash used by investing activities                 (686,057) (14,940)

See Auditor's Report and accompanying financial statements and Notes thereto

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TOUPS TECHNOLOGY LICENSING, INC.
AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended Decmeber 31, 1998 and 1997

                                                                    1997
                                                            1998      (Note 2)
                                                            ----      --------

Cash flows from financing activities:                                           
  Distributions to stockholders                           (7,592)     (41,527)
 Proceeds from the sale of capital stock              3,850,278      100,000
  Principal repayments on notes payable - stockholder    (11,215)      (4,685)
 Proceeds from line of credit                             4,600            -
 Repayments on line of credit                            (4,600)           -
  Principal repayments on capital lease obligations      (55,385)      (4,197)
  Purchase of treasury stock                                   -      (29,000)
                                                         ---------     -------

      Net cash provided by financing activities         3,776,086       20,591
                                                        ----------    --------

Net increase in cash                                       667,500        8,784 

Cash, beginning of year                                    104,580       45,796 
                                                         ---------     -------

Cash, end of year                                         $772,080     $104,580 
                                                         =========    ========

Supplemental Cash Flow Disclosures:                                             
Cash paid for interest                                      $21,234    $  3,110 
Cash paid for income taxes                                 $ 11,967    $  4,481 

See Auditor's Report and accompanying financial statements and Notes thereto

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TOUPS TECHNOLOGY LICENSING, INC.
AND SUBSIDIARIES

CONSOLIATED STATEMENTS OF STOCKHOLDERS' EQUITY
 For the year ended December 31, 1998 and 1997

                        Common    Additional    Retained
             Number      Stock      Paid-In     Earnings
                     Of Shares   (At Par)   Capital      (Deficit)   Total

Balance                                                                         
December 31, 1996                                                               
(Note 2)                1,400,000    $1,400     $97,397      $41,643   $140,440 
Issuance of common                                                              
stock upon                                                                
  inception            8,250,000     8,250           0            0      8,250
Stock Issued for:                                                               
  Services               100,000       100           -            -        100
  Cash                   160,000       160      99,840            -    100,000
  Rent                   120,000       120           -            -        120
Net income  (loss) for                                                          
the year ended                                                            
  December 31, 1997            -         -           -       49,101     49,101
Distributions       to                                                          
  shareholders                 -         -           -      (41,527)  (41,527)
                        --------    ------     -------      --------   -------
Balance,  December 31,                                                          
  1997 (Note 2)       10,030,000    10,030     197,237       49,217    256,484
Stock issued for:                                                               
  Services             5,602,697     5,603   3,574,520            -  3,574,520
  Cash                 5,381,361     5,361   3,844,897            -  3,850,278
  Acquisitions         1,203,241     1,203     688,468            -    689,671
Cancellation  of  note                                                          
  payable-stockholder          -         -      31,600            -     31,600
Net income  (loss) for                                                          
the   year    ended                                                       
  December 31, 1998            -         -           -  (5,039,766)(5,039,766)
Distributions       to                                                          
  shareholders                 -         -           -      (7,592)    (7,592)
                         -------    ------      ------   ---------- ----------
Balance,  Decemeber 31,                                                         
  1998                22,217,299   $22,217  $8,336,722 $(4,998,141) $3,360,798
                      ==========   =======  ========== ============ ==========

See Auditor's Report and accompanying financial statements and Notes thereto

TOUPS TECHNOLOGY LICENSING, INCORPORATED
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 and 1997

1.  Summary of Significant Accounting Policies                                  

           Company  - Toups  Technology  Licensing,  Incorporated  (Company),  a
      Florida  Corporation,  was  formed on July 28,  1997,  and  activated  its
      startup  operations on November 1, 1997 to facilitate market  applications
      through the licensing of late-stage  technologies primarily in the energy,
      environmental,  natural  resources and  healthcare  market  segments.  The
      Company  selects  proprietary  products or devices within market  segments
      which  management  perceives  are not  subject to rapid  change and can be
      delivered  to the  marketplace  within a three to six  month  period.  The
      consolidated  financial statements include the accounts of the Company and
      the  following  wholly  owned  subsidiaries.   All  material  intercompany
transactions have been eliminated.                                  

Subsidiary's  Name  Business  Activity            

Advanced  Micro  Welding,  Inc.(AMW)  Advanced  Micro  Welding,  Inc., a Florida
Corporation,  was formed on February 3, 1992. The Company's  primary  operations
consist of custom metal fabrication and micro welding.                          

Brounley  Associates,  Inc.  (Brounley)  Brounley  Associates,  Inc.,  a Florida
Corporation,  was formed on  February  23,  1994.  The Company is engaged in the
design, manufacture and sale of radio frequency (RF) generators.                

InterSource  Healthcare,  Inc.  (InterSource)  InterSource  Healthcare,  Inc., a
Florida  Corporation,  was formed on  November 9, 1996.  The  Company  sells and
refurbishes   medical   equipment,   provides   services  for  medical  facility
development, and sells pharmaceutical products.                                 

     Basis of Accounting - The accompanying  consolidated  financial  statements
are prepared using the accrual basis of accounting where revenues are recognized
when earned and expenses are recognized when incurred.  This basis of accounting
conforms to general accepted accounting principles.                             

1.  Summary of Significant Accounting Policies (Continued)                      

           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  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.                                                    

           Inventories - Inventories are stated at the lower of cost (determined
      on a first-in,  first-our basis) or market.  Work-in-process  and finished
goods include material, labor and overhead.                         

           Comparability  of  Statements  - Since  Toups  Technology  Licensing,
      Incorporated did not commence  operations until November 1997, amounts for
      the  year  ended  December  31,  1997,  reflect  less  than a full  year's
      transactions  (subsidiaries  accounted  for using the  pooling-of-interest
      method  reflect  the full  year  ending  December  31,  1997)  and are not
directly comparable with 1998 figures.                              

           Advertising - Advertising costs are charged to operations in the year
    incurred and totaled $66,756 and $1,522 for 1998 and 1997, respectively.

           Property,  Plant and Equipment - All property, plant and equipment is
      recorded at cost. Depreciation,  which includes the amortization of assets
      recorded under capital  leases,  is computed on the  straight-line  method
      over the  estimated  useful  lives of the assets.  Repair and  maintenance
      costs which do not  increase  the useful life of the assets are charged to
operations as incurred.                                             

           Allowance  for  Doubtful  Accounts  -  The  Company   establishes  an
      allowance for uncollectible  trade accounts receivable based on historical
      collection  experience and management's  evaluation of  collectibility  of
      outstanding accounts  receivable.  The allowance for doubtful accounts was
$74,237 and $5,000 as of December 31, 1998 and 1997, respectively.  

           Income Taxes - Deferred income taxes are reported using the liability
      method.  Deferred  tax  assets are  recognized  for  deductible  temporary
      differences  and  deferred  tax  liabilities  are  recognized  for taxable
      temporary  differences.  Temporary differences are differences between the
      reported  amounts of assets and liabilities and their tax bases.  Deferred
      tax assets are reduced by a valuation  allowance  when,  in the opinion of
      management,  it is more  likely  than not that some  portion or all of the
      deferred  tax  assets  will  not be  realized.  Deferred  tax  assets  and
      liabilities  are adjusted for the effects of changes in tax laws and rates
on the date of enactment.                                           

           Earnings  (Loss)  per Share -  Earnings  per share  are  computed  by
      dividing net income (loss) by the weighted-average number of shares issued
      and outstanding  during the reporting  period.  Shares issued or purchased
      during the period affect the amount of shares outstanding and are weighted
by the fraction of the period they are outstanding.                 

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2.  Acquisition of Businesses                                                   

Advanced Micro Welding, Inc.                

           On April 1,  1998,  the  Company  acquired  all the  common  stock of
      Advanced Micro  Welding,  Inc. (AMW) in exchange for 500,000 shares of the
      Company's  restricted  common  stock.  AMW is engaged in micro welding and
      custom metal  fabricating.  The  transaction  has been  accounted for as a
      pooling  of  interest  and,   accordingly,   the  consolidated   financial
      statements  for 1998 and 1997 have been  restated to include all  accounts
      and operations of AMW as if the  acquisition had occurred at the beginning
of the year presented.                                              

           Unaudited net sales and net income of the separate  companies for the
period prior to the acquisition were:                               

                                 March 31,
                                                 1998           1997

Net sales:                                                                
 Toups Technology Licensing, Incorporated(1)     $       -0-         $ -0-
  AMW                                               109,154        344,149
                                                  ---------      ---------
                     Total                        $ 109,154       $344,149

Net income (loss):                                                      
   Toups Technology Licensing, Incorporated        $(215,096)      $(40,413)
               AMW                                    7,246         55,785
                                                     --------        ---------
                      Total                        $(207,850)        $15,372

(1)Toups  Technology  Licensing,  Incorporated  was a development  stage company
during all of 1997.                                                   

Brounley Associates, Inc.                                 

           On October 1, 1998,  the  Company  acquired  all the common  stock of
      Brounley Associates, Inc. (Brounley) in exchange for 900,000 shares of the
      Company's  restricted  common  stock.  Brounley  is  engaged in the design
      manufacture and sale of radio frequency  generators  throughout the United
      States and abroad.  The transaction has been accounted for as a pooling of
      interest and, accordingly,  the consolidated financial statements for 1998
      and 1997 have been  restated to include all  accounts  and  operations  of
      Brounley as if the  acquisition  had occurred at the beginning of the year
presented.                                                          

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TOUPS TECHNOLOGY LICENSING, INCORPORATED
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 and 1997

Acquisitions of Businesses (Continued)                                          

           Unaudited net sales and net income of the separate  companies for the
period prior to the acquisition were:                               

                                 September 30,
                                              1998            1997

Net sales:                                                        
Toups Technology Licensing Incorporated                         
   and subsidiary                             $790,667     $ 344,149
  Brounley                                     910,292       852,020
                                                 --------     ----------
                   Total                      $1,700,959    $1,196,169

Net income (loss):                                              
Toups Technology Licensing, Incorporated                      
    and subsidiary                            (1,358,377)     15,372
   Brounley                                      158,427      33,729
                                                 -----------     ---------
                    Total                       $(1,199,950)     $49,101

InterSource Healthcare, Inc.                              

           On November  30,  1998,  the Company  purchased  100% of the stock of
      InterSource Healthcare,  Inc. (InterSource) by issuing 1,203,241 shares of
      restricted  and  unrestricted  common  stock .  InterSource  acquires  and
      refurbishes  used  medical  equipment  for  resale,  sells  pharmaceutical
      products  and  provides  services for medical  facility  development.  The
      Company's 1998 consolidated  results include the operations of InterSource
from the date of acquisition.                                       

           The  acquisition  was  accounted  for  using the  purchase  method of
      accounting.  Accordingly,  the  purchase  price was  allocated  to the net
assets acquired based upon their estimated fair market values.      

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TOUPS TECHNOLOGY LICENSING, INCORPORATED
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 and 1997

Acquisitions of Businesses (Continued)                                          

           The following  unaudited pro forma summary  combines the consolidated
      results of the Company and  InterSource as if the acquisition had occurred
      at the beginning of 1998 and 1997 after giving effect to certain pro forma
      adjustments,  including, among other things, additional depreciation based
      on the fair value of equipment  acquired and the estimated  related income
tax effect.                                                         
                                            1998              1997

In thousands, (unaudited)                         
             Net sales                      $4,134,161      $1,970,559
              Net income (loss)             $(2,213,556)       $(23,547)

           This pro forma financial  information is presented for  informational
      purposes  only and may not be  indicative  of the results of operations as
      they  would have been if the  Company  and  InterSource  had been a single
      entity  during  1998 and 1997,  nor is it  necessarily  indicative  of the
results of operations which may occur in the future.                

Joint Venture                                                                   

           Effective  December 15, 1998,  the Company  entered into an agreement
      with  Compania  DeLuz Y Fuerza De Las  Terrenas,  C. por A.  (Utility),  a
      Dominican  Republic  utility  company,  to form the  joint  venture  "Aqua
      Fuel(a)-Dominicana, SA". The ownership of Aqua Fuel-Dominicana will be 49%
to Toups Technology Licensing, Inc. (TTL) and 51% to the utility.   

           The purpose of Aqua Fuel-Dominicana is the construction and operation
      of an Aqua Fuel(a)  production  facility which,  at a minimum,  is able to
   generate 1.653 gigawatts of electric power during a twenty year period.

           The  agreement  outlines a  three-step  approach to  accomplish  Aqua
      Fuel-Dominica's  purpose,  1) a  feasibility  study  of  an  Aqua  Fuel(a)
      generator  with a  capability  of at least  4,000  CF/hr to run a 1,000 KW
      generator  successfully  and continuously for a period of two weeks and is
      scheduled  to  conclude  no later than  sixty days after the Aqua  Fuel(a)
      generator is installed in the Dominican Republic; 2) immediately after the
      completion of the Feasibility Study, the development of the blueprints and
      design for  construction  of the Aqua Fuel(a)  production  facility  shall
      commence and will be completed  no later than 60 days  thereafter;  and 3)
      the  construction of the plant shall commence  immediately upon receipt of
      the drawings and materials being  available in the Dominican  Republic and
is scheduled for completion within six months.                      

           TTL's  capital  contribution  to  Aqua  Fuel-Dominicana  will  be the
      delivery of the Aqua Fuel(a)  technology  and the equipment as required by
      the agreement,  the Utility is required to fund all other capital needs of
      the joint venture. Additionally, the Utility is to find investors who will
      invest at least  $500,000 in TTL, TTL is to issue 500,000 of its shares to
      the Utility and 2,000,000 shares to the president of Aqua  Fuel-Dominicana
for services during 1999.                                           
4.  Concentration of Credit Risk                                                

           The Company  maintains  cash  deposits with a bank that include funds
      greater than the federally insured limit of $100,000. The cash balances in
      excess of the insured  amounts were $650,765 at December 31, 1998 and $-0-
      at December  31, 1997.  Management  believes the Company is not exposed to
any significant credit risk related to cash.                        

           The Company  grants credit to its customers  during the normal course
      of business and performs  ongoing  credit  evaluations  of its  customers'
      financial condition. The Company maintains allowances for potential credit
      losses. The Company had sales to five customers that totaled approximately
      83% of total sales for the year ended  December  31,  1998.  Additionally,
      three  customers  comprise  approximately  96% of the  December  31,  1998
      accounts  receivable - trade. The owners of the entities that comprise the
three customers are minority shareholders of the Company.           

5.  Inventories                                                                 

           Inventories  as of  December  31,  1998  and  1997  consisted  of the
following:                                                                      

                1998              1997

Raw materials       $455,357           $99,278    
Work-in-process       46,004           131,554    
Finished goods        41,294             6,850    
                 -------            --------
      Total      $542,655           $237,682

6.  Licensing Agreement Commitments                                             

           The  Company  has  entered  into  licensing   agreements  with  three
      licensors.   Amounts  relating  to  these   agreements   recorded  in  the
accompanying consolidated statements are as follows:                
              Year ending December 31,
              1998              1997

Prepaid royalties    $89,000        $11,000       
            =========       ========

Royalties payable  $42,843          $   -0-       
            =======          =======

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6.  Licensing Agreement Commitments (Continued)                                 

           Royalty  expense  for the year ended  December  31, 1998 and 1997 was
      $94,843 and $-0-,  respectively.  In exchange  for the rights  under these
agreements, the Company has committed to pay the following:         

Year ending                                       
1999          $        96,000           
2000                   96,000           
      ----------------
Total    $       192,000    
    ================

           In addition  to the above,  if the  Company  exercised  its option to
renew the licenses it will have future minimum royalties as follows:

Year ending                                       
         2001                             $        200,000
         2002                             $        250,000
         2003                             $        300,000
         2004, and every year thereafter  $        400,000

7.  Property, Plant and Equipment                                               

           Property,  plant and  equipment,  at cost,  and  related  accumulated
      depreciation  and  amortization  as of  December  31,  1998  and  1997 are
summarized as follows:                                              

                                                  1998              1997

           Leasehold improvements              $  96,999          $  -0-
           Office furniture and equipment        119,467           7,594
           Machinery and equipment             1,505,517          88,921
           Equipment under capital leases        448,089          77,973
                                               --------          -------
                                               2,170,072         174,488
Less: Accumulated depreciation                    
                 and amortization                152,159          65,775
                                               --------          -------
                     Total                      $2,017,913        $108,713

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8.  Related Party Transactions                                                  

     The  Company  has  the   following   receivables   from   officers   and/or
stockholders:                                                                   

                            1998              1997
Interest-free demand note - unsecured:                                          
      Shareholders            $85,263            $   -0-
      Officers                  2,222                -0-
                              -------             ------
              Total            $87,485              $  -0-
                               =======            ========
    8% note payable            $    -0-         $   42,815
      Less: Current portion         -0-             15,325

             Long-term portion $   -0-            $ 27,490
                                 ================  ===============

           For the year  ending  December  31,  1998,  the  Company had sales of
      approximately   $1.7  million  to  entities  owned  by  certain   minority
shareholders of the Company.                                        

           The Company paid approximately $22,632 for employee leasing, $102,308
      for  rent,  and  $21,000  for  consulting  fees to  Intersource  prior  to
acquisition.                                                        

9.  Capital Leases                                                            

           The following is an analysis of the equipment under capital leases by
major classes:                                                                  

                                        1998              1997

        Machinery and equipment           $448,089        $ 77,973
        Less: Accumulated depreciation      53,003           2,250
                                          --------        --------
                 Total                   $395,086         $ 75,723
                                       ===========       =========

     Amortization of leased  equipment is included in  depreciation  expense and
totaled  $50,753  and $2,250 for the year  ending  December  31,  1998 and 1997,
respectively.                                                                   

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9.  Capital Leases (Continued)                                                  

     The following is a schedule by years of future minimum lease payments as of
December 31, 1998 and 1997.                                                     

      1998            1997

1998                         $      -           $ 20,503                        
1999                          111,359             20,503                        
2000                          118,403             20,503                        
2001                          115,817             20,503                        
2002                          101,541             10,773                        
2003                           61,549                  -                        

Total minimum lease payments  508,669             92,785                        
Less: Amount                                                                    
representing interest        120,432              19,009                      

Present value of net                                                          
imum lease payments       $ 388,237            $73,776                    
   ===========           =======

           The present value of net minimum lease  payments are reflected in the
balance sheet as:                                                               

                                                     1997         1998

Current portion of capital lease obligations materials   $66,125      $24,324   
Capital lease obligations, net of current portion        322,112       49,452   
                                                    ---------       --------
                                                     $ 388,237      $ 73,776
                                                   ==========        =======

10.  Note Payable - Stockholder                                                 

           The balance reflected on the December 31, 1997 consolidated financial
      statements relates to a note payable with an original principal balance of
      $47,500 and interest rate of 8% to a stockholder  dating back to 1994 when
      Brounley  was formed.  No  payments  were made on this note prior to 1997.
      During 1998,  the note balance of $31,600 was  reclassified  as additional
paid-in capital.                                                    

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TOUPS TECHNOLOGY LICENSING, INCORPORATED
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1998 and 1997

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11.  Line of Credit                                                             

           InterSource  maintains a $50,000  bank line of credit  with  interest
     payable monthly at bank prime (current 8.75%) plus 2%. At December 31, 1998
     and 1997, the amounts due were $49,574 and $-0-, respectively.  The line of
     credit matures  November 30, 1999. The line is secured by inventory and the
personal guarantee of certain stockholders.                           

12.  Capital Stock                                                              

Common                                                    

           In 1998,  the  Company  amended  its  Articles  of  Incorporation  to
     authorize  50  million  shares of common  stock  with a par value of $0.001
     (one,  one-thousandth  dollar) per share. As of December 31, 1998 and 1997,
     there  were  22,217,299  and  8,630,000   shares  issued  and  outstanding,
     respectively.  Of the 22,217,299  shares issued and outstanding at December
     31, 1998,  6,034,056  shares are  unrestricted  and  16,183,243  shares are
     restricted  as to  the  sale  to  other  parties  pursuant  to  the  resale
     provisions of Sec. Rule 144. Of the 8,630,000 shares issued and outstanding
     at December 31, 1997,  170,000 shares are unrestricted and 8,460,000 shares
     are  restricted  as to the sale to other  parties  pursuant  to the  resale
provisions of SEC Rule 144.                                           

Preferred                                                 

           The  Company  is also  authorized  to  issue  10  million  shares  of
     preferred stock having a par value of $1 per share. There were no preferred
shares issued or outstanding at either December 31, 1998 or 1997.     

13.  Operating Leases                                                           

           The  Company  has  leases  for  buildings  which  are  classified  as
     operating leases.  Total rent expense for all operating leases for 1998 and
1997 was $117,154 and $-0-, respectively.                             

           Future  minimum lease  payments  under the  noncancellable  operating
    leases with initial or remaining terms of one year or more are as follows:

1999         $  291,410                     
2000            263,718                     
2001            276,904                     
2002            265,414                     
___________         
$ 1,097,446         

14.  Income Taxes                                                               

           The Company has  cumulative  net  operating  losses of  approximately
     $2,300,000 and $40,413 at December 31, 1998 and 1997,  respectively,  which
     are expected to provide future tax benefits of  approximately  $782,000 and
     $8,085,  respectively,  for both  Federal and State  purposes.  A valuation
     allowance  for  the  entire  benefit  has  been  recognized  as it  is  not
     reasonable to estimate  when or if the benefit will be realized.  These tax
     benefits expire  beginning in 2012. The income tax expense  recorded in the
     accompanying  financial  statements  represents  income  taxes  payable for
     operations of the companies  acquired for activities  prior to the dates of
merger.                                                               

15.  Noncash Disclosures                                                        

           The following  transactions  were excluded from the statement of cash
flows because they were not cash transactions.                        

     . At inception the Company issued 8,250,000 shares to its organizers. These
shares of stock were recorded at a total of $8,250.                             

     . In addition to the  commitments  described  in the  "licensing  agreement
commitment" note. In 1997, the Company issued 165,000 shares of restricted stock
to the licensors of the Company's three technologies. These shares were recorded
at a total of $165.                                                             

     . In 1997,  the  Company  issued  125,000  shares  of  restricted  stock to
consultants and employees. These shares were recorded at $125.                  

     . In 1997, the Company  issued  120,000 shares of restricted  stock for the
use of operating facilities for one year. These shares of stock were recorded at
$120.                                                                           

     . In 1998,  the Company  acquired  assets of $369,846  under  capital lease
agreements.                                                                     

     . In 1998,  a  shareholder  note  payable for $31,600 was  reclassified  as
additional paid-in capital.                                                     

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15.  Noncash Disclosures (Continued)                                            

 .    In 1998, the Company issued  1,203,241  shares of restricted stock for the
acquisition of InterSouce Healthcare, Inc.                            

           Assets acquired          $1,301,521
          Liabilities acquired        $611,850

 .   In 1998, the Company issued 5,602,697 shares of restricted common stock for
services. These shares were recorded at a total of $728,351.          

 .    In 1998,  the Company  issued  900,000  shares of restricted stock for the
acquisition of Brounley Associates, Inc.                              

            Assets acquired             $358,887
           Liabilities acquired          $99,670

 .    In 1998,  the Company  issued  500,000  shares of restricted stock for the
acquisition of Advanced Micro Welding, Inc.                           

            Assets acquired             $301,834
           Liabilities acquired         $214,544

16.  Contingencies                                                              

           The Company is periodically involved in legal actions and claims that
     arise in the normal  course of  operations.  Management  believes  that the
     ultimate  resolution  of any such actions will not have a material  adverse
effect on the Company's financial position.                           

           The year  2000 is  expected  to  create  computer  problems  for many
     organizations  because some computers and their programs only recognize the
     last two digits in the year.  For example,  the year 1998 is  recognized as
     98. When the year 2000 arrives some  computers may not process  information
     accurately  or may shut down.  Management  is in the process of  evaluating
     their  systems to  correct  any  problems  which may be created by the year
     2000. The Company plans to have all their vital internal systems  compliant
     before the year 2000  arrives.  However,  it is not possible to insure that
outside entities will be 2000 compliant.                              

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17.  Commitments                                                                

           The  Company  has  entered  into  an  agreement  to  have   equipment
     manufactured for a cost of $500,000.  At December 31, 1998, the first phase
     of the  equipment  is complete  and $72,100 has been  recorded in property,
plant and equipment.                                                  

18.  Subsequent Events                                                          

     In January 1999,  the Company  entered into a lease  agreement that will be
accounted for as a capital  lease.  The  equipment  has a cost of $341,200.  The
lease calls for an initial payment of $34,120 followed by sixty monthly payments
of $6,323.                                                                      

     In January 1999,  the Company  issued  25,000  shares of restricted  common
stock at a price of $1.00 per share.                                            

     On February 17,  1999,  the Company  sold  $750,000 of Series  1999-A Eight
Percent  (8%)  convertible  notes due  January  1,  2002.  Under the  securities
purchase  agreement,  the investor will purchase another $750,000 in convertible
notes within 30 days after the Company files a Registration Statement or at such
time as the parties mutually agree.                                             

     The notes can be  converted  to common stock of the company at a conversion
price  (the  "Conversion  Price")  for each share of common  stock  equal to the
lesser of (x) one hundred percent (100%) of the lowest of the closing bid prices
for the Common Stock for the five (5) trading  days  immediately  preceding  the
Closing Date (defined as the date of this Note);  or (y) eighty percent (80%) of
the lowest of the  closing  bid  prices  for the  Common  Stock for the five (5)
trading  days  immediately  preceding  the  Conversion  Date as  reported on the
National Association of Securities Dealers OTC Bulletin Board Market.           

     Additionally,  the investor was issued a warrant to purchase  75,000 shares
of the Company's stock at $2.3375 per share through February 17, 2002.          

     Since the  investor  did not convert  the notes ont eh day of closing,  the
Company is required to recognize as interest  expense the beneficial  conversion
terms of the notes. This additional  interest of $187,500 will be amortized over
the period  between the closing date (February 17, 1999) and the first date (May
17, 1999) on which the notes can be converted.                                  

     At such time as the investor  completes  the agreement and pays the Company
the balance of  $750,000,  the  investor  will  receive a three year  warrant to
purchase 75,000 shares at 110% of the market price on the date of closing.      

     If the investor  does not convert the second  series of notes at the second
closing  date,  the  Company  will again be  required  to  recognize  additional
interest expense due to the beneficial  conversion terms of the notes.  Assuming
the market  price is  unchanged  as of the second  closing,  the  Company  would
amortize  $187,500 over the three months  beginning  with the date of the second
closing.                                                                        

19.  Restatement of Financial Statements                                        

     During 1998, the Company issued 5,602,697  unregistered,  restricted shares
of its stock to attract and retain key  employees,  to acquire  various  license
agreements, to make acquisitions and for other developmental needs. These shares
were valued at $728,351 ($.13 per share) based on restricted liquidity,  lack of
profitable   operations   and  unproven   marketability   of  several   licensed
technologies.  After  consultation  with the Securities and Exchange  Commission
staff,  the Company has determined that a more reasonable value for these shares
would be one in closer proximity to sales to others for similar shares,  reduced
for a lack of  liquidity  discount.  Based  on this  approach  the  Company  has
determined that the shares should be recorded at $.639 per share. This change in
value requires an additional, non-cash charge to 1998 general and administrative
compensation  of  $2,851,772.  This  increases  the  Company's  1998  loss  from
$2,187,994 ($0.1498 per share) to $5,039,766 ($0.4142 per share).               

     Further,  the balance sheet impact of the additional non-cash  compensation
expense increases  additional  paid-in capital from $5,484,590 to $8,336,722 and
decreases  Retained Earnings  (Deficit) from  ($2,146,369) to ($4,998,141).  The
overall change to the Stockholders' Equity section of the balance sheet is $0.  

20.  Recission of Stock                                                         

     Subsequent to year-end,  the Company decided to rescind 1,950,000 shares of
stock   previously   issued  to   certain   officers/directors.   The   Company,
simultaneously,  issued stock options to the same officers/directors to purchase
1,950,000 shares of the Company's stock. The stock may be purchased at $.639 per
share for a three year period beginning on September 1, 1998.                   

21.  Issuance of Preferred Stock                                                

     On March 30, 1999, the Company  executed a series of agreements and amended
its articles of  incorporation in order to complete the placement of $750,000 of
its Series A 7% Preferred Stock with an investor.  Under the terms of the Series
A Preferred  Stock,  the holder may convert at 105% of the closing price anytime
up to 90 days after  issuance;  85% of the closing price anytime between 91 days
and 119 days following closing; 80% of the closing price anytime between 120 and
149 days following closing,  or; 75% of the closing price anytime after 150 days
following  the closing  date  through  March 30,  2004.  The Company also issued
93,750  warrants  exercisable  at $2.40 per share to the investor in  connection
with the sale of the  Preferred  Stock.  As a part of a finders  fee the Company
issued 50,000  warrants  allowing for the purchase of a like number of shares of
the Company's stock at $2.40 per share through March 30, 2004.                  

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CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING 
AND FINANCIAL DISCLOSURE

The Company has never had any disagreement with its accountants.      

PART II - INFORMATION NOT REQUIRED IN PROSPECTUS

INDEMNIFICATION OF DIRECTORS AND OFFICERS.                                      

     Article III of the Company's  by-laws  provide for the  indemnification  of
directors,  in that Directors of the Company shall not be personally  liable for
monetary  damages to the Company or any other  person for any  statement,  vote,
decision  or failure to act,  regarding  corporate  management  or policy,  by a
director,  unless  the  director  breached  or failed to  perform  his duties as
director.                                                                       

     Article VI of the  Company's  by-laws  provide for the  indemnification  of
officers, directors, employee and agents of the Company. Such indemnification is
available to any person who was or is a party to any  proceeding  (other than an
action  by, or in the right of, the  Company),  by reason of the fact that he or
she is or was a director, officer, employee or agent of the Company or is or was
serving at the request of the Company.                                          

     Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Act") may be permitted  to  directors,  officers  and  controlling
persons of the small  business  issuer  pursuant to the foregoing  provisions or
otherwise, the small business issuer has been advised that in the opinion of the
Securities  and  Exchange  Commission  such  indemnification  is against  public
policy, as expressed in the Act and is, therefore, unenforceable.               

OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION                                     

                   Registration fees             $           3,231
                   Transfer agents' fees         $           1,500
                                                             -----
                   Total                         $           4,731
                                                             =====

RECENT SALES OF UNREGISTERED SECURITIES                                         

   The Company issued "unregistered" securities to various persons and firms
as specified  below and all such  securities  were  acquired  directly  from the
Company in transactions not involving any public  offering.  All such securities
may only be resold upon compliance with Rule 144, adopted under the Act of 1933.
All securities  were sold in reliance upon Section 4(2) of the Securities Act of
1933. All purchasers were either  "accredited" or sophisticated.  All purchasers
executed  a  Subscription  Agreement  indicating  they have such  knowledge  and
experience  in  financial  and  business  matters  that,  either alone or with a
purchasers  representative,  they are capable of evaluating the merits and risks
of the investment. All purchasers were provided with access to information about
the Company.                                                                    

     Further,   throughout  these   transactions   specified  in  the  following
discussions,  the Company  relied on Section 4(2) of the Act of 1933, as amended
and all purchasers  executed a Subscription  Agreement  indicating (i) they meet
the definition of "Accredited  Investor" as that term is specified in Regulation
D, Rule 502, and; (ii) they have such  knowledge and experience in financial and
business  matters  that either alone or with a  purchasers  representative,  are
capable of evaluating the merits and risks of the investment.                   

     During November 1998 through March, 1999, the Company completed an offering
of its  unregistered  common shares in the manner and on reliance of the various
Sections  of the  Act of  1933  cited  above  to 43  accredited  investors.  The
unregistered  common shares were offered and sold at the rate of $1.00 per share
for an aggregate of  $1,747,500  in proceeds to the Company The Company  further
agreed to  conduct a  registration  of the  shares  sold in the above  described
private offering and all persons participating therein are included as a part of
the registration to which this Prospectus is intended. The Company's offering is
now closed.                                                                     

     During November, the Company issued 1,203,241 unregistered common shares in
exchange for 100% of the issued and  outstanding  capital  stock of  InterSource
Health Care,  Inc. The Company  agreed to  registered  225,000 of the  1,203,241
unregistered shares issued in connection with the acquisition of InterSource.   

     During November through December,  the Company issued 838,000  unregistered
common shares to either engage consultants or had fees come due from consultants
that had  previously  been engaged to include  Michael McBee 5,000 shares;  Mark
Trinske  10,000  shares;  Steven Ungar 250,834  shares;  Mike  O'Malley  248,333
shares; Richh Limited Partnership 263,333 shares;  Michael Finley 50,000 shares;
Eugene Malove 10,000 shares, and; Daniel B. Crossman 500 shares.                

     During November and December, 1998, the Company issued 150,500 unregistered
shares to employees including David DeCara 90,000; John Rogers 10,000;  Michelle
Goldstein 20,000;  Ronald Moore 15,000;  Rebecca Bonner 3,500; Rick Gabel 6,000,
and; Cheryl McDermitt 6,000.                                                    

     The Augustine Notes. On February 17, 1999, the Company executed a series of
agreements with Augustine Capital Group  ("Augustine")  relating to the purchase
by Augustine of $1,500,000 of TTL's Series 1999-A Eight Percent (8%)  Covertible
Notes (the  "Notes")  and the  issuance  of  Warrants  and  registration  rights
relating thereto. On that same date,  Augustine delivered $750,000 to TTL and is
obligated to deliver a second $750,000 30 days following the registration of the
shares underlying the Notes. There were no brokers,  promoters,  underwriters or
similar persons  associated with this transaction.  Closing fees of $10,000 were
paid (i) to Augustine  counsel and (ii) third party counsel whom acted as Escrow
Agent.  A more  detailed  summary  of  the  Series  1999-A  Eight  Percent  (8%)
Convertible Note due January 1, 2002 and the warrants and  registrations  rights
provided in connection therewith immediately follows                            

     The Shaar  Preferred.  On March 30, 1999, the Company  executed a series of
agreements  and amended its articles of  incorporation  in order to complete the
placement  of $750,000 of its Series A 7%  Preferred  Stock with The Shaar Fund.
Under the terms of the Series A Preferred  Stock, the holder may convert at 105%
of the closing price (the "Closing  Price" was fixed at $2.10 on March 30, 1999)
anytime up to 90 days after  issuance;  85% of the closing price anytime between
91 days and 119 days following closing; 80% of the closing price anytime between
120 and 149 days following closing, or; 75% anytime after 150 days following the
closing date. The Company also issued 93,750  warrants  exercisable at $2.40 per
share in  connection  with the  sale of  Preferred  Stock  and  granted  certain
registration rights. The Company paid a finders fee of 8% or $60,000 plus 50,000
Warrants  allowing for the purchase of the  Company's  securities at 120% of the
closing bid price at time of exercise. A more detailed summary of the Series A -
7%  Convertible  Preferred  Stock  and the  warrants  and  registrations  rights
provided in connection therewith immediately follows this section.              

Series 1999-A Eight Percent (8%) Convertible Note due January 1, 2002           

     The  Company  shall repay to  Augustine  the  principal  sum of $750,000 on
January 1, 2002 (Maturity Date) and interest on the principal sum outstanding at
the rate of 8% per  annum  due  quarterly  in  arrears  on March  31,  June 30 ,
September 30 and December 31 of each year during the term of the Note. The first
such  interest  payment is due June 30, 1999.  The Notes may be  exchangable  in
amounts of $50,000  or  greater.  Conversions  of the Note must be  effected  in
increments of at least $10,000 of principal amount.                             

     Augustine  may convert  the face amount of the Note at any time  commencing
the earlier of (i) the date the  Registration  Statement  relating to the shares
underlying  the Note becomes  effective,  or; (ii) the date which is ninety (90)
days after February 17, 1999 (date of Note).  Accordingly,  the Conversion  date
would be approximately May 17, 1999.                                            

     The per share price at which  Augustine  may convert the Note is the lesser
of:  (i) 100% of the  lowest  closing  bid price per share  during the five days
preceeding  the Closing Date (this price per share has been fixed at $1.78125 (1
& 25/32) per share.  Accordingly,  should  Augustine  select  method (i) for the
conversion  rate of their  principal  amount,  they would be entitled to 421,053
Toups Technology common shares); or (ii) 80% of the lowest closing bid price per
share during the five days preceeding the conversion date.                      

     The Company  may,  at its option,  redeem the Note at any time in an amount
equal to 125% of the face  amount  of the  portion  of the Note  remaining  plus
interest at the time of such redemption.                                        

     In keeping  with the intent of the  parties,  the  Company  shall  register
421,053 common shares relating to the first closing and 421,053 common shares in
anticipation  of the second  closing.  At this  time,  the  estimated  number of
registered  common  shares  necessary  for the full  conversion of the principal
amount of the notes is 842,106 common shares.                                   

Warrants in connection with the Augustine Notes                                 

     As a part of  sale  the  Augustine  Notes,  the  Company  provided  125,000
Warrants  wherein each such Warrant  entitles the holder thereof to purchase the
Company's  common  stock at the rate of 110% of the  closing  bid  price for the
Common  Stock  on the  date of such  Closing  (the  closing  bid  price  for the
Company's  common  shares on  February  17,  1999 was  $2.00.  Accordingly,  the
exercise price for the Warrants relating to the first Closing is $2.20 per share
making the full exercise price of the 125,000  Warrants  delivered in connection
with the first Closing $275,000).                                               

Registration Rights  in connection with the Augustine Notes                     

     As a  part  of  its  Augustine  agreements,  the  Company  granted  certain
registration  rights  which,  in  effect,  require  TTL  to  amend  its  current
pre-effective SB-2 Registration  Statement to include the total estimated number
of shares available for conversion of the Notes and exercise of the Warrants.   

Series A 7% Convertible Preferred Stock                                         

On March 30, 1999,  the Company  executed a series of agreements and amended its
articles of  incorporation in order to complete the placement of $750,000 of its
Series A 7% Preferred Stock with The Shaar Fund. Under the terms of the Series A
Preferred  Stock, the holder may convert at 105% of the closing price anytime up
to 90 days after issuance;  85% of the closing price anytime between 91 days and
119 days following closing; 80% of the closing price anytime between 120 and 149
days  following  closing,  or; 75% anytime after 150 days  following the closing
date.                                                                           

     The Company also issued 93,750  warrants  exercisable at $2.40 per share in
connection  with the sale of Preferred  Stock and granted  certain  registration
rights.  The Company  paid a finders fee of 8% or $60,000  plus 50,000  Warrants
allowing for the purchase of the Company's securities at 120% of the closing bid
price at time of exercise.                                                      

Warrants issued in connection with the Series A 7% Convertible Preferred Stock  

     As a part of the sale of its Series A 7% Convertible  Preferred  Stock, the
Company also issued  93,750  Warrants  providing the holder the right to acquire
the  Company's  common stock at a price equal to 120% of the market price on the
closing date.  The Warrants may be exercised  anytime up through March 30, 2004.
The exercise price of the warrants  issued in connection with the sale of Series
A 7% Convertible  Preferred  Shares is $2.40 per share. As a further part of the
sale of the  Series  A 7%  Convertible  Preferred  Shares,  the  Company  50,000
warrants as a part of a finders fee. The finder's  warrants are identical in all
respects  to the  warrants  issued to the holder of the Series A 7%  Convertible
Preferred Shares.                                                               

     Registration  rights  in  connection  with  the  Series  A  7%  Convertible
Preferred Stock                                                                 

As a part of its Shaar Fund agreements, the Company granted certain registration
rights which,  in effect,  require TTL to amend its current  pre-effective  SB-2
Registration Statement to include the total estimated number of shares available
for  conversion  of the Preferred  Stock and exercise of the Warrants  including
those Warrants issued to the finder.                                            

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EXHIBITS                                                                        

Table of Exhibits                                                  Page No.     

The following  Exhibits are  incorporated  by reference  from  previously  filed
material:                                                                       

EX-3.(i)          Articles of Incorporation                                     

EX-3.(ii)         By-laws                                                       

EX-5.(i)        Opinion re: legality                                            

EX-5.(ii)       Opinion re: legality                                            

EX-10.(i)       BPV License Agreement (BP Valves)                               

EX-10.(ii)      WAFT License Agreement (AquaFuel)                               

EX-10.(iii)     BORS Lift Manufacturing License Agreement                       

EX-10.(iv)      AMW Acquisition Agreement                                       

EX-10((v)       Amended BORS Lift License Agreement                             

EX-10(vi)       Magnetion(a) License Agreement                                  

EX-10(vii)      Tunnel Bat License Agreement                                    

EX-10(viii)     Exchange of Share Agreement, re:  Brounley Engineering          

EX-10(ix)       Exchange of Share Agreement, re:  InterSource Health Care, Inc. 

EX-10(x)        Joint Venture Agreement by and between Toups Technology and Luz 
y Fuerza Utility                                

EX-20           AquaFuel Certification Report                                   

The following exhibit is included herein and made a part hereof.                

EX-23           Auditor's Consent                                               

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UNDERTAKINGS                                                                    

The undersigned registrant hereby undertakes that it will:                      

(1)    File,  during  any  period  in which it  offers  or sells  securities,  a
post-effective amendment to this registration statement to:       

     (i)  Include any prospectus  required by Section 10(a)(3) of the Securities
Act;                                                        

     (ii) Reflect in the prospectus any facts or events which,  individually  or
          together,  represent a fundamental  change in the  information  in the
          registration  statement;   and  notwithstanding  the  foregoing,   any
          increase  or decrease  in volume of  securities  offered (if the total
          dollar  value of  securities  offered  would not exceed that which was
          registered)  and  any  deviation  from  the  low  or  high  end of the
          estimated  maximum  offering  range  may be  reflected  in the form of
          prospectus filed with the Commission  pursuant to Rule 424(b),  if, in
          the aggregate,  the changes in the volume and price  represent no more
          than a 20% change in the maximum aggregate offering price set forth in
          the   "Calculation  of  Registration   Fee"  table  in  the  effective
registration statement.                                     

     (iii)Include any additional or changed material  information on the plan of
distribution.                                               

(2)    For   determining   liability   under  the  Securities  Act,  treat  each
       post-effective   amendment  as  a  new  registration   statement  of  the
       securities offered, and the offering of the securities at that time to be
the initial bona fide offering.                                   

(3)    File a  post-effective  amendment to remove from  registration any of the
securities that remain unsold at the end of the offering.         

(4)    Insofar as indemnification  for liabilities  arising under the Securities
       Act of 1933 (the  "Act") may be  permitted  to  directors,  officers  and
       controlling persons of the Company pursuant to the foregoing  provisions,
       or  otherwise,  the company has been  advised  that in the opinion of the
       Securities and Exchange Commission such indemnification is against public
       policy as expressed in the Act and is, therefore,  unenforceable.  In the
       event that a claim for  indemnification  against such liabilities  (other
       than the payment by the  undersigned  of  expenses  incurred or paid by a
       director,  officer  or  controlling  person  of  the  undersigned  in the
       successful defense of any action, suit or proceeding) is asserted by such
       director, officer or controlling person in connection with the securities
       being  registered,  the  undersigned  will,  unless in the opinion of its
       counsel the matter has been settled by controlling precedent, submit to a
       court   of   appropriate   jurisdiction   the   question   whether   such
       indemnification  by it is  against  public  policy  as  expressed  in the
       Securities  Act and will be  governed by the final  adjudication  of such
issue.                                                            

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SIGNATURES                                                                      

Toups Technology Licensing, Inc.
 (Registrant).
______________________
Leon H. Toups,
President and Chief Executive Officer 
By (Signature and Title)

     In accordance  with the  requirements  of the Securities Act of 1933,  this
registration  statement  has  been  signed  by  the  following  persons  in  the
capacities and on the dates stated.                                             

 S/S LEON H. TOUPS
 (Signature)

 President and Chief Executive Officer
 (Title)

(Date):  June 23, 1999                                                          

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘SB-2/A’ Filing		Date		First		Last			Other Filings
		3/30/04		29		30
		2/17/02		29
		1/1/02		29		30
		9/1/01		14
		12/31/99		14					10KSB,  NT 10-K
		11/30/99		27
		6/30/99		30					10QSB,  NT 10-Q
Filed on:		6/25/99							8-K/A
		6/23/99		1		33			8-K/A
		6/21/99		14
		6/16/99		14
		5/26/99		4
		5/17/99		29		30			NT 10-Q
		5/13/99		14
		3/30/99		29		30
		2/17/99		29		30
		2/2/99		14
		1/19/99		4					PRE 14A
		1/11/99		1		4			PRE 14A
		1/1/99		4
		12/31/98		3		29			10KSB,  10KSB/A,  5,  8-K/A,  DEF 14A
		12/18/98		12
		12/15/98		22
		11/30/98		12		21
		10/1/98		20
		9/30/98		12					10QSB,  8-K
		9/1/98		14		29
		8/20/98		4
		6/16/98		4					10QSB
		4/1/98		20
		1/5/98		4
		12/31/97		3		27
		11/1/97		14		19
		7/28/97		3		19
		12/31/96		19
		11/9/96		19
		2/23/94		19
		2/3/92		19
									List all Filings