<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-QSB


(Mark One)
   [X]      Quarterly Report Pursuant to Section 13 or 15(d) of The Securities 
            Exchange Act of  1934
                 For the quarterly period ended March 31, 1997

   [  ]     Transition Report Under Section 13 or 15 (d) of the Securities 
            Exchange Act of 1934
                  For the transition period from _____ to _____

                         Commission File Number 0-25136

                             KINETIC VENTURES, LTD
          (Name of Small Business Issuer as specified in its charter)

                DELAWARE                           33-0464753
    ------------------------------     ------------------------------------
   (State or other jurisdiction of     (I.R.S. Employer Identification No.)
    incorporation or organization)

      1095 PENDER STREET, SUITE 850,VANCOUVER, BRITISH COLUMBIA V6E 2M6
      -----------------------------------------------------------------
             (Address of principal executive offices) (Zip Code)

                   Issuer's telephone number, (604) 689-1428

     Check whether the issuer (1) has filed all reports required 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 [ ]

There were 9,933,733 shares of the issuer's Common Stock outstanding as of
May 10, 1997.


             This Form 10-QSB consists of 12 pages and no exhibits.


                                       1

<PAGE>

                        PART I - FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

                             KINETIC VENTURES LTD.
                          CONSOLIDATED BALANCE SHEETS

                                                   (Unaudited)
                                                    MARCH 31,      DECEMBER 31,
                                                      1997            1996
ASSETS
CURRENT ASSETS

CASH AND CASH EQUIVALENTS                          $      8,442    $    105,204
ACCOUNTS RECEIVABLE-NET                                                 379,873
INVENTORY                                                             1,519,099
PREPAID EXPENSES                                                         43,641
                                                   ------------    ------------
          TOTAL CURRENT ASSETS                            8,442    $  2,047,817

FURNITURE & EQUIPMENT (NET)                                             322,360
DEPOSITS                                                                  6,223
                                                   ------------    ------------
                                                   $      8,442    $  2,376,400
                                                   ------------    ------------
                                                   ------------    ------------

LIABILITIES
CURRENT LIABILITIES

OBLIGATION UNDER CAPITAL LEASE, CURRENT PORTION    $          0    $      2,065
NOTES PAYABLE - BALLARD MEDICAL PRODUCTS                134,142       3,260,000
ACCOUNTS PAYABLE & ACCRUED EXPENSES                                     444,648
                                                   ------------    ------------
                                                        134,142       3,706,713

OBLIGATION UNDER CAPITAL LEASE, NET OF
CURRENT PORTION                                                           4,026
                                                   ------------    ------------

          TOTAL LIABILITIES                             134,142       3,710,739
                                                   ------------    ------------

CONVERTIBLE REDEEMABLE PREFERRED STOCK,
REDEEMED ON MARCH 20, 1997 FOR $2,281                                 1,867,795

STOCKHOLDERS' DEFICIT:

COMMON STOCK, $0.001 PAR VALUE, 40,000,000
   SHARES AUTHORIZED, 9,933,733 OUTSTANDING               9,934           9,934
ADDITIONAL PAID IN CAPITAL                           15,696,079      13,848,284
ACCUMULATED DEFICIT                                 (15,831,713)    (17,060,352)
                                                   ------------    ------------
          TOTAL STOCKHOLDERS' DEFICIT                  (125,700)     (3,202,134)
                                                   ------------    ------------
                                                   $      8,442    $  2,376,400
                                                   ------------    ------------
                                                   ------------    ------------

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




                                       2
<PAGE>

                            KINETIC VENTURES LTD.
                   CONSOLIDATED STATEMENTS OF INCOME (LOSS)
              FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
                                (UNAUDITED)


                                                THREE MONTHS AND YEAR TO DATE
                                                           ENDED
                                                          MARCH 31,
                                               --------------------------------
                                                    1997               1996

SALES                                               $345,450           $749,311
COST OF GOODS SOLD                                   253,974            548,481
                                               -------------     --------------
                                                      91,476            200,830
                                               -------------     --------------
OPERATING EXPENSES:
   RESEARCH AND DEVELOPMENT                          110,919            299,923
   SALES AND MARKETING                               315,137            427,733
   GENERAL AND ADMINISTRATIVE                        209,527            247,829
                                               -------------     --------------
                                                     635,583            975,485
                                               -------------     --------------
OTHER INCOME (EXPENSE):
   INTEREST EXPENSE (NET)                            (68,613)            (6,420)
GAIN ON SALE OF ASSETS                             1,828,338
OTHER                                                 13,021
                                               -------------     --------------
                                                   1,772,746             (6,420)
                                               -------------     --------------
          INCOME (LOSS) BEFORE PROVISION
             FOR INCOME TAXES                      1,228,639           (781,075)

PROVISION FOR STATE INCOME TAXES                       3,000              3,000
                                               -------------     --------------

NET INCOME (LOSS)                                 $1,225,639          ($784,075)
                                               -------------     --------------
                                               -------------     --------------

NET INCOME (LOSS) PER COMMON SHARE                     $0.12             ($0.08)
                                               -------------     --------------
                                               -------------     --------------
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
   OUTSTANDING                                     9,933,733          9,933,733
                                               -------------     --------------
                                               -------------     --------------

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






                                       3

<PAGE>

                           KINETIC VENTURES LTD.
                  CONSOLIDATED STATEMENTS OF CASH FLOWS
             FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
                                (UNAUDITED)


                                                         THREE MONTHS AND YEAR
                                                                TO DATE
                                                                 ENDED
                                                               MARCH 31,
                                                        ----------    ----------
                                                           1997         1996

CASH FLOWS FROM OPERATING ACTIVITIES:
   NET INCOME (LOSS) FOR THE PERIOD                     $1,225,639    ($784,075)
                                                        ----------    ----------
ADJUSTMENTS TO RECONCILE NET LOSS TO NET
   CASH USED BY OPERATING ACTIVITIES:

       NET EFFECT FROM SALE OF ASSETS TO BALLARD        (1,828,338)
       DEPRECIATION AND AMORTIZATION                        25,283       22,737
       DECREASE (INCREASE) IN ACCOUNTS RECEIVABLE          182,982     (183,877)
       (INCREASE) DECREASE IN INVENTORY                     59,074      (86,138)
       DECREASE IN PREPAID EXPENSES                         11,695       20,377
       INCREASE (DECREASE) IN ACCOUNTS
          PAYABLE AND ACCRUED EXPENSES                     (46,185)     (64,028)
                                                        ----------    ----------
                                                        (1,595,489)    (162,873)
                                                        ----------    ----------

       NET CASH USED BY  OPERATING ACTIVITIES             (369,850     (946,948)
                                                        ----------    ----------

CASH USED BY INVESTING ACTIVITIES:
       (INCREASE) IN DEPOSITS                                            (2,750)
                                                        ----------    ----------
       NET CASH USED BY INVESTING ACTIVITIES                (4,310)      (2,750)
                                                        ----------    ----------
CASH PROVIDED BY FINANCING ACTIVITIES:
       PROCEEDS FROM NOTES PAYABLE                         280,000      780,000
       PAYMENTS & CURRENT MATURITIES OF
          CAPITAL LEASE OBLIGATION                            (321)        (414)
       DEFERRED ISSUANCE COSTS                                             (748)
       REDEMPTION OF PREFERRED STOCK                        (2,281)
                                                        ----------    ----------
       NET CASH PROVIDED BY
          FINANCING ACTIVITIES                             277,398      778,838
                                                        ----------    ----------

       NET DECREASE IN CASH AND
          CASH EQUIVALENTS                                 (96,762)    (170,860)

       CASH AND CASH EQUIVALENTS,
          BEGINNING OF PERIOD                              105,204      280,115
                                                        ----------    ----------
       CASH AND CASH EQUIVALENTS,
          END OF PERIOD                                     $8,442     $109,255
                                                        ----------    ----------
                                                        ----------    ----------


    The accompanying notes are an integral part of the financial statements



                                       4

<PAGE>


                            KINETIC VENTURES LTD.
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   For the Period Ending March 31, 1997
                                (Unaudited)

1.  Summary of Significant Accounting Policies:

    BASIS OF PRESENTATION:

    The consolidated financial statements include the accounts of the Company
    and its wholly-owned subsidiary, Endovascular, Inc., a California
    corporation.  All intercompany accounts and transactions have been
    eliminated in consolidation.

    Although unaudited, the interim consolidated financial statements in this
    report reflect all adjustments, consisting of normal recurring accruals,
    which are, in the opinion of management, necessary for a fair statement of
    financial position, results of operations and cash flows for the interim
    periods covered and of the financial condition of the Company at the
    interim balance sheet dates.  The results of operations for the interim
    periods presented are not necessarily indicative of the results expected
    for the entire year.

    The year-end balance sheet information was derived from audited
    consolidated financial statements, but does not include all disclosures
    required by generally accepted accounting principles.  These consolidated
    financial statements should be read in conjunction with the Company's
    audited consolidated financial statements and notes thereto included in the
    Company's Annual Report on Form 10-KSB for the year ended December 31,
    1996.

    The Company has experienced recurring loses from operations and has an
    accumulated deficit of $15,831,713 at March 31, 1997.  These matters raise
    substantial doubt about the Company's ability to continue as a going
    concern.







                                       5

<PAGE>

2.  Inventory:

    Inventories are stated at the lower of cost (first-in, first-out) or market
    and consists of the following:

                                                      (Unaudited)
                                                       March 31,   December 31,
                                                         1997         1996
                                                      -----------  ------------
    Raw materials                                              $0      $445,890
    Work in process                                             0       113,211
    Finished goods                                              0       497,600
                                                               --  ------------
                                                               $0    $1,056,701
                                                               --  ------------
                                                               --  ------------

    All inventories were sold on March 20, 1997, as part of the sale of assets
    (see Note 5).

3.  Property And Equipment:

    Property and equipment consist of the following:

                                                      (Unaudited)
                                                       March 31,   December 31,
                                                         1997         1996
                                                      -----------  ------------
    Office furniture                                           $0      $216,867
    Equipment                                                   0       240,764
    Leasehold improvements                                      0        93,452
                                                               --      --------
                                                                0       551,083
       Less, Accumulated depreciation
          and amortization                                      0      (229,775)
                                                               --      --------
                                                               $0      $321,308
                                                               --      --------
                                                               --      --------

    All Property and Equipment were sold on March 20, 1997, as part of the sale
    of assets (see Note 5).








                                       6

<PAGE>

4.  Notes Payable:

    Notes payable consist of the following:

                                                     (Unaudited)
                                                       March 31,   December 31,
                                                         1997          1996
                                                      ----------   ------------
    Note payable to Ballard Medical
      Products, due on demand collateralized by
      substantially all assets of the
      Company, bearing interest at 10%                  $134,142     $3,260,000
                                                        --------     ----------
                                                        --------     ----------

    A substantial portion of the note payable to Ballard was applied to the
    purchase price of the assets sold on March 20, 1997 (see Note 5).

5.  Acquisition or Distribution of Assets:

    On February 28, 1997, Ballard, through a wholly owned subsidiary, delivered
    notice to the Company of its exercise of its option to purchase all the
    Company's assets pursuant to the Stock Purchase and Option Agreement
    entered into on July 17, 1995 as amended (the "Option Agreement").  The
    Option Agreement was approved by the Company's stockholders at special
    meeting which took place on November 13, 1995. On March 20, 1997, Neuro
    Navigational Corporation, now known as Kinetic Ventures Ltd., a Delaware
    Corporation, completed the sale of substantially all of its assets to
    Ballard Medical Products, a Utah corporation

    The purchase price for the assets was $4,245,422, plus an adjustment for
    prepaid rent of $2,233.  Deducted from the purchase price were the $500,000
    consideration paid in 1995 for the option under the Option Agreement,
    $198,631 of liabilities assumed, $3,671,471 of principal and interest owing
    by the Company to Ballard and liquid assets of $11,695, or a net purchase
    price deficiency of $134,142.

    The Company's 200,000 shares of Series A Preferred Stock were redeemed and
    retired.  The deficiency of $134,142 in the payment of the purchase price
    is represented by the Company's 10% promissory note due on demand.  Such
    note is secured by substantially all of the Company's assets.  Concurrently
    with the sale of the Company's assets, pursuant to authorization granted by
    the stockholders at the special meeting held on 

                                       7

<PAGE>

    November 13, 1995, the Company changed it name to Kinetic Ventures Ltd.

6.  Income Taxes:

    At December 31, 1996 the Company had net operating loss carryforwards for
    federal and state purposes of approximately $16,490,000 and $8,290,000,
    respectively.  In addition, the Company had research and experimentation
    credit carryforwards for federal and state purposes of approximately
    $350,000 and $132,000, respectively.  These tax loss carryforwards will
    offset any current tax liability from the sale of the Company's assets to
    Ballard, accordingly, no provision for income taxes has been recorded at
    March 31, 1997.

7.  COMMITMENTS:

    The Companies noncancelable operating leases for office space and equipment
    were assumed by Ballard as part of the sale of the assets on March 20,
    1997.




















                                       8

<PAGE>

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

    On March 20, 1997 the Company completed the sale, pursuant to a Stock
    Purchase and Option Agreement dated July 17, 1995, of substantially all its
    assets to Ballard Medical Products ("Ballard").  Reference should be made
    to the Company's Annual Report on From 10-KSB for the year ended December
    31, 1996 and its Current Report on Form 8-K for March 20, 1997 for a
    description of the transaction and the Company's future business plans.

    The following discussion should be read in conjunction with the Financial 
    Statements and Notes thereto appearing elsewhere in this Quarterly Report 
    on Form 10-QSB.  In addition the Company desires to take advantage of 
    certain provisions of the Private Securities Litigation Reform Act of 
    1995 that provide a "safe harbor" for forward looking statements made by 
    or on behalf of the Company. Except for the historical information 
    contained herein, the matters discussed herein are forward looking 
    statement, the accuracy of which is necessarily subject to risks and 
    uncertainties. Specifically, the Company wishes to alert readers that the 
    information set forth in "Item 1. Description of Business-Proposed 
    business Plans," and the Company's intentions and efforts to enter into 
    further business activities contained in the Company's Annual Report on 
    Form 10-KSB for the year ended December 31, 1996 are forward looking 
    statements. Various factors, including the inability of management to 
    identify, locate and acquire in a timely manner future business 
    activities, among other matters discussed in this Report, may adversely 
    affect the Company's ability to remain in existence. Failure to locate 
    further business activities could lead to the  dissolution of the Company.

    Until the Company is successful in entering into further business 
    activities, it can be expected that its revenues will be nominal.

    NET SALES

    Net Sales decreased to $345,450 for the three months and year to date 
    ended March 31, 1997 as compared to $749,311 for the three months and 
    year to date ended March 31, 1996 a decrease of 54%. For the quarter and 
    year to date, the decrease in sales is attributable to a decrease in 
    sales through an international distributor and the uncertainty in the 
    marketplace due to the impending sale of the Company's assets. In 
    addition, because of the closing of the sale of the Company's assets on 
    March 20, 1997, the Company had no revenues subsequent to March 20, 1997.


                                       9

<PAGE>

    GROSS PROFIT

    Gross Profit decreased to $91,476 for the three months and year to date 
    ended March 31, 1997 as compared to $200,830 for the three months and 
    year to date ended March 31, 1996 a decrease of 54%.  This decrease in 
    both the quarter and year to date was due to lower sales volume.

    RESEARCH AND DEVELOPMENT

    Research and Development expenses represent the Company's investment in 
    the advancement of less invasive technology in the fields of neuro and 
    vascular surgery. These expenses decreased to $110,919 for the three 
    months and year to date ended March 31, 1997 as compared to $299,923 for 
    the three months and year to date ended March 31, 1996 a decrease of 63%. 
    This decrease was due to a decrease in personnel and related benefit 
    costs and an reduced spending in expenses related to the Company's 
    vascular products including clinical and regulatory submissions.

    SALES AND MARKETING EXPENSES

    Sales and Marketing expenses were $315,137 for the three months and year 
    to date ended March 31, 1997 as compared to $427,733 for the three months 
    and year to date ended March 31, 1996 a decrease of 26%. This decrease 
    was related to lower sales volume.

    GENERAL AND ADMINISTRATIVE EXPENSES

    General and administrative expenses were $209,527 for the three months 
    and year to date ended March 31, 1997 as compared to $247,829 for the 
    three months and year to date ended March 31, 1996 a decrease of 15%. The 
    decrease for the three months and year to date was due primarily to 
    reduced insurance premiums for product liability coverage and Directors 
    and Officers liability insurance.

    NET INCOME (LOSS)

    Net Income for the three months and year to date ended March 31, 1997 was 
    $1,228,639 as compared to a net loss of $784,075 for the three months and 
    year to date ended March 31, 1996 an increase of $2,012,714. The increase 
    for the three months and year to date is primarily attributable to the 
    gain on sale of the Company's assets on March 20, 1977 (see Note 5 to the 
    financial statements).

       LIQUIDITY AND CAPITAL RESOURCES

    Working capital was a deficit of ($125,700) at March 31, 1997 as compared 
    to working capital of $646,375 at March 31, 1996 or a decrease of 

                                       10

<PAGE>

    $772,075. The Company's cash resources at March 31, 1997 were minimal and 
    the Company has an outstanding demand loan due to Ballard Medical 
    Products of $134,142. Such loan is secured by substantially all of the 
    Company's assets. 

    The Company had, at March 31, 1997, no commitments for any other credit 
    facilities such as revolving loans or lines of credit that could provide 
    additional working capital.






















                                       11

<PAGE>

                        PART II - OTHER INFORMATION

ITEMS 1,2,3,4, AND 5 ARE NOT APPLICABLE AND HAVE BEEN OMITTED.


ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

     a.   No exhibits have been filed with this Report.

     b.   The Company filed two reports on Form 8-K dated February 26, 1997 and 
     March 20, 1997, respectively, both in connection with the sale of the 
     Company's assets under an existing option. The former report was filed 
     in response to Items 5 and 7 and the latter report was filed in response 
     to Items 2 and 7.



                                SIGNATURES


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


                                       KINETIC VENTURES LTD.


     DATED: MAY 15, 1997               BY: /S/ BRIAN BAYLEY
                                       -----------------------------
                                       BRIAN BAYLEY, PRESIDENT
                                       (PRINCIPAL EXECUTIVE OFFICER)











                                       12