SCHEDULE 14C
(Rule 14c-101)

Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934

Check the appropriate box:

[X] Preliminary Information Statement [ ] Confidential, For Use of
the Commission Only (as permitted
by Rule 14c-5(d)(2))

[ ] Definitive Information Statement

DELTA MUTUAL, INC.
(Name of Registrant as Specified in Its Charter)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required

[ ] Fee computed on table below per Exchange Act Rules 14c-5(g) and
0-11.

(1) Title of each class of securities to which transaction applies: n/a

(2) Aggregate number of securities to which transaction applies: n/a

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined): n/a

(4) Proposed maximum aggregate value of transaction: n/a

(5) Total fee paid: n/a

[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provide by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount previously paid: n/a

(2) Form, Schedule or Registration Statement No.: n/a

(3) Filing Party: n/a

(4) Date Filed: n/a

Preliminary Copy dated November 5, 2001

Preliminary Copy dated November 9, 2001

DELTA MUTUAL, INC.
1730 Rhode Island Ave., N.W., Suite 812
Washington, D.C. 20036
(202) 408-1155

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON DECEMBER ___, 2001

To the Stockholders of Delta Mutual, Inc.:

NOTICE IS HEREBY GIVEN THAT a special meeting of the Stockholders of
Delta Mutual, Inc., a Delaware corporation (hereinafter the "Company" or
"Delta"), will be held at 1730 Rhode Island Avenue, N.W., Suite 812, on December
___, 2001, at 10:00 o'clock a.m. local time, for the following purposes:

1. To consider and act upon a proposal to amend the Company's Certificate
of Incorporation, such amendment to be subject to consummation of the
Company's acquisition of substantially all the assets of Enterprises
Solutions, Inc.:

(a) changing the Company's name to "Internet High Assurance
Corporation";

(b) increasing its authorized common stock from 20,000,000 to
100,000,000 shares, par value $0.0001 per share;

2. To approve the Company's 2001 Employee Stock Option Plan (the "Stock
Option Plan") and reserve up to 2,000,000 shares of Common Stock for
issuance thereunder;

3. To elect Kenneth A. Martin, Sailor H. Mohler, and Phillip Chung to
serve as directors on the Company's Board of Directors until the next
annual meeting or until their resignations are tendered and duly
accepted by the Company; and

4. To transact such other business as may properly come before the meeting
or any adjournment or postponement thereof.

The Board of Directors has fixed the close of business on November ___,
2001, as the record date for determining the stockholders entitled to notice of
and to vote at the Special Meeting and any adjournment or postponement thereof.

Shares of common stock can be voted at the meeting only if the holder
is present at the meeting in person or by valid proxy. WE ARE NOT ASKING YOU FOR
A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.

All stockholders are cordially invited to attend the meeting.

By Order of the Board of Directors,

Kenneth A. Martin, President

November , 2001
Washington, DC

Preliminary Copy dated November 9, 2001

DELTA MUTUAL, INC.

1730 Rhode Island Avenue, N.W., Suite 812, Washington, DC 20036

INFORMATION STATEMENT

Special Meeting of Stockholders December ___, 2001

This Information Statement is being furnished by Delta Mutual, Inc., a
Delaware corporation ("Delta" or the "Company"), to holders of its common stock
of record November ___, 2001 (the "Record Date") in connection with a Special
Meeting of Stockholders (the "Special Meeting") to be held at 1730 Rhode Island
Avenue, N.W., Suite 812, Washington, DC, on December ___, 2001, at 10:00 A.M.
(local time), and any adjournment or postponement thereof.

At such meeting, stockholders will consider and act upon proposals (1)
to amend the Company's Certificate of Incorporation to (a) change its name to
"Internet High Assurance Corporation", (b) increase the number of authorized
Common Stock of the Company from 20,000,000 to 100,000,000 shares, and (c)
authorize the Company to issue up to 5,000,000 shares of Preferred Stock, par
value $0.0001; (2) to approve the Company's 2001 Employee Stock Option Plan (the
"Stock Option Plan"); and (3) to elect Kenneth A. Martin, Sailor H. Mohler, and
Phillip Chung as directors of the Company until the next annual meeting or until
their resignations are tendered and duly accepted by the Company. Amendment of
the Company's Certificate of Incorporation would be conditioned on consummation
of the acquisition of substantially all the assets of Enterprises Solutions,
Inc. ("Enterprises") pursuant to the Agreement of Sale between the Company and
Enterprises.

The amendments to the Company's Certificate of Incorporation (the
"Certificate of Amendment"), the Stock Option Plan, and the proposed election of
Kenneth A. Martin, Sailor H. Mohler, and Phillip Chung as directors of the
Company are more fully described below, and copies of Certificate of Amendment
and Stock Option Plan are attached as Appendices "A" and "B". Stockholders of
the Company should consider carefully the matters discussed in this Information
Statement before casting their vote.

You are entitled to vote at the meeting if you owned shares of Delta's
common stock as of the close of business on November __, 2001 (the "Record
Date"). You will be entitled to cast one vote for each share of common stock
that you owned as of that time. As of that date, we had 557,000 shares of common
stock outstanding.

Stockholders who own in excess of 50% of the Company's outstanding
shares have advised us that they intend to vote in favor of each of the items
set forth above. It is anticipated, therefore, that the proposals will be
approved.

WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US
A PROXY.

You should rely only on the information or representations provided in
or referred to in this Information Statement. Delta has not authorized anyone
else to provide you with information. You should not assume that the information
in this Information Statement is accurate as of any date other than the date on
the cover page of this document.

Mailed to Stockholders November ___, 2001.

TABLE OF CONTENTS

INFORMATION STATEMENT 1
BACKGROUND TO THE MEETING 3
The Agreement with Enterprises Solutions, Inc. 3
Unrelated Matters to Be Considered 3
Annual Report; Financial Information 4
MATTERS TO BE VOTED ON 4
Amendment of Certificate of Incorporation 4
Change of the Company's Name 4
Increase in Authorized Shares 4
Authorization of Preferred Stock 5
Stock Option Plan 5
Election of Directors 7
VOTING SECURITIES AND PRINCIPAL HOLDERS 8
Section 16(a) Beneficial Ownership Reporting Compliance 10
Change of Control in 2001 10
DIRECTORS AND EXECUTIVE OFFICERS 10
Compensation of Directors and Executive Officers 11
Employment Agreements 11
Certain Relationships and Related Transactions 11
Meetings and Committees of the Board of Directors 12
INDEPENDENT PUBLIC ACCOUNTANTS 12
Audit Fees 12
THE MEETING 12
Shares Outstanding 12
Voting Procedures 12
Dissenters or Appraisal Rights 13
Costs 13
FINANCIAL INFORMATION 13
Incorporated by Reference 13
APPENDICES
Proposed Certificate of Amendment A
Proposed 2001 Employee Stock Option Plan B
Form 10-KSB for year ended December 31, 2000 C
Form 10-QSB for period ending September 30, 2001 D

BACKGROUND TO THE MEETING

The Agreement with Enterprises Solutions, Inc.

In May 2000, we entered into an Agreement of Sale pursuant to which
Delta would acquire substantially all the assets of Enterprises Solutions, Inc.
("Enterprises") in exchange for approximately 11,068,307 shares of Delta's
common stock. The principal asset being acquired is Enterprises' Internet
security business. We believe such acquisition will provide Delta with an
operating business in an industry with potential for growth, which would be in
the best interests of Delta's stockholders.

Enterprises, whose executive offices are located in Braintree,
Massachusetts, is a development stage company organized to produce devices and
software for computer security. While it has had no sales to date, it has
developed three products which it believes are ready for market. One is a PC
accessory consisting of a small keypad with card-swipe which generates its own
encryption key and identification signal, permitting it to send protected data
over open systems such as the Internet. Enterprises has also developed software
which encrypts the transmission and affords the receiver the means by which to
ensure the data has not been altered en route. Enterprises' keypads cannot
operate without supporting software. One version of its keypad accessory has a
fixed Global Positioning Satellite chip that transmits the keypad's longitude
and latitude, as well as the transaction's date and time. Enterprises has also
developed a complementary computer platform device with a designed-in computer
and network security function utilizing a standard Intel-based architecture.
There have been no sales of any of such products, and there can be no assurance
that they will operate as envisioned or attain commercial success.

We are not seeking approval of Delta's stockholders for this
transaction. Under Delaware law, stockholder approval is not required for the
issuance of stock, including the issuance of stock in a transaction such as that
with Enterprises.

As part of the Agreement of Sale, we agreed to change Delta's name to
"Internet High Assurance Corporation", and to increase its authorized common
stock from 20,000,000 to 100,000,000 shares. The change of name is believed to
better reflect the Company's business following the acquisition of Enterprises'
technology, and an increase in authorized stock is deemed desirable for possible
future financings, for employee compensation and inducements, and for possible
acquisitions. Such actions require an amendment of Delta's Certificate of
Incorporation, which is on the agenda for this meeting.

Under the Agreement of Sale, we will be issuing approximately
11,068,307 shares of common stock to Enterprises in exchange for its assets. A
portion of such shares will be held in escrow for a period of 90 days after the
closing, and will be returned to Delta to the extent Enterprises' liabilities
exceed its $50,000 cash retention. After the transaction, Enterprises' will own
approximately 95% of Delta's outstanding shares, and Delta's stockholders will
own approximately 5%. As part of the Agreement of Sale, Enterprises is required
to dissolve and liquidate following the sale of its assets to Delta, at which
time its shares of Delta stock will be distributed to its stockholders.

We have filed with the Securities and Exchange Commission a
Registration Statement for the shares of Delta stock to be issued to Enterprises
in exchange for its assets. The Registration Statement contains additional
information about Enterprises and the proposed transaction. If you would like a
copy of the Registration Statement, you may call us at the number indicated on
the heading of this Information Statement, and we will provide you one without
charge.

Unrelated Matters to Be Considered

In anticipation of the Special Meeting to consider the amendment of
Delta's charter, we determined it would be appropriate to consider providing for
an employee stock option plan. We believe that a stock option plan will assist
us in attracting and retaining qualified executives.

We also determined it would be appropriate to elect directors at this
meeting, for which purpose the Board has renominated its current board members.

Annual Report; Financial Information

A copy of the Company's Annual Report on Form 10-KSB, as filed with the
Securities and Exchange Commission, is attached as Appendix C. A copy of its
Quarterly Report on Form 10-QSB is attached as Appendix D. These reports include
financial information for the year ended December 31, 2000 and for the nine
months ended September 30, 2001.

MATTERS TO BE VOTED ON

Amendment of Certificate of Incorporation

Subject to consummation of the Company's acquisition of substantially
all Enterprises' assets, the Board of Directors proposes to amend Delta's
Certificate of Incorporation to (a) change the Company's name to "Internet High
Assurance Corporation", (b) increase the Company's authorized common stock from
20,000,000 shares to 100,000,000 shares, and (c) authorize the Company to issue
up to 5,000,000 shares of Preferred Stock. If for any reason the acquisition of
Enterprises' assets fails to take place, the Certificate of Amendment will not
be filed.

Change of the Company's Name

The proposed amendment to the Company's Certificate of Incorporation
includes a provision changing the Company's name from Delta Mutual, Inc. to
"Internet High Assurance Corporation". This change of name is required under the
Agreement of Sale with Enterprises, and we believe it is desirable in light of
the business which Delta is acquiring from Enterprises.

Increase in Authorized Shares

We presently have 557,000 shares outstanding, and will be issuing up to
11,068,307 shares to Enterprises in exchange for its assets. In connection with
such acquisition, we will be assuming Enterprises' obligations under various
outstanding options and warrants and a convertible note which, in the event they
were all exercised and converted, would require us to issue an additional
5,929,199 shares.

Such options, warrants, and conversion rights are exercisable at prices
ranging from $0.667 to $7.50 per share, for periods expiring between February
2002 and August 2006. They include warrants to purchase 2,535,200 shares which
expire in August 2006, warrants to purchase 253,520 shares which expire in April
2003, warrants to purchase 2,281,680 shares which expire in June 2003, warrants
to purchase 405,632 shares which expire in December 2003, options to purchase
47,535 shares which expire in February 2002; options to purchase 12,676 shares
which expire in August 2002; options to purchase 126,760 shares which expire in
December 2002; options to purchase 31,690 shares which expire in March 2003;
options to purchase 76,056 shares which expire in April 2002; options to
purchase 31,690 shares which expire in May 2002, and options to purchase 126,760
shares in March 2003. Of these, the options to purchase 126,760 shares at $6.25
per share expiring in March 2003 and the warrants to purchase 2,535,200 shares
at $1.00 per share expiring in August 2006 are held by the estate of
Enterprises' former President and C.E.O., John Solomon. An additional 2,000,000
shares would be reserved for employee options in the event the 2001 Employee
Stock Option Plan is approved.

At present, only 20,000,000 shares authorized. Unless the number of
authorized shares is increased, the Company would have fewer than 500,000 shares
available for issuance in connection with additional financings, acquisitions,
employee options, and other corporate purposes. Accordingly, we are proposing
that the Company's authorized stock be increased to 100,000,000 shares, par
value $.0001 per share. The Board of Directors recommends the proposed increase
to insure that a sufficient number of authorized and unissued shares are
available (i) to raise additional capital for the Company's operations, (ii) to
make options and shares available for employees, future non-employee directors,
and consultants as an incentive for services to the Company, and (iii) for
issuance in connection with possible acquisitions of other companies.

We do not presently have any specific plans or arrangements relating
to the issuance of any of the shares proposed to be authorized. Such shares
would be available for issuance by the Board of Directors without further action
by the stockholders. Although shares may be issued only for consideration deemed
adequate under Delaware law, issuance could have a dilutive effect on existing
stockholders, reducing the percentage of Delta's outstanding shares represented
by those held by such existing stockholders. Neither the presently authorized
shares nor the additional shares that would be authorized by the proposed
amendment have preemptive rights.

Authorization of Preferred Stock

We believe that the ability to issue preferred stock could be useful in
connection with some kinds of venture capital financing, acquisitions, and other
corporate transactions. We are therefore proposing that the Company's
Certificate of Incorporation be amended to authorize the issuance of up to
5,000,000 shares of Preferred Stock, par value $.0001 per share.

Under the proposed amendment, the Board of Directors would be
authorized to issue one or more series of preferred stock with such
designations, rights, preferences, limitations and/or restrictions as it should
determine by vote of a majority of such directors. By way of illustration,
special rights and preferences may include special voting rights (or denial of
voting rights), special rights with respect to payment of dividends, conversion
rights, rights of redemption, sinking funds, and special rights in the event of
liquidation, as the Board may determine. The Board has no present intentions or
plans relating to the issuance of preferred stock.

The Board of Directors recommends that the stockholders vote in favor
of the amendment to the Company's Certificate of Incorporation described above.

Stock Option Plan

On November 1, 2001, the Board of Directors approved a stock option
plan to be known as the 2001 Employee Stock Option Plan. This plan (sometimes
the "Plan") would provide for options to purchase up to 2,000,000 shares of the
Company's common stock, which options would be available for grant to key
employees and others deemed deserving by the Board of Directors. The Board has
recommended that the Stock Option Plan be approved by our stockholders.

The primary purposes of the Stock Option Plan are to provide a means of
rewarding deserving employees in a way which provides an incentive for such
employees to assist the Company's growth and success, and to assist us in
attracting and retaining qualified personnel.

Persons eligible to receive awards under the Plan would include key
employees of the Company and its subsidiaries and non-employee directors of the
Company and its subsidiaries, as determined by the Board or a committee
established by the Board for such purpose. The Plan would authorize the Board to
grant, over a 10 year period, options to purchase up to 2,000,000 shares of the
Company's common stock. If any option expires or is terminated prior to
termination of the Stock Option Plan, any shares subject to such option, to the
extent it had not been exercised, would be available for the grant of new
options under the Plan. Any shares used as full or partial payment by an
optionee upon exercise of an option also may subsequently be used by the Company
to satisfy other options granted under the Plan. The Stock Option Plan provides
that the purchase price per share may not be less than 100% of the fair market
value of the common stock at the time of grant. The purchase price would be
payable in cash or common stock of the Company held for at least six months and
with a market value equivalent to that of the shares being acquired or, in the
discretion of the Board (or a committee), any combination of these.

Options granted under the Plan could be in the form of options which
qualify as "incentive stock options" under Section 422 of the Internal Revenue
Code (the "Code") or "non-qualified options" (options which do not meet the
criteria for "incentive stock options" under Section 422). The tax treatment of
incentive stock options is generally more favorable to employees than the
treatment afforded non-qualified stock options. Generally, the exercise of an
incentive stock option does not require the optionee to recognize income for
federal income tax purposes. (The difference between the exercise price of the
incentive stock option and the fair market value of the stock at the time of
purchase is, however, an item of tax preference which may require payment of an
alternative minimum tax.) On sale of shares acquired by exercise of an incentive
stock option (assuming that the sale does not occur within two years of the date
of grant or within one year from the date of exercise), any gain would be taxed
to the optionee as long-term capital gain. In contrast, when an optionee
exercises a non-qualified option, he or she recognizes taxable income (subject
to withholding) in an amount equal to the difference between the fair market
value of the shares on the date of exercise and the exercise price. Upon any
sale of such shares by the optionee, any difference between the sale price and
the fair market value of the shares on the date of exercise would generally be
treated as capital gain or loss. No deduction is usually available to the
employer corporation upon the grant or exercise of an incentive stock option
(although a deduction may be available if the optionee sells the shares so
acquired before the applicable holding period expires). By contrast, when a
non-qualified stock option is exercised, the employer corporation is entitled to
a deduction in an amount equal to the income recognized by the employee, subject
to certain limitations imposed by the Code in the case of highly compensated
employees.

Options granted under the Stock Option Plan will generally be
transferable only by will or by the laws of descent and distribution, and they
may be exercised during the lifetime of the optionee only by the optionee or by
his legal representative in the event of his disability. In its sole discretion,
however, the Board may permit an optionee to make certain transfers of
non-qualified stock options, provided that the transfers are to "family members"
and are not for value, as defined in the General Instructions to Form S-8 under
the Securities Act of 1933.

The Stock Option Plan would be administered by the Board of Directors
or a committee appointed by the Board from those of its members who are
"non-employees" as defined in Rule 16b-3 under the Securities Exchange Act of
1934 (the "Exchange Act"). The Board of Directors intends to appoint Sailor H.
Mohler and Phillip Chung as members of a committee for the award of options
under the plan. Under the Stock Option Plan, the Board of Directors, or the
committee if one is appointed, would have full authority to determine the
persons to whom options are granted and the number and purchase price of the
shares represented by each option, the time or times at which the options may be
exercised, and the terms and provisions of each option, which need not be the
same for all options.

The term of each option would not be more than 10 years from the date
of grant, and options would be exercisable only during the continuance of the
participant's employment with the Company or one of its subsidiaries. To the
extent otherwise exercisable on such date, the plan permits an outstanding
option to be exercised after termination of employment (i) within one year by
the estate or rightful heir(s) of the optionee if the optionee's employment is
terminated due to the optionee's death;

(ii) within one year after the date of such termination if the termination is
due to the optionee's disability (as defined in the plan); or (iii) within three
months after the date of such termination if the termination was due to the
optionee's retirement (as defined in the plan) or was for reasons other than
death or disability and other than "for cause" (as defined in the Plan). In no
event would an option be exercisable after termination of its original term.
Upon termination of an optionee's employment "for cause", any unexercised
options held by the optionee would be forfeited. Unexercised options will
terminate in the event of the Company's dissolution, liquidation, or sale of all
or substantially all of its assets. In the event of the Company's merger with
another corporation, the option would be assumed or an equivalent option
substituted by the successor corporation or, if such successor corporation does
not agree to assume the option or substitute an equivalent option, the Board can
provide for the option holder to have the right to exercise the option as to all
of the optioned shares, including shares as to which the option would not
otherwise be exercisable.

The number of shares subject to options and the option prices will be
appropriately adjusted in the event of changes in the Company's outstanding
common stock by reason of stock dividends, recapitalizations, mergers,
consolidations, stock splits, combinations of shares, and the like. The Board of
Directors may at any time terminate or modify the Stock Option Plan, except that
it may not make any changes to the plan which would materially increase the
number of shares that may be issued, or materially modify the eligibility
requirements for participation in the plan without approval of the stockholders.

Election of Directors

At the Special Meeting, the stockholders will elect three directors to
serve until the next annual meeting of stockholders or until their respective
successors are elected and qualified. In the event any nominee is unable or
unwilling to serve as a director at the time of the Special Meeting, the Board
of Directors may designate a substitute nominee for election by the Company's
stockholders to fill such vacancy, or the size of the Board may be reduced in
accordance with the By-Laws of the Company. We have no reason to believe that
any of the persons named below will be unable or unwilling to serve as a nominee
or as a director if elected.
Name Age Office
---- --- ------
Kenneth A. Martin 46 President, C.E.O., and Director
Phillip Chung 39 Secretary and Director
Sailor H. Mohler 58 Director

The following information about such directors has been furnished to us
by the respective nominees.

Kenneth A. Martin has been a director and President since acquiring a
controlling interest in the Company in April 2001. He is a principal in the law
firm of Martin & Adams, PLLC, Washington, D.C., which he founded in March 2000;
from January 1997 to February 2000, he was a principal in the firm of Martin &
Rylander. From 1990 to 1997, Mr. Martin was a partner in the firm of Riley &
Artabane, in Washington, D.C. From 1980 to 1987, he served in the U.S. Air Force
as a contracting officer, attaining the rank of Captain. While in the Air Force,
he held a top secret security clearance and was responsible for the acquisition
of sophisticated information technology and electronic systems for the
Department of Defense and civilian agencies of the federal government. A
practicing attorney since 1987, Mr. Martin's practice focuses on corporate law,
public contract law, federal regulatory compliance, intellectual property, and
commercial and criminal litigation.

Phillip Chung has been a director of the Company since April 2001. Mr.
Chung is a practicing attorney and principal of the law firm of Chung Press
P.C., McLean, Virginia, which he founded in 1993. A practicing attorney since
1991, Mr. Chung's legal practice focuses on commercial law and commercial
litigation.

Sailor H. Mohler has been a director of the Company since April 2001.
Mr. Mohler is currently president of Sono Medica, Inc., a medical services firm
in Vienna, Virginia, which he founded in 1999. From 1992 to 1997, he was
president and a director of Transmedica, another medical firm in Vienna,
Virginia. From 1983 to 1992, he served as an engineer for SWL, Inc., a defense
contractor in Vienna, Virginia. Mr. Mohler has over 20 years of research,
development, testing, and engineering experience in areas related to electronics
systems, and is responsible for the granting of a number of patents.

Although it does not have a nominating committee, and there are no
formal procedures for stockholders to nominate persons to serve as directors,
the Board will consider nominations from stockholders. Any such nominations
should be addressed to Kenneth A. Martin at the Company's address set forth
above.

VOTING SECURITIES AND PRINCIPAL HOLDERS

The following table sets forth information concerning the common stock
held (i) by each person who, as of the close of business on November 8, 2001,
holds of record or is known by Delta to hold beneficially or of record, more
than 5% of Company Common Stock, and (ii) by each director, and by all directors
and executive officers as a group. All shares are owned beneficially and of
record.

Shares Owned
Beneficially Percent of
Name And of Record Class(1)
---- ------------- -----

Kelcon, Inc. 450,000 80.8%
1730 Rhode Island Ave. (ste. 812)
Suite 812
Washington, DC 20036

Kenneth A. Martin (2) 450,000 80.8%
1730 Rhode Island Ave. (ste. 812)
Washington, DC 20036

Michael J. Marshall (3) 100,000 18.0%
Swafham Prior House
Cambridge CB5 OLD
England

All officers and directors
as a group (3 persons) 450,000 80.8%

(1) Based on 557,000 shares issued and outstanding as of the date
of this Information Statement. Beneficial ownership as
reported in the table includes (a) shares as to which a person
possesses sole or shared voting and/or investment power and
(b) shares which may be acquired within 60 days upon the
exercise of outstanding options and warrants.

(2) All such shares are owned of record by Kelcon, Inc., a
Delaware corporation owned by Mr. Martin. Mr Martin's law
firm, Martin & Adams, PLLC, owns 100,000 shares of
Enterprises, on account of which it is expected that such firm
will receive 126,760 shares of the Company's stock issued in
exchange for Enterprises' assets.

(3) In connection with a $375,000 loan to Kelcon, Inc., Mr.
Marshall has the right to convert $100,000 of the principal
amount of his loan into 100,000 shares of the Delta common
stock owned by Kelcon.

Upon consummation of Delta's purchase of Enterprises' assets,
Enterprises will own 11,068,307 shares or 95.2% of Delta's outstanding shares,
and the 450,000 shares owned by Kelcon, Inc. will constitute only 3.9% of
Delta's outstanding shares.

In connection with Delta's acquisition of Enterprises' assets, we have
agreed to assume Enterprises' obligations to Enterprises' former chief executive
officer, John A. Solomon, under its settlement of Mr. Solomon's employment
contract prior to his death in October 2001. As part of that settlement, Mr.
Solomon's estate will receive a five year warrant to purchase 2,535,200 shares
of Delta's common stock at a price of $.7889 per share. Upon exercise of such
warrant(s), his estate would own 3,200,690 shares or 22.6% of Delta's
outstanding stock. Mr. Solomon also owned options to purchase 100,000 shares of
Enterprises' common stock at a price of $6.25 per share, which are being assumed
by Delta in connection with the transaction with Enterprises.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(A) of the Securities Exchange Act requires our officers and
directors, and persons who own more than 10% of a registered class or our equity
securities, to file reports of ownership and changes in ownership with the
Securities and Exchange Commission and the National Association of Securities
Dealers. Such persons are required by regulations under the Securities Exchange
Act to furnish us with copies of all such forms filed by them. To the best of
our knowledge, James E. Platek, Bonnie C. Cunningham, and Robert Franz each
failed to file a Form 3 when due. Mr. Platek and Ms. Cunningham, who were then
directors and 10% stockholders, were required to file Form 3s by July 2000;
instead they reported the information required by Form 3 on Form 5, which forms
were timely

filed in February 2001. Mr. Franz, a director at the time who was required to
file a Form 3 by August 31, 2000, reported the information required by Form 3 on
Form 5 on February 21, 2001.

Kenneth Martin, Sailor H. Mohler and Philip Chung, who became directors
April 19, 2001, were required to file Form 3's by April 29, 2001. To the best of
our knowledge, such Forms have yet to be filed.

Change of Control in 2001

In April 2001, Kelcon, Inc., a Delaware corporation ("Kelcon"),
acquired 450,000 shares of Delta's common stock from James E. Platek and Bonnie
J. Cunningham, two directors of the Company, for $450,000. As a result of this
transaction, Kelcon owns 80.8% of Delta's outstanding stock. Kelcon is owned by
Kenneth A. Martin, who is now the Company's president. The $450,000 purchase
price paid by Kelcon was supplied by a $75,000 equity investment by Mr. Martin
and a $375,000 loan from Michael J. Marshall, an overseas investor who had
previously invested in Enterprises. Mr. Marshall's loan is due November 15,
2001, with interest at 20% per year. Mr. Marshall has the right to convert
$100,000 of the loan into 100,000 shares of the Company's common stock held by
Kelcon. In connection with the sale of Mr. Platek's and Ms. Cunningham's shares
to Kelcon, they appointed Mr. Martin to the Board and they and Robert Franz
resigned as directors. Thereafter, Mr. Martin appointed Sailor H. Mohler and
Phillip Chung as directors.

DIRECTORS AND EXECUTIVE OFFICERS

Our directors and officers are currently as follows:

Name Age Title
---- --- -----
Kenneth A. Martin 46 President, C.E.O. and Director

Phillip Chung 39 Secretary, Director

Sailor H. Mohler 58 Director

For brief descriptions of the recent employment and business experience
of Delta's officers and directors, see "Election of Directors". There are no
family relationships between any of Delta's executive officers and/or directors.

It is contemplated that following the acquisition Enterprises' assets,
new or additional directors will be appointed to the Board, but no decision has
yet been made as to who such directors will be.

It is contemplated that Alfred Saker will serve as Secretary/Treasurer
following the acquisition of Enterprises' assets. Mr. Saker has served as
Enterprises' Secretary/Treasurer since June 2000, during which period he also
served as a member of Enterprises' board of directors. From 1998 to 2000, he was
self employed, starting a restaurant with a partner who bought Mr. Saker's
interest when he joined Enterprises. From 1996 to 1998, he was finance manager
for International Shipholding Corporation, a marine transportation company, and
from 1993 to 1996, he served as treasurer for American Heavy Lift Shipping
Company, an owner/operator of oil tankers in New Orleans, Louisiana. From 1990
to 1993, Mr. Saker was controller for BP Oil Company.

Delta's directors are elected by the stockholders and hold office until
their successors are elected and qualified. Vacancies in Delta's Board are filed
by the Board itself. Officers are appointed by Delta's Board of Directors, and
serve at the discretion of the Board.

Until completion of the transaction with Enterprises, our officers are
devoting their time to the Company on an "as needed" basis.

Compensation of Directors and Executive Officers

None of Delta's officers or directors has received any compensation for
services since the Company's inception. Current management continues to act
without compensation, and has agreed to continue doing so until after the
acquisition of Enterprises' assets.

Delta does not compensate members of its board for their service as
directors, either on an annual basis or for attendance at meetings. We do intend
to reimburse our officers and directors for reasonable expenses incurred during
the course of their performance.

Employment Agreements

We do not have any employment contracts with any of our officers or
directors. Such persons are employed on an at-will basis, and the terms and
conditions of employment are subject to change. At such time as the Company
closes on the acquisition of Enterprises' assets, we intend to enter into a
two-year employment contract with Kenneth A. Martin, pursuant to which he will
be entitled to receive a salary of $150,000 the first year and $165,000 the
second year following the acquisition.

We have agreed to assume Enterprises' obligations under its contract
with Alfred T. Saker, Enterprises' Secretary/Treasurer. Under the terms of such
contract, which extends until the end of April 2005, Mr. Saker is entitled to a
salary of $83,500 per year. Such contract also provided for the issuance of
24,000 shares of Enterprises' stock, which were issued in February 2001 and will
be converted into Delta stock in connection with the Agreement of Sale between
Enterprises and Delta.

Certain Relationships and Related Transactions

Kenneth A. Martin, the Company's president and a member of the Board of
Directors who will be nominated for reelection at the Special Meeting of
Stockholders is also the president and sole stockholder of Kelcon, Inc., which
currently owns 80.8% of Delta's outstanding stock. Through Kelcon, Mr. Martin
negotiated the acquisition of control of Delta. (See "Change of Control in 2001"
above.)

Mr. Martin is also counsel to Enterprises, whose assets are being
acquired by Delta. Legal fees paid by Enterprises to Mr. Martin's firm amounted
to $298,119 in 2000 and $196,173 in the first ten months of 2001. In addition,
Enterprises issued 100,000 shares of its common stock to Mr. Martin's law firm
in February 2001 for legal services.

Meetings and Committees of the Board of Directors

With only three members, our Board of Directors does not presently have
standing audit, nominating, compensation, or committees performing similar
functions. In the future, we may appoint one or more such committees. We plan to
appoint a Committee in connection with the approval of the 2001 Employee Stock
Option Plan.

During the fiscal year ended December 31, 2000, our Board of Directors
did not hold any meetings, but all members of the Board participated in two
actions by unanimous consent.

INDEPENDENT PUBLIC ACCOUNTANTS

Wiener Goodman & Co., Eatontown, New Jersey, served as our independent
auditors for the year 2000, and there is no present intention to replace that
firm as auditors for the year 2001. No relationship exists between Wiener
Goodman & Co. and Delta other than that of independent auditor and client.

Because of the expense involved, we do not expect that a representative
of Wiener Goodman & Co. will come to the meeting.

THE MEETING

Shares Entitled to Vote

There are 557,000 shares outstanding, each or which entitles the holder
to one vote. Our charter does not provide for cumulative voting.

Voting Procedures

The presence, in person or by proxy, of the holders of at least a
majority of the shares of Enterprises' outstanding common stock is necessary to
constitute a quorum for the transaction of business at the meeting.

If a stockholder abstains from voting on any matter, his or her shares
will be considered present at the meeting for purposes of determining a quorum
and for purposes of calculating the vote, but will not be considered to have
been voted in favor of such matter. If a properly executed proxy is returned by
a broker holding shares in street name which indicates that the broker does not
have discretionary authority as to certain shares to vote on one or more
matters, such shares will be considered present at the meeting for purposes of
determining a quorum, but will not be considered to be represented at the
meeting for purposes of calculating the vote with respect to such matter.

All votes will be tabulated separately as affirmative and negative
votes, abstentions and broker non-votes. Those persons will be elected directors
who receive a plurality of the votes cast by persons entitled to vote in such
election. Abstentions or directions to withhold authority will have no effect on
the outcome of the vote. For each other matter presented at the meeting, the
affirmative vote of a majority of the shares present in person or by proxy and
entitled to vote on such matter is required for approval.

Dissenters' or Appraisal Rights

Under Delaware law, Delta's stockholders do not have any dissenters' or
appraisal rights with respect to the approval of the Stock Option Plan or the
Certificate of Amendment.

Costs

The Company will bear the entire cost of preparing, assembling,
printing and mailing this Information Statement. Copies of the Information
Statement will be furnished to brokerage houses, fiduciaries and custodians to
be forwarded to the beneficial owners of our common stock.

FINANCIAL INFORMATION

Incorporated by Reference

Our Form 10-KSB containing financial statements for the year 2000, and
our report on Form 10-QSB for the fiscal quarter ended June 30, 2001 (including
Management's Discussion and Analysis of Financial Condition and Results of
Operations) are attached as Appendices C and D. These reports are incorporated
herein by reference.

APPENDIX A

CERTIFICATE OF AMENDMENT

CERTIFICATE OF INCORPORATION

DELTA MUTUAL, INC.

Pursuant to Section 242 of the General Corporation Law of the State of
Delaware, Delta Mutual, Inc. (the "corporation"), a corporation organized and
existing under the General Corporation Law of the State of Delaware, does hereby
certify:

FIRST: That the Board of Directors of the corporation on November 1,
2001, adopted resolutions proposing and declaring advisable the following
amendments to the Certificate of Incorporation of the corporation:

RESOLVED, that the Board of Directors declares advisable, and
recommends to the stockholders for adoption, the following amended First Article
to replace, in its entirety, the First Article of the corporation's Certificate
of Incorporation:

FIRST: The name of the corporation (hereinafter called the
"corporation") is Internet High Assurance Corporation.

RESOLVED, that the Board of Directors declares advisable, and
recommends to the stockholders for adoption, the following amended Fourth
Article to replace, in its entirety, the Fourth Article of the corporation's
Certificate of Incorporation:

FOURTH: The total number of shares of stock which the
corporation shall have authority to issue is One Hundred Five Million
(105,000,000), of which One Hundred Million (100,000,000) are Common
Stock, having a par value each of One-hundredth of One Cent ($0.0001)
per share, and Five Million (5,000,000) are Preferred Stock, having a
par value each of One-hundredth of One Cent ($0.0001) per share.

Authority is hereby expressly vested in the Board of Directors
of the corporation, subject to the provisions of this Fourth Article
and to the limitations prescribed by law, to authorize the issue from
time to time of one or more series of Preferred Stock and with respect
to each such series to fix by resolution or resolutions adopted by the
affirmative vote of a majority of the whole Board of Directors
providing for the issue of such series, the voting powers, full or
limited, if any, of the shares of such series and the designations,
preferences and relative, participating, optional or other special
rights and the qualifications, limitations or restrictions thereof. The
authority of the Board of Directors with respect to each series shall
include, but not be limited to, the determination or fixing of the
following:

(a) The number of shares constituting the series and the designation
of such series;

(b) The dividend rate on the shares of such series, the conditions and
dates upon which such dividends shall be payable, the relation which
such dividends shall bear to the dividends payable on any other class
or classes or series of the corporation's capital stock, and whether
such dividends shall be cumulative or non-cumulative;

(c) Whether the shares of such series shall be subject to redemption by
the corporation at the option of either the corporation or the holder
or both or upon the happening of a specified event, and, if made
subject to any such redemption, the times or events, prices and other
terms and conditions of such redemption;

(d) The terms and amount of any sinking fund provided for the purchase
or redemption of the shares of such series;

(e) Whether of not the shares of such series shall be convertible into,
or exchangeable for, at the option of either the holder or the
corporation or upon the happening of a specified event, shares of any
other class or classes or any other series of the same or any other
class or classes of the corporation's capital stock, and, if provision
be made for conversion or exchange, the times or events, prices, rates,
adjustments, and other terms and conditions of such conversions or
exchanges;

(f) The restrictions, if any, on the issue or reissue of any additional
Preferred Stock;

(g) The rights of the holders of the shares of such series upon the
voluntary or involuntary liquidation, dissolution or winding up of the
corporation, and the relative rights of priority, if any, of payment of
shares of that series; and

(h) The provisions as to voting, optional and/or other special rights
and preferences, if any.

If upon any voluntary or involuntary liquidation, dissolution
or winding up of the corporation, the assets available for distribution
to holders of shares of Preferred Stock of all series shall be
insufficient to pay such holders the full preferential amount to which
they are entitled, then such assets shall be distributed ratably among
the shares of all series of Preferred Stock in accordance with the
respective preferential amounts (including unpaid cumulative dividends,
if any) payable with respect thereto.

SECOND: That the amendments were fully approved and adopted by the
affirmative vote of the majority of shares present in person at a Special
Meeting of Stockholders held on December __, 2001, in accordance with the
provisions of Sections 211 and 216 of the General Corporation Law of the State
of Delaware.

IN WITNESS WHEREOF, the corporation has caused this Certificate of
Amendment of Certificate of Incorporation to be signed by its President and
attested to by its Secretary this ____ day of December, 2001.

Delta Mutual, Inc.

By: ________________________________
President

ATTEST:

- ----------------------------
Secretary

APPENDIX B

DELTA MUTUAL, INC.

2001 EMPLOYEE STOCK OPTION PLAN

1. Purpose

The proper execution of the duties and responsibilities of the
executives and key employees of Delta Mutual, Inc. (the "Corporation") is a
vital factor in the continued growth and success of the Corporation. Toward this
end, it is necessary to attract and retain effective and capable individuals to
assume positions that contribute materially to the successful operation of the
business of the Corporation. It will benefit the Corporation, therefore, to bind
the interests of these persons more closely to its own interests by offering
them an attractive opportunity to acquire a proprietary interest in the
Corporation and thereby provide them with added incentive to remain in the
service of the Corporation and to increase the prosperity, growth, and earnings
of the Corporation. This stock option plan is intended to serve these purposes.

2. Definitions

The following terms wherever used herein shall have the meanings set
forth below.

"Board of Directors" or "Board" shall mean the Board of Directors of
the Corporation.

"Code" shall mean the Internal Revenue Code of 1986, as amended, and
any regulations promulgated thereunder.

"Committee" shall mean a committee to be appointed by the Board of
Directors in accordance with Section 4(a) of the Plan.

"Common Stock" shall mean the shares of common stock of the
Corporation, including both the voting and non-voting classes of stock.

"Corporation" shall mean Delta Mutual, Inc., a Delaware
corporation.

"Employee" shall mean a common law employee of the Corporation or a
Parent or a Subsidiary.

"Employment" means periods during which an Employee qualifies as
an Employee.

"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

"Fair Market Value" of the Common Stock on any date shall be (a) the
average on that date of the high and low prices of a share of Common Stock on
the principal national securities exchange on which shares of Common Stock of
the same class are then trading, or, if shares were not traded on such date,
then on the next preceding date on which a trade occurred; or (b) if Common
Stock is not traded on a national securities exchange but is quoted on the
National Association of Securities Dealers, Inc.

Authorized Quotation System ("NASDAQ") or a successor quotation system, the last
reported sale price on such date as reported by NASDAQ or such successor
quotation system; or (c) if Common Stock is not traded on a national securities
exchange and is not reported on NASDAQ or a successor quotation system, the
closing bid price (or average of bid prices) last quoted on such date by an
established quotation service for over-the-counter securities; or (d) if Common
Stock is not traded on a national securities exchange, is not reported on NASDAQ
or a successor quotation system and is not otherwise publicly traded on such
date, the fair market value of a share of the same class of Common Stock as
established by the Board of Directors or Committee acting in good faith and
taking into consideration all factors which it deems appropriate, including,
without limitation, the Corporation's net book value and recent sale or offer
prices for the Common Stock in private arm's-length transactions. During periods
when the Fair Market Value of a share of Common Stock cannot be determined under
any of the methods specified in clauses (a), (b) and (c), above, the Board of
Directors or Committee shall have the authority to establish the Fair Market
Value of the Common Stock as of the beginning of (or periodically during) each
fiscal year of the Corporation and to use such value for all transactions
occurring thereafter within such fiscal year.

"Immediate Family Member" shall mean each of (a) the children, step
children or grandchildren of the Employee to whom the Option is granted, (b) the
spouse or any parent of the Employee to whom the Option is granted, (c) any
trust solely for the benefit of any such family members, and (iv) any
partnership or other entity in which such family members are the only partners
or other equity holders.

"Incentive Stock Option" shall mean any Option granted pursuant to the
Plan that is designated as an Incentive Stock Option and which satisfies the
requirements of Section 422(b) of the Code.

"Nonstatutory Stock Option" shall mean any Option granted pursuant to
the Plan that is not an Incentive Stock Option.

"Option" or "Stock Option" shall mean a right granted pursuant to the
Plan to purchase shares of Common Stock, and shall include the terms "Incentive
Stock Option" and "Nonstatutory Stock Option".

"Optionee" shall mean an Employee who is granted an Option under
this Plan.

"Option Agreement" shall mean a written agreement representing Options
granted pursuant to the Plan, as contemplated by Section 7 of the Plan.

"Option Holder" means the Optionee or, if applicable, the person to
whom the Optionee's rights under the Option Agreement shall have been validly
transferred.

"Parent" shall mean a "parent company" of the Corporation, whether now
or hereafter existing, as defined in Section 424(e) of the Code.

"Plan" shall mean the Delta Mutual, Inc. 2001 Employee Stock Option
Plan as originally approved by the Board of Directors on ____________, 2001, as
embodied in this document, and as the same may be amended from time to time.

"Share" shall mean a share of the Common Stock of the Corporation that
is subject to an Option, as adjusted in accordance with Section 9 of the Plan.

"Subsidiary" shall mean a "subsidiary corporation" of Corporation or a
Parent, whether now or hereafter existing, as defined in Section 424(f) of the
Code.

3. Effective Date of the Plan

The Plan shall become effective upon stockholder approval pursuant to
Section 15 of the Plan, provided that such approval is received before the
expiration of one year from the date the Plan is approved by the Board of
Directors, and provided further that the Board of Directors may grant Options
pursuant to the Plan prior to stockholder approval if such Options by their
terms are contingent upon subsequent stockholder approval of the Plan.

4. Administration

(a) Procedure.

(i) Administration With Respect to Directors and Officers.
With respect to grants of Options to Employees who are also officers or
directors of the Corporation, the Plan shall be administered by (A) the Board,
if the Board may administer the Plan in compliance with Rule 16b-3 promulgated
under the Exchange Act or any successor thereto ("Rule 16b-3") with respect to a
plan intended to qualify thereunder as a discretionary plan, or (B) a committee
designated by the Board to administer the Plan, which committee shall be
constituted in such a manner as to permit the Plan to comply with Rule 16b-3
with respect to a plan intended to qualify thereunder as a discretionary plan.
Once appointed, such Committee shall continue to serve in its designated
capacity until otherwise directed by the Board. From time to time the Board may
increase the size of the Committee and appoint additional members thereof,
remove members (with or without cause) and appoint new members in substitution
therefor, fill vacancies, however caused, and remove all members of the
Committee and thereafter directly administer the Plan, all to the extent
permitted by Rule 16b-3 with respect to a plan intended to qualify thereunder as
a discretionary plan.

(ii) Multiple Administrative Bodies. If permitted by Rule
16b-3, the Plan may be administered by different bodies with respect to
directors, non-director officers and Employees who are neither directors nor
officers.

(iii) Administration With Respect to Other Employees. With
respect to grants of Options to Employees who are neither directors nor officers
of the Corporation, the Plan shall be administered by (A) the Board or (B) a
Committee designated by the Board, which committee shall be constituted in such
a manner as to satisfy the legal requirements relating to the administration of
incentive stock option plans, if any, of Nevada corporate and securities laws
and of the Code (the "Applicable Laws"). Once appointed, such Committee shall
continue to serve in its designated capacity until otherwise directed by the
Board. From time to time the Board may increase the size of the Committee and
appoint additional members thereof, remove members (with or without cause) and
appoint new members in

substitution therefor, fill vacancies, however caused, and remove all members of
the Committee and thereafter directly administer the Plan, all to the extent
permitted by the Applicable Laws.

(b) Powers of the Board. Subject to the provisions of the Plan, the
Board (or the Committee) shall have the authority, in its discretion: (i) to
grant Incentive Stock Options or Nonstatutory Stock Options; (ii) to determine,
upon review of relevant information the fair market value of the Common Stock in
each class; (iii) to determine the exercise price per Share of Options to be
granted, which exercise price shall be determined in accordance with Section
7(b) of the Plan; (iv) to determine the regular, full-time Employees to whom,
and the time or times at which, Options shall be granted and the number of
Shares to be represented by each Option; (v) to interpret the Plan; (vi) to
prescribe, amend and rescind rules and regulations relating to the Plan; (vii)
to determine the rules and provisions of each Option granted (which need not be
identical) and, with the consent of the holder thereof, modify or amend each
Option; (viii) to accelerate or defer (with the consent of the Option Holder)
the exercise date of any Option, consistent with the provisions of Section 7 of
the Plan; (ix) to authorize any person to execute on behalf of the Corporation
any instrument required to effectuate the grant of an Option previously granted
by the Board or Committee; and (x) to make all other determinations deemed
necessary or advisable for the administration of the Plan.

(c) Effect of Board's Decision. All decisions, determinations and
interpretations of the Board (or the Committee designated by the Board to
administer the Plan) shall be final and binding on all Optionees and Option
Holders of any Options granted under the Plan.

5. Participation in the Plan

(a) Participation in the Plan shall be limited to those Employees (1)
who are designated for payroll purposes as full-time, permanent employees of the
Corporation and any Parents or Subsidiary and (2) who shall be designated by the
Committee and approved by the Board of Directors as participants in the Plan.
The Plan shall not confer upon any Optionee any right with respect to
continuation of Employment, nor shall it interfere in any way with his or her
right or the Corporation's right to terminate his or her employment at any time,
with or without cause.

(b) No member of the Board of Directors who is not also an Employee
shall be eligible to participate in the Plan.

6. Stock Subject to the Plan

(a) Subject to Section 9 of the Plan, there shall be reserved for the
granting of Options pursuant to the Plan and for issuance and sale pursuant to
such Options Two Million (2,000,000) Shares of Common Stock, par value $.0001
per share. To determine the number of Shares of either the voting or non-voting
class of Common Stock that is available at any time for the granting of Options,
there shall be deducted from the total number of reserved shares of that class
of Common Stock, the number of shares of that class of Common Stock in respect
of which Options have been granted pursuant to the Plan that are still
outstanding or have been exercised. The Shares of Common Stock to be issued upon
the exercise of Options granted pursuant to the Plan shall be made available
from the authorized but unissued shares of Common Stock or reacquired Common
Stock. If for any reason Shares of Common Stock as to which an Option has been
granted cease to be subject to purchase thereunder, then such Shares of Common
Stock again shall (unless the Plan shall have been terminated) be available for
issuance pursuant to the exercise of Options pursuant to the Plan.
Notwithstanding any other provision

of the Plan, Shares issued under the Plan and later repurchased by the
Corporation shall not become available for future grant or sale under the Plan.

(b) Proceeds from the purchase of shares of Common Stock upon the
exercise of Options granted pursuant to the Plan shall be used for the general
business purposes of the Corporation.

7. Terms and Conditions of Options

(a) Options granted hereunder may be either Incentive Stock Options or
Nonstatutory Stock Options and may be for the purchase of either voting or
non-voting Common Stock, all as determined by the Board of Directors or
Committee at its discretion and as designated in the terms of the Option
Agreement. However, notwithstanding such designations, to the extent that the
aggregate fair market value of the Shares with respect to which Options
designated as Incentive Stock Options are exercisable for the first time by any
Optionee during any calendar year (under all plans of the Corporation) exceeds
$100,000, such Options shall be treated as Nonstatutory Stock Options. For
purposes of the prior sentence, Options shall be taken into account in the order
in which they were granted, and the fair market value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.

(b) The per Share exercise price for the Shares to be issued pursuant
to exercise of an Option shall be such price as is determined by the Board of
Directors or Committee at the time of the grant, but shall be subject to the
following:

(i) In the case of an Incentive Stock Option:

(A) which is granted to an Employee who, at the time
of the grant of such Incentive Stock Option, owns stock representing more than
ten percent (10%) of the voting power of all classes of stock of the Corporation
or any Parent or Subsidiary, the per Share exercise price shall be no less than
110% of the Fair Market Value per Share on the date of grant.

(B) which is granted to any other Employee, the per
Share exercise price shall be no less than 100% of the fair market value per
Share on the date of grant.

(ii) In the case of Nonstatutory Stock Option

(A) which is granted to a person who, at the time of
the grant of such Option, owns stock representing more than ten percent (10%) of
the voting power of all classes of stock of the Corporation or any Parent or
Subsidiary, the per Share exercise price shall be no less than 110% of the fair
market value per Share on the date of the grant.

(B) granted to any other person, the per Share
exercise price shall be no less than 100% of the fair market value per Share on
the date of grant.

For purposes of this Section 7(b), in the event that an Option
is amended to reduce the exercise price, the date of grant of such Option shall
thereafter be considered to be the date of such amendment.

If the Board of Directors or Committee does not establish a
specific exercise price per share at the time of grant, the exercise price per
share shall be equal to the Fair Market Value of a share of Common Stock on the
date of grant of the Options.

(c) Each Option, subject to the other limitations set forth in the
Plan, may extend for a period of up to but not exceeding 10 years from the date
on which it is granted. The term of each Option shall be determined by the Board
of Directors or Committee at the time of grant of the Option and specified in
the Option Agreement, provided that if no term is specified by the Board or
Committee the term of the Option shall be the maximum term permitted under this
Section measured from the date on which it is granted. Notwithstanding anything
to the contrary, in the case of an Option granted to an Optionee who, at the
time the Option is granted, owns stock representing more than ten percent (10%)
of the voting power of all classes of stock of the Corporation or any Parent or
Subsidiary, (a) if the Option is an Incentive Stock Option, the term of the
Option shall be five (5) years from the date of grant thereof or such shorter
term as may be provided in the Incentive Stock Option Agreement, or (b) if the
Option is a Nonstatutory Stock Option, the term of the Option shall be five (5)
years and one (1) day from the date of grant thereof or such shorter term as may
be provided in the Nonstatutory Stock Option Agreement.

(d) The Board of Directors or Committee may provide in the Option
Agreement that the right to exercise each Option for the number of shares
subject to each Option shall vest in the Optionee over such period of time as
the Board or Committee, in its discretion, shall determine for each Optionee.

(e) Options shall be nontransferable and nonassignable and may not be
sold, pledged, assigned, hypothecated, transferred, or disposed in any manner,
except that (1) Options may be transferred by testamentary instrument or by the
laws of descent and distribution, and (2) subject to the terms and conditions of
the Option Agreement or any other terms and conditions imposed by the Board of
Directors or Committee from time to time, Options may be transferred in
accordance with Section 7(l) of the Plan if the applicable Option Agreement or
other action of the Board or Committee expressly provides that the Options are
transferable.

(f) Upon voluntary or involuntary termination of an Optionee's active
Employment for any reason (including disability), his Option and all rights
thereunder shall terminate effective at the close of business on the date the
Optionee ceases to be an active, regular employee of the Corporation or any of
its subsidiaries, except (1) to the extent previously exercised and (2) as
provided in Sections 7 (g), (h), (i) and (j) of the Plan.

(g) In the event an Optionee takes a leave of absence from the
Corporation or any Parent or Subsidiary for personal reasons or as a result of
entry into the armed forces of the United States, or any of the departments or
agencies of the United States government, the Committee may consider his or her
case and may take such action in respect of the related Option Agreement as it
may deem appropriate under the circumstances in its absolute discretion,
including accelerating the time previously-granted Options may be exercised and
extending the time following the Optionee's termination of Employment during
which the Option Holder is entitled to purchase the Shares of Common Stock
subject to such Options, provided that in no event may any Option be exercised
after the expiration of the term of the Option or more than ninety (90) days
after the Optionee's termination of Employment.

(h) If an Optionee's Employment terminates as a result of his or her
total and permanent

disability (as defined in Section 22(e)(3) of the Code), the Option Holder may
exercise his or her Option within no more than the twelve (12) month period
beginning on the date of his or her termination of Employment (to the extent the
Option Holder was entitled to exercise the Option at the date of the Optionee's
termination of Employment and provided that in no event may any Option be
exercised after the expiration of the term of the Option), after which the
Option shall lapse.

(i) If an Optionee dies during the term of his or her Option without
the Option having been fully exercised, the executor or administrator of the
Optionee's estate or the person who inherits the right to exercise the Option by
bequest or inheritance shall have the right within one (1) year of the
Optionee's death to purchase the number of Shares of Common Stock that the
deceased Optionee was entitled to purchase at the date of death, after which the
Option shall lapse, provided that in no event may any Option be exercised after
the expiration of the term of the Option.

(j) If an Optionee terminates employment without having fully exercised
the Option due to the Optionee's retirement at or after age 60 and with the
consent of the Corporation, then the Option Holder shall have the right within
ninety (90) days of the Optionee's termination of Employment to purchase the
number of shares of Common Stock that the Option Holder was entitled to purchase
at the date of termination of the Optionee's Employment, after which the Option
shall lapse, provided that in no event may any Option be exercised after the
expiration of the term of the Option. The Board of Directors or Committee may
cancel an Option during the ninety day period referred to in this paragraph, if
the Optionee engages in employment or activities contrary, in the opinion of the
Board or Committee, to the best interests of the Corporation. The Board or
Committee shall determine in each case whether a termination of Employment shall
be considered a retirement with the consent of the Corporation, and, subject to
applicable law, whether a leave of absence shall constitute a termination of
Employment. Any such determination of the Board or Committee shall be final and
conclusive, unless the Committee is overruled by the Board.

(k) The granting of an Option pursuant to the Plan shall not constitute
or be evidence of any agreement or understanding, express or implied, on the
part of the Corporation or any of its subsidiaries to retain or employ the
Optionee for any specified period.

(l) The Board of Directors or Committee may provide, in the original
grant of a Nonqualified Stock Option or in an amendment or supplement to a
previous grant, that some or all of the Nonqualified Stock Options granted under
the Plan are transferable by the Optionee to an Immediate Family Member of the
Optionee, provided that (i) the Option Agreement, as it may be amended from time
to time, expressly so provides or the Board or Committee otherwise designates
the Option as transferable, (ii) the transfer by the Optionee is a bona fide
gift without consideration, (iii) the transfer is irrevocable, (iv) the Optionee
and any such transferee provides such documentation or other information
concerning the transfer or the transferee as the Board of Directors or Committee
or any Employee of the Corporation acting on behalf of the Board or Committee
may from time to time request, and (v) the Optionee or the Option Holder
complies with all of the terms and conditions (including, without limitation,
any further restrictions or limitations) included in the Option Agreement. Any
Nonqualified Stock Option transferred in accordance with the terms and
conditions provided in this Section 7(l) shall continue to be subject to the
same terms and conditions that were applicable to such Nonqualified Stock Option
prior to the transfer. Notwithstanding any other provisions of the Plan, the
Corporation shall not be required to honor any exercise by an Immediate Family
Member of an Option transferred in accordance with the terms and conditions
provided in this Section 7(l) unless and

until payment or provision for payment of any applicable withholding taxes has
been made.

(m) In addition to the general terms and conditions set forth in this
Paragraph 7 in respect of Options granted pursuant to the Plan, Incentive Stock
Options granted pursuant to the Plan shall be subject to the following
additional terms and conditions:

(i) "Incentive Stock Options" shall be granted only
to individuals who, at the date of grant of the Option, are
regular, full-time Employees of the Corporation or any Parent
or Subsidiary;

(ii) No Employee who owns beneficially more than 10%
of the total combined voting power of all classes of stock of
the Corporation shall be eligible to be granted an "Incentive
Stock Option", unless the exercise price per Share is at least
110% of the Fair Market Value of the Common Stock subject to
the Option on the date of grant of the Option and the Option,
by its terms, is not exercisable after the expiration of five
years from the date the Option is granted.

(iii) To the extent that the aggregate fair market
value (determined at the time the Option is granted) of the
shares of Common Stock in respect of which an Option is
exercisable for the first time by the Optionee during any
calendar year (and taking into account all "incentive stock
option" plans of the Corporation and its subsidiaries) exceeds
$100,000, that number of whole shares for which an Option
issued hereunder is exercisable with an aggregate fair market
value in excess of this $100,000 limit shall not be treated as
having been granted under an "incentive stock option"; and

(iv) Any other terms and conditions specified by the
Committee that are not inconsistent with the Plan, except that
such terms and conditions must be consistent with the
requirements for "incentive stock options" under Section 422
of the Code.

8. Methods of Exercise of Options

(a) An Optionee (or other Option Holder, if any, entitled to exercise
an Option hereunder) desiring to exercise an Option granted pursuant to the Plan
as to all or part of the Shares of Common Stock covered by the Option shall (i)
notify the Corporation in writing at its principal office to that effect,
specifying the number of Shares of Common Stock to be purchased and the method
of payment therefor, and (ii) make payment or provision for payment for the
shares of Common Stock so purchased in accordance with this Paragraph 8. Such
written notice may be given by means of a facsimile transmission. If a facsimile
transmission is used, the Option Holder should mail the original executed copy
of the written notice to the Corporation promptly thereafter. An Option may not
be exercised for as fraction of a share of Common Stock.

(b) The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Board of Directors and may consist entirely of cash, check, promissory note,
other shares of Common Stock which (i) either have been owned by the Option
Holder for more than six (6) months on the date of surrender or were not
acquired, directly or indirectly, from the Corporation, and (ii) have a Fair
Market Value on the date of surrender equal to the aggregate exercise price of
the Shares as to which said Option shall be exercised,

or any combination of such methods of payment, or such other consideration and
method of payment for the issuance of Shares to the extent permitted under the
laws of Nevada. In making its determination as to the type of consideration to
accept, the Board shall consider if acceptance of such consideration may be
reasonably expected to benefit the Corporation.

(c) An Option shall be deemed to be exercised when written notice of
such exercise has been given to the Corporation in accordance with the terms of
the Option by the Option Holder and full payment for the Shares with respect to
which the Option is exercised has been received by the Corporation. Full payment
may, as authorized by the Board of Directors, consist of any consideration and
method of payment allowable under Section 8(b) of the Plan. Until the issuance
(as evidenced by the appropriate entry on the books of the Corporation or of a
duly authorized transfer agent of the Corporation) of the stock certificate
evidencing such Shares, no right to vote (in the case of voting stock) or
receive dividends or any other rights as a shareholder shall exist with respect
to the optioned Shares, notwithstanding the exercise of the Option. The
Corporation shall issue (or cause to be issued) such stock certificate promptly
upon exercise of the Option. In the event that the exercise of an Option is
treated in part as the exercise of a Nonstatutory Stock Option, the Corporation
shall issue a separate stock certificate evidencing the Shares of each class
treated as acquired upon exercise of an Incentive Stock Option and a separate
stock certificate evidencing the Shares of each class treated as acquired upon
exercise of a Nonstatutory Stock Option, and shall identify each such
certificate accordingly in its stock transfer records. No adjustment will be
made for a dividend or other right for which the record date is prior to the
date the stock certificate is issued, except as provided in Section 9 of the
Plan.

(d) An Option Holder at any time may elect in writing to abandon an
Option in respect of all or part of the number of Shares of Common Stock as to
which the Option shall not have been exercised.

(e) Exercise of an Option in any manner shall result in a decrease in
the number of Shares that thereafter may be available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.

9. Adjustments Upon Changes in Capitalization or Merger

Subject to any required action by the shareholders of the Corporation,
the number of Shares of Common Stock covered by each outstanding Option, and the
number of Shares of Common Stock which have been authorized for issuance under
the Plan but as to which no Options have yet been granted or which have been
returned to the Plan upon cancellation or expiration of an Option, as well as
the price per Share of Common Stock covered by each such outstanding Option,
shall be proportionately adjusted for any increase or decrease in the number of
issued shares of Common Stock resulting from a stock split, reverse stock split,
stock dividend, combination or reclassification of the Common Stock, or any
other increase or decrease in the number of issued shares of Common Stock
effected without receipt of consideration by the Corporation; provided, however,
that conversion of any convertible securities of the Corporation shall not be
deemed to have been "effected without receipt of consideration." Such adjustment
shall be made by the Board of Directors, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein, no
issuance by the Corporation of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of Shares
of Common Stock subject to an Option.

In the event of the proposed dissolution, liquidation or sale of all or
substantially all of the assets of the Corporation, the Board shall notify the
Optionee or other Option Holder at least fifteen (15) days prior to such
proposed action. To the extent it has not been previously exercised, the Option
will terminate immediately prior to the consummation of such proposed action. In
the event of the merger of the Corporation with or into another corporation, the
Option shall be assumed or an equivalent option shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation,
unless such successor corporation does not agree to assume the Option or to
substitute an equivalent option, in which case the Board shall, in lieu of such
assumption or substitution, provide for the Option Holder to have the right to
exercise the Option as to all of the optioned Shares, including Shares as to
which the Option would not otherwise be exercisable. If the Board makes an
Option fully exercisable in lieu of assumption or substitution in the event of a
merger or sale of assets, the Board shall notify the Optionee or other Option
Holder that the Option shall be fully exercisable for a period of fifteen (15)
days from the date of such notice, and the Option will terminate upon the
expiration of such period.

10. Time of Granting Options

The date of grant of an Option shall, for all purposes, be the date on
which the Board of Directors or Committee makes the determination granting such
Option. Notice of the determination shall be given to each Optionee within a
reasonable time after the date of such grant.

11. Amendments and Discontinuance of the Plan

(a) The Board of Directors shall have the right at any time and from
time to time to amend, modify, or discontinue the Plan in such respects as the
Board may deem advisable; provided that, unless approved by the Corporation's
shareholders in accordance with Section 15, no such amendment, modification, or
discontinuance of the Plan shall (i) revoke or alter the terms of any valid
Option previously granted pursuant to the Plan, (ii) increase the number of
shares of Common Stock to be reserved for issuance and sale pursuant to Options
granted pursuant to the Plan, (iii) change the maximum aggregate number of
shares of Common Stock that may be issued upon the exercise of Options granted
pursuant to the Plan to any single individual, (iv) decrease the price
determined pursuant to the provisions of Section 7(b), (v) change the class of
persons to whom Options may be granted pursuant to the Plan, (vi) provide for
Options exercisable more than 10 years after the date granted, (vii) if the
Corporation has a class of equity securities registered under Section 12 of the
Exchange Act at the time of such revision or amendment, any material increase in
the benefits accruing to participants under the Plan.

(b) Shareholder Approval. If any amendment requiring shareholder
approval under Section 15(a) of the Plan is made at a time when any class of
equity securities by the Corporation is registered under Section 12 of the
Exchange Act, such shareholder approval shall be solicited as described in
Section 15 of the Plan.

(c) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated, unless mutually agreed otherwise between the Optionee or
other Option Holder and the Board of Directors, which agreement must be in
writing and signed by the

Option Holder and the Corporation.

12. Plan Subject to Governmental Laws and Regulations

The Plan and the grant and exercise of Options pursuant to the Plan
shall be subject to all applicable governmental laws and regulations.
Notwithstanding any other provision of the Plan to the contrary, the Board of
Directors may in its sole and absolute discretion make such changes in the Plan
as may be required to conform the Plan to such laws and regulations. Shares
shall not be issued pursuant to the exercise of an Option unless the exercise of
such Option and the issuance and delivery of such Shares pursuant thereto shall
comply with all relevant provisions of law, including, without limitation, the
Securities Act of 1933, as amended, the Exchange Act, the rules and regulations
promulgated thereunder, and the requirements of any stock exchange upon which
the Shares may then be listed, and shall be further subject to the approval of
counsel for the Corporation with respect to such compliance.

As a condition to the exercise of an Option, the Corporation may
require the person exercising such Option to represent and warrant at the time
of any such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Corporation, such a representation is required by any
of the aforementioned relevant provisions of law.

13. Reservation of Shares

The Corporation, during the term of this Plan, will at all times
reserve and keep available such number of Shares as shall be sufficient to
satisfy the requirements of the Plan.

The inability of the Corporation to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the
Corporation's counsel to be necessary to the lawful issuance and sale of any
Shares hereunder, shall relieve the Corporation of any liability in respect of
the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.

14. Option Agreement

Options shall be evidenced by written option agreements in such form as
the Committee shall determine from time to time.

15. Shareholder Approval

(a) Continuance of the Plan shall be subject to approval by the
shareholders of the Corporation within twelve (12) months before or after the
date the Plan is adopted.

(b) The required approval of the shareholders of the Corporation shall
be solicited substantially in accordance with Section 14 of the Exchange Act and
the rules and regulations promulgated thereunder.

16. Information to Optionee

The Company shall provide to each Option Holder, during the period for which
such Option Holder has one or more Options outstanding, copies of all annual
reports and other information which are provided to all shareholders of the
Corporation. The Corporation shall not be required to provide such information
if the issuance of Options under the Plan is limited to Senior Executive
Officers whose duties in connection with the Corporation assure their access to
equivalent information.

17. Term of Plan

The Plan shall become effective upon the earlier to occur of its
adoption by the Board of Directors or its approval by the shareholders of the
Corporation as described in Section 15 of the Plan. It shall continue in effect
for a term of ten (10) years unless sooner terminated under Section 11 of the
Plan.

[The remainder of this page is intentionally blank.]

APPENDIX C

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

FORM 10-KSB

[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

Commission file number: 000-30563

DELTA MUTUAL, INC.
(Name of small business issuer in its charter)

DELAWARE 14-1818394
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

19 NEW ENGLAND AVE., SUITE 8C, SUMMIT NEW JERSEY 07901
(Address of principal executive offices) (Zip Code)

Issuer's telephone number: (908) 918-0130

Securities registered under Section 12(b) of the Exchange Act: NONE

Securities registered under Section 12(g) of the Exchange Act:

COMMON STOCK
$0.0001 PAR VALUE

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

Check if disclosure of delinquent filers in response to Item 405 of Regulation
S-B is not contained in this form, and no disclosure will be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB.[ ]

Issuer's revenues for its most recent fiscal year. $0

Aggregate market value of the voting and non-voting common equity held
by non-affiliates of the registrant
as of April 9, 2001: $64,130 (See Item 5)

Number of shares outstanding of registrant's Common Stock, no par value,
as of April 9, 2001: 557,000 (See Item 11)

Documents incorporated by reference: NONE

Transitional Small Business Disclosure Format (check one): Yes No X
--- ---

Exhibit index on consecutive page 15 Page 1 of 30 Pages

PART I

FORWARD LOOKING STATEMENTS

Under the "safe harbor" provisions of the Private Securities Litigation Reform
Act of 1995 (the "PSLRA"), we caution readers regarding forward looking
statements found in this report and in any other statement made by, or on our
behalf, whether or not in future filings with the Securities and Exchange
Commission. Forward looking statements are statements not based on historical
information and which relate to future operations, strategies, financial results
or other developments. Forward looking statements are necessarily based upon
estimates and assumptions that are inherently subject to significant business,
economic and competitive uncertainties and contingencies, many of which are
beyond our control and many of which, with respect to future business decisions,
are subject to change. These uncertainties and contingencies can affect actual
results and could cause actual results to differ materially from those expressed
in any forward looking statements made by or on our behalf. We disclaim any
obligation to update forward looking statements.

ITEM 1. DESCRIPTION OF BUSINESS.

Unless the context otherwise requires, the terms "we", "our" and "us" refers to
Delta Mutual, Inc.

GENERAL

We were incorporated under the name Delta Mutual, Inc. on November 17, 1999 in
the State of Delaware. We are a development stage company that intended to
provide mortgage services through the Internet to the "sub-prime" market. The
sub-prime market consists of borrowers having substandard credit. We intended to
offer varied levels of mortgage and lending services by capitalizing on the
popularity of Internet based financial services companies. We believed both
consumers and investors would be interested in our business plan and the
services we intended to offer. We secured the domain name rights to the name
deltamutual.com.

Initially, we believed we would be able to fund our intended operations through
the sale of our common stock. Our common stock is quoted on the Over-the-Counter
Electronic Bulletin Board under the symbol "DLTM". At the time of our formation,
companies with Internet based businesses were treated favorably in the capital
markets. During the 12 months preceding the date of this report, the market for
the stock of Internet based businesses has deteriorated substantially. Many
companies with Internet based businesses have simply gone out of business
because they were not able to generate sufficient revenues and were unable to
raise additional capital.

We believe the market decline for companies with Internet based businesses has
adversely impacted our ability to raise the funds necessary to support our
intended operations. From inception through December 31, 2000, we raised a
limited amount of capital ($10,750) through the sale of our common stock. As of
the date of this report, we have been unable to secure additional financing to
pursue our initial business plan. While we continue to explore the feasibility
of implementing our original business plan, given our lack of success at
securing sufficient financing to develop an Internet based mortgage business, we
believe it is in the best interests of us and our shareholders to consider other
business opportunities. Additionally, we believe it may be necessary to acquire
another business to prevent having to cease operations. As of the date of this
report, we are focusing our efforts on identifying such a business. We have
engaged in preliminary discussions with parties about acquiring another
business, or being acquired by another business, but as of the date of this
report, we have not entered into any agreements relating to any such
acquisitions.

potential business opportunities. It is impossible to predict at this time the
status of any business in which we may become engaged, in that such business may
need to seek additional capital, may desire to have its shares publicly traded,
or may seek other perceived advantages which we offer.

We anticipate that we may be able to participate in only limited potential
business ventures because we have nominal assets and limited financial
resources. Our lack of diversification should be considered a substantial risk
to our shareholders because it may not permit us to offset potential losses from
one venture against gains from another.

We do not intend to seek capital to finance the operation of any acquired
business opportunity until such time as we have successfully consummated a
merger or acquisition. It is anticipated that we will incur nominal expenses in
the implementation of our plan of operation.

We anticipate that the search for an alternate business opportunity will be
complex and extremely risky. Due to general economic conditions, rapid
technological advances being made in some industries and shortages of available
capital, we believe that there are numerous firms seeking the perceived benefits
of a publicly registered corporation. Such perceived benefits may include, among
other things, facilitating or improving the terms on which additional equity
financing may be sought, providing liquidity for incentive stock options or
similar benefits to key employees, and providing liquidity (subject to
restrictions of applicable statutes) for all shareholders. Potentially,
available business opportunities may occur in many different industries and at
various stages of development, all of which will make the task of comparative
investigation and analysis of such business opportunities extremely difficult
and complex.

We have, and will continue to have, limited capital with which to provide the
owners of business opportunities with any significant cash or other assets.
However, we believe we will be able to offer owners of acquisition candidates
the opportunity to acquire an interest in a publicly registered company without
incurring the cost and time required to conduct an initial public offering. The
owners of the business opportunities will, however, incur significant legal and
accounting costs in connection with our acquisition of a business opportunity,
including the costs of preparing annual (Form 10-K or 10-KSB), quarterly (Form
10-Q or 10-QSB) and current reports (Form 8-K), agreements and related
documents. The Securities Exchange Act of 1934 specifically requires that any
merger or acquisition candidate comply with all applicable reporting
requirements, which includes providing audited financial statements to be
included within the numerous filings required under the Exchange Act. However,
we have not conducted market research and are not aware of statistical data
which would support the perceived benefits of a merger or acquisition
transaction for the owners of a business opportunity.

Our officers and directors will analyze new business opportunities. We intend to
concentrate on identifying preliminary prospective business opportunities which
may be brought to our attention through present affiliations and relationships
of our officers and directors, or by our shareholders. In analyzing prospective
business opportunities, we will consider such matters as:

o available technical, financial and managerial resources;

o working capital and other financial requirements;

o history of operations, if any;

o prospects for the future, and the nature of present and expected
competition;

o quality and experience of management services which may be
available and the depth of that management;

o potential for further research, development, or exploration;

o potential for growth, expansion and profit; and

o perceived public recognition of name identification, products
and services.

Our officers and directors expect to meet personally with management and key
personnel of the business opportunity as part of their "due diligence"
investigation. To the extent possible, we intend to utilize written reports and
personal investigations to evaluate the above factors.

We will rely upon the efforts of our officers, directors and, to a much lesser
extent, the efforts of our shareholders, in implementing our plan of operation.
We do not anticipate hiring outside consultants or advisors, except for our
legal counsel and accountants. However, if we do retain an outside consultant or
advisor, any cash fee earned by such party will most likely be paid by the
prospective merger/acquisition candidate. As of the date of this report, we do
not have any contracts or agreements with any outside consultants and none are
contemplated.

ACQUISITION STRUCTURE

In implementing a structure for a particular business acquisition, we may become
a party to a merger, consolidation, reorganization, joint venture, or licensing
agreement with another corporation or entity. We may also acquire stock or
assets of an existing business. On the consummation of a transaction, it is
probable that our present management and shareholders will no longer be in
control of us. In addition, our directors may, as part of the terms of the
acquisition transaction, resign and be replaced by new directors without a vote
of our shareholders.

It is anticipated that any securities issued in any such reorganization would be
issued in reliance upon an exemption from registration under applicable federal
and state securities laws. In some circumstances, however, as a negotiated
element of its transaction, we may agree to register all or a part of such
securities immediately after the transaction is consummated or at specified
times thereafter. If such registration occurs, of which there can be no
assurance, it will be undertaken by the surviving entity after we have
successfully consummated a merger or acquisition. At this time, we do not
anticipate registering any additional securities until a merger or acquisition
is consummated. The issuance of substantial additional securities and their
potential sale into the trading market may have a depressive effect on the value
of our securities.

While the actual terms of a transaction cannot be predicted, it may be expected
that the parties will desire to avoid the creation of a taxable event and
structure the acquisition in a so-called "tax-free" reorganization under the
Internal Revenue Code. In order to obtain tax-free treatment under the Internal
Revenue Code, it may be necessary for the owners of the acquired business to own
80% or more of the voting stock of the surviving entity. In such event, our
shareholders would retain 20% or less of the issued and outstanding shares of
the surviving entity, which would result in significant dilution in the equity
of our shareholders.

We will participate in a business opportunity only after the negotiation and
execution of appropriate written agreements. Although the terms of such
agreements cannot be predicted, generally such agreements:

o require some specific representations and warranties by all of
the parties;

o specify certain events of default;

o detail the terms of closing and the conditions that must be
satisfied by each of the parties prior to and after such closing;

o outline the manner of bearing costs, including costs associated
with our attorneys and accountants;

o set forth remedies on default; and

o include miscellaneous other terms.

We will not consider an opportunity where the entity cannot provide independent
audited financial statements within a reasonable period of time after closing of
the proposed transaction. If such audited financial statements are not available
at closing, or within a reasonable time thereafter, the closing documents will
provide that the proposed transaction will be voidable at our discretion. If the
transaction is voided, the agreement will also contain a provision providing for
the acquisition entity to reimburse us for all costs associated with the
proposed transaction.

COMPETITION

We will remain an insignificant participant among the firms which engage in the
acquisition of business opportunities. There are many established venture
capital and financial concerns which have significantly greater financial and
personnel resources and technical expertise than we do. In view of our combined
extremely limited financial resources and limited management availability, we
will continue to be at a significant competitive disadvantage compared to our
competitors.

INVESTMENT COMPANY ACT OF 1940

Although we will be subject to regulation under the Securities Act of 1933, and
the Securities Exchange Act of 1934, we believe we will not be subject to
regulation under the Investment Company Act of 1940. In the event we engage in a
business combination which results in us holding a passive investment interest
in a number of entities, we could be subject to regulation under the Investment
Company Act. In such event, we would be required to register as an investment
company and could be expected to incur significant registration and compliance
costs. We have obtained no formal determination from the Securities and Exchange
Commission as to our status under the Investment Company Act. Consequently, a
violation of the Investment Company Act could subject us to civil and criminal
penalties and could cause us to cease operations.

INVESTMENT ADVISERS ACT OF 1940

Under the Investment Advisers Act of 1940, an "investment adviser" means any
person who, for compensation, engages in the business of advising others, either
directly or through publications or writings, as to the value of securities or
as to the advisability of investing in, purchasing, or selling securities, or
who, for compensation and as part of a regular business, issues or promulgates
analyses or reports concerning securities. We will only seek to locate a
suitable merger or acquisition candidate, and do not intend to engage in the
business of advising others in investment matters for a fee or otherwise.

RISK FACTORS

Our business is subject to numerous risk factors, including the following:

NO REVENUE AND MINIMAL ASSETS. We have no operations or revenues. We essentially
have no assets or financial resources. Since we have been unable to obtain
sufficient funding to develop an Internet based mortgage services company, we
will, in all likelihood, continue to incur operating expenses without
corresponding revenues until we acquire a business opportunity. There is no
assurance that we can identify such a business opportunity and consummate such a
combination. As a result, we may continue to incur net operating losses that
will increase continuously.

SPECULATIVE NATURE OF OUR OPERATIONS. The success of our current plan of
operation will depend to a great extent on the operations, financial condition
and management of the identified business opportunity. In the event we complete
a business combination, the success of our operations may be dependent upon
management of the successor firm or venture partner firm and numerous other
factors beyond our control.

SCARCITY OF AND COMPETITION FOR BUSINESS OPPORTUNITIES AND COMBINATIONS. We are
and will continue to be an insignificant participant in the business of seeking
mergers with, joint ventures with and acquisitions of small private and public
entities. A large number of established and well-financed entities, including
venture capital

firms, are active in mergers and acquisitions of companies that may be desirable
target candidates for us. Nearly all such entities have significantly greater
financial resources, technical expertise and managerial capabilities than us
and, consequently, we will be at a competitive disadvantage in identifying
possible business opportunities and successfully completing a business
combination. Moreover, we will also compete in seeking merger or acquisition
candidates with numerous other small public companies.

NO AGREEMENT FOR BUSINESS COMBINATION OR OTHER TRANSACTION. We have no
arrangement, agreement or understanding with respect to engaging in a merger
with, joint venture with or acquisition of, a private or public entity. There
can be no assurance that we will be successful in identifying and evaluating
suitable business opportunities or in concluding a business combination.
Management has not identified any particular industry or specific business
within an industry for evaluation by us. We cannot assure you that we will be
able to negotiate a business combination on terms favorable to us.

NO STANDARDS FOR BUSINESS COMBINATION. We have not established a specific length
of operating history or a specified level of earnings, assets, net worth or
other criteria which we will require a target business opportunity to have
achieved. Accordingly, we may enter into a business combination with a business
opportunity having:

o no significant operating history;

o losses; limited or no potential for earnings;

o limited assets;

o negative net worth; or

o other characteristics that are indicative of development stage
companies.

CONTINUED MANAGEMENT CONTROL, LIMITED TIME AVAILABILITY. While seeking a
business combination, management anticipates devoting up to 70 hours per month
to our business. We have not entered into employment agreements with any of our
current officers and we are not expected to do so in the foreseeable future. We
have not obtained key man life insurance on any of our officers or directors.
Notwithstanding the combined limited experience and time commitment of
management, loss of the services of any of these individuals would adversely
affect development of our business and our likelihood of continuing operations.

CONFLICTS OF INTEREST - GENERAL. Our officers and directors participate in
business ventures which could be deemed to compete directly with us. Additional
conflicts of interest and non-arm's length transactions may also arise in the
event our officers or directors are involved in the management of any firm with
which we transact business.

REPORTING REQUIREMENTS MAY DELAY OR PRECLUDE ACQUISITION. Sections 13 and 15(d)
of the Securities Exchange Act require reporting companies to provide certain
information about significant acquisitions, including audited financial
statements for the company acquired, covering one, two, or three years,
depending on the relative size of the acquisition. The time and additional costs
that may be incurred by some target entities to prepare such statements may
significantly delay or essentially preclude us from consummating an otherwise
desirable acquisition. Acquisition prospects that do not have or are unable to
obtain the required audited statements may be inappropriate for acquisition so
long as the reporting requirements of the Securities Exchange Act are
applicable.

LACK OF MARKET RESEARCH OR MARKETING ORGANIZATION. We have neither conducted,
nor have others made available to us, results of market research indicating that
market demand exists for the transactions we are contemplating. Moreover, we do
not have, and do not plan to establish, a marketing organization. Even in the
event demand is identified for a merger or acquisition contemplated by us, we
cannot assure you we will be successful in completing any such business
combination.

LACK OF DIVERSIFICATION. Our operations, even if successful, will in all
likelihood result in us engaging in a business combination with another entity.
Consequently, our activities may be limited to those engaged in by any entity
with which we merge or acquire. Our inability to diversify our activities into a
number of areas may subject us to economic fluctuations within a particular
business or industry and, therefore, increase the risks associated with our
operations.

GOVERNMENT REGULATION. Although we will be subject to the reporting requirements
under the Securities Exchange Act, management believes we will not be subject to
regulation under the Investment Company Act, insofar as we will not be engaged
in the business of investing or trading in securities. In the event we engage in
business combinations which result in us holding passive investment interests in
a number of entities, we could be subject to regulation under the Investment
Company Act. In such event, we would be required to register as an investment
company and could be expected to incur significant registration and compliance
costs. We have not obtained a formal determination from the Securities and
Exchange Commission as to our status under the Investment Company Act and,
consequently, violation of the Investment Company Act could subject us to civil
and criminal penalties and could cause us to cease operations.

PROBABLE CHANGE IN CONTROL AND MANAGEMENT. A business combination involving the
issuance of our common stock will, in all likelihood, result in shareholders of
a private company obtaining a controlling interest in us. Any such business
combination may require our management and/or affiliates to sell or transfer all
or a portion of our common stock held by them and/or to resign as members of our
board of directors. The resulting change in control of us could result in
removal of one or more of our present officers and directors and a corresponding
reduction in or elimination of their participation in our future affairs.

REDUCTION OF PERCENTAGE SHARE OWNERSHIP FOLLOWING A BUSINESS COMBINATION. If we
engage in a business combination with a private entity, in all likelihood, such
a combination would result in us issuing securities to the owners of such
private entity. The issuance of our previously authorized and unissued common
stock would result in a reduction in the percentage of shares owned by our
present and prospective shareholders and may result in a change in control or
management of us.

"PENNY" STOCK REGULATION OF BROKER-DEALER SALES OF OUR SECURITIES. The SEC has
adopted rules that regulate broker-dealer practices in connection with
transactions in "penny stocks". Generally, penny stocks are equity securities
with a price of less than $5.00 (other than securities registered on certain
national securities exchanges or quoted on the NASDAQ system). If our shares are
traded for less than $5.00 per share, as they currently are, the shares will be
subject to the SEC's penny stock rules unless (1) our net tangible assets exceed
$5,000,000 during our first three years of continuous operations or $2,000,000
after our first three years of continuous operations; or (2) we have had average
revenue of at least $6,000,000 for the last three years. The penny stock rules
require a broker-dealer, prior to a transaction in a penny stock not otherwise
exempt from the rules, to deliver a standardized risk disclosure document
prescribed by the SEC that provides information about penny stocks and the
nature and level of risks in the penny stock market. The broker-dealer also must
provide the customer with current bid and offer quotations for the penny stock,
the compensation of the broker-dealer and its salesperson in the transaction and
monthly account statements showing the market value of each penny stock held in
the customer's account. In addition, the penny stock rules require that prior to
a transaction in a penny stock not otherwise exempt from those rules, the
broker-dealer must make a special written determination that the penny stock is
a suitable investment for the purchaser and receive the purchaser's written
agreement to the transaction. These requirements may have the effect of reducing
the level of trading activity in the secondary market for a stock that becomes
subject to the penny stock rules. As long as our common stock is subject to the
penny stock rules, the holders of the common stock may find it difficult to sell
our common stock.

TAXATION. Federal and state tax consequences will, in all likelihood, be major
considerations in any business combination we may undertake. Currently, such
transactions may be structured so as to result in tax-free treatment to both
companies, pursuant to various federal and state tax provisions. We intend to
structure any business combination so as to minimize the federal and state tax
consequences to both us and the target entity; however, there can be no
assurance that such business combination will meet the statutory requirements of
a tax-free reorganization

or that the parties will obtain the intended tax-free treatment upon a transfer
of stock or assets. A non-qualifying reorganization could result in the
imposition of both federal and state taxes which may have an adverse effect on
both parties to the transaction.

REQUIREMENT OF AUDITED FINANCIAL STATEMENTS MAY DISQUALIFY BUSINESS
OPPORTUNITIES. Management believes that any potential business opportunity must
provide audited financial statements for review for the protection of all
parties to the business combination. One or more attractive business
opportunities may choose to forego the possibility of a business combination
with us, rather than incur the expenses associated with preparing audited
financial statements.

EMPLOYEES

We have no full time employees. Our president and secretary have agreed to
allocate a portion of their time to our activities, without compensation. These
officers anticipate that our business plan can be implemented by their devoting
an aggregate of 70 hours per month to our business affairs and, consequently,
conflicts of interest may arise with respect to the limited time commitment by
such officers. We do not expect any significant changes in the number of
employees, until we have operations.

Our officers and directors are or may become involved with other companies who
have a business purpose similar to ours. As a result, potential conflicts of
interest may arise in the future. If such a conflict does arise and one of our
officers or directors is presented with business opportunities under
circumstances where there may be a doubt as to whether the opportunity should
belong to us or another company they are affiliated with, they will disclose the
opportunity to all such companies.

ITEM 2. DESCRIPTION OF PROPERTY.

We have no properties and at this time no agreements to acquire any properties.
We operate from our offices at 19 New England Ave., Suite 8C, Summit New Jersey
07901. Space is provided to us on a rent free basis by James E. Platek, our
president, director and a principal shareholder, and it is anticipated that this
arrangement will remain until such time as we successfully consummate a merger
or acquisition. We believe that this space will meet our needs for the
foreseeable future.

ITEM 3. LEGAL PROCEEDINGS.

None.

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

None.

PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Our common shares have been quoted on the Over-the-Counter Bulletin Board
operated by the National Association of Securities Dealers, since approximately
February 1, 2001. Our shares are listed under the symbol "DLTM".

The last reported bid and ask prices of our common stock by the OTC Bulletin
Board were $0.20 and $1.01, respectively, on April 9, 2001. These quotations
reflect inter-dealer prices, without retail mark-up, mark-down, or commission
and may not represent actual transactions.

As of April 4, 2001, there were 42 record holders of our common stock.

During the last two fiscal years, no cash dividends have been declared on our
common stock and management does not anticipate that dividends will be paid in
the foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES

During March 2000, we sold 2,000 shares of common stock at $0.10 per share, for
gross proceeds of $200. The sales were made to two purchasers. No commissions
were paid in connection with the sales. These shares were issued pursuant to
Rule 504 of Regulation D under the Securities Act. The sales were made in a
private offering to friends and associates of our officers, directors and/or
shareholders. These sales did not result in the offer or sale of more than
$1,000,000 of securities during any twelve month period.

During April 2000, we sold 50,000 shares of common stock at $0.10 per share, for
gross proceeds of $5,000. No commissions were paid in connection with the sale.
The sale was made to one purchaser. These shares were issued pursuant to Rule
504 of Regulation D under the Securities Act. The sale was made in a private
offering to Fair Market, Inc., a Colorado corporation. These sale did not result
in the offer or sale of more than $1,000,000 of securities during any twelve
month period.

During May 2000, we sold 20,000 shares of common stock at $0.10 per share, for
gross proceeds of $2,000. No commissions were paid in connection with the sales.
The sales were made to two purchasers. These shares were issued pursuant to Rule
504 of Regulation D under the Securities Act. The sales were made in a private
offering to friends and associates of our officers, directors and/or
shareholders. These sales did not result in the offer or sale of more than
$1,000,000 of securities during any twelve month period.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

GENERAL

Delta was incorporated under the laws of the State of Delaware on November 17,
1999. Delta is a development stage company which initially intended to develop
an Internet based mortgage services company. At the present time, we have not
commenced operations or any activities beyond developing an initial business
plan. To date, we have been unable to secure sufficient financing to implement
our initial business plan. As such, management believes it is in the best
interest of us and our shareholders to seek other business opportunities.

We have, and will continue to have limited capital with which to commence
operational activities. We have incurred, and will continue to incur, expenses
relating to our operations. Specifically, as long as we are required to file
reports under the Securities Exchange Act, we will continue to incur accounting
and legal fees relating to our filings. We enjoy the non-exclusive use of
office, telecommunication and incidental supplies of stationery, provided by our
officers. As of the date of this report, we has not received any revenues and
must rely entirely upon loans and equity investments from affiliates to pay
operating expenses.

PLAN OF OPERATION

We currently have no capital to fund operations or on-going expenses. We must
rely upon loans and investments from affiliates to pay operating expenses. There
are no assurances that such affiliates will continue to advance funds to us or
will continue to invest in our securities. If we are unable to obtain additional
financing, we may be unable to identify and/or acquire a suitable business
opportunity. During the twelve months following the filing of this report, we
intend to seek to acquire assets or shares of an entity actively engaged in a
business that generates

revenues, in exchange for our securities. We have not identified a particular
acquisition target and have not entered into any material negotiations regarding
such an acquisition. Management intends to contact investment bankers, corporate
financial analysts, attorneys and other investment industry professionals
through various media. As of the date of this report, none of our officers,
directors, promoters or affiliates has engaged in any material contact or
discussions with any representative of any other company regarding the
possibility of an acquisition or merger between us and such other company.

Depending upon the nature of the relevant business opportunity and the
applicable state statutes governing the manner in which the transaction is
structured, our board of directors expects that it will provide our shareholders
with complete disclosure documentation concerning a potential business
opportunity and the structure of the proposed business combination prior to
consummation. Such disclosure is expected to be in the form of a proxy,
information statement, or report.

While such disclosure may include audited financial statements of such a target
entity, there is no assurance that such audited financial statements will be
available. The board of directors does intend to obtain certain assurances of
the value of the target entity's assets prior to consummating such a
transaction, with further assurances that audited financial statements would be
provided within sixty days after closing. Closing documents will include
representations that the value of the assets conveyed to or otherwise so
transferred will not materially differ from the representations included in such
closing documents, or the transaction will be voidable.

Due to the fact that we no operations, it is anticipated that our cash
requirements will be minimal, and that all necessary capital, to the extent
required, will be provided by our directors, officers and/or shareholders. We do
not anticipate that we will have to raise capital or acquire any plant or
significant equipment in the next twelve months, unless a merger or acquisition
target is identified.

LIQUIDITY

At December 31, 2000 and 1999, we had working capital deficits of $28,067 and
$2,281, respectively. The increase in our working capital deficit is a result of
the net loss incurred during the fiscal year ended December 31, 2000. Since we
have no source of revenue, our working capital deficit will continue to increase
as we incur additional operating expenses. Presently we have no external sources
of cash and we are dependent upon our management and shareholders for funding.

ASSETS

At December 31, 2000, we had total assets of $421, compared to total assets of
$5,383 at December 31, 1999. All of our assets at December 31, 2000 and 1999
consisted of cash. As of the date of this report, we have essentially no assets.

RESULTS OF OPERATIONS

We have no current operations and have not generated any revenue. We must rely
entirely upon loans from affiliates to pay operating expenses.

During the fiscal year ended December 31, 2000 we incurred a net loss of
$32,986. From inception (November 17, 1999) to December 31, 1999, we had a net
loss of $5,831. We are continuing to incur professional fees and other expenses.
If we do not find a suitable acquisition target or other source of revenue, we
will continue to incur net losses and may have to cease operations entirely.
This factor, among others, raises substantial and compelling doubt about our
ability to continue as a going concern.

Our ability to continue as a going concern is dependent upon our ability to
generate sufficient cash flow to meet our obligations on a timely basis, to
identify and close an acquisition with a suitable target company, obtain
additional financing or refinancing as may be required, and ultimately to attain
profitability. There are no assurances that we

will be able to identify a suitable acquisition target and close such
acquisition, obtain any additional financing or, if we are able to obtain
additional financing, that such financing will be on terms favorable to us. The
inability to obtain additional financing when needed will have a material
adverse effect on our operating results.

The Independent Auditors' Report and Note 1 of the Notes to Financial Statements
accompanying this report state that substantial doubt has been raised about our
ability to continue as a going concern. Our present business operations do not
generate sufficient revenues to cover our expenses. We would have to obtain
other business operations or severely reduce our expenses to remain viable, and
we cannot assure you that we will be able to do so.

ITEM 7. FINANCIAL STATEMENTS.

Please refer to the pages beginning with F-1.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE.

None.

PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

DIRECTORS AND EXECUTIVE OFFICERS

Our officers and directors are:

NAME AGE TITLE(S)
---- --- --------

James E. Platek 33 President, Chief Executive Officer and Director
since November 1999.

Bonnie J. Cunningham 28 Secretary, Treasurer, and Director since November
1999.

Robert C. Franz 31 Director since August 2000.

Our directors are elected by the shareholders and our officers are appointed by
our board of directors. Our officers hold office until their successors are
elected and qualified. Vacancies in our board are filed by the board itself. Our
officers and directors devote their time to us on an "as needed" basis, which,
depending on the circumstances, could amount to as little as 20 hours per month.
We anticipate a time commitment of approximately 70 hours per month. Set forth
below are brief descriptions of the recent employment and business experience of
our officers and directors.

JAMES PLATEK, PRESIDENT, CHIEF EXECUTIVE OFFICER AND DIRECTOR. Mr. Platek holds
a bachelors degree in History from Rutgers University. Since 1998, Mr. Platek
has been a self-employed financial consultant and private investor. From 1997 to
1998, Mr. Platek was a retail broker for Morgan Stanley Dean Witter, New York,
New York. From 1995 to 1998, Mr. Platek was the Director of Marketing for
Plymouth Partners, New York, New York. Mr. Platek was responsible for marketing,
analysis and fund raising. Plymouth Partners is a private company which assists
companies with funding and marketing. Mr. Platek is the Vice President of
Institutional Marketing of Regent Group, Inc., an SEC reporting issuer. Since
May, 2000, Mr. Platek has also been Treasurer and a director of Noxso

Corporation, an SEC reporting issuer. Noxso is a "shell" company seeking a
merger or acquisition candidate.

BONNIE J. CUNNINGHAM, SECRETARY, TREASURER AND DIRECTOR. Ms. Cunningham is a
1995 graduate of Purdue University, with a bachelors degree in Science. Ms.
Cunningham has been engaged in retail management since 1995 with nationally
recognized merchandisers such as Nautica, Federated Merchandising Group &
JCPenney. From 1999 to present, Ms. Cunningham has employed by Nautica (New
York, New York) as a Retail Analyst from 1999 to present. Her responsibilities
include developing financial plans for major retail accounts and planning the
men's sportswear assortments. Ms. Cunningham was employed as an Associate
Product Manager by Federated Merchandising Group (New York, New York) from 1997
to 1999. Ms. Cunningham developed the private label fashion jewelry line for
Federated divisions. From 1995 to 1997, she was employed by JCPenney (Whitehall,
Pennsylvania) as a merchandise manager for women's sportswear. Her
responsibilities included training and motivating sales associates to achieve
department goals.

ROBERT C. FRANZ, DIRECTOR. Mr. Franz received a bachelors degree in Arts from
Rutgers College, Rutgers/The State University of New Jersey in 1991 and a Master
of Science in Management from Troy State University in 1997. Since 1999 Mr.
Franz has served as a Research Associate for Castle Connolly Medical (New York,
New York). From 1994 to 1999, Mr. Franz was employed by RCI Consultants and
trained executives in Seoul, South Korea, for corporations including Samsung
Electronics, Daewoo and Hyundai.

There are no family relationships between any of our executive officers and/or
directors.

LEGAL PROCEEDINGS

To the best of our knowledge, during the past five years no director, person
nominated to become a director, executive officer, promoter or control person of
us has:

(1) Had any bankruptcy petition filed by or against any business
of which such person was a general partner or executive
officer either at the time of the bankruptcy or within two
years prior to that time;

(2) Had any conviction in a criminal proceeding or being subject
to a pending criminal proceeding (excluding traffic violations
and other minor offenses);

(3) Been subject to any order, judgment, or decree, not
subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining,
barring, suspending or otherwise limiting his involvement in
any type of business, securities or banking activities; or

(4) Been found by a court of competent jurisdiction (in a civil
action), the Securities and Exchange Commission or the
Commodity Futures Trading Commission to have violated a
federal or state securities or commodities law, and the
judgment has not been reversed, suspended, or vacated.

PRIOR ACQUISITION EXPERIENCE

None of our officers and/or directors have had any direct experience in
identifying emerging companies for investment and/or business combinations.

CONFLICTS OF INTEREST

Members of our management are associated with other firms involved in a range of
business activities. Consequently, there are potential inherent conflicts of
interest in their acting as our officers and directors. Insofar as the officers
and directors are engaged in other business activities, management anticipates
they will devote only a minor amount of time to our affairs.

Our officers and directors are now and may in the future become shareholders,
officers or directors of other companies which may be formed for the purpose of
engaging in business activities similar to those conducted by us. Accordingly,
additional direct conflicts of interest may arise in the future with respect to
such individuals acting on behalf of us or other entities. Moreover, additional
conflicts of interest may arise with respect to opportunities which come to the
attention of such individuals in the performance of their duties or otherwise.
We do not currently have a right of first refusal pertaining to opportunities
that come to management's attention insofar as such opportunities may relate to
our business operations.

Our officers and directors are, so long as they are officers or directors of us,
subject to the restriction that all opportunities contemplated by our plan of
operation which come to their attention, either in the performance of their
duties or in any other manner, will be considered opportunities of, and be made
available to us and the companies that they are affiliated with on an equal
basis. A breach of this requirement will be a breach of the fiduciary duties of
the officer or director. If we or the companies in which the officers and
directors are affiliated with both desire to take advantage of an opportunity,
then said officers and directors would abstain from negotiating and voting upon
the opportunity. However, all directors may still individually take advantage of
opportunities if we should decline to do so. Except as set forth above, we have
not adopted any other conflict of interest policy with respect to such
transactions.

We do not have any standing audit, nominating, or compensation committees of the
board of directors.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act requires our officers and
directors, and persons who own more than 10% of a registered class of our equity
securities, to file reports of ownership and changes in ownership with the
Securities and Exchange Commission and the NASD. Officers, directors and greater
than 10% percent shareholders are required by SEC regulation to furnish us with
copies of all Section 16(a) forms they file. To the best of our knowledge, James
E. Platek, Bonnie C. Cunningham and Robert Franz all failed to timely file Form
3's. Mr. Platek and Ms. Cunningham were required to file Form 3's by July 4,
2000, and Mr. Franz was required to file a Form 3 by August 31, 2000. Mr. Platek
and Ms. Cunningham reported the information required by Form 3, on their Form
5's filed February 14, 2001. Such information related to Mr. Platek's ownership
of 300,000 shares of our common stock and Ms. Cunningham's ownership of 150,000
shares of our common stock. Mr. Franz, reported his Form 3 holdings of 1,000
shares, on his Form 5 which was filed on February 21, 2001. Mr. Franz's Form 3
was required to be filed by February 14, 2001.

In addition, to the best of our knowledge no reports were filed by any persons
who owned 10% or more of the Delta's common stock.

ITEM 10. EXECUTIVE COMPENSATION.

None of our officers or directors received any compensation for services from
our date of inception (November 17, 1999) to December 31, 2000. They have agreed
to act without compensation until operations have commenced.

SUMMARY COMPENSATION TABLE

The following table sets forth information for James E. Platek, our Chief
Executive Officer ("CEO"), during the fiscal year ended December 31, 2000. No
disclosure need be provided for any executive officer, other than the CEO, whose
total annual salary and bonus for the last completed fiscal year did not exceed
$100,000. Accordingly, no other executive officers are included in the table.

LONG TERM COMPENSATION
-------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
----------------------------------- ------------------------ ------------
OTHER RESTRICTED SECURITIES
ANNUAL STOCK UNDERLYING ALL OTHER
NAME AND PRINCIPAL COMPENSATION AWARD(S) OPTIONS / LTIP COMPENSATION
POSITION YEAR SALARY($) BONUS($) ($) ($) SARS ($) PAYOUTS ($) ($)
- ----------------------------------------------------------------------------------------------------------------------

James E. Platek, 2000 -0- -0- -0- -0- -0- -0- -0-
President and 1999(1)<F1> -0- -0- -0- -0- -0- -0- -0-
Chief Executive
Officer(1)<F1>
- ----------------------------------------------------------------------------------------------------------------------
<FN>
<F1>
(1) From inception (November 17, 1999) to December 31, 1999.
</FN>

COMPENSATION PLANS

We have not adopted any deferred compensation, pension, profit sharing, stock
option or welfare benefit plan or programs for the benefit of its officers or
future employees.

EMPLOYMENT AGREEMENTS

We do not have any employment contracts with any of our officers or directors.
Such persons are employed by us on an at will basis, and the terms and
conditions of employment are subject to change.

DIRECTORS' COMPENSATION

We do not compensate directors in their capacity as such nor do we compensate
our directors for attendance at meetings. We do reimburse our officers and
directors for reasonable expenses incurred during the course of their
performance.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

The following table sets forth information, as of March 31, 2001, with respect
to the beneficial ownership of our common stock by each person known by us to be
the beneficial owner of more than five percent of the outstanding common stock
and by our directors and officers, both individually and as a group:

NAME AND ADDRESS OF SHARES OWNED BENEFICIALLY
BENEFICIAL OWNER AND OF RECORD PERCENT OF CLASS (1)<F1>
-------------------------------- ------------------------- --------------------

James E. Platek 300,000 53.9%
19 New England Ave.
Suite 8C
Summit, NJ 07901

Bonnie J. Cunningham 150,000 26.9%
6746 Wild Cherry Dr.
Coopersburg, PA 18036

Robert Franz 1,000 0.2%
931 Summit Avenue, Apt. 3
Jersey City, NJ 07307

NAME AND ADDRESS OF SHARES OWNED BENEFICIALLY
BENEFICIAL OWNER AND OF RECORD PERCENT OF CLASS (1)<F1>
-------------------------------- ------------------------- --------------------

Officers and directors as a group 451,000 81.0%
(3 persons)
-----------------
<FN>
<F1>
(1) Percentages are based on 557,000 shares of common stock outstanding
as of March 31, 2001.
</FN>

CHANGES OF CONTROL

A business combination involving the issuance of our common stock will, in all
likelihood, result in shareholders of a private company obtaining a controlling
interest in us. Any such business combination may require our current
shareholders to sell or transfer all or a portion of their common stock and/or
resign from their positions as officers and/or directors of our company. The
resulting change in control of our company could result in removal of the
current management, and a corresponding reduction in or elimination of their
participation in our future affairs.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

During the period ended December 31, 1999, James E. Platek, one of our officers,
directors and a principal shareholder of us, advanced us $4,950. The loan
accrues interest at the rate of 10% per annum and is unsecured.

During the period ended December 31, 2000, James E. Platek purchased 300,000
shares of common stock from us at a price of $0.0001 per share for an aggregate
of $30.00.

During the period ended December 31, 2000, Bonnie J. Cunningham purchased
150,000 shares of common stock from us at a price of $0.0001 per share for an
aggregate of $15.00.

James E. Platek and Bonnie J. Cunningham may be deemed to be "promoters" or
"founders" of us within the meaning of the rules and regulations promulgated
under the Securities Act.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.

(a) Exhibits:

REGULATION CONSECUTIVE
S-B NUMBER EXHIBIT PAGE NUMBER

3.1 Certificate of Incorporation (1) N/A

3.2 Bylaws (1) N/A

3.2a Amendment to Article III, Section I of the Bylaws (2) N/A

11 Statement Re: Computation of Per Share Earnings See Financial
Statements

- ---------------------------
(1) Incorporated by reference from the Registration Statement on Form
10-SB/A Amendment No. 1 filed with the Securities and Exchange
Commission on June 15, 2000.

(2) Incorporated by reference from the Quarterly Report on Form 10-QSB
filed with the Securities and Exchange Commission on November 21, 2000.

(b) The following reports on Form 8-K were filed during the last quarter of
the period covered by this report:

There have been no reports filed on Form 8-K during the period covered
by this report. In accordance with the rules and regulations of the
Securities and Exchange Commission, Delta disclosed the resignation of
Daniel J. Baier, CPA, P.C., and the engagement of Weiner, Goodman &
Company, P.C. under "Part II - Item 5. Other Events" of the Form 10-QSB
filed on November 21, 2000.

SIGNATURES

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

DELTA MUTUAL, INC.

Dated: April 16, 2001
By: /s/ James E. Platek
---------------------------------------
James E. Platek, President

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

SIGNATURE TITLE DATE

President and Director
/s/ James E. Platek (Principal Executive Officer, Principal
- ----------------------------------- Financial and Accounting Officer) April 16, 2001
James E. Platek

/s/ Bonnie J. Cunningham
- ----------------------------------- Secretary, Treasurer and Director April 16, 2001
Bonnie J. Cunningham

/s/ Robert C. Franz
- ----------------------------------- Director April 16, 2001
Robert C. Franz

- --------------------------------------------------------------------------------
Two Industrial Way West, Eatontown, NJ 07724 (732) 544-8111 Fax (732) 544-8788
E-mail: wgpc@bellatlantic.net

WIENER, GOODMAN
& COMPANY, P.C.
===============
Certified Public Accountants
& Consultants

Memberships
SEC Practice Section of AICPA Joel Weiner, CPA
PCPS of AICPA Gerald Goodman, CPA
American Institute of CPA
New Jersey Society of CPA

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
Delta Mutual, Inc.

We have audited the accompanying balance sheet of Delta Mutual, Inc. (a
development stage company) (the "Company") as of December 31, 2000, and the
related statements of operations, stockholders' deficiency and cash flows for
the year ended December 31, 2000 and for the period November 17, 1999 (Date of
Formation) 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 audit. The financial
statements of Delta Mutual, Inc. as of December 31, 1999 were audited by other
auditors whose report dated February 22, 2000 expressed an unqualified opinion
on those statements.

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

In our opinion, such financial statements referred to above present fairly, in
all material respects, the financial position of Delta Mutual Inc. at December
31, 2000 and 1999, and the results of its operations and its cash flows for the
years ended December 31, 2000 and 1999 and for the period November 17, 1999
(Date of Formation) through December 31, 2000, in conformity with generally
accepted accounting principles.

The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. The Company is a development stage enterprise
whose business purpose is to develop as an "online" mortgage company, catering
specifically to the needs of households with substandard credit by offering
first and second mortgages as well as home equity lines of credit. The Company
is pursuing other business opportunities as it has been unable to implement its
mortgage business. As more fully explained in Note 1 of the financial
statements, the Company needs to obtain additional financing to fulfill its
developmental activities and achieve a level of sales adequate to support its
cost structure. These uncertainties raise substantial doubt about the Company's
ability to continue as a going concern. Management's plans are also described in
Note 1. The accompanying financial statements do not include any adjustments
that might result from the outcome of these uncertainties should the Company be
unable to continue as a going concern.

/s/WIENER, GOODMAN & COMPANY, P.C.
WIENER, GOODMAN & COMPANY, P.C.
Certified Public Accountants
Eatontown, New Jersey

February 25, 2001

WIENER, GOODMAN & COMPANY, P.C.
Certified Public Accountants & Consultants

2541 Monroe Avenue o Suite 306
Rochester, New York 14618
DANIEL J. BAIER, CPA, P.C. (716) 271-4550
================================================================================
Certified Public Accountant o Business and Financial Advisory Services

April 16, 2001

Mr. James Platek
Delta Mutual, Inc.
335 Garden Street
Hoboken, New Jersey 07030

Dear Mr. Platek,

I was engaged to audit, in accordance with Generally Accepted Auditing
Standards, the December 31, 1999 financial statements of Delta Mutual,
Inc. ("Company").

You have requested that I reissue my report on the December 31, 1999
financial statements of the Company to be included in an annual report
on Form 10KSB to be filed with the Securities and Exchange Commission.

Upon completion of a subsequent events review, it has become evident
that the original report must be modified. This modification is
necessary because of the Company's disclosure in the Form 10KSB that

"...INITIALLY, WE BELIEVED WE WOULD BE ABLE TO FUND OUR
INTENDED OPERATIONS THROUGH THE SALE OF OUR COMMON STOCK. OUR
COMMON STOCK IS QUOTED ON THE OVER-THE-COUNTER ELECTRONIC
BULLETIN BOARD UNDER THE SYMBOL "DLTM". AT THE TIME OF OUR
FORMATION, COMPANIES WITH INTERNET BASED BUSINESSES WERE
TREATED FAVORABLY IN THE CAPITAL MARKETS. DURING THE 12 MONTHS
PRECEDING THE DATE OF THIS REPORT, THE MARKET FOR THE STOCK OF
INTERNET BASED BUSINESSES HAS DETERIORATED SUBSTANTIALLY. MANY
COMPANIES WITH INTERNET BASED BUSINESSES HAVE SIMPLY GONE OUT
OF BUSINESS BECAUSE THEY WERE NOT ABLE TO GENERATE SUFFICIENT
REVENUES AND WERE UNABLE TO RAISE ADDITIONAL CAPITAL.

WE BELIEVE THE MARKET DECLINE FOR COMPANIES WITH INTERNET
BASED BUSINESSES HAS ADVERSELY IMPACTED OUR ABILITY TO RAISE
THE FUNDS NECESSARY TO SUPPORT OUR INTENDED OPERATIONS. FROM
INCEPTION THROUGH DECEMBER 31, 2000, WE RAISED A LIMITED
AMOUNT OF CAPITAL ($10,750) THROUGH THE SALE OF OUR COMMON
STOCK. AS OF THE DATE OF THIS REPORT, WE HAVE BEEN UNABLE TO
SECURE ADDITIONAL FINANCING TO PURSUE OUR INITIAL BUSINESS
PLAN. WHILE WE CONTINUE TO EXPLORE THE FEASIBILITY OF
IMPLEMENTING OUR ORIGINAL BUSINESS PLAN, GIVEN OUR LACK OF
SUCCESS AT SECURING SUFFICIENT FINANCING TO DEVELOP AN
INTERNET BASED MORTGAGE BUSINESS, WE BELIEVE IT IS IN THE BEST
INTERESTS OF US AND OUR SHAREHOLDERS TO CONSIDER OTHER
BUSINESS OPPORTUNITIES. ADDITIONALLY, WE BELIEVE IT MAY BE
NECESSARY TO ACQUIRE ANOTHER BUSINESS TO PREVENT HAVING TO
CEASE OPERATIONS. AS OF THE DATE OF THIS REPORT, WE ARE
FOCUSING OUR EFFORTS ON IDENTIFYING SUCH A BUSINESS. WE HAVE
ENGAGED IN PRELIMINARY DISCUSSIONS WITH PARTIES ABOUT
ACQUIRING ANOTHER BUSINESS, OR BEING ACQUIRED BY ANOTHER
BUSINESS, BUT AS OF THE DATE OF THIS REPORT, WE HAVE NOT
ENTERED INTO ANY AGREEMENTS RELATING TO ANY SUCH
ACQUISITIONS...." [Emphasis supplied.]

MR. JAMES PLATEK, DELTA MUTUAL, INC. PAGE 2 OF 3

Accordingly, the accompanying revised report should be presented in
place of the original report, and the Firm hereby grants its consent to
the inclusion of this revised report in the Form 10KSB.

Sincerely,

/s/Daniel J. Baier
Daniel J. Baier

Daniel J. Baier, CPA, P.C. o 2541 Monroe Avenue o Suite 304 o Rochester,
New York 14618 o (716) 271-4550

To the Shareholders of Delta Mutual, Inc.

I have audited the accompanying balance sheet of Delta Mutual, Inc.
as of December 31, 1999, and the related statements of loss, cash
flows and shareholders' equity for the period since inception
(November 17, 1999) then ended. These financial statements are the
responsibility of the Company's management. My responsibility is to
express an opinion on these financial statements based on my audit.

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

In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Delta
Mutual Inc. as of December 31, 1999, and the results of its
operations and its cash flows for the year then ended in conformity
with generally accepted accounting principles.

The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. The Company is a
development stage enterprise whose business purpose is to develop as
an "online" mortgage company, catering specifically to the needs of
households with substandard credit by offering first and second
mortgages as well as home equity lines of credit. The Company is
pursuing other business opportunities as it has been unable to
implement its mortgage business. As more fully explained in Note 1 of
the financial statements, the Company needs to obtain additional
financing to fulfill its developmental activities and achieve a level
of sales adequate to support its cost structure. These uncertainties
raise substantial doubt about the Company's ability to continue as a
going concern. Management's plans are also described in Note 1. The
accompanying financial statements do not include any adjustments that
might result from the outcome of these uncertainties should the
Company be unable to continue as a going concern.

/s/Daniel J. Baier
Daniel J. Baier, CPA, P.C.
Rochester, NY
February 22, 2000
(except for Note 1, for which
the date is April 16, 2001)

DELTA MUTUAL INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET

ASSETS

December 31,
--------------------------
2000 1999
------------ -----------

Current Assets:
Cash $ 421 $ 5,383
------------ -----------

TOTAL ASSETS $ 421 $ 5,383
============ ===========

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current Liabilities:
Accounts payable and accrued expenses $ 23,538 $ 2,714
Loan from stockholder 4,950 4,950
------------ -----------
Total Liabilities 28,488 7,664
------------ -----------

Stockholders' Deficiency:
Common stock $0.0001 par value - authorized
20,000,000 shares; 557,000 and 485,000
shares issued and outstanding 56 49
Additional paid-in-capital 10,694 3,501
Deficit accumulated during
the development stage (38,817) (5,831)
------------ -----------
Total Stockholders' Deficiency (28,067) (2,281)
------------ -----------

TOTAL LIABILITIES AND
STOCKHOLDERS' DEFICIENCY $ 421 $ 5,383
============ ===========

See notes to financial statements.
F-1

DELTA MUTUAL INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS

Period from
November 17, 1999
Years Ended December 31, (Date of Formation)
------------------------------- through
2000 1999 December 31, 2000
--------------- -------------- --------------------

Costs and Expenses
General and administrative
expenses $ 32,986 $ 5,831 $ 38,817
--------------- -------------- ------------------

Net (loss) $ (32,986) $ (5,831) $ (38,817)
=============== ============== ==================

(Loss) per common share
basic and diluted $ (0.06) $ (0.01)
=============== ==============

Weighted average number of
common shares outstanding-
basic and diluted 543,433 485,000
=============== ==============

See notes to financial statements.
F-2

DELTA MUTUAL, INC
(A DEVELOPMENT STAGE COMPANY)
STATEMENT of STOCKHOLDERS' DEFICIENCY

Deficit
Number of Accumulated
Common Common Paid in During Development
Shares Stock Capital Stage Total
------------ ---------- ------------- ------------------- -------------

Balance at formation
(November 17, 1999 - $ - $ - $ - $ -
Sale of common stock
(at $0.0001 - $0.10 per share) 485,000 49 3,501 3,550
Deficit for the period from
November 17, 1999
(Date of formation) through
December 31, 1999 - - - (5,831) -
------------ ---------- ------------- ----------------- -------------

Balance, December 31, 1999 485,000 49 3,501 (5,831) (2,281)

Sale of common stock
(at $0.10 per share) 72,000 7 7,193 7,200

Net (loss) (32,986) -
------------ ---------- ------------- ----------------- -------------

Balance, December 31, 2000 557,000 $ 56 $ 10,694 $ (38,817) $ (28,067)
============ ========== ============= ================= =============

See notes to financial statements.
F-3

DELTA MUTUAL INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS

Period
November 17, 1999
Years Ended December 31, (Date of Formation)
--------------------------- through
2000 1999 December 31, 2000
----------- ------------- -------------------

Cash flows from operating activities:

Net loss $ (32,986) $ (5,831) $ (38,817)
Changes in operating assets
and liabilities: 20,824 2,714 23,538
----------- ------------- -----------------
Net cash (used in) operating activities: (12,162) (3,117) (15,279)
----------- ------------- -----------------

Cash flows from financing activities:
Proceeds from sale of common stock 7,200 3,550 10,750
Proceeds from officer - 4,950 4,950
----------- ------------- -----------------
Net cash provided by
financing activities 7,200 8,500 15,700
----------- ------------- -----------------

Net increase (decrease) in cash (4,962) 5,383 421
Cash - Beginning of year 5,383 - -
----------- ------------- -----------------
Cash - Ending of year $ 421 $ 5,383 $ 421
=========== ============= =================

Supplementary information:
Cash paid during year for:
Interest $ - $ -
=========== ============
Income taxes $ 285 $ -
=========== ============

Changes in operating assets and
liabilities consists of:
Increase in accounts payable
and accrued expenses $ 20,824 $ 2,714
=========== =============

See notes to financial statements.
F-4

DELTA MUTUAL INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS

1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES

ORGANIZATION

We were incorporated under the name Delta Mutual, Inc. on November 17,
1999 in the State of Delaware. From inception through December 31, 2000 the
Company has not yet commenced operations and no revenue has been derived.
Accordingly, the Company is considered a development stage enterprise. We are a
development stage company that intended to provide mortgage services through the
Internet to the "sub-prime" market. The sub-prime market consists of borrowers
having substandard credit. We intended to offer varied levels of mortgage and
lending services by capitalizing on the popularity of the Internet based
financial services companies. We believed both consumers and investors would be
interested in our business plan and the services we intended to offer. We
secured the domain name rights to the name deltamutual.com.

The Company intends to raise capital to develop as an "online" mortgage
company catering specifically to the needs of households with substandard credit
by offering first and second mortgages as well as home equity lines of credit.
The Company expects to handle all aspects of loan origination for the borrower
and would also provide complete transaction services for sale in the secondary
market. The intended services, offered principally through an internet web site.

While we continue to explore the feasibility of implementing our
original business plan, given our lack of success at securing sufficient
financing to develop an Internet based mortgage business, we believe it is in
the best interests of Delta and its shareholders to consider other business
opportunities. Additionally, we believe it may be necessary to acquire another
business to prevent having to cease operations. As of the date of this report,
we are focusing our efforts on identifying such a business. We have engaged in
preliminary discussions with parties about acquiring another business, or being
acquired by another business, but as of the date of this report, we have not
entered into any agreements relating to any such acquisitions.

F-5

We do not intend to restrict our search to any specific business,
industry, or geographical location and we may participate in a business venture
of any kind or nature. We may seek business opportunities with entities that
have recently commenced operations, or that wish to utilize the public
marketplace in order to raise additional capital to expand into new products or
markets, to develop a new product or service, or for other corporate purposes.
We may acquire assets and establish wholly-owned subsidiaries in various
businesses or acquire existing businesses as subsidiaries. Therefore, we have
virtually unlimited discretion to search for and enter into negotiations with
potential business opportunities. It is impossible to predict at this time the
status of any business in which we may become engaged, in that such business may
need to seek additional capital, may desire to have its shares publicly traded,
or may seek other perceived advantages which we offer.

NATURE OF BUSINESS AND LIQUIDITY

The Company's financial statements for the year ended December 31, 2000
have been prepared on a going concern basis which contemplates the realization
of assets and settlement of liabilities and commitments in the normal course of
business. Management recognizes that the Company's continued existence is
dependent upon its ability to obtain needed working capital through additional
equity and/or debt financing and the commencement of its planned principal
operations.

The Company's business is subject to most of the risks inherent in the
establishment of a new business enterprise. The likelihood of success of the
Company must be considered in light of the expenses, difficulties, delays and
unanticipated challenges encountered in connection with the formation of a new
business, raising operating and development capital, and the marketing of a new
product.

The Company presently does not have sufficient liquid assets to finance
its anticipated funding needs and obligations. If fundraising activities are not
successfully completed, the Company may not be able to meet its obligations as
they become due and, accordingly, may not be able to continue its business
operations as presently anticipated.

Management is actively seeking additional capital to ensure the
continuation of its development activities. However, there is no assurance that
additional capital will be obtained. These uncertainties raise substantial doubt
about the ability of the Company to continue as a going concern.

F-6

USE OF 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 period.
Actual results could differ from those estimates.

LOSS PER COMMON SHARE

Basic and diluted loss per common share are computed by dividing the
net loss by the weighted average number of common shares outstanding during the
year. Diluted earnings per common share are computed by dividing net earnings
(loss) by the weighted average number of common shares and potential common
shares outstanding during the year.

FAIR VALUE OF FINANCIAL INSTRUMENTS

For financial instruments including cash, accounts payable and accrued
expenses, it was assumed that the carrying amount approximated fair value
because of the short maturities of such instruments.

INCOME TAXES

At December 31, 2000 the Company has a net operating loss ("NOL")
carryforward of approximately $38,900 for financial reporting purposes and zero
for tax purposes. The difference between financial reporting and tax purposes
results from temporary differences caused by capitalization of start-up
expenditures for tax purposes as required by Internal Revenue Code Section 195.
The Company has not reflected any benefit of such net operating loss
carryforward in the accompanying financial statements in accordance with
Financial Accounting Standards Board Statement No. 109 as the realization of
this deferred tax benefit is not more than likely.

NEW FINANCIAL ACCOUNTING STANDARDS

In December 1999, the Securities and Exchange Commission (SEC) issued
Staff Accounting Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial
Statements". SAB 101 summarizes certain of the SEC's views in applying generally
accepted accounting principles to revenue recognition in financial statements.
The Company adopted the provisions of SAB 101 during the fourth quarter ended
December 31, 2000. Such adoption has not resulted in a material impact on the
Company's consolidated results of operations, financial position or cash flows.

F-7

In March, 2000, the Financial Accounting Standards Board ("FASB")
issued Interpretation No. 44 (FIN No. 44), Accounting for Certain Transactions
Involving Stock Compensation - an interpretation of APB 25. FIN No. 44 clarifies
(i) the definition of employees for purposes of applying APB Opinion No. 25,
(ii) the criteria for determining whether a plan qualifies as a noncompensatory
plan, (iii) the accounting consequences of various modifications to the terms of
a previously fixed stock option or award, and (iv) the accounting for an
exchange of stock compensation awards in a business combination. FIN No. 44 was
effective July 1, 2000. This standard has not had a significant impact on the
Company's results of operations, financial position or cash flows.

2. - COMMON STOCK

The Company has a single class of Common Stock with a par value of
$0.0001 per share. There are 20 million shares authorized, and at December 31,
2000 and 1999, respectively, 557,000 and 485,000 shares were issued and
outstanding. The president of the Company purchased 300,000 shares in November
of 1999.

Such shares were issued without registration in reliance on an
exemption in federal securities laws that permit issuance of stock up to $1
million without registration of the securities.

3. - RELATED PARTY TRANSACTIONS

In connection with the initial capitalization of the Company, its
principal stockholder loaned the Company $4,950. The loan payable to the
officer/stockholder at December 31, 2000 and 1999 was $4,950. Interest is
accrued at 10%. For the period ended December 31, 2000 and 1999, interest of $30
and $14 has been accrued on this loan.

As described in Note 2, the president of the Company purchased 300,000
shares in November of 1999.

F-8

APPENDIX D

FORM 10-QSB

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.

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

For the quarterly period ended September 30, 2001

[ ] 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 000-30563

DELTA MUTUAL, INC.
(Exact name of registrant as specified in its charter)

DELAWARE 14-1818394
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

1730 RHODE ISLAND AVENUE N.W., SUITE 312, WASHINGTON, D.C. 20036
(202) 408-1155
(Address and telephone number, including area code, of
registrant's principal executive office)

(Former name, former address and former fiscal year, if changed
since last report)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

YES X NO
--- ---

Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

At October 23, 2001 there were 557,000 shares of Common Stock, $.0001 par
value, outstanding.

DELTA MUTUAL, INC.

INDEX

Page

Part I. Financial Information 1

Item 1. Financial Statements

Balance Sheets as of September 30,
2001 (unaudited) and December 31, 2000 2

Statements of Operations for the Nine Months
and Three Months Ended September 30, 2001
and 2000 (unaudited) and the Period
November 17, 1999 (Date of Formation) through
September 30, 2001 3

Statements of Cash Flows for the Nine Months
Ended September 30, 2001 and 2000 (unaudited)
and the Period November 17, 1999 (Date of
Formation) through September 30, 2001 4

Notes to Condensed Financial Statements
(unaudited) 5 - 8

Item 2. Management's Discussion and Analysis
or Plan of Operations 9 - 11

Part II. Other Information

Item 1. Legal Proceedings 12
Item 2. Changes in Securities 12
Item 3. Defaults upon Senior Securities 12
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 13

Signatures 14

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Certain information and footnote disclosures required under
generally accepted accounting principles have been condensed or omitted
from the following financial statements pursuant to the rules and
regulations of the Securities and Exchange Commission. It is suggested
that the following condensed financial statements be read in
conjunction with the year-end financial statements and notes thereto
included in the Company's Annual Report on Form 10-KSB for the year
ended December 31, 2000.

The results of operations for the nine months ended September
30, 2001, are not necessarily indicative of the results to be expected
for the entire fiscal year or for any other period.

-1-

DELTA MUTUAL INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET

ASSETS

September 30, December 31,
---------------------------
2001 2000
------------ ------------
(unaudited)

Current Assets:
Cash $ 11,671 $ 421
------------ ------------

TOTAL ASSETS $ 11,671 $ 421
============ ============

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current Liabilities:
Accounts payable and accrued expenses $ 2,265 $ 23,538
Due to Enterprise Solutions, Inc. 54,414 $ --
Loan from stockholder 27,578 4,950
------------ ------------
Total Liabilities 84,257 28,488
------------ ------------

Stockholders' Deficiency:
Common stock $0.0001 par value - authorized
20,000,000 shares; 557,000
shares issued and outstanding 56 56
Additional paid-in-capital 20,688 10,694
Deficit accumulated during
the development stage (93,330) (38,817)
------------ ------------
Total Stockholders' Deficiency (72,586) (28,067)
------------ ------------

TOTAL LIABILITIES AND
STOCKHOLDERS' DEFICIENCY $ 11,671 $ 421
============ ============

See notes to financial statements.

DELTA MUTUAL INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
(Unaudited)

Period from
November 17, 1999
Nine Months Ended September 30, Three Months Ended September 30, (Date of Formation)
---------------------------------- ---------------------------------- through
2001 2000 2001 2000 September 30, 2001
--------------- --------------- --------------- --------------- ------------------

Costs and Expenses
General and administrative
expenses $ 54,513 $ 23,858 $ 28,721 $ 17,263 $ 93,330
--------------- --------------- --------------- --------------- ------------------

Net (loss) $ (54,513) $ (23,858) $ (28,721) $ (17,263) $ (93,330)
--------------- --------------- --------------- --------------- ------------------

(Loss) per common share
basic and diluted $ (0.10) $ (0.05) $ (0.05) $ (0.03)
=============== =============== =============== ===============

Weighted average number of
common shares outstanding-
basic and diluted 557,000 531,124 557,000 557,000
=============== =============== =============== ===============

See notes to financial statements.

DELTA MUTUAL INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
(Unaudited)

Period
November 17, 1999
Nine Months Ended September 30, (Date of Formation)
----------------------------------- through
2001 2000 September 30, 2001
--------------- --------------- --------------------

Cash flows from operating activities:

Net loss $ (54,513) $ (23,858) $ (93,330)
Changes in operating assets
and liabilities: (21,229) 16,686 2,309
--------------- --------------- --------------------
Net cash (used in) operating activities: (75,742) (7,172) $ (91,021)
--------------- --------------- --------------------

Cash flows from financing activities:
Proceeds from sale of common stock -- 7,200 10,750
Proceeds from officer 32,578 -- 42,478
Proceeds from loans 494,414 -- 494,414
Payment of loan (440,000) (440,000)
Payment to officer -- (4,950) (4,950)
--------------- --------------- --------------------
Net cash provided by
financing activities 86,992 2,250 102,692
--------------- --------------- --------------------

Net increase (decrease) in cash 11,250 (4,922) 11,671
Cash - Beginning of period 421 5,382 --
--------------- --------------- --------------------
Cash - End of period $ 11,671 $ 460 $ 11,671
=============== =============== ====================

Non-cash financing activities:
Conversion of debt to paid-in capital $ -- $ -- $ 4,994
=============== =============== ====================

Supplementary information:
Cash paid during year for:
Interest $ -- $ 50
=============== ===============
Income taxes $ -- $ 425
=============== ===============

Changes in operating assets and
liabilities consists of:
Increase (decrease) in accounts
payable and accrued expenses $ (21,229) $ 16,668
=============== ===============

See notes to financial statements.

DELTA MUTUAL INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONDENSED FINANCIAL STATEMENTS

1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. ORGANIZATION

The balance sheet as of September 30, 2001, and the statements of
operations and cash flows for the nine months ended September 30, 2001
and 2000 have been prepared by Delta Mutual, Inc. and are unaudited. In
the opinion of management, all adjustments (consisting of normal
recurring adjustments) necessary to present fairly the financial
position, results of operations and cash flows for all periods presented
have been made. The information for December 31, 2000 was derived from
audited financial statements.

2. BASIS OF PRESENTATION

The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. The
Company's primary planned activities intended to provide mortgage
services through the Internet to the "sub-prime" market. The sub-prime
market consists of borrowers having substandard credit. The Company
intended to offer varied levels of mortgage and lending services by
capitalizing on the popularity of the Internet based financial services
companies. At September 30, 2001, operations had not yet commenced and no
revenue has been derived; accordingly, the Company is considered a
development stage enterprise. There is no assurance the Company will
achieve a profitable level of operation.

On May 11, 2001, the Company entered into an Agreement of Sale (the
"Agreement") with Enterprises Solutions, Inc. ("ESI"). Pursuant to the
Agreement, the Company shall acquire substantially all of the assets of
ESI in exchange for approximately 10,500,000 shares of the Company's
common stock.

The Company presently does not have sufficient liquid assets to finance
its anticipated funding needs and obligations or to proceed with the
acquisition of Enterprises Solutions, Inc. The Company's continued
existence and completion of the Enterprises Solutions, Inc. transaction
is dependent upon its ability to obtain needed working capital through
additional equity and/or debt financing. Management is actively seeking
additional capital to ensure the continuation of its operations and to
complete this acquisition. However, there is no assurance that additional
capital will be obtained. These uncertainties raise substantial doubt
about the ability of the Company to continue as a going concern.

-5-

The financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the
amounts and classifications of liabilities that might be necessary should
the Company be unable to continue as a going concern.

3. AGREEMENT OF SALE

In May 2001, Delta and ESI entered into an agreement whereby ESI will
sell its assets to Delta for 1.2676 newly issued Delta common shares for
each common share of ESI outstanding. Delta is then expected to pay all
of ESI's remaining liabilities. ESI will then be liquidated in accordance
with the Plan of Liquidation and Dissolution. Approximately 10,500,000
shares of Delta are expected to be issued to ESI shareholders. In short,
ESI shareholders will hold approximately 95% of the total issued and
outstanding shares of Delta after the transaction. Also, the continuing
business of the new entity will be that of ESI. For these reasons, this
transaction is considered to be a merger and will be accounted for as if
ESI were the surviving entity.

Although the transaction documents refer to Delta as purchasing the net
assets of ESI, the transaction for accounting purposes is considered a
merger between two companies. As a result, the net assets of ESI are not
revalued but are carried over to the new entity at their net asset values
as reflected on ESI's books pre merger. Delta will record the transaction
at the par value of the newly issued stock and adjust the additional
paid-in capital account for the par value of ESI's retired stock and the
elimination of Delta's deficit.

The Agreement is conditioned on the effectiveness of the registration
statement required to be filed with the Securities and Exchange
Commission for the Acquisition, approval of the sale of substantially all
of the assets of ESI as part of the Acquisition transaction by the
stockholders of ESI, and on the approval by the stockholders of the
Company of the recapitalization. Following the recapitalization, the
Company will have an authorized capitalization of 100,000,000 shares of
common stock and 5,000,000 shares of preferred stock.

The following consolidated pro forma condensed statements of operations
for the three months ended September 30, 2001 and 2000 give effect to the
transaction as if it occurred on January 1, 2000.

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Nine Months Ended September 30, Three Months Ended September 30,
----------------------------------- -----------------------------------
2001 2000 2001 2000
--------------- --------------- --------------- ---------------

Revenue $ -- $ -- $ -- $ --
Total operating costs and expenses $ 2,506,560 $ 3,106,497 $ 727,866 $ 976,466
Net (loss) $ (2,435,435) $ 3,028,094 $ (710,516) $ (929,062)
Net (loss) per common share
-basic and diluted $ (0.22) $ (0.27) $ (0.06) $ (0.08)
Weighted average number of
common shares outstanding
-basic and diluted 11,057,000 11,031,124 11,057,000 11,057,000
=============== =============== =============== ===============

4. LOSS PER SHARE

Basic loss per common share is computed using the weighted average number
of common shares outstanding during the period. Diluted earnings per
common share are computed using the weighted average number of common
shares and potential common shares outstanding during the period. During
the nine months ended September 30, 2001 and 2000, potential common
shares were not used in the computation of diluted loss per common share
as their effect would be antidilutive.

5. COMMON STOCK

The Company has a single class of Common Stock with a par value of
$0.0001 per share. At September 30, 2001, 557,000 shares were issued and
outstanding.

Such shares were issued without registration in reliance on an exemption
in federal securities laws that permit issuance of stock up to $1 million
without registration of the securities.

6. RELATED PARTY TRANSACTIONS

In connection with the initial capitalization of the Company, its former
principal stockholder loaned the Company $4,950. Interest was accrued at
10%. The loan and accrued interest was capitalized as of March 31, 2001.
In April, 2001 the new principal shareholder advanced the Company $32,578
to fund the Company's operations.

In connection with the acquisition of ESI, the Company was advanced
$494,414 and was repaid $440,000 as of September 30, 2001.

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7. RECENT DEVELOPMENTS

On April 20, 2001, Kelcon, Inc., a Delaware corporation purchased 450,000
shares of common stock, $.0001 par value from the officers of Delta
Mutual Inc, effectively changing the ownership of the Company.

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Item 2. Management's Discussion and Plan of Operations

Forward Looking Statements

This Form 10-QSB contains Forward-Looking statements made pursuant to the safe
harbor provisions of the Securities Litigation Reform Act of 1995. Such
statements consist of any statement other than a recitation of historical facts
and can be identified by words such as "plan", "may", "expect", "anticipate",
"estimate", "hopes", "believes", "continue", "intends", "seeks", "contemplates",
"suggest", "envisions", or the negative thereof or other varieties thereof or
comparable terminology. Actual results could differ materially from these
Forward-Looking statements. In light of these risks and uncertainties, there can
be no assurance that the Forward-Looking information contained in this Form
10-QSB will, in fact, occur. Delta does not undertake any obligation to revise
these Forward-Looking statements to reflect future events or circumstances and
other factors discussed elsewhere in this Form 10-QSB and the documents filed or
to be filed by Delta with the SEC.

Plan of Operation

The Company is in the initial stages of startup and is exploring the
feasibility of raising sufficient capital to implement its business plan. The
Company has been in the development stage since inception (November 17, 1999).

The Company has registered its class of common stock on a Form 10-SB
registration statement filed pursuant Section 12(g) of the Securities Exchange
Act of 1934 (the "Exchange Act").

The Company has limited capital and is unable to commence the operations
described in its business plan until it raises equity or debt funding. At the
present time, the Company has not commenced operations or any activities beyond
the planning stage.

The Company has incurred, and will continue to incur, expenses relating to
its operations. Specifically, as long as the Company is required to file reports
under the Exchange Act, the Company will continue to incur accounting and legal
fees relating to these filings. The Company enjoys the non-exclusive use of
office, telecommunication and incidental supplies of stationary, provided by its
officers. As of the date of this report, the Company has not generated any
revenues.

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In May 2001, Delta and ESI entered into an agreement whereby ESI will sell its
assets to Delta for 1.2676 newly issued Delta common shares for each common
share of ESI outstanding. Delta is then expected to pay all of ESI's remaining
liabilities. ESI will then be liquidated in accordance with the Plan of
Liquidation and Dissolution. Approximately 10,500,000 shares of Delta are
expected to be issued to ESI shareholders. In short, ESI shareholders will hold
approximately 95% of the total issued and outstanding shares of Delta after the
transaction. Also, the continuing business of the new entity will be that of
ESI. For these reasons, this transaction is considered to be a merger and will
be accounted for as if ESI were the surviving entity.

Although the transaction documents refer to Delta as purchasing the net assets
of ESI, the transaction for accounting purposes is considered a merger between
two companies. As a result, the net assets of ESI are not revalued but are
carried over to the new entity at their net asset values as reflected on ESI's
books pre merger. Delta will record the transaction at the par value of the
newly issued stock and adjust the additional paid-in capital account for the par
value of ESI's retired stock and the elimination of Delta's deficit.

The Company must rely upon loans and investments from affiliates to pay its
operating expenses. There are no assurances that such affiliates will continue
to advance funds to the Company or will continue to invest in the Company's
securities. In the event the Company is unable to obtain additional capital or
funding it may be unable to pursue its business plan.

Once the Company completes its business planning and commences acquiring the
assets and resources necessary to execute its business plan, the Company will
need additional funding. No significant cash or funds are expected to be
required for the Company to complete its business planning.

Liquidity

At September 30, 2001, the Company had a working capital deficit of $72,586
compared to a working capital deficit of $28,067 at December 31, 2000. The
decrease in working capital is the result of the net loss incurred during the
nine months ended September 30, 2001.

-10-

Results of Operations

Nine Months Ended September 30, 2001 compared to
Nine Months Ended September 30, 2000

General and administrative expenses increased from $23,858 for the nine
months ended September 30, 2000 to $54,513 for the nine months ended September
30, 2001. The Company attributes this increase primarily to an increase in
professional fees.

Three Months Ended September 30, 2001 compared to
Three Months Ended September 30, 2000

General and administrative expenses increased from $17,263 for the three
months ended September 30, 2000 to $28,721 for the three months ended September
30, 2001. The Company attributes this increase primarily to an increase in
professional fees.

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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There are no legal proceedings against the Company and the
Company is unaware of such proceedings contemplated against
it.

ITEM 2. CHANGES IN SECURITIES

Not applicable.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

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

Not applicable.

ITEM 5. OTHER INFORMATION

Not applicable

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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:

Not applicable

(b) None

There were no Current Reports on Form 8-k filed by the
registrant during the quarter ended September 30, 2001.

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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

DELTA MUTUAL, INC.

BY: /s/ Kenneth Martin
-----------------------------
Kenneth Martin
Principal Financial and
Chief Accounting Officer

Dated: November 8, 2001

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