ANNUAL REPORT

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

                                FORM 10-KSB

(Mark One)

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

     For the fiscal year ended DECEMBER 31, 2000

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

     For the transition period from ___________________  to   ____________

                     Commission file number: 000-20786

                       LEAPFROG SMART PRODUCTS, INC.
              (Name of Small Business Issuer in its Charter)

   COLORADO                           7372                     05-1076959
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization)   Classification Code Numbers) Identification
                                                              No.)

1011 Maitland Center Commons                  1011 Maitland Center Commons
Maitland, Florida 32751                       Maitland, Florida 32751
(Address and Telephone Number of             (Address of Principal Place of
Business or Principal Executive Offices)      Intended Principal Place of
                                              Business)



                   Jon Gerster, Chief Financial Officer
                       Leapfrog Smart Products, Inc.
                       1011 Maitland Center Commons
                          Maitland, Florida 32751
                              (407) 838-0400
         (Name, address and telephone number of agent for service)

                                Copies to:

                          Mark T. Thatcher, Esq.
                           Adam S. Clavell, Esq.
                          Nadeau & Simmons, P.C.
                         1250 Turks Head Building
                      Providence, Rhode Island 02903

                         TELEPHONE (401) 272-5800
                          FACSIMILE (401)272-5858

Securities registered pursuant to Section 12(b) of the Securities Exchange
Act:

     NONE

Securities registered pursuant to section 12(g) of the Securities Exchange
Act:

     COMMON STOCK, NO PAR VALUE PER SHARE
     ----------------------------------------------------------------
     (Title of class)

Check whether the issuer (1) filed all reports required to be filed by
Section13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

     Yes [X]        No [ ]

Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB [ ]

State issuer's revenues for its most recent fiscal year:  $ 972,724



The aggregate market value of the 7,010,373 shares of Common Stock held by
non-affiliates was $2,081,380 as of March 31, 2001. For purposes of the
foregoing calculation only, each of the issuer's officers and directors is
deemed to be an affiliate. The market value of the shares was calculated
based on the market value of such shares on such date.

As of December 31, 2000, 8,977,845 shares of the issuer's Common Stock were
outstanding.


                   DOCUMENTS INCORPORATED BY REFERENCE:

The following documents are incorporated by reference into this report:

1.   Information required by Part III of this Form 10-KSB is incorporated
     by reference by the Company from its Definitive Information Statement
     on Schedule 14C filed with the Commission on January 18, 2000.

     Transitional Small Business Disclosure Format:

     Yes  [   ]     No   [X]


                                  PART I

---------------------------------------------------------------------------
                       IMPORTANT FACTORS RELATED TO
              FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISKS
 ------------------------------------------------------------------------

The statements contained in this report that are not purely historical are
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, including statements
regarding the Company's expectations, hopes, intentions or strategies
regarding the future. All forward-looking statements included in this
document are based on information available to the Company on this date,
and the Company assumes no obligation to update any such
forward-looking statements. It is important to note that the Company's
actual results could differ materially from those in such forward-looking
statements. Among the factors that could cause actual results to differ
materially are the risk factors that may be listed from time to time in the
Company's reports on Form 10-QSB, 10-KSB and registration statements filed
under the Securities Act.



Forward-looking statements encompass the following:

-expectation that the Company can secure additional capital;
-continued expansion of the Company's operations through joint ventures and
 acquisitions;
-success of existing and new marketing initiatives undertaken by the
 Company; and
-success in controlling the cost of services provided and general
 administrative expenses as a percentage of revenues.

The forward-looking statements included in this document are based on
current expectations that involve a number of risks and uncertainties.
These forward-looking statements were based on assumptions that:

-the Company would continue to expand;
-capital will be available to fund the Company's growth at a reasonable
 cost;
-competitive conditions within the industry would not change materially or
 adversely;
-demand for the Company's services continue increasing;
-there would be no material adverse change in the Company's operations or
 business; and
-changes in laws and regulations or court decisions will not adversely or
 significantly alter the operations of the Company.

Assumptions relating to the above statements involve judgments with respect
to future economic, competitive, regulatory         and market conditions,
and future business decisions, all of which are difficult or impossible to
predict accurately and many of which are beyond the control of the Company.

Although the Company believes that the assumptions underlying the
forward-looking statements are reasonable, any of the assumptions could
prove inaccurate and, therefore, there can be no assurance that the
forward-looking information will prove to be accurate.

In light of the significant uncertainties inherent in the forward-looking
information included in this document, the inclusion of such information
should not be regarded as a representation by the Company or any other
person that the objectives or plans of the Company will be achieved.



                      ITEM 1. DESCRIPTION OF BUSINESS

GENERAL

LEAPFROG SMART PRODUCTS, INC.--DESCRIPTION OF THE BUSINESS

Leapfrog  Smart  Products,  Inc.,  (the  Company)  develops,  designs,  and
licenses  software  exclusively  for  Smart  Card applications, and related
database management systems.  The primary focus  of the Company is software
and  hardware  solutions  for  biometric technologies  developed  for  user
authentication and access control  for  both computer networks and physical
environments.  Two patents are pending and  additional  patent applications
are in process.

The  Company  works with customers and strategic partners domestically  and
internationally  to  deliver comprehensive, integrated and customized smart
card based systems, providing  software, hardware, personalization and full
implementation.

The  company currently has 41 full-time  employees  including  15  software
engineers  and  13 technical sales and marketing professionals.  The senior
management team is  composed  of  business,  legal, financial and technical
professionals with successful careers in their respective areas.  There are
two majority owned subsidiaries, Conduit Healthcare  Solutions and Leapfrog
Global  Products  (LGIC) and a joint venture, Smart Products  International
Pte, Ltd. (SPI), based in Singapore.

Approximately $9,000,000  and  35,000  engineering hours have been invested
developing a suite of proprietary software  programs,  which  are now being
offered  in  the  market.   The Company is a recognized leader in providing
Smart Card software and hardware solutions.

Current  company  Smart Card products  and  applications  include  personal
identification, e-purse  transactions,  loyalty point storage, physical and
logical  access,  and portable storage of personal  information,  including
medical  records.   The   Company   is   transitioning  from  research  and
development  to  full  commercial rollout of  products  and  services.  The
products and technology are being marketed through indirect sales channels,
strategic partners, value-added  resellers  and  in-house  technical  sales
staff.

The Company has developed contracts and strategic relationships for
specific areas including University Campus, Healthcare, and Government
markets.  The Company has forged Strategic Business Relationships to take
advantage of these contracts and partnerships.  Under these arrangements
Leapfrog will receive revenue from engineering fees, technology license,
and products royalty fees.



Since  recognized  industry  technology leaders have yet to emerge in these
many markets, the Company has  a  unique  opportunity  to  gain significant
market share.  The essential elements for success are in place: a creative,
productive  technology  and  engineering group, a talented and  experienced
sales team, a proven management team, and a technology leadership position.

Leapfrog was selected as the exclusive  Smart  card  software  applications
provider  to Electronic Data Systems Corporation (EDS) for the first  major
US Government  Smart  card initiative; a Smart Access Common ID Contract by
the General Services Administration  (GSA).   EDS  is  one  of  five  prime
contractors named for the estimated  $1.5 billion contract.

Further, the Company installed the first hospital Smart Card patient managment
system in the U.S. and will be installing three more in the first quarter of
2001.  Other major contracts to provide Smart Card software, systems and
solutions, are in negotiation and management believes that these will be signed
in 2001.

The  Company  has  written and sold software applications to the  following
customers:

Bronson Methodist Hospital         Smart Tracker 55
Disney                             Realty Tracker
Envoy                              Secure Pak/Commander
Loyalty Card, Inc.                 Community Card
Illco Unican                       Control Point
Munroe Regional Hospital System    Smart Tracker 55
National Safety Depot              Community Card
Super Show                         Interactive Kiosk
University of Central Florida      Control/Point Biothentic
United States Navy                 Biothentic
Woods & Water RV Resort            Control Point
Whiskey Creek RV Resort            Control Point

Revenues to date have been generated from the sale of software and hardware
related items such as  Smart  Card readers/writers used in pilot evaluation
programs, software-testing programs,  and specialized software. Leapfrog is
focused  on  selling  custom  software solutions,  hardware,  and  packaged
commercial-off-the-shelf products.



LEAPFROG'S MARKETS

The greatest opportunities for the Company's products at present are in the
access control and security markets.   Other  significant  markets  include
corporate  and  college campus markets, Healthcare, and Federal Government.
The security industry  encompasses  logical (computer network) and physical
access across many industries.  Campus includes corporations, associations,
universities,  and  other  institutions.  Healthcare  includes  physicians,
physician organizations, pharmacies  and  hospitals.   Government  includes
Federal, State, and Local entities.



1. SECURITY SYSTEMS OVERVIEW

Logical (Computer Network) Access

The  proliferation  of  the  Internet  in network computing, remote access,
telecommunications, wireless communications  and information management has
exposed  big holes in network security.  It is  difficult  for  MIS  or  IT
managers to  verify  network  users  and the information/data that is being
manipulated.  The large number of disparate  security  solutions  makes  it
even  more  difficult  for  security  administrators to authenticate users,
provide access control and protect the integrity of information.

According to a study completed by the Computer  Security  Institute  (CSI),
the Federal Bureau of Investigation (FBI) and the Computer Intrusion Squad,
70%  of  Fortune  1000  companies  polled experienced unauthorized use of a
computer  system and 59% of the attacks  came  from  Internet  connections.
When we translate  these  network  breeches into dollars lost from theft of
proprietary information the average  loss  was  $1,136,409.  Looking at the
destruction  of data from the "Melissa" virus alone  statistics  report  an
estimated $80  billion dollars lost.  These statistics support the case for
increased network security for every business and institution.

Leapfrog Smart Products, Inc. offers the latest in biometric and Smart Card
technology  to  enable   network   managers   to  implement  stronger  user
authentication,   access   control   policies,   and  deploy   Public   Key
Infrastructure (PKI) encryption and digital certificates. By replacing user
names   and   passwords   with   finger   print   identification   network,
administrators can reduce password administration costs, speed up the login
process   and   secure  the  network  with  stronger  user  authentication,
encryption and non-repudiation.

Leapfrog's biometric  Smart  hardware  and  software  product  line  called
BiothenticTM  is targeting the network security market. The Company will be
compatible  with  all  major  network  security  software companies and can
leverage their reseller channels by offering a high  margin,  value-add  to
their  existing solution in their existing customer base.  This sales model
will provide  an  immediate  sales  channel and reduce the need for product
support by Leapfrog.  International Biometrics Group reports U.S. biometric
revenue in 1999 at $58.4 million with  projected  growth to $594 million in
2003.



PHYSICAL ACCESS

Leapfrog  offers a robust, feature rich "Intelligent  Access  Control"  IAC
software application for use with a smart card door locking system. The IAC
software is  easily  integrated  and  compatible  with  all smart card lock
systems.  Leapfrog's  application integration provides the  user  with  the
flexibility of being inter-operable  with  all card manufacturers and their
operating systems. Within the physical access  control  market,  Smart Card
technology  is  fragmented.  Leapfrog has positioned itself to be a leading
provider of Intelligent Access Control software for smart card systems that
will provide compatibility and continuity between manufacturers.

Leapfrog can offer the Intelligent  Access  Control IAC product in a stand-
alone  environment  or  provide  both  a  Network solution  and  a  Time  &
Attendance component. In addition to these  products, the company has found
that the access control market has a strong demand  for a combination smart
card/biometric   reader   to  work  in  both  a  stand-alone  and   network
environment. Providing this  solution  will  give  an  additional  distinct
competitive advantage.

2. CAMPUS CARDS OVERVIEW

There are over 3700 higher education campuses in the U.S. and an additional
800+ in Canada. Over 1500 presently support card systems of which less than
1%  employ  smart  card  technology.  With  the added presence of corporate
campuses in a regional area, building a COMMUNITY  CARD  presence beginning
with seeded sites and expanding these through direct sales  to  neighboring
campuses  offers  an  attractive  first  step  toward  scaled distribution.
Corporate campuses in nearly every industry use personalized  cards.   Both
of these markets will migrate to Smart Cards and identification software to
increase  revenue,  cut  administrative costs, improve security and enhance
customer service.

The Leapfrog management team  is  experienced  in the sale, implementation,
integration  and  support  of  a closed architecture,  distributed,  multi-
application smart card system of over 700,000 cards in North America.

These Smart Card Systems include:

   (a) CAMPUS (E SMART, ESECURE,  EVOTE,  E  MEMBER,  EVALUE,  ETICKET) - a
     "one-card"  solution combined with a multi-application suite  targeted
     for vertical markets such as higher education campuses.
   (b) ENTERPRISE  (E  SMART,  E  SECURE,  E  VALUE,  ETICKET)  - Corporate
     campuses  to  leverage  off  our established one-card solution with  a
     focus  on  secure access, both logical  and  physical,  as  a  channel
     market.
   (c)  ASSOCIATION   MANAGEMENT   (ESMART,   EMEMBER,  EVOTE,  ETICKET)  -
     Professional/non-professional  associations  (unions,  clubs)  with  a
     common  focus  and  a  need  for managing  their  member's  activities
     (continuing education) over a broad regional area.


Once established in a community there  will  be a critical need to continue
growth  of  distribution  through  merchants  and  a  concentrated  loyalty
program.  The  Solutions'  strategy  includes  identification   of  loyalty
marketing  firms  for  strategic  partnerships  together  with chambers  of
commerce that have a vested interest in growing a public presence.



The Corporate and campus ID Card segment is a high margin business  and The
Company  is  using both direct and indirect marketing channels to penetrate
this market.   Leapfrog is licensing solutions to existing ID Card solution
providers seeking  to  provide  Smart Card based systems.  In 1999, the two
leading identification card system providers in the U.S. had combined sales
of $500 million out of $3.5 billion for the industry at large.
Leapfrog has developed an ID card  system  that is bringing a new degree of
operational  efficiency  to  organizations.   The   card   serves   as   an
identification  badge/card  that  provides an array of additional functions
including building access control, computer network access control, payment
services, cashless commerce, loyalty, data tracking, and data portability.

The Campus ID Card segment of Leapfrog's Sales and Marketing Plan is
focused on Higher Education, Corporate Campuses, and Association
Memberships that use cardholder identification and one or more additional
primary functional requirements for the card system.

Leapfrog is focusing on single site  installations  of  multi-application
smart  card  systems  including  multiple  purses, loyalty, eMember, eVote,
eTicket,  time  & attendance, access control,  SmartTracker  and  dedicated
purses for use of specified merchants, such as campus bookstores, fast-food
restaurants surrounding  campus sites. For legacy systems such as libraries
and meal plans already installed  at client sites, the IC card will include
an  ABA  compliant  stripe for the integration  of  these  applications  to
provide  a "one-card"  solution.  The  magnetic  stripe  will  provide  the
instrument  for  offering banking services where financial institutions are
desired. All cards issued will include this suite of applications

Leapfrog licenses  a  card  management system with purse architecture to be
used as a platform and integrate  the  application  suite  noted above. The
company  has licensed Smart City products produced by Product  Technologies
Inc., of Hartford,  CT and Proton World. The Smart City system is currently
installed worldwide and at 37 campuses in North America.

 3. HEALTHCARE OVERVIEW

Approximately 200 million Europeans carried Smart Cards for health care
identification at the end of 1999.  Many countries with national health
care systems are deploying Smart Card technology to reduce the costs
associated with delivering services.  The largest operating system is in
Germany with over 80 million cards.  In France, the project called "Sesam
Vitale" has deployed over 30 million Smart Cards.

In 1999, total revenues  for  the  healthcare  industry in the U.S. were
approximately  $1  trillion  dollars  with approximately  11%,  or  $110
billion, paid out for needless or redundant  tests.   Approximately  $35
billion  was  lost to Medicare fraud alone in 1998. In 1996, the Federal
Government enacted  the  Health Insurance Portability and Accountability
Act (HIPAA).  Security and  privacy  of  individual's medical records is
the cornerstone of HIPAA.

Recent modifications to the Health Insurance Portability and Accountability
Act of 1996 (HIPAA) will expand the Smart Card market substantially.  HIPAA
has recognized "the Smart card" as a "Secure  Token" for the portability of
medical and insurance information.  Applications  for  this technology will
include secure access to medical information, logical and  physical  access
for employees and medical staff.  Smart Cards will soon become the standard
for insurance companies to provide coverage information for their members.



Leapfrog  develops  biometric  and  Smart  Card based medical record and
communication  products.   Conduit Healthcare  Solutions  markets  these
products in the healthcare market.  These  products  address the growing
need  in  the  healthcare industry for better access to and  sharing  of
patient information  and greater privacy. Providing on-line and off-line
information and communication,  Conduit's  products  will  provide rapid
access to medical records and facilitate payments for medical treatment.

Conduit's primary source of revenue is from the development of systems
and license fees.  Income is generated through transaction franchise and
database management fees.  Smart Tracker 55 is the first loyalty
membership program using Smart Cards for tracking usage as well as
storing basic medical information for seniors.  A full-scale deployment
of Smart Tracker 55 was made at Munroe Regional Hospital in Ocala,
Florida, during 1999.  This membership based card for HMOs/PPOs and
specific hospital groups that provides coverage and critical medical
information to automate the supporting bureaucracy required for medical
care. Conduit's target markets are hospitals, seniors' programs, managed
care companies, insurance companies, emergency response systems and
physicians.  Conduit has already completed contracts with 4 hosptials in
North America for Smart Tracker 55.

Conduit is also working with Federal entities such as the Veterans  Affairs
Administration, the Department of Defense, Medicare, and Medicaid. With  no
competition  in the seniors' market, this revolutionary program is expected
to gain significant  market  share  and  thus position the Company securely
within the largest sector of the U.S. economy.

4. GOVERNMENT OVERVIEW

The federal government is currently a significant domestic market for Smart
Card systems. The "GSA Common Access ID Card"  program was recently awarded
to five consortium teams.   This $1.5 billion contract is the largest Smart
Card program in the history of the United States.   Electronic Data Systems
(EDS)  led  one  of the five winning teams. By contract,  Leapfrog  is  the
exclusive Smart Card software provider to the EDS team.

The government contract  is  designed  to  provide  federal  agencies  with
interoperable,  multi-application  Smart  Cards.  The cards will be used to
provide basic visual identification and authentication  as  well  as secure
access  for  e-commerce.  The Company will benefit substantially from  this
first major US government initiative.

The Company will  also be a provider of Smart Card solutions to EDS for the
US Navy and Marine  Corps landmark Intranet contract.  This contract is the
largest federal information  technology contract in history, valued at more
than $4.1 billion over five years.  A  three-year option in the contract is
valued at more than $6.9 billion. The company  projects substantial revenue
from these projects over the next five years.



Leapfrog is one of two Smart Card software development  companies to have a
proprietary  General Services Administration (GSA) IT schedule.   This  GSA
schedule is generating  revenue  for Leapfrog through the resale of product
lines from various vendors such as Micron Technology, Inc.

                                 PRODUCTS

BIOTHENTIC SCR-100


The BiothenticTM SCR100 is a biometric  Smart  Card  reader. The Biothentic
SC-100 reader is actually a combination of three technologies:  biometrics,
security,  and Smart Cards.  The Biothentic SCR 100 brings to the  security
market a device  capable  of providing user authentication, access control,
and secures communication.

The Benefits of solutions to users are:

                 Authenticate themselves to the recipient
                 Send encrypted data with keys on a Smart Card
                 Make purchases using an e-purse
                 Access secure web sites such as medical
                 repositories, virtual universities

SMARTTRACKER 55

Smart Tracker 55 is a Smart  Card/biometric  software  solution designed by
the  Company  to  improve  the efficiency of day-to-day administrative  and
communication tasks of the varied  participants in the healthcare industry.
These include physicians, hospitals,  pharmacies,  insurance  companies and
other  healthcare  providers.   Unique  features of the system include  the
secure  transfer  of  private healthcare information  and  other  pertinent
patient management data.

Currently the Smart Tracker 55 system is implemented in hospitals to manage
seniors  programs.  The  flexibility  of  the  platform,  however, makes it
possible to adapt the system to any affinity-based program.

CONTROL POINT

Control  Point   is  a  solution  that  provides Smart Card enabled  access
control.  The Access Control Point software  is  compatible  with all Smart
Card  lock  systems.   A  unique  graphical  user interface offers security
administrators a simple, easy-to-use enrollment  system  for assigning door



rights  (for  stand  alone and network devices), card privileges,  defining
user  groups and blacklisting.   Furthermore,  the  system  is  ODBC  (Open
Database  Connectivity)  compliant  for  simple  integration  with existing
databases.  The Control Point software will control a standalone  system, a
network system, or a combination of both stand-alone or network.

The  Control  Point   software  system was developed primarily to meet  the
growing need for Smart Cards in the  access  control  industry.  The demand
for multiple applications on a single card has been the  catalyst  for  the
explosive  growth  of  Smart  Cards  over  the  years.    The Control Point
system has been designed to offer standard features  for access control, as
well  as  enhanced  features  for  advanced  security  providing   seamless
integration  into  existing  installations.  Critical information is stored
directly on the Smart Card, allowing  the  user  the  convenience of having
remote  locations  that  can  be  programmed from a central  location  with
specific expiration dates.

Also, the Company's strategy includes  the  resale  of  turnkey  products
integrated to card management systems such as SmartCity and Proton. Each is
a  purse   platform  with  sophisticated  back  office  processing  systems
providing  secure  transaction  processing  and  settlement.  SmartCity  is
supported by  Product  Technologies  Inc. (PTI) a company from Hartford, CT
owned  by  ICL/Fujitsu.  An  advantage to  the  SmartCity  product  is  the
inclusion of a loyalty scheme that would have to be purchased separately on
the Proton platform. The following  is  a  short discussion of the software
products included in the Companies offerings:

SMARTCITY is  a  turnkey  smart   card-based   e-purse (electronic  purse)
application that  also  provides  a  multi-application
development platform and  tools  to  systems  integrators.  SmartCity is an
object-oriented   client-server   application   supporting   EMV-compatible
(Europay,  MasterCard, and Visa specifications), Microsoft Smart  Card  for
Windows, and  other  smart  reloadable  e-purse  smart cards and disposable
memory cards. It also supports secure multi-party loyalty applications that
can be integrated with e-purse applications.

The flexible, yet extremely secure design architecture of the system allows
it  to  be  easily  customized to each card issuer's requirements.  Audited
transactions, multi-issuer,  multiple  purses  and  currencies,  debit  and
credit  purses,  and  foreign language support are standard features of the
system. Utilizing a single  smart  card, SmartCity can additionally provide
support  for  physical  access control,  logical  access,  secure  Internet
access,   identification,   electronic    ticketing,   and   other   custom
applications.

Designed  as  a  host  system  independent  application,  integration  with
existing  payment  systems, credit/debit card authorization  networks,  ATM
networks, merchant POS  systems,  and  other  infrastructures is seamlessly
achieved.  SmartCity  is  a  field  proven  system  with   more   than   70
installations   on   5   continents   in  financial  and  multi-application
environments.

Proton is smart card management software developed by and for the large
banks.  It involves a complete suite of purchasing and revalue
functionality; in particular, it has a broad set of systems interfaces that
enable the product to conduct credit and debit authorizations on the
national interchange networks.



Proton's front end is similar to Smart City.  The differences lie in the
back office, which is more scalable and built for nationally distributed
transaction volumes. Proton will allow us to position ourselves as a
processing node that could easily be integrated into a bank's data
processing stream; it will employ the banks' technologies, and implement
the same control standards of high professional care.

EMEMBER{TM} is a stand-alone application capable of functioning as a single
application on a smart card or in concert  with the eSmart{TM} platform and
other Leapfrog software. The product is a web-based  application  generated
from  the demographic database provided by the client. The data is used  to
populate  and update information on smart cards with up to five parameters,
including expiration  date, which can limit physical and logical access and
reward  cardholders  with   the   benefits   of   membership   in   desired
organizations.

The  functionality of eMember{TM} breaks into two main areas; updating  the
information  on  your  Leapfrog  card  and/or  checking that information in
various formats to limit access to a location or  database. The eMember{TM}
utility  will  facilitate  this  functionality  by "interpreting"  existing
demographic codes for use with codes stored on the Leapfrog card.

EVOTE{TM} is  a  stand-alone  web-based  Smart  card application  that  is
configurable as either a strict voting application  for  campus  elections,
Association Membership surveys, Executive management elections, or  general
market/product  surveys.   As a traditional election format, it allows  the
easy set-up and configuration  of candidates, positions, voting eligibility
(as determined by data on Smart  card)  per  candidate,  dates & timeframes
when  voting  is  allowed,  and  general  voter eligibility management  and
tracking.  For Association membership surveys  or product/marketing surveys
it  facilitates  the  set-up  of the survey via a Wizard  that  allows  the
creation of up to 30 questions  per  product/topic/subject, the grouping of
products/topics/subjects into a categories  (Pre-defined  or  Administrator
defined),  captures  demographic  data stored in a standard format  on  the
smart card, marks the card as having  responded  to  the  given survey, and
provides   reporting   and  statistical  tools  for  each  of  the  various
categories/products/topics/subjects and demographics.


SALES AND MARKETING

In the technology  industry, there are three distinct phases of a company's
development:  Formulation,   Product  Development,  and  Sales.  Management
believes that LEAPFROG has successfully negotiated the Formulation phase in
1997 and 1998.  In  1999, the Company  focused  on  Product Development.
Major efforts in product sales began in mid-2000 after  additional  capital
became available to fund sales and marketing efforts.

LEAPFROG intends  to  market its  products three ways:

(a)  partnership distribution and licensing;
(b) closed user-group decision makers; and
(c) indirect distribution.



Initially, it is extremely important for a smaller company to create strong
strategic  partnerships.  Management does not believe that LEAPFROG has the
marketing resources and capabilities  of  major companies in other software
market  segments.  Instead,  LEAPFROG  intends  to  focus  on  establishing
important relationships and alliances with other companies that can license
Leapfrog's  software  and distribute it through  their  existing  channels,
although there can be no assurance  that  such relationships and alliances
can be established. LEAPFROG intends to target alliances which may include
Fortune 500 companies such as Sprint, Motorola, Lockheed  Martin, EDS, and
others. If successful, LEAPFROG can expect to garner  license  fees on a
wholesale basis from each alliance.

Secondly,  LEAPFROG  plans  to employ a "leadership relationship" marketing
strategy to offer its software  to  closed  user groups. Marketing emerging
technology  requires  one-on-one  selling  with  decision-makers.  In  this
regard,  Management  intends to utilize sales tactics  that  are  based  on
portraying Leapfrog in  a lead position, utilizing personal contacts at the
highest level in each target user group.

Lastly,  LEAPFROG  plans  to   offer   certain  products  through  indirect
distribution channels. These channel distributors  will  be  located  on  a
regional  basis and will be chosen based on overall commitment to LEAPFROG.
For example,  a  company  may  have the exclusive rights to market specific
LEAPFROG software products in a  particular geographic region, but would be
a non-exclusive reseller in other  areas. Further, a distributor's discount
level may be determined by the number  of  units  purchased or the level of
value-added services provided.

COMPETITION

The  entire  Smart  card  industry  is  fragmented  into  several   strata.
Management  believes that Leapfrog's direct competitors are companies  that
create software  applications.  They  are: 3GI, National CacheCard, Precis,
Cybermark, and RealMed. All of these companies  are  small  privately  held
companies.

There  are  a  host  of  other players in the industry with whom Management
believes LEAPFROG does not  compete.  Within the Smart card industry, the
sub-markets include:

(1)card  manufacturers  (Schlumberger, Gemplus, Giesecke  &  Devrient)  and
hardware manufacturers (Verifone, DANYL, Intellect) who are suppliers to
LEAPFROG;

(2)integrators (IBM, Honeywell/Bull)  who  generally  do not develop or own
any software that is proprietary in nature, but rather marketers of limited
applications only, which do not currently encroach on LEAPFROG markets, but
become potential customers;



(3)American Express, Visa, Master Card and banks who aid in developing
market awareness and are potential LEAPFROG customers; and


(4)system platform providers (Microsoft, Visa, Mondex,  Proton)  who  write
languages for applications but do not market Smart card products to  end
users.

Management does not believe that LEAPFROG directly competes with these
players, but rather purchases from or sells to them.


                      ITEM 2. DESCRIPTION OF PROPERTY

The Company currently leases its headquarters facility in Maitland,
Florida, which is owned by Geneva College. The space for the headquarters
facility is leased to the Company.  The following tabulates certain
information with respect to the lease currently executed between the
Company and Geneva College. The lease has annual increases of $.50 per
square foot per year.

Current
                                Square              Monthly
Location                        Footage             Rental      Expiration
-----------------------         ----------------    ----------- -------------

Executive Offices               14,500              $19,790     November, 2004
1011 Maitland Center Commons
Maitland, Florida 32751


                         ITEM 3. LEGAL PROCEEDINGS

Leapfrog and its subsidiary, Leapfrog Global IC Products, Inc.  ("LGIC")
were named in an action (Valenti vs. Leapfrog Smart Products, Inc. ("LSP")
et al) alleging that the companies failed to disclose certain corporate
records as required by Florida Law.  LSP's special Florida litigation
counsel has advised the company that the remedies asked for in the
complaint against LSP are not available because LSP is a Colorado
corporation. In any event, the plaintiff is seeking primarily equitable
relief, and not monetary damages except attorney's fees, against both LSP
and LGIC.   As such, even if the suit was successful, it would not
materially impact the financial condition of either LSP or LGIC.



REAL PROVENCHER V. LEAPFROG SMART PRODUCTS, INC., F/K/A ALBARA CORPORATION,
AND AMERICAN SECURITIES TRANSFER INCORPORATED was filed in the U.S.
District Court for the Southern District of Texas, Houston Division.
Plaintiff, a shareholder of the Company, has filed the following claims
against the Company: 1) the Company breached its statutory duty to register
and transfer Plaintiff's shares in the Company; 2) the Company violated his
statutory right under Rule 144(k) of the Securities Act of 1934 to
terminate restrictions to sell his shares; 3) the Company committed common
law and statutory fraud; 4) breach of contract under a Bleed Out Agreement;
5) and tortuous interference with Plaintiff's contract to sell 77,300
shares of stock.  Plaintiff has alleged actual damages of $2,576,000 plus
attorney's fees, and pre-and post-judgement interest.

The Company filed a lawsuit styled LEAPFROG SMART PRODUCTS, INC. V. REAL
PROVENCHER , in the U.S. District Court of the Middle District of Florida,
Orlando Division with the following claims: 1) breach of contract under a
Consulting Agreement; 2) breach of contract under the terms of a Bleed Out
Agreement; 3) violation of Rule 16 of the Securities Act of 1934; 4)
fraudulent misrepresentation and common law fraud; and 5) violation of Rule
144 of the Securities Act of 1934.  The Company alleged compensatory
damages, costs, and further relief, as the court finds appropriate.  The
Florida Court has transferred venue to the U.S. District Court for the
Southern District of Texas, Houston Division and the two cases have been
consolidated.

As part of a consulting agreement with Provencher, a warrant with an
effective date of February 18, 2000 was issued for the right to purchase
500,000 shares of common stock at $3.50 per share on or after April 30,
2000.  The warrant expires on January 31, 2010.  The exercise price of
$3.50 was to be adjusted to $0.035 in the event the Company did not close
an equity offering raising an aggregate of at least $2.5 million by July
16, 2000; which did not occur.  Although, Provencher has not attempted to
exercise the warrants, as part of the lawsuit the Company is attempting to have
the warrants declared null and void due to the alleged non-performance under the
Consulting Agreement.

Discovery is underway in the case.  Some settlement discussions have begun
but no settlement has occurred at this time.  The Company is unable to determine
the likelihood of an unfavorable outcome in this case and is not able to
estimate the potential loss to the Corporation at this time.  Accordingly, the
financial statements include no provisions or liability related to the ultimate
outcome of this matter.

The Company was party to a lawsuit brought by Publicard, Inc. regarding the
repayment of $100,000 in notes due to them from the Company.  It was the
Company's position that although these notes were recorded with interest
accruing, the notes should be offset with certain costs incurred by the
Company.  This lawsuit was settled on February 2, 2001, requiring that the
Company repay $90,000 in nine $10,000 monthly installments beginning
February 2001.



The lessor of the Company's former office space has sued the Company for breach
of contract and lien foreclosure based on the Company's breach of lease and
failure to pay rent.  Damages requested are $270,400, plus attorney's fees and
costs.  The Company has brought a counter suit against the lessor for a
declaratory action, breach of lease, tortious interference with an advantageous
business relationship, and breach of good faith and fair dealings regarding
reletting the property The Company has accrued an insignificant portion of the
lessor's claims in an amount equal to the unpaid lease payments that would have
been due under the lease through December 31, 2000.  No other amounts have been
recorded in the accompanying financial statements for theis uncertainty, as
managment cannot reasonably extimate the ultimate outcome.


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

No matters were submitted to a vote of shareholders during the fourth
quarter of fiscal year 2000.


                                  PART II

                   ITEM 5. MARKET FOR COMMON EQUITY AND
                        RELATED STOCKHOLDER MATTERS

During the 1999 and 2000 fiscal years, the Company's common stock traded on
the over-the-counter market and was quoted in the National Association of
Securities Dealers, Inc.'s "OTC Bulletin Board".  The range of high and low
bid quotations for the common stock for the two most recently completed
fiscal years is provided below.  The volume of trading in the Company's
common stock has been limited and the bid prices as reported may not be
indicative of the value of the common stock or of the existence of an
active trading market.  These over-the-counter market quotations reflect
inter-dealer prices without retail markup, markdown or commissions and may
not necessarily represent actual transactions.



1998 FISCAL YEAR HIGH BID LOW BID

First Quarter  $ 0.01    $ 0.01
Second Quarter $ 0.01    $ 0.01
Third Quarter  $ 0.01    $ 0.01
Fourth Quarter $ 0.05    $ 0.04

1999 FISCAL YEAR HIGH BID LOW BID

First Quarter  $ 0.09    $ 0.04
Second Quarter $ 0.09    $ 0.01
Third Quarter  $ 0.43    $ 0.01
Fourth Quarter $ 0.50    $ 0.34

2000 FISCAL YEAR HIGH BID LOW BID

First Quarter  $ 9.00    $ 5.88
Second Quarter $ 6.31    $ 2.63
Third Quarter  $ 4.69    $ 1.44
Fourth Quarter $ 1.94    $ 0.31

On December 31, 2000, the reported bid for the Company's
common stock was $0.375.

The Company has never paid dividends with respect to the common stock and
currently does not have any plans to pay cash dividends in the future.
There are no contractual restrictions on the Company's present or future
ability to pay dividends.  Future dividend policy is subject to the
discretion of the Board of Directors and is dependent upon a number of
factors, including future earnings, capital requirements and the financial
condition of the Company. The payment of future dividends will also be
restricted to the extent of $19,500 in liquidation preference inuring to
the benefit of the holders of the Company's Series F Preferred Stock. The
Colorado Corporation Code provides that a corporation may not pay dividends
if the payment would reduce the remaining net assets of the corporation
below the corporation's stated capital plus amounts constituting a
liquidation preference to other security holders.


                      ITEM 6. SELECTED FINANCIAL DATA

The statement of operations data as set forth below for the years ended
December 31, 1999 and 2000 and the balance sheet data at December 31, 1999
and 2000, have been derived from our combined financial statements and
notes, which have been audited by Moore Stephens Lovelace, P.A.,
independent auditors, whose report is included in this Annual Report.



The following financial data should be read in conjunction with the
consolidated financial statements and notes and management's discussion and
analysis of financial condition and results of operations included in this
prospectus.




                                   Year Ended      Year Ended
                                   December 31,    December 31,
                                   1999            2000
                                   --------------  --------------

STATEMENT OF OPERATIONS
-------------------------------------
                                             

Revenues                           $   121,533     $   972,724

Cost of Operations                 $    44,199     $   905,805

Selling and Administrative
  Expenses                         $ 2,737,851     $ 6,993,060

Other Income (Expenses)            $  (437,123)    $  (500,603)

Net Loss                           $(3,097,640)    $(7,426,744)

Net Loss per common
  Share, basic and diluted         $     (0.72)    $     (1.09)

Weighted average common
  shares outstanding                 4,280,158       6,866,964





BALANCE SHEET DATA
---------------------------------

The balance sheet data as of December 31, 2000 excludes the
underlying shares to warrants and options.





                                        Periods Ended December 31,
                                   ----------------------------------
                                     1999                    2000
                                   ---------------           --------------
                                                       

Working capital deficit              $(1,924,309)            $(2,531,095)
Total assets                         $   752,977             $ 1,110,066
Total long-term liabilities          $         -                       -
Total liabilities                    $ 2,257,597             $ 3,063,922

Stockholders' deficit                $(1,504,620)            $(1,953,856)




DIVIDEND POLICY

The Company expects to retain its earnings to finance further growth and,
when appropriate, retire existing debt. As a result, the Directors of the
Company expect that, for the foreseeable future, the Company will not
declare or pay any dividends on any of its shares.



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

The following discussion should be read in conjunction with the Financial
Statements and notes thereto.

GENERAL

Management's discussion and analysis contains various "forward looking
statements." Such statements consist of any statement other than a
recitation of historical fact and can be identified by the use of
forward-looking terminology such as "may," "expect," "anticipate,"
"estimate" or "continue" or use of negative or other variations or
comparable terminology.

We caution that these statements are further qualified by important factors
that could cause actual results to differ materially from those contained
in the forward-looking statements, that these forward-looking statements
are necessarily speculative, and there are certain risks and uncertainties
that could cause actual events or results to differ materially from those
referred to in such forward-looking statements.

PLAN OF OPERATION

LEAPFROG did not have any external sources of working capital during 2000
and minimal revenues during 2000 except for the sale of stock to
individuals and the issuance of notes payable. On February 18, 2000,
LEAPFROG merged with Albara Corporation through a reverse acquisition in
which Albara acquired LEAPFROG and the existing shareholders of LEAPFROG
obtained control of Albara. Even with the completion of this business
combination transaction, there can be no assurance that the company will
have sufficient funds to continue significant development, marketing and
manufacturing activities.  The funding obtained during 2000 from the sales
of stock to individuals and issuances of notes payable were less than
expected and accordingly, liquidity was very tight during the year.

From the period January 1, 2001 through March 31, 2001, additional debt of
$1.5 million was issued to third parties.

There is no assurance that the Company will be able to obtain additional
financing on terms acceptable to the Company.  If Management is successful
in obtaining additional funding, these funds will be used primarily to
provide working capital needed for repayment of outstanding notes payable,
software development, sales and marketing expense, to finance research,
development and advancement of intellectual property concerns and for
general administration.



Results of Operations-

Year Ended December 31, 2000 as Compared to Year Ended December 31, 1999

Revenues and Gross Profits:
----------------------------------

LEAPFROG is a development stage company with virtually no revenues in 1999
and only start up revenues in 2000.  Revenues for the year ended December
31, 2000 increased $851,000, from $122,000 to $973,000, a 700% increase
compared to the year ended December 31, 1999. Approximately $589,000 of the
revenues for the year ended December 31, 2000 were for purchases by the U.
S. Government made through the Company's General Administrative Services
("GSA") contract.  In addition to these GSA contract revenues, the
remaining increase in revenues of $262,000 during 2000 was due to the
recognition of revenue on the percentage of completion method for three
substantially complete projects involving both hardware and software
installation and development in the logical access and healthcare loyalty
products.  The completions of these projects will serve as working models
for future sales.  All revenues from these projects were associated with
the sale of predominantly hardware related items such as Smart card
readers/writers utilized in pilot evaluation programs, software testing
programs and specialized software solutions by potential future users of
Leapfrog's software products.

Gross profit for the year ended December 31, 2000 decreased to $67,000 from
$77,000 in the same period in 1999.  The gross profit on the GSA contract
revenues was $22,000 or 4% of the revenues.  The gross margin on the
remaining revenues was $45,000 or 12%.  This 12% margin is lower than is
expected on future sales but the projects implemented during 2000 were
primarily first time implementations and therefore more time intensive to
install.  The gross profit for 1999 was higher in amount and percentage due
to several factors.  There were several small projects in 1999 with low
incremental direct costs to the Company that will not be a recurring source
of revenue in the future.  These gross margins are not necessarily
indicative of margins expected in future years.

Total Operating Expenses:
-------------------------------

Total operating expenses for the year ended December 31, 2000, increased
$4.3 million from $2.7 million to $7.0 million, a 155% increase compared to
the same period in 1999.  This increase is net of  $118,000 and $76,000 in
software development expenditures that have been capitalized during the
year ended December 31, 2000 and 1999, respectively.  In the fourth quarter
of 2000, expense was recognized of $1.2 million for stock options issued
below market value.  After deducting this charge from total operating
expenses the remaining balance of $5.8 million represents a 113% increase
of $3.1 million over the prior year.  Over half of this remaining increase
is primarily associated with the increase in average number of employees
from 21 in 1999 to 39 in 2000.  Consulting fees also increased primarily
due to payment for services of consultants to assist in maintaining a
public market presence to attract investors.  General and administrative
expenses increased also with increased legal and accounting costs for SEC



filings, negotiations with investors and litigation, and in most areas with
the hiring of new personnel requiring more space and general overhead as
well as the travel and other related costs for developing sales,
advertising and marketing materials and in identifying potential contract
opportunities and recruiting distributors and value added resellers who may
participate in the intended product rollout in 2001.

Personnel and related expenses increased $2.8 million or 234% to $4.1
million for the year ended December 31, 2000 compared to the $1.2 million
for the same period in 1999.  In the fourth quarter of 2000, expense was
recognized of $1.2 million for stock options issued below market value.
After deducting this charge from personnel expenses the remaining balance
of $2.9 million represents a 138% increase of $1.7 million over the prior
year.   This remaining increase was due to the increase in average number
of employees from 21 in 1999 to 39 in 2000.  In addition, average salaries
increased as more expertise was brought into the Company in sales,
engineering and to cover the administration of a public company.

Consulting fees increased by $459,000 from the $392,000 incurred for the
year ended December 31, 1999 to $851,000 for the year ended December 31,
2000. The expenses in 1999 related primarily to fees paid to individuals
and companies that assisted the Company in identifying potential contract
opportunities and recruiting distributors and value added resellers.  In
2000, consultants were employed for the same purposes as in 1999, but
expenses increased in 2000 primarily due to payment for services of
consultants to assist in maintaining a public market presence to attract
investors.

General and administrative expenses increased to $2.0 million for the year
ended December 31, 2000 from  $1.1 million for the same period in 1999.
This $919,000 or 86% increase was due largely to increased legal and
accounting costs for SEC filings, negotiations with investors and
litigation.  General and administrative expenses also increased in several
areas with the hiring of new personnel requiring more space and general
overhead as well as the travel and other related costs for developing
sales, advertising and marketing materials and in identifying potential
contract opportunities and recruiting distributors and value added
resellers who may participate in the intended product rollout in 2000.  For
the first time, Board of Director fees of $154,000 were accrued in 2000 and
insurance costs increased for Directors and Officers insurance by
approximately $50,000.

Depreciation and amortization expenses increased $36,000 or 66% to $92,000
for the year ended December 31, 2000 compared to $55,000 for the same
period in 1999. The increase was due to the purchase of additional assets
as well as the amortization of capitalized software costs and the addition
attributable to costs of assets acquired in excess of fair market value.



Other income and expense:
--------------------------------

Interest expense for the year ended December 31, 2000 decreased $66,000
from $433,000 to $368,000 when compared to the same period in 1999. In
March through July 1999, LEAPFROG completed a short-term debt offering to a
select group of accredited investors providing net proceeds of $1,402,000.
As additional consideration, LEAPFROG provided these note holders 386,128
shares of common stock. For accounting purposes, these shares of common
stock were valued at $290,000 and that value was included as additional
interest consideration and expense associated with the issuance of notes
payable.  Substantially all of the remaining interest expense in 1999 is
directly associated with these outstanding notes payable and the $350,000
in bank notes.

In January of 2000, $550,000 in debentures were issued with 75,000 shares
of common stock as an incentive to enter into these agreements.  These
shares resulted in $56,250 in interest expense begin recorded.  Also,
included in interest expense was $55,000 attributable to the value of the
stock options issued with the $100,000 related party note on April 28,
2000.  During 2000, interest expense was accrued on all the debt incurred
in 1999, but for a full year.  The interest related to stock issued with
debentures and options issued with the notes that was more in 1999 than in
2000 offset the usual interest accrued on the debt.

Net loss:
----------

The net loss for the year ended December 31, 2000 increased $4.3 million
from $3.1 million to $7.4 million, a 140% increase compared to the year
ended December 31, 1999.  This increase is net of  $118,000 and $76,000 in
software development expenditures that were capitalized during the years
ended December 31, 2000 and 1999, respectively.

This increase in the net loss is primarily associated with the increases in
operating expenses incurred as additional personnel were hired and the
costs of becoming and maintaining a publicly traded company were incurred.
Not only were payroll and related occupancy and overhead expenses almost
doubled with the increase in average number of employees from 21 in 1999 to
39 in 2000, but legal and accounting fees and consulting fees increased
with the hiring of outside expertise for SEC filings, investor relations
and litigation.  The increase in the loss includes the fourth quarter $1.2
million charge for employee stock options issued below market.  The net
loss per share of common stock increased from $.72 per share in 1999 to
$1.09 in 2000. This increase is primarily due to the increase in losses
realized partially offset by an increase in the weighted average number of
common shares outstanding from 4,280,158 for the year ended December 31,
1999 to 6,866,964 for the year ended December 31, 2000.

LIQUIDITY AND CAPITAL RESOURCES

Net cash used by operating activities increased $1.9 million from $2.4
million for the year ended December 31, 1999 to $4.3 million for the year
ended  December  31, 2000.  The increase in the cash used for operations is
a direct increase in the net loss of the Company offset by the buildup of
accounts payable balances and the $1.2 million charge for employee stock
options issued below market which is a non-cash expense.



Net cash used by investing activities increased $2,000 from $237,000 for
the year ended December 31, 1999 to $239,000 for the year ended December
31, 2000. The increase was minimal because the decrease in acquisitions of
property and equipment were offset by the additional capitalization of
software costs in 2000. Management expects the cash invested in this area
to increase as funds are available.

Net cash provided by financing activities increased $2.0 million from $2.6
million  for  the  year ended December 31, 1999  to  $4.6  million  for
the year ended December 31, 2000.  Financing activities during 1999
included the issuance of common stock providing $1.2 million in the
aggregate and the issuance of notes payable which provided a net of  $1.4
million offset by an  $18,000 repayment of existing notes payable.
Financing activities during 2000 included the issuance of common and
preferred stock providing $4.0 million in the aggregate and the issuance of
notes payable that provided a net of $579,000 after repayment of principal
in the amount of $502,000.

Like many early stage technology companies, the majority of Leapfrog's
assets are intangible assets such as copyrights, trademarks, and research
and development costs which by their very nature are not reflected in the
Company's balance sheet as assets.

In the past, Leapfrog's Management has been successful in attracting
accredited investors who have purchased newly issued common stock. However,
there can be no assurance that the Company will be able to obtain
additional equity financing on similar terms in the future.  Over the past
two years much of Leapfrog's debt financing has been short-term notes
payable.

These notes may only be repaid if the company successfully raises
additional equity or debt financing. In addition to the cash requirement
associated with repaying these notes, LEAPFROG may not be able to mount an
effective national marketing campaign for its products without an
additional infusion of capital. The Company does not have any commitments
to provide additional capital funding.  Accordingly, there can be no
assurance that any additional funds will be available to the Company to
allow it to repay its outstanding debt and to cover the expenses associated
with executing its sales and marketing plan.

Subsequent Events After December 31, 2000

On April 2, 2001, the Company entered into an agreement for the sale of
approximately 82% of Conduit with closing to be within 120 days with a two-
year right-of-first refusal to purchase the remaining shares of Conduit
held by the Company at an equivalent price per share.  The sale of Conduit
includes licensing rights for the Company's software assets solely related
to the healthcare industry in the United States, which includes, but is not
limited to  hospitals, physician offices, pharmacies, insurance companies,
managed care organizations, clinics, dental offices, chiropractic,
podiatry, ocular health, governmental healthcare agencies, providers and
payors, ambulances, nursing homes, and home healthcare agencies.  In



exchange for selling the controlling interest in Conduit, the purchaser
will pay the Company $510,000 and provide Conduit with $1.9 million to fund
its ongoing business as well as guaranteeing software development fees of
$3.0 million pursuant to the terms of a software development agreement
which Conduit and the Company executed in connection with the stock
purchase agreement. The purchaser is required to pay the Company $250,000
by May 29, 2001.  Between that date and closing, the purchaser will pay the
Company not less than 20% of all cash collected, up to a maximum of
$510,000, including the $250,000 paid by May 29, 2001, in any private
offering of Conduit's securities undertaken to satisfy the purchaser's
obligation to provide the Conduit funding.  The balance if any will be paid
at closing. Additionally, the Company would be responsible for satisfying
the future exercises, if any, of the outstanding stock options of Conduit
as of the date of the definitive agreement.

In March 2001, Leapfrog Merger, Inc. changed its name to Leapfrog Smart
Products, Inc.

In February 2001, the Company issued a note to a shareholder and noteholder
for $2.0 million to be funded in various installments from January 25, 2001
through May 15, 2001.  Through April 3, 2001, the Company has received
approximately $1.5 million of this funding.  The note is secured by all
assets of the Company. Interest accrues at 12% and is due and payable
quarterly beginning July 1, 2001.  The note matures on July 1, 2002.  The
note or any portion thereof, is convertible into shares of the Company's
common stock at the rate of $1.00 per share.  As part of this financing
agreement, the noteholder received an option to purchase up to 1,000,000
share of the Company's common stock at $1.00 per share through June 30,
2002.

Proceeds from this note were used to repay the $200,000 remaining balance
on a note that was secured by all assets of the Company and was due in
January 2000.

The Company is currently renegotiating the terms of much of the outstanding
debt.  The $100,000 note with the bank has been extended until October 1,
2002.  Many of the debenture holders agreed to take new notes in place of
the debentures.  Notes have been issued that brought $477,000 of the debt
outstanding at December 31, 2000 current.  The majority of the new notes
call for repayment of the principal and interest over 24 month periods
either beginning in March or August 2001.

On January 16, 2001 the Board of Directors approved employment contracts
with three key employees.  The terms of the contracts extend to dates
ranging from January 24, 2002 to September 30, 2003.  The agreements call
for aggregate salaries of $390,000 with annual 4% increases.  These
agreements call for the issuance of an aggregate of 1,100,000 stock options
to purchase common stock of the Company.  The options all have a strike
price of $1.00 each with various vesting dates through January 1, 2002 and
expiration dates ranging from January 16, 2004 through December 31, 2005.
The other material provision to one of the contracts involves the payment
of a cash bonus equal to 1% of the Company's net profits, defined as net
earnings before insurance, taxes and amortization.  Another contract
requires the payment of a cash bonus equal to 4% of the Company's income
from U. S. operations, defined as net income before taxes, minority
interests, extraordinary items, amortization of intangible assets, interest
on long-term debt and any incentive compensation to employees.



In January 2001, the Board of Directors elected the following officers:

Co-CEO's                                    Dale Grogan and Les Bromwell
Chairman of the Board                       Randolph Tucker
President, Leapfrog Smart Products, Inc.    Les Bromwell
Chief Operating Officer                     Perry Dunn
Chief Financial Officer                     Jon Gerster
Chief Technology Officer                    Damian Szigeti
Vice President for Sales and Marketing      Vince Ley
Vice President for Investor Relations       Ken Clinton
President, LGIC                             Gary Wolfson
Controller/Treasurer                        Nana Li

The appointment of Jon Gerster as CFO was after the resignation at the
beginning of January 2001 of Jim Gornto as CFO.

Y2K COMPLIANCE

LEAPFROG concluded its efforts concerning its exposure relative to year
2000 issues for both information and non-information technology systems.
Management actively monitors the status of the readiness program of the
Company.  Leapfrog's out of pocket cost associated with becoming Year 2000
compliant were not significant. These cost were expensed as incurred, and
the Company does not anticipate any additional material expenditure as a
result of Year 2000 issues.

Based on operations since January 1, 2000, including the leap year date of
February 29, 2000, the Company has not experienced any significant
disruption or change, and does not expect any significant impact to its
ongoing business as a result of the Year 2000 issue.  Additionally, the
Company is not aware of any significant Year 2000 issues or problems that
have arisen for its significant customers, vendors or service providers. As
there can be no assurance that the Company's efforts to achieve Year 2000
readiness have been completely successful or that customers, vendors and
service  providers will not experience Year 2000 related  failures  in  the
future, the  Company  will  continue  to  monitor its exposure to Year 2000
issues and will leave its contingency plans  in place in the event that any
significant Year 2000 related issues arise.

FORWARD LOOKING STATEMENTS

This Management's Discussion and Analysis of Financial Condition and
Results of Operations includes a number of forward-looking statements that
reflect Management's current views with respect to future events and
financial performance. Those statements include statements regarding the
intent, belief or current expectations of LEAPFROG and members of its
management team as well as the assumptions on which such statements are
based. Prospective investors are cautioned that any such forward-looking



statements are not guarantees of future performance and involve risk and
uncertainties, and that actual results may differ materially from those
contemplated by such forward-looking statements.  Readers are urged to
carefully review and consider the various disclosures made by the Company
in this report and in the Company's other reports filed with the Securities
and Exchange Commission.  Important factors currently known to Management
could cause actual results to differ materially from those in
forward-looking statements.  The Company undertakes no obligation to update
or revise forward-looking statements to reflect changed assumptions, the
occurrence of unanticipated events or changes in the future operating
results over time.   The Company believes that its assumptions are based
upon reasonable data derived from and known about its business and
operations and the business and operations of LEAPFROG.  No assurances are
made that actual results of operations or the results of the Company's
future activities will not differ materially from its assumptions.

MARKET RISKS AND OTHER BUSINESS FACTORS

In passing the Private Securities Litigation Reform Act of 1995 (the
"Reform Act"), Congress encouraged public companies to make "forward
looking statements" by creating a safe harbor to protect companies from
securities law liability in connection with forward looking statements. We
intend to qualify both our written and oral forward looking statements for
protection under the Reform Act and any other similar safe harbor
provisions.

Generally, forward looking statements include expressed expectations of
future events and the assumptions on which the expressed expectations are
based. All forward looking statements are inherently uncertain as they are
based on various expectations and assumptions concerning future events and
they are subject to numerous known and unknown risks and uncertainties
which could cause actual events or results to differ materially from those
projected.

Due to those uncertainties and risks, the investment community is urged not
to place undue reliance on our written or oral forward looking statements.
We undertake no obligation to update or revise our forward looking
statements to reflect future developments. In addition, we undertake no
obligation to update or revise forward looking statements to reflect
changed assumptions, the occurrence of unanticipated events or changes to
future operating results over time.

EVOLVING INDUSTRY STANDARDS; RAPID TECHNOLOGICAL CHANGES

The Company's success in its business will depend in part upon its
continued ability to enhance its existing products and services, to
introduce new products and services quickly and cost effectively to meet
evolving customer needs, to achieve market acceptance for new product and



service offerings and to respond to emerging industry standards and other
technological changes. There can be no assurance that the Company will be
able to respond effectively to technological changes or new industry
standards. Moreover, there can be no assurance that competitors of the
Company will not develop competitive products, or that any such competitive
products will not have an adverse effect upon the Company's operating
results.

Moreover, management intends to continue to implement "best practices" and
other established process improvements in its operations going forward.
There can be no assurance that the Company will be successful in refining,
enhancing and developing its operating strategies and systems going
forward, that the costs associated with refining, enhancing and developing
such strategies and systems will not increase significantly in future
periods or that the Company's existing software and technology will not
become obsolete as a result of ongoing technological developments in the
marketplace.

SUFFICIENCY OF CASH FLOWS

Because current cash balances and projected cash generation from operations
are not sufficient to meet the Company's cash needs for working capital and
capital expenditures during 2001, management intends to seek additional
equity or obtain additional credit facilities.  The sale of additional
equity could result in additional dilution to the Company's shareholders. A
portion of the Company's cash may be used to acquire or invest in
complementary businesses or products or to obtain the right to use
complementary technologies. From time to time, in the ordinary course of
business, the Company evaluates potential acquisitions of such businesses,
products or technologies.

INCOME TAXES

The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes"
("SFAS 109") issued by the Financial Accounting Standards Board ("FASB"),
under which deferred tax assets and liabilities are provided on differences
between the carrying amounts for financial reporting and the tax basis of
assets and liabilities for income tax purposes using the enacted tax rates.
Under SFAS 109, deferred tax assets may be recognized for temporary
differences that will result in deductible amounts in future periods. A
valuation allowance is recognized, if on the weight of available evidence,
it is more likely than not that some portion or the entire deferred tax
asset will not be realized.

FEDERAL INCOME TAX ASPECTS OF INVESTMENT IN THE COMPANY

The discussion contained herein has been prepared by the Company and is
based on existing law as contained in the Code, amended United States
Treasury Regulations ("Treasury Regulations"), administrative rulings and



court decisions as of the date of this Registration Statement. No assurance
can be given that future legislative enactments, administrative rulings or
court decisions will not modify the legal basis for statements contained in
this discussion. Any such development may be applied retroactively to
transactions completed prior to the date thereof, and could contain
provisions having an adverse affect upon the Company and the holders of the
Common Stock. In addition, several of the issues dealt with in this summary
are the subjects of proposed and temporary Treasury Regulations. No
assurance can be given that these regulations will be finally adopted in
their present form.

                       ITEM 8. FINANCIAL STATEMENTS

The financial statements are included beginning at page F-1. See page F-2
for the Table of Contents to the Financial Statements.

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

As previously reported on a Current Report on Form 8-K dated March 17,
2000, LEAPFROG dismissed Thomas Leger & Company, P.A., whose address is
1235 Loop West, Suite 907, Houston, Texas. Thomas Leger & Company, P.A. was
previously engaged as the principal accountant to audit the registrant's
(then Albara's) financial statements. On March 2, 2000, by unanimous
consent of the board of directors of the Company, Leapfrog dismissed Thomas
Leger & Company and retained Moore Stephens Lovelace, P.A.  The following
information is set forth pursuant to Reg. Sec. 229.304 of Regulation S-K of
the Securities Act of 1933:

(a) Thomas Leger and Company's report on the balance sheet of Albara
Corporation, the predecessor corporation to the Company, for only the year
ended December 31, 1998 contained no adverse opinion or a disclaimer of
opinion, nor was it qualified or modified as to uncertainty, audit scope,
or accounting principles;

(b) The board of directors recommended and approved the decision to change
accountants;

(c) From the date Albara commenced operations until their dismissal, there
have been no disagreements with the former accountant on any matter of
accounting principles or practices, financial statement disclosure, or
auditing scope of procedure.

(d) The Company has requested Thomas Leger & Company, P.A., to furnish it a
letter addressed to the Commission stating whether it agrees with the above
statements.  A copy of that letter was filed as Exhibit 16.1 to the
Company's Form 8-K, dated March 17, 2000.



On February 25, 2000, Leapfrog hired Moore Stephens Lovelace, P.A.
Certified Public Accountants, whose address is 1201 South Orlando Avenue,
Suite 400 Winter Park, FL 32789-7192 as the principal accountant to audit
the Company's financial statements.

                                 PART III

           ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
                             CONTROL PERSONS;

Compliance with Section 16(a) of the Securities Exchange Act of 1934

Section 16(a) of the Exchange Act, requires the Company's officers,
directors and persons who beneficially own more than ten percent of the
Common Stock to file reports of securities ownership and changes in such
ownership with the Securities and Exchange Commission.

Officers, directors and greater than ten percent beneficial owners also are
required by rules promulgated by the Securities and Exchange Commission to
furnish the Company with copies of all Section 16(a) forms they file.

Based solely upon review of the copies of such forms furnished to the
Company, or written representations that no Form 5 filings were required,
the Company believes that during 2000 all Section 16(a) filing requirements
applicable to its officers, directors and greater than ten percent
beneficial owners were complied with on a timely basis.

Committees of the Board
------------------------------------
The Board of Directors delegates certain of its authority to a Compensation
Committee and an Audit Committee.

The primary function of the Compensation Committee will be to review and
make recommendations to the Board with respect to the compensation,
including bonuses, of the Company's officers and to administer the
Company's Compensatory Stock Consulting Plan.

The function of the Audit Committee is to review and approve the scope of
audit procedures employed by the Company's independent auditors, to review
and approve the audit reports rendered by both the Company's independent
auditors and to approve the audit fee charged by the independent auditors.
The Audit Committee will report to the Board of Directors with respect to
such matters and recommends the selection of independent auditors.



MANAGEMENT

(a) The Company's directors as of December 31, 2000:

NAME                TITLE                         AGE

Dale Grogan         President & Director
Randolph Tucker     CEO, Treasurer & Director
Ron Breland         Director
Bruce Starling      Chairman & Director
Van Staton          Director
George Stuart       Director
Dennis Lehr         Director
Dr. Les Bromwell    Director
Bill Baker          Director

(b) The Company's officers as of December 31, 2000: See response to Item
2(a) above.

NAME                TITLE               ADDRESS

Bruce Starling      Chairman            1011 Maitland Center Commons
                                        Maitland, FL 32751

Randolph Tucker     CEO & Treasurer     1011 Maitland Center Commons
                                        Maitland, FL 32751

Dale Grogan         President           1011 Maitland Center Commons
                                        Maitland, FL 32751

Jim Gornto          CFO                 1011 Maitland Center Commons
                                        Maitland, FL 32751

Perry Dunn          Secretary           1011 Maitland Center Commons
                                        Maitland, FL 32751

(c) The Company's general partners: None.

(d) Record owners of 5 percent or more of any class of the Company's common
stock: See response to Item 2(e) below.

(e) Beneficial owners of 5 percent or more of any class of the Company's
common stock:



COMMON STOCK


------------------------------------------------------------------------------
NAME AND ADDRESS              NUMBER OF           PERCENT
OF BENEFICIAL OWNER           SHARES              OF CLASS  OPTIONS
------------------------------------------------------------------------------

Ron Breland                      8,800            0.10%     1,025,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Dale Grogan                    331,000            3.69%      925,574
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

------------------------------------------------------------------------------
NAME AND ADDRESS              NUMBER OF           PERCENT
OF BENEFICIAL OWNER           SHARES              OF CLASS  OPTIONS
------------------------------------------------------------------------------

Bruce Starling                 189,858            2.11%     50,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Van Staton                     313,629            3.49%     50,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Randolph Tucker               520,500             5.80%    936,052
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Bill Baker                      7,500              .08%          -
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751



Dennis Lehr                    25,612              .29%     12,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Dr. Les Bromwell               92,843             1.03%     12,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Jim Gornto                      3,000             0.03%     35,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Perry Dunn                     11,730             0.13%     36,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751<

Song Ru Hua                   500,000             5.57%          -
108 Powers Court #110
Sterling, VA 20166

BIOGRAPHICAL INFORMATION:

BRUCE STARLING Director.

Mr. Starling attended the University of Florida  where he earned a Bachelor
of   Science  in  Business  Administration  (1963),  Master   of   Business
Administration (1965) and Juris Doctor (1967).

After  graduating the University  of  Florida School of Law, Mr. Starling
entered  the military serving in the Judge  Advocate  General's  office  in
Vietnam (1968-1972).  He  practiced law in the Miami and Orlando offices of
Helliwell,  Melrose and DeWolf  (1972-1977)  and  was  General  Counsel  to
Governor Reubin Askew (Tallahassee, Florida 1977 to 1979).



From 1979 through 1981, he was the Executive  Assistant  to  the  U.S.
Trade  Representative  in 1979 and subsequently became a partner in the
Orlando based law firm of DeWolf, Ward and Morris (1981-1986).

Mr.  Starling  became  Senior  Vice President of Harcourt Brace Jovanovich,
Inc.  (1986-1990),  was  Of  Counsel  to  Akerman,  Senterfitt  and  Edison
(1990-1992), Assistant Executive  Director  of the Greater Orlando Aviation
Authority (1992-1993) and later VP of governmental  relations  for the Walt
Disney  Corporation  (1993-1994).  Mr. Starling with his brother Alan,  now
owns the Starling Auto Group based in Kissimmee, Florida.

Mr. Starling presently sits on the Advisory  Board  of  Colonial  Bank; the
Florida  Prepaid  College Board, where he was appointed by the Governor  of
Florida; the Florida  Tax  Watch Board, the Florida District Export Council
Board, the Florida/Korea Economic  Cooperation  Committee  and  the Florida
Chamber of Commerce Board.

VAN STATON, Director

Mr.  Staton  received  an  Honorary  Associate  Degree from Central Florida
Community  College,  Ocala,  Florida  and  is  a member  of  the  Executive
Committee and Board of Directors of the Company.

Mr.  Staton was manager of the Ocala, Florida Belk  Lindsey  store  for  36
years  before his retirement in 1984. He is a former member of the Board of
Trustees for the Central Florida Community Collage and past Chairman of the
School Board  for  Marion  County,  Florida. He is actively involved in the
recruiting  and  regional  training  as  an   area  coordinator  for  Excel
Telecommunications, a public company.

RANDOLPH TUCKER, CEO/Director

Mr. Tucker has practiced business law for more  than  25  years  and  has
consummated numerous transactions in all phases of business. His experience
includes  business   formation  and administration,  banking,  bankruptcy,
mergers and acquisitions.  He  is  recognized  as  one  of  the outstanding
specialists  within the membership law discipline. He has represented  over
50 corporations  in  various  aspects  of  leisure law over the past twelve
years. His business experience includes the chartering of banks, television
stations, underwritings, and various corporate counsel responsibilities.



As CEO of Leapfrog Smart Products, he has been instrumental in creating the
infrastructure and corporate environment. Mr. Tucker has been able to
assemble some of the brightest minds in a new industry and establish a
cohesive creative workplace.  Mr. Tucker provided strategic guidance,
business development, and expansion analysis.

DALE GROGAN, President/Director

Mr. Grogan's professional experience includes over a decade in finance  and
investment   banking. He   has   managed  two  investment  banking  firms
specializing  in  business  start-ups, with  particular  emphasis  in  the
membership industry. Related  business  experience  for Mr. Grogan includes
the  formation  and initial administration of a national  non-profit  trade
association within the leisure and travel industry, board membership for an
interactive  travel   information   supplier, and   advisor   to  several
telecommunications  marketing  companies  within  the  pre-paid phone card
industry.

Mr.  Grogan  provides  corporate  and  industry vision. His duties  include
product  and  market  development,  recruiting,   management  and  strategy
formulation and implementation. Mr. Grogan is a recognized author and guest
speaker  in  the  Smart  card  industry  and  serves  on  various  industry
technology committees. He is a co-founder and President of  Leapfrog  Smart
Products.

RONALD BRELAND, Director

Mr.  Breland  is the current President of Selbre Associates, Inc. He brings
28 years of experience in  contract  negotiations  and management for both
commercial  and  governmental  markets.  Mr.  Breland  has  supervised  and
personally   negotiated  more  than  1,000  Schedule  Contracts and   has
successfully  conducted   compliance   audits  for  several  Fortune  1,000
companies.  Mr.  Breland  was a Charter Member  of  the  Industry  Advisory
Council of the Federation of  Government Information Processing Councils, a
member of the American Management  Association  and  a former member of the
Baltimore-Washington  Minority  Economic Development Council.  Mr.  Breland
holds a B.S. in Engineering from the University of Maryland.

WILLIAM BAKER, Director

Mr. Baker currently holds the title of President and CEO of the Motion
Picture Academy and EVP of the Motion Picture Academy Association,
positions held since 1994.  Mr. Baker's tenure with the Association began
in December 1991, when he was named Senior VP and Director, Worldwide
Piracy.   Prior to joining the MPA/MPAA, Mr. Baker enjoyed a very
successful career with the Federal Bureau of Investigation, which he began
in 1965.  At the time of his retirement from the FBI in 1991, Mr. Baker
held the position of Assistant Director, Criminal Investigative Division,
responsible for all criminal investigations.  While on hiatus from the FBI,
Mr. Baker also served as Director of Public Affairs for the Central
Intelligence Agency.



Throughout his career, Mr. Baker has been recipient of numerous awards,
including the Edmund J. Rudolph Award  (1992), at the Attorney General's
40{th} Annual Awards Ceremony.  Mr. Baker has also been bestowed the U.S.
Marshal's Star for lifetime achievement in law enforcement and
the rare title of Distinguished Executive by President Bush in recognition
of his outstanding accomplishments in advancing the FBI's investigative
mission.

Mr. Baker is a graduate of the University of Virginia and a US Air Force
veteran, assigned to the office of Special Investigations.

DR. LES BROMWELL, Director

Leslie G. Bromwell studied at the Massachusetts Institute of Technology,
where he received degrees in Chemical Engineering and in Civil Engineering.
During his study at MIT he participated in numerous research projects
involving both Chemical and Civil Engineering.

After receiving his doctorate from MIT in 1966, Dr. Bromwell joined the
faculty of the Department of Civil Engineering.  From 1966 to 1972, he
taught undergraduate and graduate courses in engineering. Dr. Bromwell also
directed sponsored research projects and supervised graduate students in
their thesis research. After leaving MIT in 1972, he returned to Florida
and started an engineering company in Lakeland, Bromwell & Carrier, Inc.,
which in 1997 became BCI Engineers & Scientists, Inc.

Dr. Bromwell received registration as a Professional Engineer in eight
states.  He represented industrial clients, government agencies,
contractors, architects, and engineers on projects involving environmental
and geotechnical problems and issues.  He served on consulting boards and
task forces for the U.S. Army Corps of Engineers, the National Aeronautics
and Space Administration, and the State of Florida.  Dr. Bromwell was a
member of NASA's Lunar Science Team, a group of experts responsible for
scientific investigations during the Apollo manned missions.  As a member
of this team, he participated in the development of new instruments for
conducting lunar surface experiments, in the training of astronauts for
surface activities, and in the testing of lunar samples returned to earth.

 In 1989, he became President of Consolidated Minerals, Inc., a Leesburg,
Florida, based company engaged in mining, agriculture, and power
generation.  As President of CMI, he led the development of new
technologies and their implementation through several start-up subsidiary
companies and foreign joint ventures in China and Brazil.  In 1997, CMI
merged with Florida Crushed Stone Company.  In 1998, Dr. Bromwell also was
named President of an affiliated company, US Nutraceuticals, LLC.  USN
harvests botanical ingredients for herbal products and manufactures high
quality herbal extracts using proprietary supercritical fluid extraction
technology.  In October 2000, Dr. Bromwell resigned from FCS and USN, and
became Chairman and CEO of Leapfrog Global IC Products, Inc. a subsidiary
of Leapfrog Smart Products, Inc.



DENNIS J. LEHR, Director

Mr. Lehr became Of Counsel to Hogan & Hartson in 1994.  In addition to his
part-time law practice, Mr. Lehr has worked as a private consultant for
domestic and international businesses on financing issues.  These
activities have taken him five times to China, as well as several trips to
Germany, Switzerland and Liechtenstein.  During his career with the firm,
Mr. Lehr has traveled extensively and has lectured in Australia, Canada,
China, Russia and Switzerland.  In 1992, he was part of a technical
assistance mission sponsored by the State Department that traveled to
Russia and Kazakhstan.  Mr. Lehr was the capital markets "expert" on this
trip, which was lead by the then Solicitor General, Kenneth Starr.  In
addition to his activities in the American Bar Association, as a business
consult and with Hogan & Hartson Mr. Lehr acts as a part-time consultant to
the Securities and Exchange Commission.

Mr. Lehr's practice of law is concentrated in the areas of banking,
financial institutions and securities law.  His education includes a B.A.
from New York University, L.L.B. from Yale University and L.L.M. from New
York University.

JIM GORNTO, CFO

Mr.  Gornto, who serves as  the  Company's  CFO,  earned  a  Bachelor's  of
Business  Administration  from  Georgia  State University in 1969, where he
also  earned an M.B.A. in 1972. He has over  30  years  experience  in  the
banking  industry,  beginning  in 1969 with First National Bank in Griffin,
Georgia. Mr. Gornto began as a cashier  at  First National Bank and, before
his  departure  in  1973,  was elected Vice President  and  Executive  Vice
President. He subsequently served  as President and Chief Executive Officer
of the Bank of Fort Valley in Fort Valley,  Georgia,  First  American Bank,
Monroe, Georgia, Florida National Bank, Gainesville, Florida,  Barnett Bank
of Pinellas County, Clearwater, Florida, South Trust Bank, Ocala, Florida,
Bank  U.S.,  Ocala,  Florida  and First Federal Savings Bank of New Smyrna.
During his years in executive offices,  Mr.  Gornto  has  participated in a
number of mergers and acquisitions between financial institutions with tens
of  millions of dollars in assets. At Riverside National Bank,  Mr.  Gornto
earned  his  Series  7  and  63  licenses.  He also served as an Investment
Representative  at  Edward  Jones Investments, Port  Orange,  Florida.  He
served in Vietnam in the United States Army-Airborne Division of Special
Forces.

PERRY DUNN, Chief Operating Officer
Perry Dunn joined the Leapfrog team in October 1999 after a distinguished
30-year career in the United States Marine Corps.  During the decade of the
90's he served in several senior positions in the Fleet Marine Forces, in
the Pentagon, and in the Department of Defense acquisition corps.  He was
the Commanding Officer of Marine Helicopter Squadron 167 in North Carolina;
Special Assistant to the Navy and Marine Corps Acquisition Executive;
Deputy Director of Asian and Pacific Affairs for the Secretary of Defense;
and Director of Marine Corps Acquisition Programs in Orlando, Florida.  His
vast experience throughout his career, positions him well to oversee and
coordinate the daily operations of Leapfrog Smart Products.



Perry earned his Bachelor's of Science Degree from the United States Naval
Academy, and gained his Master's Degree in Business Administration from the
University of West Florida.  In the local community he is especially active
in service to his church and in supporting the Chamber of Commerce as a
member of the Education Committee and Community Service Committee of
Leadership Orlando Alumni.  He is a graduate of Leadership Orlando, Class
45.


BOARD OF DIRECTORS

Colorado provides that a corporation's board of directors may be divided
into various classes with staggered terms of office. The Company's
directors are elected for a term of three years and until their successors
are elected and qualified.

NUMBER OF DIRECTORS

The Company's board of directors currently consists of eight directors.
The number of directors on the Company's board may only be
changed by a vote of a majority of the directors, subject to the rights of
the holders of any outstanding series of the Company's preferred stock to
elect additional directors.

REMOVAL OF DIRECTORS

The Company's directors, or the entire board, may be removed for cause by
the affirmative vote of the holders of at least 50% of the outstanding
shares of capital stock of the Company entitled to vote in the election of
directors, voting as a single class and subject to the rights of the
holders of any outstanding series of the Company's preferred stock.

FILLING VACANCIES ON THE BOARD OF DIRECTORS

Any newly created directorships in either of our boards of directors,
resulting from any increase in the number of authorized directors or any
vacancies, may be filled by a majority of the remaining members of such
board of directors, even though less than a quorum, or in the case of the
Company, by a sole remaining director, subject to the rights of holders of
any outstanding series of preferred stock.

Newly created directorships or decreases in directorships in either of our
boards of directors are to be apportioned among the classes of directors so
as  to  make all classes as nearly equal in number as practicable, provided
that no decreases  in  the  number  of directors in either of our boards of
directors may shorten the term of any director then in office.

To the extent reasonably possible, any  newly  created directorship will be
added to the class of directors whose term of office  is  to  expire at the
latest  date following the creation of that directorship, unless  otherwise
provided for by resolution of the majority of the directors then in office.
Any newly  eliminated  directorship will be subtracted from the class whose
office is to expire at the  earliest  date following the elimination of the
directorship, unless otherwise provided for  by resolution of the majority
of the directors then in office.



ABILITY TO CALL SPECIAL MEETINGS

Special meetings of the Company's stockholders  may  be  called  by  the
Company's board of directors,  by  affirmative  vote  of  a majority of the
total  number  of  authorized  directors  at that time, regardless  of  any
vacancies, or by the chief executive officer.

ADVANCE NOTICE PROVISIONS FOR STOCKHOLDER NOMINATIONS AND
PROPOSALS

The Company's bylaws allow stockholders to nominate candidates for election
to the board of directors at any annual or  any special stockholder meeting
at  which  the board of directors has determined  that  directors  will  be
elected. In  addition, the bylaws allow stockholders to propose business to
be brought before  any annual stockholder meeting. However, nominations and
proposals may only be  made  by  a stockholder who has given timely written
notice  to  the  Secretary of the Company  before  the  annual  or  special
stockholder meeting.

Under the Company's bylaws, to be timely, notice of stockholder nominations
or proposals to be  made  at an annual stockholder meeting must be received
by the Secretary of the Company  no less than 60 days nor more than 90 days
before the first anniversary of the  preceding  year's  annual  stockholder
meeting.  If the date of the annual meeting is more than 30 days before  or
more than 60  days  after  the  anniversary  of the preceding year's annual
stockholder meeting, notice will also be timely if delivered within 10 days
of the date on which public announcement of the  meeting  was first made by
the Company.



In addition, if the number of directors to be elected is increased  and  no
public  announcement  is made by the Company naming all of the nominees or
specifying the size of the  increased  board  of directors at least 70 days
before the first anniversary of the preceding year's annual meeting, or, if
the date of the annual meeting is more than 30 days before or 60 days after
the anniversary of the preceding year's annual  meeting,  at  least 70 days
before  the  annual  meeting,  a  stockholder's  notice  will be considered
timely, with respect to the nominees for any new positions  created  by the
increase, if it is delivered to the Secretary of the Company within 10 days
of  the date on which public announcement of the meeting was first made  by
the Company.

Under  the  Company's  bylaws,  to  be  timely,  notice  of  a  stockholder
nomination to be made at a special stockholder meeting must be received  no
less  than  60 days nor more than 90 days before a special meeting at which
directors are  to  be elected or within 10 days of the date on which public
announcement of the special meeting was first made by the Company.

A stockholder's notice to the Company must set forth all of the following:

-    all information  required to be disclosed in solicitations of proxies
for  election of directors,  or  information  otherwise  required  by
applicable  law, relating to any person that the stockholder proposes to
nominate for  election or reelection as a director, including that person's
written consent  to  being named in the proxy statement as a nominee and to
serving as a director if elected

-    a brief description of the business the stockholder proposes to bring
before the meeting, the reasons  for conducting that business at that
meeting and any material interest  of the stockholder in the business
proposed

-    the stockholder's name and address as they appear on the Company's
books and the class and number of shares which are beneficially owned by
the stockholder

The chairman of the Company's stockholder meeting will have the power to
determine whether the nomination or proposal was made by the stockholder in
accordance  with  the  advance notice procedures set forth in the Company's
bylaws. If the chairman  determines  that the nomination or proposal is not
in compliance with the Company's advance  notice  procedures,  the chairman
may declare that the defective proposal or nomination will be disregarded.

DIRECTOR COMPENSATION

Beginning in June, 2000, all Directors are paid $3,000 per
meeting in addition to reasonable travel expenses.

LIMITATION OF LIABILITY AND INDEMNIFICATION

The  Company's  Articles  of Incorporation provide that a director  of  the
Company shall not be personally  liable  to  the  Company  or  any  of  its
shareholders  for  monetary  damages  for  breach  of  fiduciary  duty as a
director, except for liability for:

(a)  any  breach  of  the  director's  duty  of loyalty to the Company or
its shareholders;

(b)  acts or omissions not in good faith or which  involve  gross
negligence, intentional misconduct or a knowing violation of law;

(c)  for  any  unlawful  distribution  as  set  forth  in the Colorado
Model Business  Corporation  Act of Colorado (the "CMBCA")  or  (iv)  for
any transaction  from  which  the  director  derived  an  improper
personal benefit.



These provisions may have the  effect  in certain circumstances of reducing
the  likelihood of derivative litigation  against  directors.  While  these
provisions  may  eliminate  the  right  to  recover  monetary  damages from
directors  in  various  circumstances,  rights to seek injunctive or  other
non-monetary relief is not eliminated.

FOREIGN CORRUPT PRACTICES ACT

Some of the Company's operations are transacted in Asia. To the extent that
we conduct operations and sell our products outside the U.S., we are
subject to the Foreign Corrupt Practices Act which makes it unlawful for
any issuer to pay or offer to pay, any money or anything of value to any
foreign

official, foreign political party or foreign political party official or
any candidate for foreign political office (foreign official) or any person
with knowledge that all or a portion of such money or thing of value will
be offered, given, or promised, directly or indirectly, to any foreign
official.

We have not made any offers, payments, promises to pay, or authorization of
any money or anything of value to any foreign official and have implemented
a policy to be followed by our officers, directors, employees and anyone
acting on its behalf, that no such payments can and will be made. We have
made all employees cognizant of the need for compliance with the Foreign
Corrupt Practices Act and any violation of our policy will result in
dismissal. Further, we conduct periodic reviews of this policy with all
employees to ensure full compliance.



                      ITEM 11. EXECUTIVE COMPENSATION

The following table sets forth compensation awarded to, earned by or paid
to our chief executive officer and each executive officer whose
compensation exceeded $100,000 for the year ended December 31, 2000.




                        SUMMARY COMPENSATION TABLE

Name and                                          Automobile      Other Annual
Principal Position         Year       Salary($)   Allowance ($)   Compensation($)
-------------------        ---------- ---------   -------------   ---------------
                                                      
Chief Financial Officer    2000       100,000     6,000           (A)
Gornto,
Jim

Director & President       2000       130,000     8,000           (B)
Grogan,                             (annualized)
Dale                       1999        87,500
                                    (annualized)
                           1998        75,000
                           1997        64,583

Director & CEO             2000       145,605     8,000           (C)
Tucker,                             (annualized)
Randolph                   1999        98,750
                                    (annualized)
                           1998        85,000
                           1997        80,833
____________________________


    (A) Mr. Gornto was granted 1,000 options to purchase Company common
        stock on 9/15/00 with immediate vesting.  These options expire on
        9/15/03 and have a strike price of $1.75.  Mr. Gornto was also
        issued 9,000 options to purchase Company common stock on 12/22/00
        with immediate vesting.  These options expire on the earlier of
        12/22/03 or 90 days after termination of employment and have a
        strike price of $0.25.

     Prior to the merger with Albara Corporation in February 2000, Mr.
     Gornto had been granted 25,000 options which remain outstanding.
     These options were granted on 4/20/99 with immediate vesting, a strike
     price of $1.75 and an expiration date of 12/31/03.

   (B)  Mr. Grogan has an employment contract with the Company.  The
        contract, dated May 1, 2000, granted a salary of $125,000 with
        annual 4% increases in September.  The contract granted 25,000
        shares of stock that were issued in December 2000.  Under this
        contract Mr. Grogan was granted 375,000 options to purchase Company
        common stock on 9/15/00 with immediate vesting and another 375,000
        which vested on January 1, 2001.  These options expire on 12/15/05
        and have a strike price of $1.00.  Additionally, the contract
        entitles Mr. Grogan to a 1%  commission on all investment funds
        into the Company from May 1, 2000 through May 1, 2001 and a
        $1,000,000 life insurance policy funded by the Company.  For the
        year ended December 31, 2000, the Company has accrued commissions
        of $27,911, of which only $22,428 has been paid.



     Mr. Grogan is also entitled to Board of Directors fees for Leapfrog
     Smart Products, Inc. (LSP) and for Leapfrog Global IC Products, Inc.
     (LGIC).  For the year ended December 31, 2000, directors fees of
     $14,000 and $7,000 were accrued for LSP and LGIC, respectively, of
     which  $14,000 of the LSP fees were paid.

     Mr. Grogan was granted 1,000 options to purchase Company common stock
     on 9/15/00 with immediate vesting.  These options expire on 9/15/03
     and have a strike price of $1.75.  Mr. Grogan was also issued  15,000
     options to purchase Company common stock on 12/22/00 with immediate
     vesting.  These options expire on the earlier of 12/22/03 or 90 days
     after termination of employment and have a strike price of $0.25.

     Prior to the merger with Albara Corporation in February 2000, Mr.
     Grogan had been granted the following options which remain
     outstanding:


     Grant      Vesting    Strike   Expiration   Number of
     Date       Date       Price    Date         Options
     ---------- ---------- -------  -----------  -------------
                                     
     10/1/98    10/1/98    $   .25     10/1/01         16,257
     10/1/98    10/1/98    $  1.00     10/1/01         12,317
     12/23/98   12/23/98   $  1.75     12/23/01        15,000
     9/15/99     3/15/01   $  1.00      9/15/04       100,000


   (C)  Mr. Tucker has an employment contract with the Company.  The
        contract, dated May 1, 2000, granted a salary of $140,000 with
        annual 4% increases in September.  The contract granted 25,000
        shares of stock that were issued in December 2000.  Under this
        contract Mr. Tucker was granted 375,000 options to purchase Company
        common stock on 9/15/00 with immediate vesting and another 375,000
        which vest on January 1, 2001.  These options expire on 12/15/05
        and have a strike price of $1.00.  Additionally, the contract
        entitles Mr. Tucker to a 1%  commission on all investment funds
        into the Company from May 1, 2000 through May 1, 2001 and a
        $1,000,000 life insurance policy funded by the Company.   For the
        year ended December 31, 2000, the Company has accrued commissions
        of $27,911, of which none have been paid.

     Mr. Tucker is also entitled to Board of Directors fees for Leapfrog
     Smart Products, Inc. (LSP) and for Leapfrog Global IC Products, Inc.
     (LGIC).  For the year ended December 31, 2000, directors fees of
     $14,500 and $7,000 were accrued for LSP and LGIC, respectively, of
     which  $9,000 of the LSP fees were paid.

     Mr. Tucker was granted 1,000 options to purchase Company common stock
     on 9/15/00 with immediate vesting.  These options expire on 9/15/03
     and have a strike price of $1.75.  Mr. Tucker was also issued 15,000
     options to purchase Company common stock on 12/22/00 with immediate
     vesting.  These options expire on the earlier of 12/22/03 or 90 days
     after termination of employment and have a strike price of $0.25.



     Prior to the merger with Albara Corporation in February 2000, Mr.
     Tucker had been granted the following options which remain
     outstanding:


     Grant      Vesting    Strike   Expiration    Number of
     Date       Date       Price    Date          Options
     ---------- ---------- -------  -----------   -------------
                                      
     10/1/98    10/1/98    $  .25   10/1/01           34,694
     10/1/98    10/1/98    $  .25   10/1/01           15,887
     10/1/98    10/1/98    $ 1.00   10/1/01            3,971
     12/23/98   12/23/98   $ 1.75   12/23/01          15,500
     9/15/99     3/15/01   $ 1.00    9/15/04         100,000



Compensation of Directors

As of June 2000, all directors of the Company are paid $3,000 per meeting
in addition to reasonable travel expenses.

Directors' and Officers' Insurance

The Company has purchased liability insurance for the directors and officers of
the Company.  No part of this premium will be paid by the directors or officers
of the Company.

STOCK OPTION PLAN

The Company maintains a stock option plan designed to provide incentives to
directors, executive officers and employees of the Company or its
subsidiaries and companies wholly owned by these individuals in order to
permit those persons to participate in the growth and success of the
Company.

Any options so granted will be exercisable at the exercise price and for
such period of time as may be determined by the board of directors of the
Company and approved pursuant to the requirements of the applicable stock
exchange, or if the Company's securities are not listed on a stock
exchange, then in accordance with the conditions established by the board
of directors of the Company.



INDEBTEDNESS OF DIRECTORS AND SENIOR OFFICERS AND PROMOTERS

No director, senior officer, promoter or other member of management or
their respective associates or affiliates have been materially indebted to
the Company at any time during the period ended December 31, 2000 or since
that date.

EMPLOYMENT AGREEMENTS

The CEO, Randolph Tucker, and the President, Dale Grogan each have
employment agreements with the Company.  The agreements were both entered
into on May 1, 2000 as a continuation of their contracts signed September
15, 1999 and are the same except for the base salary.  The base
salaries for Tucker and Grogan are $150,000 and $125,000, respectively,
with an automatic 4% increase each September 15{th}.  The contract term is
through April 30, 2003.


The contracts grant 25,000 shares of freely traded stock to each.  The
contracts each granted 750,000 stock options with a $1.00 strike price that
expire on December 31, 2005.  Fifty percent of the options vested
immediately with the other fifty percent vesting on January 1, 2001.

The contracts grant a cash bonus of five percent (5%) of the Company's
income from operations, defined as net income before taxes, minority
interests, extraordinary items, amortization of intangible assets, interest
on long-term debt and this incentive compensation.

The contract also requires a monthly automobile allowance of $500,
appropriate membership dues and subscription fees, payment for outside
disability insurance, "piggy back" registration rights for all stock owned,
a $1,000,000 term-life insurance policy and one percent (1%) commission for
all investment funds into the Company and any of its subsidiaries from May
1, 2000 until May 1, 2001.



  ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

PRINCIPAL SHAREHOLDERS

The following table sets forth the beneficial ownership of the ownership of
Leapfrog Smart Products, Inc. outstanding common stock on December 31, 2000
by:

-    each director and executive officer of the Company

-    all directors and executive officers of the Company as a group, and

-    each shareholder who was known by the  Company  to be the beneficial
     owner of more than five percent (5%) of the outstanding  shares of
     Leapfrog Smart Products, Inc.:




COMMON STOCK
                                                     
------------------------------------------------------------------------------
NAME AND ADDRESS              NUMBER OF           PERCENT
OF BENEFICIAL OWNER           SHARES              OF CLASS    OPTIONS
------------------------------------------------------------------------------
Ron Breland                      8,800               0.10%       1,025,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Dale Grogan                    331,000               3.69%         925,574
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Bruce Starling                 189,858               2.11%          50,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Van Staton                     313,629               3.49%          50,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Randolph Tucker                520,500               5.80%         936,052
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751



Bill Baker                       7,500                .08%               -
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Dennis Lehr                     25,612                .29%          12,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Dr. Les Bromwell                92,843               1.03%          12,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Jim Gornto                       3,000               0.03%          35,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Perry Dunn                      11,730               0.13%          36,000
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751

Song Ru Hua                    500,000               5.57%               -
C/O Leapfrog
Smart Products, Inc.
1011 Maitland Center Commons
Maitland, FL 32751



Management has advised that they may acquire additional shares of the
Company's common stock from time to time in the open market at prices
prevailing at the time of such purchases.


          ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

In connection with the transactions described below, the Company did not
secure an independent determination of the fairness and reasonableness of
such transactions and arrangements with affiliates of the Company. However,
in each instance described below, the directors reviewed and unanimously
approved the fairness and reasonableness of the terms of the transactions.
The Company believes that the transactions described below were fair and
reasonable to the Company on the basis that such transactions were on terms
at least as favorable as could have been obtained from unaffiliated third
parties. The transactions between officers and directors of the Company, on
the one hand, and the Company, on the other, have inherent conflicts of
interest.



The Company  is  a  party  to  a  Representation  Agreement  with  Selbre
Associates,  a  Maryland  corporation, dated April 29, 1999. Ron Breland, a
director of the Company, is the owner of over 95% of the outstanding equity
of  Selbre.  Pursuant  to  that   agreement,  the  Company  pays  Selbre  a
consultation  fee of $4,000 per month  during  the  two-year  term  of  the
agreement, in exchange  for  which  Selbre assists the Company in marketing
the  Company's  products to the Federal  government.  In  addition  to  the
consultation fee,  Selbre  is eligible to receive stock options to purchase
up to 500,000 shares of the  Company's  Common  Stock  in  the  event  that
certain  revenue  targets  are  met  by the Company. The agreement is filed
herewith as Exhibit 10.7.

We believe that all transactions with our officers, shareholders and each
of our affiliated companies have been made on terms no less favorable to
our company than those available from unaffiliated parties. In the future,
we intend to handle transactions of a similar nature on terms no less
favorable to Leapfrog than those available from unaffiliated parties.

No expert named in this prospectus was paid on a contingent basis or had a
material interest in the Company or any of its subsidiaries. Likewise, no
expert was connected with the Company or any of its subsidiaries as a
promoter, underwriter, voting trustee, director, officer or employee.

The Company intends to indemnify its officers and directors to the full
extent permitted by Colorado law. Under Colorado law, a corporation may
indemnify its agents for expenses and amounts paid in third party actions
and, upon court approval in derivative actions, if the agents acted in good
faith and with reasonable care. A majority vote of the Board of Directors,
approval of the stockholder or court approval is required to effectuate
indemnification.

Insofar as indemnification for liabilities arising under the Securities
Act, as amended, may be permitted to officers, directors or persons
controlling the Company, the Company has been advised that, in the opinion
of the Securities and Exchange Commission, such indemnification is against
public policy as expressed in such Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other
than the payment by the Company of expenses incurred or paid by an officer,
director or controlling person of the Company in the successful defense of
any action, suit or proceeding) is asserted by such officer, director or
controlling person in connection with the securities being registered, the
Company 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 such Act and will be governed by the final
adjudication of such issue.

Transactions between the Company and its officers, directors, employees and
affiliates will be on terms no less favorable to the Company than can be
obtained from unaffiliated parties. Any such transactions will be subject
to the approval of a majority of the disinterested members of the Board of
Directors.



                 ITEM 14. EXHIBITS AND REPORTS ON FORM 8-K

                             INDEX TO EXHIBITS

(a) EXHIBITS

The following documents are filed herewith or have been included as
exhibits to previous filings with the Commission and are incorporated
herein by this reference:

Exhibit No.    Exhibit
-----------    -------

###  2.1       Agreement and Plan of Merger

##   3(a)      Articles of Incorporation

##   3(b)      Bylaws

#    4(a)      Agreements Defining Certain Rights of Shareholders

#    4(b)      Specimen Stock Certificate

#    10(a)     Pre-incorporation Consultation and Subscription Agreement

##   10.1      Consultation Services Agreement

##   10.2      Legal Services Engagement Agreement

###  10.3      Bleed-Out Agreement

###  10.4      Consulting Agreement

###  10.5      Warrant Agreement

###  10.6      Registration Rights Agreement

#### 16        Letter on Change in Certifying Accountant

#    21        Subsidiaries of the Registrant

x    23(a)     Consent-Legal

xx   27        Financial Data Schedule

x    99.1      Safe Harbor Compliance Statement

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



x    filed herewith

xx   previously filed with the Company's Annual Report on Form 10-KSB on
     April 17, 2000

#    previously filed with  the  Company's  Definitive Information
     Statement on Schedule 14C on January 18, 2000.

##   previously filed with  the Company's Registration Statement on Form
     S-8 on February 29, 2000

###  previously filed with the Company's Form 8-K dated March 8, 2000

#### previously filed with the Company's Form 8-K dated March 17, 2000

(b) REPORTS ON FORM 8-K

The Company filed the following reports on Form 8-K during the last
quarter of the 1999 fiscal year and through the third quarter of the 2000
fiscal year:

Current Report on Form 8-K  dated March 8, 2000, reporting a change in
control of the registrant, pursuant  to a merger transaction, in Item 1,
and other information regarding the merger transaction in Item 5.
Financial statements were filed in Item 7.

Current Report on Form 8-K dated March 17, 2000, reporting a change in
the registrant's certifying account in  Item  4. No financial statements
were filed.




                              C O N T E N T S
                                 ________


                                                            Page
                                                           NUMBER


REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS          F-1


CONSOLIDATED FINANCIAL STATEMENTS

  Consolidated Balance Sheets                               F-3

  Consolidated Statements of Operations                     F-4

  Consolidated Statements of Changes in Shareholders'
   Equity (Deficit)                                         F-5

  Consolidated Statements of Cash Flows                     F-6

  Notes to Consolidated Financial Statements                F-7





            REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS



Board of Directors
Leapfrog Smart Products, Inc. and Subsidiaries
(A Development Stage Company)
Maitland, Florida



We  have  audited  the accompanying consolidated balance sheets of Leapfrog
Smart Products, Inc.  and  Subsidiaries (a development stage company) as of
December 31, 2000 and 1999,  and  the  related  consolidated  statements of
operations, changes in shareholders' equity (deficit), and cash  flows  for
the  years then ended and for the period April 11, 1996 (date of inception)
through   December   31,   2000.    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
did not audit the financial statements of Leapfrog Smart Products, Inc. and
Subsidiaries for the years ended  December  31, 1997 and December 31, 1998,
which reflect a deficit accumulated during development  stage of $2,413,005
and which is included in the financial statements presented  for the period
April  11,  1996  (date  of  inception)  through December 31, 2000.   Those
statements were audited by other auditors,  whose report has been furnished
to us, and our opinion insofar as it relates to the amounts included in the
cumulative  period  since  April  11,  1996  (date  of  inception)  through
December 31, 2000, is based solely on the report of the other auditors.

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

In our opinion, based upon our audits and the report of the other auditors,
the consolidated financial statements referred to above present fairly,  in
all  material  respects, the financial position of Leapfrog Smart Products,
Inc. and Subsidiaries  as of December 31, 2000 and 1999, and the results of
its operations and its cash  flows  for  the  years  then ended and for the
period  April  11, 1996 (date of inception) through December  31,  2000  in
conformity with generally accepted accounting principles.


                                    F-1




Board of Directors
Leapfrog Smart Products, Inc. and Subsidiaries

The accompanying  consolidated  financial  statements  have  been  prepared
assuming that the Company will continue as a going concern.  The Company is
currently  in  its  development  stage  and,  as discussed in Note 1 to the
financial  statements, since its inception, the  Company  has  incurred  an
accumulated  deficit  of  approximately  $13,000,000 and as of December 31,
2000,  it  has  a  working  capital  deficit of  approximately  $2,500,000.
Additionally, the Company incurred a net  loss  of approximately $7,400,000
and had negative cash flows from operations of approximately  $4,300,000 in
the  year  ended December 31, 2000.  These matters raise substantial  doubt
about the Company's  ability  to continue as a going concern.  Management's
plans  concerning these matters  are  also  described  in  Note  1  to  the
financial   statements.   The  financial  statements  do  not  include  any
adjustments that might result from the outcome of this uncertainty.

/s/ Moore Stephens Lovelace, P.A.
Certified Public Accountants

Orlando, Florida
March 8, 2001, except for Note 9,
  as to which the date is April 2, 2001.

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

                                  F-2



            LEAPFROG  SMART  PRODUCTS,  INC.  AND  SUBSIDIARIES
                       (A Development Stage Company)

                        CONSOLIDATED BALANCE SHEETS

                        December 31, 2000 and 1999


                                   ASSETS



                                                     2000          1999
                                                  ----------     ----------
                                                           
CURRENT ASSETS
  Cash                                            $  107,413     $   18,529
  Accounts receivable                                113,092          6,554
  Inventory                                          122,382         52,639
  Prepaid expenses                                   172,060        219,740
  Notes receivable-related parties                    15,900         26,600
  Other receivables                                    1,980          9,226
                                                  ----------     ----------
                      TOTAL CURRENT ASSETS           532,827        333,288

PROPERTY AND EQUIPMENT, NET                          238,457        267,073

OTHER ASSETS
  Related-party advances                             107,009         43,116
  Notes receivable-related parties                         -          5,000
  Deposits                                            38,136          8,600
  Capitalized software costs, net of
     accumulated amortization of $24,884 and
     $7,600 respectively                             169,137         68,400
  Costs in excess of fair market value of
     assets acquired, net of accumulated
     amortization of $5,500 and $2,500
     respectively                                     24,500         27,500
                                                  ----------     ----------
                                                  $1,110,066     $  752,977
                                                  ==========     ==========

              LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
  Notes payable                                   $1,452,956     $1,859,049
  Notes payable-related parties                      355,258         75,258
  Accounts payable                                 1,043,453        223,474
  Accrued expenses                                   212,255         99,816
                                                  ----------     -----------
                      TOTAL CURRENT LIABILITIES    3,063,922      2,257,597

MINORITY INTEREST                                          -              -

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY (DEFICIT)
  Convertible Preferred Stock-no par value;
    10,000,000 shares authorized
   Series A-125,000 and -0- shares issued and
    outstanding                                      480,000              -
   Series F-(aggregate liquidation preference
    of $19,500); 195 and -0- shares isssued and
    outstanding                                       14,625              -
  Common Stock-no par value; 30,000,000 shares
    authorized; 8,977,845 and 5,189,769 shares
    issued and outstanding                        10,488,908      4,006,025
  Deficit accumulated during development stage   (12,937,389)    (5,510,645)
                                                 --------------  ------------
                                                  (1,953,856)    (1,504,620)
                                                 --------------  ------------
                                                 $ 1,110,066     $  752,977
                                                 ==============  ============


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

                                     F-3


              LEAPFROG SMART PRODUCTS, INC. AND SUBSIDIARIES
                       (A Development State Company)

                   CONSOLIDATED STATEMENTS OF OPERATIONS

                   Years Ended December 31, 2000 and 1999




                                                                     Cumulative
                                                                     From
                                                                     April 11, 1996
                                                                     (Inception)
                                                                     Through
                                 2000                1999            December 31, 2000
                                 ------------        ------------    ------------------
                                                            
REVENUES                         $  972,724          $   121,533     $   1,853,514
COST OF SALES                       905,805               44,199         1,496,234
                                 ------------        ------------    ------------------
GROSS PROFIT                         66,919               77,334           357,280

OPERATING EXPENSES
 Personnel and related expenses   4,057,722            1,216,809         6,614,471
 Consulting fees                    851,342              392,308         2,075,114
 General and administrative       1,992,186            1,073,256         3,404,854
 Depreciation and amortization       91,810               55,478           223,009
                                 ------------        ------------    ------------------
    TOTAL OPERATING EXPENSES      6,993,060            2,737,851        12,317,448

OTHER INCOME (EXPENSE)
 Other income, net                   40,512                3,095            62,434
 Interest expense                  (367,603)            (433,341)         (859,266)
 Loss on disposal of assets         (23,512)              (6,877)          (30,389)
 Equity interest in loss of
   subsidiary                      (150,000)                   -          (150,000)
                                 ------------        ------------    ------------------
        TOTAL OTHER INCOME (LOSS)  (500,603)            (437,123)         (977,221)
                                 ------------        ------------    ------------------
                    NET LOSS    $(7,426,744)         $(3,097,640)    $ (12,937,389)
                                ============         ============    ================


NET LOSS                        $(7,426,744)         $(3,097,640)    $ (12,937,389)
PREFERRED DIVIDENDS IN
  ARREARS                           (24,494)                   -
                                -------------        ------------

NET LOSS ATTRIBUTABLE TO
  COMMON SHAREHOLDERS           $(7,451,238)         $(3,097,640)
                                =============        =============


BASIC AND DILUTED NET LOSS
  PER COMMON SHARE              $     (1.09)         $     (0.72)
                                =============        ============

WEIGHTED AVERAGE NUMBER OF
  COMMON SHARES OUTSTANDING       6,866,964            4,280,158
                                =============        ============


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

                                    F-4


                   CONSOLIDATED STATEMENTS OF CHANGES IN
                      SHAREHOLDERS' EQUITY (DEFICIT)



                                                                    Deficit           Total
                   Preferred Stock            Common Stock          Accumulated       Shareholders'
                    No Par Value              No Par Value          During            Equity
                --------------------       --------------------     Development       (Deficit)
                Shares        Amount       Shares        Amount     Stage
                                                                    
Common Stock
  issued to
  founding
  shareholders
  on April 11,
  1996          -             -            1,414,000    $  168,100  -                 $  168,100

Net loss for
  the period
  ended
  December 31,
  1996          -             -            -               -        (245,429)           (245,429)
                -----------   ----------   ------------  ---------- ----------        ------------
Balance-
  December 31,
  1996          -             -            1,414,000       168,100  (245,429)            (77,329)

Issuance of
  Common Stock  -             -            1,070,846       429,500  -                    429,500

Net loss for
  the year
  ended
  December 31,
  1997          -             -            -               -        (649,827)           (649,827)
                ------------  -----------  -------------  --------- -----------       --------------

Balance-
  December 31,
  1997          -             -            2,484,846       597,600  (895,256)           (297,656)

Issuance of
  Common Stock  -             -            1,066,373       964,811  -                    964,811

Issuance of
  Common Stock
  for Conversion
  of Notes
  Payable       -             -              216,000       216,000  -                    216,000

Net Loss for the
  Year ended
  December 31,
  1998          -             -            -               -       (1,517,749)        (1,517,749)
                -----------   -----------  -------------   ------- -----------        -----------

Balance-
  December 31,
  1998          -             -            3,767,219     1,778,411 (2,413,005)          (634,594)

Issuance of
  Common Stock
  for Cash      -             -              474,879     1,141,504  -                  1,141,504

Issusance of
  Common Stock
  on excerics
  of options    -             -               64,075        16,019  -                     16,019

Issuance of
  Common Stock
  for Services  -             -             424,135       699,995   -                    699,995

Issuance of
  Common Stock
  for Payment
  of Debt       -             -              33,333        50,000   -                     50,000

Issuance of
  Common Stock
  for
  Acquisition
  of Minority
  Interest
  Position in
  Subsidiary    -             -              40,000        30,000   -                     30,000

Issuance of
  Common Stock
  Related to
  Debt
  Financing     -             -             386,128       290,096   -                    290,096

Net Loss for
  the Year ended
  December 31,
  1999          -             -            -              -        (3,097,640)        (3,097,640)
               ------------   ----------   ------------   --------- ---------         -----------

Balance-
  December 31,
  1999          -             -           5,189,769     4,006,025  (5,510,645)        (1,504,620)

Issuance of
  Common Stock
  for Cash      -             -           2,446,310     3,539,107   -                  3,539,107

Issuance of
  Common Stock
  on exercise
  of options    -             -              29,500        66,186   -                     66,186

Intrinsic
  value of
  Options
  Issued to
  Employees     -             -          -              1,167,580   -                  1,167,580

Issuance of
  Common Stock
  and Stock
  Options
  for services  -             -            323,800       887,869    -                    887,869

Issuance of
  Common Stock
  relative to
  debt
  financing     -             -             76,666        62,081    -                     62,081

Issuance of
  Common Stock
  for conversion
  of debentures
  and related
  accrued
  interest      -              -          295,003        774,685    -                    774,685

Issuance of
  Series A
  Preferred
  Stock         125,000      480,000      -              -          -                    480,000

Merger with
  Albara
  Corporation       195       14,625     616,797         (14,625)   -                    -

Net Loss for
  the year
  ended
  December 31,
  2000         -             -            -              -          (7,426,744)       (7,426,744)
               ------------  ----------   ----------    -----------  ---------         ---------
Balance-
  December 31,
  2000          125,195      494,625   8,977,845       10,488,908  (12,937,389)       (1,953,856)
               ============  ========= ==============  ============ ==========
 ===========


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

                                      F-5


                   CONSOLIDATED STATEMENTS OF CASH FLOWS



                                                             Cumulative
                                                             from
                                                             April 11, 1996
                                                             (inception)
                                                             through
                              2000            1999           December 31, 2000
                              -------------   ------------   -----------------
                                                    
CASH FLOWS FROM OPERATING
  ACTIVITIES
   Net Loss                   $ (7,426,744)   $ (3,097,640)  $  (12,937,389)
   Adjustments to reconcile
     net loss to net cash
     used in operating
     activities
    Depreciation                    72,568          52,978          198,256
    Depreciation and
      amortization charged
      to cost of sales             12,122           26,338           38,460
    Amortization                   19,242            2,500           21,742
    Assets expensed to
     research and
     development                   28,968                -           28,968
   Loss on disposal of
     assets, net                   23,512            6,877           33,639
   Loss on write-off of
     related party note
     receivable                    -                17,870           17,870

   Common stock issued for
     services and interest        994,886          990,091        2,002,480
   Compensation to employees
     for stock options issued
     below market               1,167,580                -        1,167,580
   Cash provided by (used in)
     change in:
      Accounts receivable        (106,538)          (3,554)        (113,092)
      Related party advances      (63,893)         (39,394)        (107,009)
      Other receivables             7,246           (9,226)          (1,980)
      INventory                   (69,743)         (21,139)        (122,382)
       Prepaid expenses and
        other assets               18,144         (222,130)        (210,196)
      Accounts payable            850,552         (124,199)       1,091,693
      Accrued expenses            180,401           63,630          280,217
      Deferred income                   -          (11,500)               -
      Minority interest                 -           11,018                -
                               -------------     -------------    -----------
           NET CASH USED IN
           OPERATING
           ACTIVITIES          (4,291,697)      (2,357,480)      (8,611,143)


CASH FLOWS FROM INVESTING ACTIVITIES
   Acquisition of property,
     plant and equipment         (107,512)        (143,878)        (537,611)
   Net (increase) decrease in
     notes-receivable-related
     parties                      (13,654)         (17,400)         (63,124)
   Capitalization of software
     costs                       (118,021)         (76,000)        (194,021)
   Proceeds from sale of
     vehicles                           -                -            8,473
                               ------------      --------------   -----------
           NET CASH USED IN
           INVESTING
           ACTIVITIES            (239,187)        (237,278)        (786,283)

CASH FLOWS FROM FINANCING ACTIVITIES
   Proceeds from issuance of
     notes payable                801,902        1,402,326        3,217,768
   Payments on notes payable     (502,491)         (18,434)        (826,975)
   Proceeds from
     exercise of common stock
     options                       21,250           16,019          469,870
   Proceeds from sales of common
     and preferred stock        4,019,107        1,141,504        6,288,918
   Proceeds from related-party
     borrowings                   280,000           37,300          362,658
   Repayments of related-party
     borrowings                         -           (6,300)          (7,400)
                               ---------------   --------------   ------------
           NET CASH PROVIDED
           BY FINANCING
           ACTIVITIES            4,619,768       2,572,415        9,504,839
                               ---------------   ---------------  ------------
       NET INCREASE
          (DECREASE)
          IN CASH                   88,884         (22,343)         107,413

   CASH AT BEGINNING OF YEAR        18,529          40,872                -
                               ---------------   ---------------  -------------
   CASH AT END OF YEAR         $   107,413          18,529          107,413
                               ===============   ===============  =============


The accompanying notes are an integral part of the financial statements

                                    F-6




            LEAPFROG  SMART  PRODUCTS,  INC.  AND  SUBSIDIARIES
                       (A Development Stage Company)

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                  Years Ended December 31, 2000 and 1999



NOTE  1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         ORGANIZATION

         Leapfrog Smart Products, Inc. and Subsidiaries' operations include
         the  design, development, and licensing of Smart card applications
         and related  database  management systems and services.  The Smart
         card is a wallet-sized plastic card with an embedded computer chip
         carrying accessible data  that  is  retrievable  on  demand and is
         capable of integrating various functions with security features.

         Leapfrog Smart Products, Inc. ("Leapfrog") was incorporated  under
         the laws of the State of Florida in 1996 originally under the name
         Telephones! Telephones!, Inc.

         Effective  February  18,  2000,  Albara  Corporation ("Albara"), a
         Colorado   corporation,   acquired,  through  its   wholly   owned
         subsidiary Leapfrog Merger,  Inc.,  a Florida corporation, 100% of
         the outstanding common stock of Leapfrog in exchange for 5,350,049
         shares  of  Albara  common stock.  Additionally,  the  outstanding
         stock options of Leapfrog  were  converted,  on  a pro rata basis,
         into 2,434,950 Albara stock options.  Prior to the  merger, Albara
         was  considered  to  be  a  publicly  held  shell company with  no
         revenues and insignificant expenses, assets and liabilities.  Upon
         completion of the merger, the original shareholders of Albara held
         616,797 shares of its common stock and 195 shares  of its Series F
         Preferred  Stock.   As  a  result  of  the  exchange,  the  former
         shareholders of Leapfrog gained control of Albara.  For accounting
         purposes,   the   acquisition   has   been   accounted  for  as  a
         recapitalization of Leapfrog with Leapfrog being  treated  as  the
         acquiring  entity (reverse acquisition) with no goodwill recorded.
         Accordingly,   the   historical   financial  statements  prior  to
         February  18,  2000  are  those  of the  original  Leapfrog  Smart
         Products,  Inc. and Subsidiaries with  the  related  shareholders'
         equity being  retroactively  restated  to  reflect  the equivalent
         number of Albara shares received in the merger after giving effect
         to the differences in par value.  In connection with  the  merger,
         Albara changed its name to Leapfrog Smart Products, Inc.  Leapfrog
         recorded  a  charge  to  general  and  administrative  expenses of
         $64,000  for  direct and other merger related costs pertaining  to
         the  merger  transaction.    Merger  transaction  costs  consisted
         primarily of fees for legal, investment  banking and other related
         charges.

         Leapfrog owns approximately 95% of the outstanding common stock of
         Leapfrog Global IC Products, Inc. ("LGIC")  and  approximately 96%
         of  the outstanding common stock of Conduit Healthcare  Solutions,
         Inc.  ("Conduit").   By  licensing  agreement,  LGIC  owns  all of
         Leapfrog's technology and distribution rights of its product  line
         outside  of North America, except for the territories subsequently
         granted to  Smart Products International Pte., Ltd.  The agreement
         expires in 2009,  calls for revenue sharing, and may be terminated
         if  certain  performance   measures  are  not  met.   Conduit  was
         originally incorporated in 1997 under the name Leapfrog Healthcare
         Products, Inc.  Certain employees and consultants of Leapfrog hold
         stock options to purchase an  aggregate  of  10%  of  LGIC  at  an
         exercise  price of $11,500.  These individuals also have the right
         to receive  additional options to purchase up to an additional 48%
         of LGIC for $48,000 if certain performance measures are met.

                                    F-7




NOTE  1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
          (CONTINUED)

         ORGANIZATION (CONTINUED)

         Certain employees  of  and  consultants  to  Leapfrog  hold  stock
         options  to  purchase  an  aggregate  of  17.8%  of  Conduit at an
         exercise  price of $2,250.  In 2000, LGIC created Leapfrog  China,
         Inc., as a  wholly  owned  subsidiary, for the purpose of pursuing
         opportunities in Asia.

         The  consolidated financial statements  include  the  accounts  of
         Leapfrog  Smart  Products,  Inc.,  Leapfrog  Merger, Inc., Conduit
         Healthcare Solutions, Inc., Leapfrog Global IC  Products, Inc. and
         Leapfrog China, Inc. (collectively, the "Company").  The Company's
         50% ownership interest in Smart Products International  Pte., Ltd.
         is   accounted   for   on  the  equity  method.   All  significant
         intercompany transactions and balances have been eliminated in the
         consolidated financial statements.

         DEVELOPMENT STAGE COMPANY

         Since its inception, the  Company's  planned  principal operations
         have  not  yet begun to produce significant revenue;  accordingly,
         the Company is considered to be a development stage enterprise.

         INVENTORY

         Inventory is  stated  at  the  lower  of  cost or market.  Cost is
         determined  using  the first-in, first-out method.   Inventory  is
         generally comprised  of software purchased for resale, Smart cards
         and accessories, and readers  and other parts for installing Smart
         Card systems.

         PREPAID EXPENSES

         Prepaid expenses consists of the  following  at  December 31, 2000
         and 1999:



                        2000       1999
                             
Prepaid consulting     $ 100,103   $ -
Prepaid legal fees       -           186,750
Prepaid license fees      25,760      25,760
Other                     46,197       7,230
                       ---------  ----------
                       $ 172,060   $ 219,740
                       =========  ==========


         In  1999, prepaid legal fees were paid for through the issuance of
         150,000  shares  of  the  Company's common stock.  The shares were
         valued at per share prices  approximating recent private placement
         transactions.

         PROPERTY AND EQUIPMENT

         Property  and  equipment  are stated  at  cost.   Depreciation  is
         provided using the straight-line  method over the estimated useful
         lives  of the related assets, which  range  from  three  to  seven
         years.

                                    F-8




NOTE  1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
          (CONTINUED)

         INVESTMENT

         During the  year  ended  December  31,  2000,  the  Company funded
         approximately  $171,000  into  a  newly formed Singapore  company,
         Smart  Products  International  Pte.,  Ltd.  ("SPI"),  for  a  50%
         ownership interest.  SPI was formed to market, sell and distribute
         the Company's software and hardware  products throughout the Asia-
         Pacific region (excluding the Peoples'  Republic  of  China),  and
         also to market and sell those products elsewhere, as stated in the
         joint venture agreement.  SPI is managed and controlled by the 50%
         shareholder  located in Singapore; accordingly, this investment is
         recorded  on  the  equity  method.   Activity  of  SPI  since  its
         inception has consisted  primarily  of  start-up  activities.   In
         2000,  the  Company  charged  to  expense  $150,000 for its equity
         interest in the loss of SPI.  The joint venture agreement provides
         SPI with an exclusive license for the marketing  and  distribution
         rights  to  the  Company's  core  products  and core technologies,
         developed through January 15, 2001, throughout  the  SPI exclusive
         territory.  The initial term of the license commences May 31, 2001
         and is for a period of twenty years.

         SOFTWARE DEVELOPMENT COSTS

         Costs incurred internally in creating a computer software  product
         are  charged  to  research  and  development expense when incurred
         until  technological  feasibility has  been  established  for  the
         product.  Research and  development  expense  for  the years ended
         December   31,   2000   and   1999  were  $638,832  and  $293,643,
         respectively.   Technological  feasibility   is  established  upon
         completion  of  a  detail  program  design  or,  in  its  absence,
         completion   of   a   working  model.   Thereafter,  all  software
         production costs are capitalized  and subsequently reported at the
         lower   of   amortized   cost  or  net  realizable   value.    The
         establishment  of  technological   feasibility   and  the  ongoing
         assessment   of   the   recoverability  of  these  costs  requires
         considerable  judgment  by  management  with  respect  to  certain
         external factors, such as  anticipated  future  revenue, estimated
         economic life, and changes in software and hardware  technologies.
         Capitalization  of  software  development  costs  ceases when  the
         product is available for general release to customers.   Costs  of
         maintenance  and  customer  support  are  charged  to expense when
         related  revenue  is recognized or when those costs are  incurred,
         whichever occurs first.   Capitalized costs are amortized based on
         current and estimated future  revenue  for  each  product  with an
         annual  minimum  equal to the straight-line amortization over  the
         remaining estimated  economic  life  of the product.  Amortization
         expense related to capitalized software  costs  for the year ended
         December 31, 2000 and 1999, was $17,284 and $7,600, respectively.

         EXCESS OF COSTS OVER FAIR VALUE OF NET ASSETS ACQUIRED

         During the year ended December 31, 1999, the Company  acquired  an
         additional  16%  ownership  interest  in Conduit by issuing 40,000
         shares  of  the  Company's  common stock to  the  former  minority
         interest.  The shares issued  were  valued  at  per  share  prices
         approximating  recent  private placement transactions.  The excess
         of  costs  over  fair  value  of  net  assets  acquired  has  been
         capitalized and is being  amortized using the straight-line method
         over ten years.

         The  Company  assesses the recoverability  of  intangible  assets,
         including excess  of  cost  over fair value of assets acquired, if
         facts and circumstances suggest  that  their  carrying  amount may
         have  been impaired.  In making its assessment, the Company  gives
         consideration  to the undiscounted cash flows from the use of such
         assets, the estimated fair value of such assets, and other factors
         that may affect  the  recovera-bility  of such assets.  If such an
         assessment indicates that the carrying value  of intangible assets
         may not be recoverable, the carrying value of intangible assets is
         reduced.

                                    F-9




NOTE  1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
          (CONTINUED)

         Unearned Revenue

         Payments  received from customers which relate to  future  periods
         are deferred  and  are recognized in the periods in which they are
         earned.

         REVENUE AND EXPENSE RECOGNITION

         Revenues are generally recognized when the product is delivered to
         the customer or when  the  service  has been performed and related
         costs and expenses are recognized when  incurred.   Contracts  for
         the  development  of  software  and  installation  of  the related
         hardware  that  extend  over  more  than one reporting period  are
         accounted  for  using  the  percentage-of-completion   method   of
         accounting.   Revenue  recognized  at the financial statement date
         under these contracts is that portion  of the total contract price
         that costs expended to date bears to the  total  anticipated final
         cost,  based on current estimates of cost to complete.   Revisions
         in total  costs  and  earnings  estimates during the course of the
         contract  are  reflected in the accounting  period  in  which  the
         circumstances necessitating  the  revision  become  known.  At the
         time a loss on a contract becomes known, the entire amount  of the
         estimated  loss  is recognized in the financial statements.  Costs
         attributable to contract  disputes are carried in the accompanying
         balance sheet only when realization is probable.  Amounts received
         on contracts in progress in  excess  of  the revenue earned, based
         upon the percentage-of-completion method, are recorded as deferred
         revenue and the related costs and expenses  incurred  are recorded
         as deferred costs.

         In 2000, the Company entered into a contract with the U.S. General
         Services  Administration  ("GSA") to supply GSA with hardware  and
         software  products  related  to   Smart   Card   technologies  and
         applications.   Significant  portions  of these contracts  may  be
         fulfilled by subcontractors (the "Subcontractors")  authorized  by
         the  Company  and GSA.  Revenues earned under the GSA contract are
         recorded by the  Company at the gross amount billed to GSA and the
         corresponding cost  of sales is recorded at the amount serviced by
         the Subcontractors under  the  GSA contract.  Revenues and cost of
         sales  recognized under the GSA contract  during  the  year  ended
         December    31,   2000   approximated   $589,000   and   $567,000,
         respectively.

         WARRANTY EXPENSE

         The  Company  estimates  future  warranty  costs  based  upon  the
         historical relationship  of  warranty  costs  to  sales.  To date,
         warranty costs have not been significant.

         INCOME TAXES

         The Company recognizes deferred tax assets and liabilities for the
         expected future tax consequences of events that have been included
         in the financial statements or tax returns.  Deferred  tax  assets
         and liabilities are determined based on the difference between the
         financial  statement and tax bases of assets and liabilities using
         enacted tax  rates in effect for the year in which the differences
         are expected to reverse (see Note 7).

                                     F-9




NOTE  1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
          (CONTINUED)

         NET LOSS PER SHARE OF COMMON STOCK

         The  basic  and   diluted   net  loss  per  common  share  in  the
         accompanying consolidated statements  of operations are based upon
         the net loss after the deduction of preferred dividends in arrears
         divided  by  the  weighted average number  of  shares  outstanding
         during the periods  presented.   Diluted net loss per common share
         is the same as basic net loss per common share since the inclusion
         of all potentially dilutive common  shares  that would be issuable
         upon the exercise of outstanding stock options and the convertible
         preferred stock and convertible promissory notes  would  be  anti-
         dilutive.

         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.

         CREDIT RISK

         Financial instruments,  which  potentially  subject the Company to
         concentrations  of  credit  risk,  consist  principally  of  cash,
         receivables and related-party advances.  The Company maintains its
         cash  in  bank  deposit  accounts  which,  at  times,  may  exceed
         federally  insured  limits.   The Company has not experienced  any
         losses in such accounts and believes that it is not exposed to any
         significant credit risk on cash.

         FAIR VALUE OF FINANCIAL INSTRUMENTS

         At  December 31, 2000 and 1999,  the  fair  values  of  cash,
         receivables, accounts  payable  and  notes  payable approximated
         their carrying values because of their short-term nature.

         CONTINUED OPERATIONS

         The accompanying consolidated financial  statements have been prepared
         on a going concern basis, which contemplates the  realization of assets
         and satisfaction of liabilities in the normal  course of business.
         As shown in the accompanying financial statements  during the year
         ended December 31, 2000 and 1999, the Company incurred  losses  of
         approximately  $7,400,000 and $3,100,000, respec-tively, and had a
         deficiency in working  capital  of  approximately  $2,500,000  and
         $1,900,000  at  December  31,  2000 and 1999, respectively.  These
         factors, among others, may indicate  the Company will be unable to
         continue as a going concern for a reasonable  period of time.  The
         accompanying consolidated financial statements  do not include any
         adjustments relating to the outcome of this uncertainty.

                                    F-10



NOTE  1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
          (CONTINUED)

         LIQUIDITY AND PLAN OF OPERATIONS

         At   December  31,  2000  and  1999,  the  Company  had  cash   of
         approximately $107,000 and $19,000, respectively, and a deficiency
         in working capital of $2,500,000 and $1,900,000, respectively.

         The Company  has a limited operating history and its prospects are
         subject  to  the  risks,  expenses  and  uncertainties  frequently
         encountered by  companies in new and rapidly evolving markets such
         as smart card products  and  services.   These  risks  include the
         failure to develop and extend the Company's products and services,
         the  rejection  of such services by smart card customers,  vendors
         and/or advertisers,  the  inability of the Company to maintain and
         increase  its  customer  base,   as   well   as  other  risks  and
         uncertainties.    In   the  event  that  the  Company   does   not
         successfully implement its  business  plan, certain assets may not
         be recoverable.

         The Company's continuation as a going concern  is  dependent  upon
         its   ability  to  generate  sufficient  cash  flow  to  meet  its
         obligations  on  a  timely basis.  The Company's primary source of
         liquidity has been through  the  private  placement  of equity and
         debt securities.  The Company is presently exploring possibilities
         with respect to raising working capital through additional  equity
         and/or debt financings in the near future.  However, there can  be
         no  assurance  that  the  Company  will be successful in achieving
         profitable operations or acquiring additional capital or that such
         capital, if available, will be on terms  and  conditions favorable
         to the Company.  Based upon its current business plan, the Company
         believes  that  it  will  generate  sufficient cash  flow  through
         operations and external sources of capital to continue to meet its
         obligations   in  a  timely  manner.   If  anticipated   financing
         transactions and  operating  results  are not achieved, management
         has the intent and believes that it has  the  ability  to delay or
         reduce  expenditures  so  as  not  to require additional financial
         resources,  if  such  resources  were  not   available   on  terms
         acceptable  to  the  Company.   However, there can be no assurance
         that management's plans can be implemented,  or  that  the Company
         will continue as a going concern.

         RECLASSIFICATIONS

         Certain  amounts  in  the  1999  financial  statements  have  been
         reclassified to conform with the 2000 presentation.

                                    F-11



NOTE  2 - NOTES RECEIVABLE - RELATED PARTIES

         Notes  receivable  -  related parties consists of the following at
         December 31, 200 and 1999:



                                                           2000      1999
                                                              
Unsecured   6%   promissory  notes  from   employee   /
stockholder,  all  principal   and   interest   due  at
maturity, matured December 2000.                          $ 11,000 $ 11,000
Unsecured  6%  promissory note receivable from officer,
all principal and  interest  due  at  maturity, matured
December 2000.                                               1,500    1,500
Unsecured  6% promissory notes receivable from officer,
all principal  and  interest  due  at maturity, matured
December 2000.                                                   -    2,500
Unsecured    6%   promissory   note   receivable   from
employee/stockholder,  monthly interest payments of $50
beginning in March 2000,  with  all remaining principal
and interest due December 2000.                                  -    8,200
Unsecured    6%   promissory   note   receivable   from
employee/stockholder,  monthly  principal  and interest
payments of $400 beginning in February 2000,  with  all
remaining principal and interest due March 2001.                 -    5,000
Unsecured  6% promissory note receivable, principal and
interest due October 2000.                                   3,400    3,400
                                                           -------  -------
                                                            15,900   31,600
Less current portion                                       (15,900) (26,600)
                                                           -------  -------
    Total notes receivable - related parties               $     -  $ 5,000
                                                           =======  =======



NOTE  3 - RELATED PARTY - ADVANCES

         During  1998,  the  Company  advanced  an  officer  of the Company
         approximately   $5,000.    During   2000,   the  Company  advanced
         approximately an additional $6,000, which remains unpaid.

         In  1999,  the  Company  advanced  a related entity  approximately
         $38,000.   In  2000,  the  Company  advanced   the  related  party
         approximately   an  additional  $42,000.   Of  the  total   amount
         advanced, $15,000  was  satisfied  in 2000.  The unpaid balance at
         December 31, 2000, is approximately $65,000.

         In  2000,  the  Company  advanced  SPI approximately  $21,000  for
         working capital needs.

                                    F-12



NOTE  4 - PROPERTY AND EQUIPMENT, NET

         Property  and  equipment,  net  at December  31,  2000  and  1999,
         consists of the following:



                                                  2000       1999
                                                      
Computer equipment                               $ 194,016  $ 196,187
Software                                            74,598     60,350
Furniture and equipment                            155,781    147,617
Leasehold improvements                               8,767     -
Other                                                4,250     -
                                                 ---------  ----------
                                                   437,412    404,154
Less accumulated depreciation and amortization    (198,955)  (137,081)
                                                 ---------  ----------
     Property and equipment, net                 $ 238,457  $ 267,073
                                                 =========  ==========



NOTE  5 - NOTES PAYABLE

         Notes  payable, substantially all of which were past due, consists
         of the following at December 31, 2000 and 1999:



                                                      2000         1999
                                                          
Unsecured debentures,  interest  at  12%  payable
quarterly,  originally  matured  in 1999.  During
1999,  a  portion  of  these notes were  extended
through January 2000.  The  Company  is currently
attempting  to  renegotiate an extended  maturity
date on these notes (see Note 9).                   $ 697,000   $ 1,152,326
Notes  payable,  interest   at   12%  per  annum,
principal and interest matured in  January  2000,
collateralized by all assets.                         200,000       250,000
Note  payable  to financial institution, interest
due in monthly installments  at  prime plus 1.5%,
guaranteed by certain stockholders  and officers,
collateralized  by  all  assets  of  the Company,
matures in February 2001.                             100,000             -
Unsecured notes payable, matured in September and
October  1999,  default  interest  at  10.75% per     100,000       100,000
annum.
Notes  payable to financial institution, interest
due in monthly  installments  at  prime  plus 1%,
guaranteed  by certain stockholders and officers,
collateralized by all assets of the Company, past
due as of December 31, 2000.                                -       350,000
Unsecured  convertible  debentures,  interest  at
12%, matured in March 2000.                           100,000             -
Unsecured note  payable  to shareholder, interest
at 10%, matures in May 2001.                          100,000             -
Unsecured  convertible  debentures,  interest  at
prime plus 10%, matured in August 2000.               150,000             -
Other unsecured notes payable.                          5,956         6,723
                                                    ----------  -----------
                                                    1,452,956     1,859,049
Less current portion                               (1,452,956)   (1,859,049)
                                                   -----------  -----------
    Total notes payable - long term                 $       -   $         -
                                                   ===========  ===========


NOTE  5 - NOTES PAYABLE (Continued)

         Notes payable -  related  parties  consists  of  the  following at
         December 31, 2000 and 1999:



                                                          2000       1999
                                                              
Unsecured  note  payable  to  an officer and director,
interest at 8%, matures June 30, 2001.                   $ 140,000  $     -
Unsecured  note  payable  to  former   Board   member,
interest at 15% per annum, principal and interest past
due in May 2000.                                           100,000        -
Unsecured  notes  payable  to  former Board member and
stockholder, interest at 8% - 10% per annum, principal
and interest past due in June 2000 and December 2000.
                                                            90,258   50,258
Unsecured, noninterest-bearing promissory note payable
to former Board member, no specified maturity date.
                                                            10,000   10,000
Other  unsecured  notes payable, interest  at  6%  per
annum, principal and  interest  past  due  in November
1998 and January 1999.                                      15,000   15,000
                                                         --------- --------
    Total notes payable - related parties                  355,258   75,258
Less current portion                                      (355,258) (75,258)
                                                         --------- --------
    Total notes payable - related parties -
      long term                                          $ -        $ -
                                                         ========= =========


         Cash  paid  for  interest  during 2000 and 1999, was approximately
         $68,000 and $46,000, respectively.


NOTE  6 - SHAREHOLDERS' EQUITY

         PRIVATE PLACEMENTS

         During  the  year ended December  31,  2000,  the  Company  issued
         2,446,310 shares  of its common stock in private placements at per
         share prices ranging  from  $1.00  to $4.00.  The Company received
         $3,539,107 in net proceeds from these private placements.  Related
         commissions paid to officers of the  Company during the year ended
         December 31, 2000, approximated $86,000.

         During  the  year  ended  December 31, 1999,  the  Company  issued
         474,879 shares of its common  stock  in  private placements at per
         share prices ranging from $0.88 to $3.50.   The  Company  received
         $1,141,504 in net proceeds from these private placements.

         OTHER ISSUANCES OF COMMON STOCK

         During  the  years  ended  December 31, 2000 and 1999, the Company
         issued  323,800  and  424,135  shares   of   its   common   stock,
         respectively,  plus  options,  as  payment  for various consulting
         services  related to legal, finance and merger  related  services.
         The shares  issued  were  valued at per share prices approximating
         recent private placement transactions.   The  options  were valued
         using the Black-Scholes Option Valuation Model, or the cash  value
         of the service received.



                                    F-13





NOTE  6 - SHAREHOLDERS' EQUITY (Continued)

         OTHER ISSUANCES OF COMMON STOCK (CONTINUED)

         During  the  years  ended  December 31, 2000 and 1999, the Company
         issued   295,003  and  33,333  shares   of   its   common   stock,
         respectively,  in  satisfaction  of certain notes payable, related
         interest charges and other payables if objectionably determinable.

         As an incentive to several investors  in  debentures,  76,666  and
         386,128  shares of stock were issued for a dollar value of $62,081
         and $290,096  during  the  years ended December 31, 2000 and 1999,
         respectively.

         CONVERTIBLE PREFERRED STOCK

         In  March 2000, the Company issued  125,000  shares  of  Series  A
         Convertible  Preferred  Stock  at  $4  per  share and received net
         proceeds  of  $480,000.   The  holders of the Series  A  Preferred
         Shares are entitled to cumulative  dividends at the rate of 6% per
         annum.   Each  share of Series A Convertible  Preferred  Stock  is
         convertible into  one share of common stock at the election of the
         holder thereof.  The  Company  may require mandatory conversion of
         all, but not less than all, of the Series A Preferred Shares on or
         after the first anniversary of the  initial  sale if certain stock
         trading prices are attained or if there is a reorganization of the
         Company involving an exchange of its common stock  for shares of a
         United  States  domiciled  corporation,  the  shares of which  are
         traded  on  a national exchange or on the NASDAQ  National  Market
         System.  The Company may not issue additional Series A Convertible
         Preferred Stock  or  warrants,  options or other rights to acquire
         Series A Convertible Preferred Stock  without  the  prior  written
         approval  of  holders  of  at  least two-thirds of the outstanding
         Series A Preferred shares under  this issuance.  For as long as at
         least  50%  of  the  Series  A Convertible  Preferred  Shares  are
         outstanding, the holders thereof may elect one board member to the
         Company's Board of Directors.   Unpaid and undeclared dividends in
         arrears as of December 31, 2000, was $24,494.

         The  shares  issued to Albara shareholders  consisted  of  616,797
         shares of common stock and 195 shares of Series F Preferred Stock.
         The Series F Preferred Stock is non-voting and the holders thereof
         are entitled to receive dividends on a pro rata basis with holders
         of common stock.   These  holders are entitled to a $100 per share
         preference on any liquidation  of  the Company and shall share pro
         rata  with  the  common  shareholders  in  any  remaining  amounts
         distributed.  Each share is convertible  into  15 shares of common
         stock.

         PURCHASE OF MINORITY INTEREST

         During the year ended December 31, 1999, the Company  acquired  an
         additional 16% ownership interest in Conduit Healthcare Solutions,
         Inc. by issuing 40,000 shares of the Company's common stock to the
         former  minority  interest.   The shares issued were valued at per
         share prices approximating recent private placement transactions.

         AUTHORIZED SHARES

         In  August 1999, the shareholders  of  the  Company  approved  the
         increase in the number of authorized shares of the Company's stock
         from  5,000,000  to  6,000,000.   As  a  result of its merger with
         Albara in February 2000, the Company's authorized shares of no par
         value  common  stock increased to 30,000,000  and  its  authorized
         shares of no par value preferred stock increased to 10,000,000.

                                   F-14



NOTE  6 - SHAREHOLDERS' EQUITY (Continued)

         STOCK OPTIONS

         Activity related  to  the Company's stock options during the years
         ended December 31, 2000 and 1999, was as follows:



                          OUTSTANDING OPTIONS
                        ----------------------------
                                       WEIGHTED
                        NUMBER OF      AVERAGE
                         SHARES        EXERCISE PRICE
                                 
DECEMBER 31, 1998         427,082       $1.08
Grants                  1,098,546       $1.42
Exercises                 (64,075)      $0.26
Cancellations             (26,603)      $1.15
                        ------------   --------------
DECEMBER 31, 1999       1,434,950       $1.33
Grants                  3,383,000       $2.12
Exercises                 (29,500)      $0.72
Cancellations             (54,000)      $0.93
                        ------------   --------------
DECEMBER 31, 2000       4,734,450       $1.90
                        ============
Options Exercisable at
  December 31, 2000     2,997,867       $1.80
                        ============


         The  intrinsic value recorded  for  options  issued  to  employees
         during the year ended December 31, 2000, was $1,167,580.

         The  range   of   exercise   prices  for  options  outstanding  at
         December  31,  2000  was  $.25  to  $7.00.   The  following  table
         summarizes information about options  outstanding  at December 31,
         2000:



                                 OUTSTANDING OPTIONS
                                 -------------------
                                        WEIGHTED
                                         AVERAGE         WEIGHTED
                          NUMBER OF    CONTRACTUAL        AVERAGE
RANGE OF EXERCISE PRICES   SHARES    LIFE (IN YEARS)  EXERCISE PRICE
                                             
    $0.25                  350,674       2.5              $0.25
   $1.00                 2,081,230       4.2              $1.00
   $1.75                   977,546       1.6              $1.75
   $3.50                 1,000,000       9.1              $3.50
   $4.00 - $7.00           325,000       2.0              $4.92
                         ---------
                         4,734,450                        $1.90
                         =========




                           EXERCISABLE OPTIONS
                           -------------------
                                          WEIGHTED
                            NUMBER OF     AVERAGE
RANGE OF EXERCISE PRICES    SHARES        EXERCISE PRICE
                                    
    $0.25                     350,674      $0.25
   $1.00                    1,051,230      $1.00
   $1.75                      889,296      $1.75
   $3.50                      480,000      $3.50
   $4.00 - $7.00              216,667      $4.69
                            -----------
                            2,997,867      $1.80
                            ===========


         The Company has an Incentive Stock Option Plan that allows for the
         issuance  of  up  to  350,000 shares thereunder.  No options  were
         issued and outstanding under this plan as of December 31, 2000 and
         1999.
                                   F-15




NOTE  6 - SHAREHOLDERS' EQUITY (Continued)

         STOCK OPTIONS (CONTINUED)

         The Company accounts for  its  options  and  warrants according to
         Accounting Principles Board Opinion No. 25, "Accounting  for Stock
         Issued  to  Employees"  and  follows the disclosure provisions  of
         Statement of Financial Accounting  Standards  No. 123, "Accounting
         for  Stock-Based  Compensation."   Accordingly,  if   options   or
         warrants  are  granted  to  employees  or  for  services and other
         consideration with an exercise price below the fair  market  value
         on  the  date  of  the  grant, the difference between the exercise
         price and the fair market  value  is  charged  to operations.  The
         fair  value of the options granted during the fiscal  years  ended
         December  31, 2000 and 1999, reported below, has been estimated at
         the dates of  grant using the Black-Scholes Option Valuation Model
         with the following assumptions:



                          2000  1999
                          
Expected life (in years)
                          6.2   3.7
Risk-free interest rate
                          8.0%  8.0%
Volatility
                          103%  340%
Dividend yield
                          0.0%  0.0%


         The  Black-Scholes Option Valuation Model was developed for use in
         estimating  the  fair value of traded options that have no vesting
         restrictions and are  fully  transferable.   In  addition,  option
         valuation   models   require   the   input  of  highly  subjective
         assumptions,  including  the  expected  stock   price  volatility.
         Because  the Company's options have characteristics  significantly
         different from those of traded options, and because changes in the
         subjective  input assumptions can materially affect the fair value
         estimate, in the opinion of management, the existing models do not
         necessarily provide a reliable single measure of the fair value of
         its options.

         For purposes of pro forma disclosures, the estimated fair value of
         the options is  amortized  to  expense  over  the options' vesting
         period.  The Company's pro forma information is as follows:



                              2000          1999
                                      
Pro forma net loss         $ (9,351,000)   $ (4,983,000)
Pro forma loss per share   $ (1.36)        $ (1.16)


         The  effects on pro forma disclosures of applying SFAS 123 are not
         necessarily  indicative of the effects on pro forma disclosures of
         future years.

         WARRANTS

         On January 31,  2000, a warrant was issued, which was effective on
         February 18, 2000,  to  the  former majority shareholder of Albara
         for the right to purchase 500,000  shares of common stock at $3.50
         per  share on or after April 30, 2000.   The  warrant  expires  on
         January 31, 2010.  The warrant provides that the exercise price of
         $3.50  shall be adjusted to $.035 in the event the Company has not
         closed an  equity  offering  raising  an  aggregate  of  at  least
         $2,500,000 by July 16, 2000.  This warrant is currently in dispute
         (see Note 8).

         On  September  1, 2000, 142,857 warrants were issued as part of  a
         common stock sale.   These  warrants  can  be  exercised at $1.625
         price per share until March 1, 2001.

         On  August  8, 2000, 100,000 warrants were issued  as  part  of  a
         common stock sale.  These warrants were exercisable at $2.50 price
         per  share until  November  8,  2000.   These  warrants  were  not
         exercised by the expiration date.

                                   F-16



        NOTE  7 - INCOME TAXES

         Significant  components  of  the Company's deferred tax assets and
         liabilities at December 31, 2000  and  1999,  are approximately as
         follows:



                                2000         1999
                                    
Deferred tax liabilities      $ (142,000) $  (20,000)
Deferred tax assets              549,000     122,000
Net operating losses           4,427,000   1,849,000
                              ----------- -----------
     Deferred tax assets,
net of                         4,834,000   1,951,000
       tax liabilities
Less valuation allowance      (4,834,000) (1,951,000)
                              ----------- -----------
     Net deferred taxes       $        -  $        -
                              =========== ===========


         As  of  December  31, 2000, the Company had a net  operating  loss
         carryforward of approximately  $11  million  available  to  offset
         future  taxable  income.   The  net  operating  loss  carryforward
         expires through the year 2019.  This net operating loss  does  not
         include  amounts related to Albara prior to the merger, as certain
         records have not been provided by Albara (see Note 9).  Management
         does not believe  that  there  would  be  an adverse affect on the
         financial  statements  if  this information were  made  available.
         Additionally, under U.S. federal  tax  laws,  certain  changes  in
         ownership  of  a  company  may  cause severe limitations on future
         utilization  of  these  loss  carryforwards.    The   Company  has
         established a valuation allowance to fully offset all deferred tax
         assets, as their future realization is uncertain.

         Differences  between the Company's effective income tax  rate  and
         the federal statutory  rate  at  December  31,  2000 and 1999, are
         primarily due to the deferred tax asset valuation allowance.


NOTE  8 - COMMITMENTS AND CONTINGENCIES

         LEASE COMMITMENTS

         The  Company  leases  office  space  and  office  equipment  under
         noncancelable  operating  lease  agreements, which expire  through
         June 2005.

         Future minimum rental payments required  under  these  leases  are
         approximately as follows:



 YEAR ENDING
                               
December 31,                        Amount
    2001                          $ 289,000
    2002                            268,000
    2003                            260,000
    2004                            261,000
    2005                             64,000
                                  -----------
             Total future minimum
             rental payments     $1,142,000
                                 ===========
 

         Total  rent  expense  incurred  under  these  leases  approximated
         $271,000  and  $87,000  for the years ended December 31, 2000  and
         1999, respectively.

                                   F-17



NOTE  8 - COMMITMENTS AND CONTINGENCIES (Continued)

         EMPLOYMENT AGREEMENTS

         The Chief Executive Officer and the President each have employment
         agreements with the Company.   The agreements were entered into on
         May  1,  2000, as a continuation of  their  employment  agreements
         signed September  15,  1999  and  are the same except for the base
         salary.  The aggregate base salaries  under  these  agreements  is
         $275,000,  with  an  automatic  4% increase each September 15{th}.
         The agreements expire April 30, 2003.

         The agreements grant 25,000 shares of freely traded stock to each.
         The agreements each granted 750,000  stock  options  with  a $1.00
         strike  price that expire on December 31, 2005.  Fifty percent  of
         the  options   vested  immediately  with  the  other  50%  vesting
         January 1, 2001.

         The agreements grant  a  cash  bonus of 5% of the Company's income
         from  operations, defined as net  income  before  taxes,  minority
         interests, extraordinary items, amortization of intangible assets,
         interest on long-term debt and this incentive compensation.

         The agreements  also  require  a  monthly  automobile allowance of
         $500, appropriate membership dues and subscription  fees,  payment
         for outside disability insurance, "piggy back" registration rights
         for  all stock owned, a $1,000,000 term-life insurance policy  and
         1% commission for all investment funds into the Company and any of
         its  subsidiaries   from   May   1,   2000   until  May  1,  2001.
         Approximately  $56,000  in  commissions  were earned  under  these
         agreements during the year ended December 31, 2000.

         CHINESE JOINT VENTURE

         In  November  1999,  the  Company  entered into an agreement to form
         a joint  venture with Top Group, ("TOP") a Chinese corporation
         registered in  Chengdu,  P.R. China.  The Company's  interest in the
         joint venture was to  be  held  by  its wholly owned subsidiary
         Leapfrog China, Inc.  The purpose of Joint Venture Company was to adapt
         the Company's products for application  to  suitable  governmental and
         private  sector  markets  in  the  Asia-Pacific Region.   Leapfrog
         China, Inc. will be responsible for  all approved costs associated
         with the registration and protection of  the intellectual property
         and related technology rights, as well as certain other costs.  In
         2000,   the   Company   incurred   difficulty  in  launching   its
         manufacturing,   sales  and  marketing  programs,   as   well   as
         disagreements with  TOP.   Accordingly,  operations  of this joint
         venture have not been significant and primarily consist  of start-
         up  costs, travel and research and development.  The Company  has,
         for all practical purposes, ceased its participation in this joint
         venture  and is considering the dissolution thereof and is seeking
         a  new strategic  joint  venture  partner  in  China.   All  costs
         incurred  by  the  Company related to this joint venture have been
         expensed in the accompanying financial statements.

         GUARANTY

         In July 1999, the Company guaranteed a $150,000 promissory note of
         three of its officers  and/or  shareholders  (the  "Group").   The
         balance  on this note as of December 31, 2000 was $150,000 and was
         due September  2000.   The  Group  has  pledged  200,000 shares of
         Company's  common stock owned by the Group as collateral  for  the
         promissory note.   Due  to  the  absence  of  any  market for this
         guaranty  and  the related-party nature, management believes  that
         the fair value of  this  guaranty  would  not  be material and the
         estimation thereof would not be practicable.

                                   F-18




NOTE  8 - COMMITMENTS AND CONTINGENCIES (Continued)

         CONSULTING AGREEMENT WITH RELATED PARTY

         In  April  1999,  the  Company  entered into a two-year  marketing
         consulting  agreement with a member  of  the  Company's  Board  of
         Directors.  The  agreement  provides for the Company to compensate
         the  consultant  as  follows:  $4,000  per  month,  240,000  stock
         options and up to 260,000  additional  stock  options  if  certain
         revenue  targets  are  achieved  by the Company.  The consultant's
         partner has the same options granted  to  him.  The exercise price
         for all options shall be at a per share price  of $3.50.  The term
         of the options shall be ten years from the grant  date.   Past due
         consulting  fees may be converted into the Company's common  stock
         at the conversion  rate  of  $2.50  per  share.  Expenses incurred
         under this agreement during the years ended  December 31, 2000 and
         1999,  approximated  $69,000  and  $43,000, respectively.   During
         1999, approximately $11,500 was paid  to  the  consultant  and  an
         additional  $22,000  was paid through the issuance of 8,800 shares
         of the Company's common  stock.  As of December 31, 2000 and 1999,
         approximately $61,000 and  $13,000,  respectively,  was due to the
         related party.

         LITIGATION

         Real  Provencher  v.  Leapfrog  Smart Products, Inc. f/k/a  Albara
         Corporation,  and American Securities  Transfer  Incorporated  was
         filed in the U.S.  District  Court  for  the  Southern District of
         Texas, Houston Division.  Plaintiff, a shareholder of the Company,
         has  filed  the  following  claims  against the Company:   1)  the
         Company  breached  its  statutory duty to  register  and  transfer
         Plaintiff's shares in the  Company;  2)  the  Company violated his
         statutory right under Rule 144 of the Securities  Act  of  1934 to
         terminate   restrictions  to  sell  his  shares;  3)  the  Company
         committed common  law  and  statutory fraud; 4) breach of contract
         under a Bleed Out Agreement;  and  5)  tortuous  interference with
         Plaintiff's  contract  to sell 77,300 shares of stock.   Plaintiff
         has alleged actual damages of $2,576,000 plus attorney's fees, and
         pre- and post-judgment interest.

         The Company filed a lawsuit  styled  Leapfrog Smart Products, Inc.
         v.  Real Provencher , in the U.S. District  Court  of  the  Middle
         District  of Florida, Orlando Division, with the following claims:
         1) breach of  contract  under a Consulting Agreement; 2) breach of
         contract under the terms of a Bleed Out Agreement; 3) violation of
         Rule  16  of  the  Securities   Act   of   1934;   4)   fraudulent
         misrepresenta-tion  and  common  law  fraud;  and 5) violation  of
         Rule  144  of  the  Securities  Act of 1934.  The Company  alleged
         compensatory damages, costs, and  further  relief,  as  the  court
         finds appropriate.  The Florida Court has transferred venue to the
         U.S.  District  Court  for the Southern District of Texas, Houston
         Division, and the two cases have been consolidated.

         As part of a consulting  agreement with Provencher, a warrant with
         an effective date of February 18, 2000 was issued for the right to
         purchase 500,000 shares of  common  stock at $3.50 per share on or
         after April 30, 2000.  The warrant expires  on  January  31, 2010.
         The  exercise  price of $3.50 was to be adjusted to $0.035 in  the
         event the Company  did  not  close  an  equity offering raising an
         aggregate of at least $2.5 million by July 16, 2000, which did not
         occur.   Although  Provencher has not attempted  to  exercise  the
         warrants, as part of the lawsuit the Company is attempting to have
         the warrants declared  null  and  void  due  to  the  alleged non-
         performance under the consulting agreement.

         Discovery  is  underway  in the case.  Some settlement discussions
         have begun but no settlement  has  occurred  at  this  time.   The
         Company  is  unable  to determine the likelihood of an unfavorable
         outcome in this case and  is  not  able  to estimate the potential
         loss  to  the  Company at this time.  Accordingly,  the  financial
         statements include  no  provision  or  liability  related  to  the
         ultimate outcome of this matter.

                                   F-19



NOTE  8 - COMMITMENTS AND CONTINGENCIES (Continued)

         LITIGATION (CONTINUED)

         The  Company  is  also seeking certain financial records of Albara
         for the period prior  to  the merger; however, management does not
         believe the production of such  records  will  have  a significant
         impact, if any, on the financial statements.

         The  Company  was  party  to a lawsuit brought by Publicard,  Inc.
         regarding the repayment of  $100,000 in notes due to them from the
         Company.  It was the Company's  position that although these notes
         were recorded with interest accruing,  the  notes should be offset
         with  certain  costs incurred by the Company.   This  lawsuit  was
         settled on February  2,  2001,  requiring  that  the Company repay
         $90,000  in  nine $10,000 monthly installments beginning  February
         2001.

         The lessor of  the  Company's  former  office  space  has sued the
         Company for breach of contract and lien foreclosure based  on  the
         Company's  breach  of  lease  and  failure  to  pay rent.  Damages
         requested  are  $270,400,  plus  attorney's fees and  costs.   The
         Company  has  brought a counter suit  against  the  lessor  for  a
         declaratory action, breach of lease, Tortious interference with an
         advantageous business  relationship,  and breach of good faith and
         fair dealings regarding reletting of the  property.   The  Company
         has  accrued a insignificant portion of the lessor's claims in  an
         amount equal to the unpaid lease payments that would have been due
         under  the lease through December 31, 2000.  No other amounts have
         been recorded  in  the  accompanying financial statements for this
         uncertainty, as management cannot reasonably estimate the ultimate
         outcome.

         The Company is party to various  other legal proceedings; however,
         management does not believe the ultimate  outcomes to any of these
         actions  will  have a material impact to the  Company's  financial
         position.


NOTE  9 - SUBSEQUENT EVENTS

         On April 2, 2001,  the  Company  entered into an agreement for the
         sale of approximately 82% of Conduit with closing to be within 120
         days,  with  a two-year right-of-first  refusal  to  purchase  the
         remaining shares  of  Conduit held by the Company at an equivalent
         price per share.  The sale  of  Conduit  includes licensing rights
         for the Company's software assets solely related to the healthcare
         industry in the United States, which includes,  but is not limited
         to hospitals, physician offices, pharmacies, insurance  companies,
         managed care organizations, clinics, dental offices, chiropractic,
         podiatry,   ocular   health,   governmental  healthcare  agencies,
         providers  and  payors,  ambulances,   nursing   homes,  and  home
         healthcare  agencies.   In  exchange  for selling the  controlling
         interest in Conduit, the purchaser will  pay  the Company $510,000
         and  provide  Conduit  with  $1.9  million  to  fund  its  ongoing
         business, as well as guaranteeing software development  fees of $3
         million pursuant to the terms of a software development agreement,
         which  Conduit  and  the  Company executed in connection with  the
         stock purchase agreement.   The  purchaser  is required to pay the
         Company $250,000 by May 29, 2001.  Between that  date and closing,
         the purchaser will pay the Company not less than 20%  of  all cash
         collected,  up  to  a  maximum of $510,000, including the $250,000
         paid  by  May  29, 2001, in  any  private  offering  of  Conduit's
         securities undertaken  to  satisfy  the  purchaser's obligation to
         provide the Conduit funding.  The balance, if any, will be paid at
         closing.   The  future  exercise  of  any outstanding  options  of
         Conduit as of April 2, 2001 would be the obligation of the Company
         to satisfy.

         In March 2001, Leapfrog Merger, Inc. changed  its name to Leapfrog
         Smart Products, Inc.

                                   F-20





NOTE  9 - SUBSEQUENT EVENTS (CONTINUED)

         In February 2001, the Company issued a note to  a  shareholder and
         noteholder  for  $2  million  to be funded in various installments
         from January 25, 2001 through May  15,  2001.   Through  April  3,
         2001,  the Company has received approximately $1.5 million of this
         funding.   The  note  is  secured  by  all  assets of the Company.
         Interest accrues at 12% and is due and payable quarterly beginning
         July 1, 2001.  The note matures on July 1, 2002.   The note or any
         portion  thereof,  is  convertible  into  shares  of the Company's
         common  stock  at  the rate of $1.00 per share.  As part  of  this
         financing agreement, the noteholder received an option to purchase
         up to 1,000,000 shares  of the Company's common stock at $1.00 per
         share through June 30, 2002.

         Proceeds from this note were  used to repay the $200,000 remaining
         balance on a note that was secured  by  all  assets of the Company
         that was due in January 2000.

         The Company is currently renegotiating the terms  of  much  of the
         outstanding  debt.   The  $100,000  note  with  the  bank has been
         extended  until  October  1, 2002.  Many of the debenture  holders
         agreed to take new notes in  place of debentures.  Notes have been
         issued  that brought $477,000 of  the  debentures  outstanding  at
         December 31, 2000 current.  The majority of the new notes call for
         repayment  of  the  principal  and  interest over 24 month periods
         either beginning in March or August 2001.

         On  January 16, 2001, the Board of Directors  approved  employment
         contracts  with  three  key employees.  The terms of the contracts
         extend to dates ranging from  January  24,  2002  to September 30,
         2003.  The agreements call for aggregate salaries of $390,000 with
         annual 4% increases.  These agreements call for the issuance of an
         aggregate of 1,100,000 stock options to purchase common  stock  of
         the  Company.   The  options all have a strike price of $1.00 each
         with various vesting dates  through January 1, 2002 and expiration
         dates ranging from January 16,  2004  through  December  31, 2005.
         The other material provision to one of the contracts involves  the
         payment  of a cash bonus equal to 1% of the Company's net profits,
         defined as  net earnings before insurance, taxes and amortization.
         Another contract  requires the payment of a cash bonus equal to 4%
         of the Company's income  from  U.S.  operations,  defined  as  net
         income  before  taxes,  minority  interests,  extraordinary items,
         amortization of intangible assets, interest on  long-term debt and
         any incentive compensation to employees.

                                   F-21


                               SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


LEAPFROG SMART PRODUCTS, INC.

By:  /s/ Les Bromwell
------------------------------
Les Bromwell, CEO and President

Date: April 16, 2001


In accordance with the Exchange Act, this report has been signed below by
the following persons in the capacities and on the dates indicated.


                            POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints Randolph Tucker, his true and
lawful attorneys-in-fact and agents with full power of substitution and
re-substitution, for then and in their name, place and stead, in any and
all capacities, to sign any and all amendments  (including post-effective
amendments) to this registration statement and to file the same with all
exhibits thereto, and all documents in connection therewith, with the
Securities  and Exchange Commission, granting unto  said
attorneys-in-fact and agents, and  each  of  them, full power and
authority to do and perform each and every act and thing  requisite  and
necessary to be done, as fully to all intents and purposes as they might
or  could  do  in person, hereby ratifying and confirming all that said
attorneys-in-fact and  agents or any of  them,  or  their or his
substitute or substitutes, may lawfully  do  or cause to be done by
virtue hereof.

This power of attorney may be executed in counterparts.

Pursuant to 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 indicated.


SIGNATURE                  TITLE                  DATE
------------------------- ----------------------- -------------

/s/ Les Bromwell           CEO & President         April 16, 2001
-------------------------
Les Bromwell

/s/ Jon Gerster            CFO                     April 16, 2001
-------------------------
Jon Gerster