U. S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                  Form 10 - KSB

[x]      ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE  ACT
         OF 1934

                  For the fiscal year ended December 31, 2000

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

                         Commission File Number 0-10999
                                                -------

                         Eldorado Financial Group, Inc.
                         ------------------------------
                 (Name of small business issuer in its charter)

Florida                                                               59-2025386
-------                                                               ----------
(State or other Jurisdiction of            (I.R.S.  Employee Identification No.)
Incorporation or Organization)

                   211 West Wall Street, Midland, Texas 79701

               (Address of principal executive offices) (zip code)

                                 (915) 682-1761
                                 --------------
                (Company's telephone number, including area code)

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

         Securities registered under Section 12(g) of the Exchange Act:
                          Common Stock $.001 par value


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

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the best of Company'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.
[ ]

The issuer's revenues for the fiscal year ended December 31, 2000, was $0.

As of December 31, 2000,  the  aggregate  market value of the  Company's  common
Stock was not determinable as the stock is not trading.

As of January 4, 2001,  there were  9,166,515  shares of Common Stock issued and
outstanding.

Transitional Small Business Disclosure Format : Yes    No X
                                                   ---   ---

                                                                               1

<PAGE>

                                TABLE OF CONTENTS


                                                                     Page Number
                                                                     -----------
Part I

Item  1 - Description of Business                                           3
Item  2 - Description of Property                                          13
Item  3 - Legal Proceedings                                                13
Item  4 - Submission of Matters to a Vote of Security Holders              14

Part II

Item  5 - Market for Company's Common Stock and Related
          Stockholders Matters                                             14
Item  6 - Management's Discussion and Analysis or Plan of Operation        14
Item  7 - Index to Financial Statements                                    F-1
Item  8 - Changes in and Disagreements with Accountants
          on Accounting and Financial Disclosures                          18

Part III

Item  9 - Officers and Directors                                           18
Item 10 - Executive Compensation                                           19
Item 11 - Security Ownership of Certain Beneficial Owners And
          Management                                                       19
Item 12 - Certain Relationships and Related Transactions                   19
Item 13 - Exhibits and Reports on 8-K                                      20

Signatures                                                                 20




                                                                               2

<PAGE>

                  Caution Regarding Forward-Looking Information
                  ---------------------------------------------

This annual report contains certain  forward-looking  statements and information
relating  to the  Company  that  are  based on the  beliefs  of the  Company  or
management as well as assumptions made by and information currently available to
the Company or management.  When used in this document,  the words "anticipate",
"believe",  "estimate",  "expect" and "intend" and similar expressions,  as they
relate  to  the   Company  or  its   management,   are   intended   to  identify
forward-looking  statements.  Such  statements  reflect the current  view of the
Company regarding future events and are subject to certain risks,  uncertainties
and assumptions, including the risks and uncertainties noted. Should one or more
of these risks or uncertainties  materialize,  or should underlying  assumptions
prove incorrect,  actual results may vary materially from those described herein
as anticipated,  believed,  estimated,  expected or intended.  In each instance,
forward-looking  information  should be considered in light of the  accompanying
meaningful cautionary statements herein.

PART I

Item 1 - Description of Business

Eldorado  Financial Group, Inc.  ("Company") was incorporated  under the laws of
Florida on February 26, 1980 as Eldorado Gold & Exploration, Inc. On January 13,
1987 the Company amended its Articles of  Incorporation  to change the corporate
name to Eldorado Financial Group, Inc.

The Company had a public offering (Form S-3, Commission file number: 2-68091) in
May 1981. The offering  consisted of 400,000 units totaling  2,000,000 shares of
common  stock,  par value  $.001 per share and  4,000,000  warrants  to purchase
4,000,000 shares of common stock. The units were offered at a price of $4.50 per
unit. The net proceeds from the offering amounted to $1,483,307.

From inception through 1982, the Company  conducted gold exploration  efforts in
the  Country  of  Surinam  in South  America  through a  governmentally  granted
concession.  During 1982,  the Company  ceased all  operations in Surinam due to
political instability.

In 1983,  the Company  issued an  aggregate  500,000  shares of common  stock in
exchange for 100% of the issued and  outstanding  common stock and 50,000 shares
of preferred  stock and payment of an  approximate  $224,000 note payable to the
controlling   shareholder  of  Atlantic  Medical  Services,   Inc.  The  Company
discontinued all operations of Atlantic Medical Services, Inc. during 1985.

In 1983, the Company issued an aggregate 120,000 shares of common stock for 100%
of the issued and outstanding shares of Datalink Systems, Inc. ("Datalink"). The
Company ceased all operations as of December 31, 1989 and has effectively had no
operations,  assets or  liabilities  since its fiscal year ending  December  31,
1989.  Effective  August 31,  1995,  the  Company  distributed  its  holdings in
Datalink,  at the then  reported  carrying  value,  to a former  officer  of the
Company  as  compensation  for  services  performed  and  amounts  paid  for the
maintenance of the corporate entity during its dormancy.

On June 1987 a Form 15 (Certification  and Notice of Termination of Registration
under Section 12(g) of the Securities Exchange Act of 1934 or Suspension of Duty
to File Reports  under  Section 13 and 14(d) of the  Securities  Exchange Act of
1934) was filed by the Company.

In December 1995, the Company issued a total of 6,602,119  shares of restricted,
unregistered  common stock to a  controlling  shareholder  for payments  made on
behalf of the Company to support the corporate  entity during its dormant phase,
This transaction was valued at  approximately  $15,000,  which  approximated the
fair value of the amounts paid and/or services provided.

The  Company  has elected to  initiate  the  process of  voluntarily  becoming a
reporting Company under the Securities  Exchange Act of 1934 by filing this Form
10-SB registration statement.  Following the effective date of this registration
statement,   the  Company  intends  to  comply  with  the  periodical  reporting
requirements  of the  Securities  Exchange Act of 1934 and to seek to complete a
business acquisition transaction.

                                                                               3

<PAGE>

The Company may be referred to as a shell  corporation  and once  trading on the
NASD  Bulletin  Board,  a  trading  and  reporting  shell   corporation.   Shell
corporations  have zero or nominal  assets and typically no stated or contingent
liabilities.  Private  companies  wishing to become publicly trading may wish to
merge with a shell (a reverse  merger)  whereby the  shareholders of the private
Company become the majority of the  shareholders  of the combined  Company.  The
private  Company may  purchase  for cash all or a portion of the common share of
the shell  corporation  from its major  stockholders.  Typically,  the Board and
officers  of the  private  Company  become  the new  Board and  officers  of the
combined  Company and often the name of the private  Company becomes the name of
the combined Company.

The Company has very limited  capital,  and it is unlikely that the Company will
be able to take  advantage  of more  than one  such  business  opportunity.  The
Company intends to seek  opportunities  demonstrating the potential of long-term
growth as opposed to short-term  earnings.  However,  at the present  time,  the
Company has not identified any business opportunity that it plans to pursue, nor
has the Company  reached any  agreement  or  definitive  understanding  with any
person concerning an acquisition.

Prior to the effective date of this  registration  statement,  it is anticipated
that the Company's officers and directors will contact  broker-dealers and other
persons with whom they are acquainted  who are involved with  corporate  finance
matters  to advise  them of the  Company's  existence  and to  determine  if any
companies  or  businesses  that  they  represent  have  a  general  interest  in
considering  a merger or  acquisition  with a blind pool or blank check or shell
entity. No direct  discussions  regarding the possibility of merger are expected
to occur until  after the  effective  date of this  registration  statement.  No
assurance  can be given  that the  Company  will be  successful  in  finding  or
acquiring a desirable  business  opportunity,  given the limited  funds that are
expected to be available  for  acquisitions.  Furthermore,  no assurance  can be
given  that  any  acquisition,  which  does  occur,  will be on  terms  that are
favorable to the Company or its current stockholders.

The Company's search will be directed toward small and medium-sized enterprises,
which have a desire to become public corporations. In addition these enterprises
may wish to satisfy,  either  currently or in the  reasonably  near future,  the
minimum  tangible  asset  requirement  in order to qualify shares for trading on
NASDAQ or on an exchange such as the American Stock Exchange. (See Investigation
and  Selection  of Business  Opportunities).  The Company  anticipates  that the
business  opportunities  presented  to it will (i)  either be in the  process of
formation,  or be recently organized with limited operating history or a history
of  losses  attributable  to  under-   capitalization  or  other  factors;  (ii)
experiencing financial or operating  difficulties;  (iii) be in need of funds to
develop new  products or services or to expand into a new market,  or have plans
for rapid expansion through acquisition of competing  businesses;  (iv) or other
similar  characteristics.  The Company  intends to concentrate  its  acquisition
efforts on properties or businesses  that it believes to be  undervalued or that
it believes may realize a substantial  benefit from being publicly owned.  Given
the above factors,  investors  should expect that any acquisition  candidate may
have  little  or  no  operating   history,   or  a  history  of  losses  or  low
profitability.

The Company does not propose to restrict its search for investment opportunities
to any particular  geographical area or industry, and may, therefore,  engage in
essentially any business, to the extent of its limited resources.  This included
industries such as service,  finance,  natural  resources,  manufacturing,  high
technology,  product  development,   medical,  communications  and  others.  The
Company's discretion in the selection of business opportunities is unrestricted,
subject to the  availability of such  opportunities,  economic  conditions,  and
other factors.

As a consequence of this registration of its securities,  any entity,  which has
an interest in being acquired by, or merging into the Company, is expected to be
an entity that desires to become a public Company and establish a public trading
market for its securities.  In connection with such a merger or acquisition,  it
is highly  likely  that an amount of stock  constituting  control of the Company
would either be issued by the Company or be purchased from the current principal
stockholders of the Company by the acquiring entity or its affiliates.  If stock
is purchased from the current  principal  stockholders,  the transaction is very
likely  to be a  private  transaction  rather  than  a  public  distribution  of
securities,  but is also  likely to result in  substantial  gains to the current
principal  stockholders  relative to their purchase price for such stock. In the
Company's  judgment,  none of the officers and directors would thereby become an
underwriter  within the meaning of the Section  2(11) of the  Securities  Act of
1933, as amended as long as the transaction is a private transaction rather than
a public  distribution  of  securities.  The sale of a  controlling  interest by
certain  principal  shareholders  of the  Company  would  occur  at a time  when
minority  stockholders  are unable to sell their shares because of the lack of a
public market for such shares.

                                                                               4

<PAGE>

Depending upon the nature of the transaction, the current officers and directors
of the Company may resign their  management and board positions with the Company
in connection with a change of control or acquisition of a business  opportunity
(See Form of Acquisition, below, and Risk Factors The Company Lack of Continuity
of  Management).  In the  event of such a  resignation,  the  Company's  current
management  would  thereafter  have no control over the conduct of the Company's
business.

It is  anticipated  that  business  opportunities  will  come  to the  Company's
attention from various sources,  including its officers and directors, its other
stockholders,   professional   advisors  such  as  attorneys  and   accountants,
securities  broker-dealers,   venture  capitalists,  members  of  the  financial
community,  and others who may present unsolicited proposals. The Company has no
plan,  understandings,  agreements,  or commitments with any individual for such
person to act as a finder of opportunities for the Company.

The  Company  does not foresee  that it will enter into a merger or  acquisition
transaction with any business with which its officers or directors are currently
affiliated. Should the Company determine in the future, contrary to the forgoing
expectations,  that a  transaction  with  an  affiliate  would  be in  the  best
interests  of the  Company  and its  stockholders,  the  Company is, in general,
permitted by Florida law to enter into a transaction if:

     The material facts as to the  relationship or interest of the affiliate and
     as to the contract or  transaction  are disclosed or are known to the Board
     of Directors, and the Board in good faith authorizes,  approves or ratifies
     the contract or  transaction by the  affirmative  vote of a majority of the
     disinterested directors, even though the disinterested directors constitute
     less than a quorum; or

     The material facts as to the  relationship or interest of the affiliate and
     as to the  contract  or  transaction  are  disclosed  or are  known  to the
     stockholders  entitled to vote thereon,  and the contract or transaction is
     specifically authorized,  approved or ratified in good faith by vote of the
     stockholders;  or the contract or  transaction is fair as to the Company as
     of the  time it is  authorized,  approved  or  ratified,  by the  Board  of
     Directors or the stockholders.

Investigation and Selection of Business Opportunities

To a large extent, a decision to participate in a specific business  opportunity
may be made upon  management's  analysis of the  quality of the other  Company's
management  and  personnel,  the  anticipated  acceptability  of new products or
marketing concepts,  the merit of technological  changes,  the perceived benefit
the business  opportunity will derive from becoming a publicly held entity,  and
numerous  other  factors  which are  difficult,  if not  impossible,  to analyze
through the  application of any objective  criteria.  In many  instances,  it is
anticipated that the historical  operations of a specific  business  opportunity
may not  necessarily  be indicative of the potential for the future because of a
variety of factors,  including,  but not limited to, the possible need to expand
substantially,  shift marketing approaches,  change product emphasis,  change or
substantially augment management, raise capital and the like.

It is  anticipated  that the  Company  will not be able to  diversify,  but will
essentially be limited to the acquisition of one business opportunity because of
the Company's limited financing.  This lack of  diversification  will not permit
the Company to offset  potential  losses from one business  opportunity  against
profits from another,  and should be considered an adverse factor  affecting any
decision to purchase the Company's securities.

Certain types of business acquisition  transactions may be completed without any
requirement  that the Company first submit the  transaction to the  stockholders
for their approval.  In the event the proposed transaction is structured in such
a fashion that  stockholder  approval is not required,  holders of the Company's
securities (other than principal  stockholders  holding a controlling  interest)
should not anticipate  that they will be provided with  financial  statements or
any other documentation prior to the completion of the transaction.  Other types
of transactions require prior approval of the stockholders.

In the event a proposed business combination or business acquisition transaction
is  structured in such a fashion that prior  stockholder  approval is necessary,
the  Company  will be  required  to  prepare  a Proxy or  Information  Statement
describing  the proposed  transaction,  file it with the Securities and Exchange
Commission  for  review  and  approval,  and  mail a copy  of it to all  Company
stockholders  prior to holding a stockholders  meeting for purposes of voting on
the  proposal.  Minority  shareholders  that do not vote in favor of a  proposed
transaction  will then have the right,  in the event the transaction is approved
by the required number of stockholders, to exercise statutory dissenter's rights
and elect to be paid the fair value of their shares.

                                                                               5

<PAGE>

The  analysis  of  business  opportunities  will be  undertaken  by or under the
supervision  of  the  Company's  officers  and  directors,   none  of  whom  are
professional  business analysts (See Management).  Although there are no current
plans to do so, Company management might hire an outside consultant to assist in
the  investigation  and  selection  of business  opportunities,  and might pay a
finder's fee.  Since Company  management has no current plans to use any outside
consultants or advisors to assist in the investigation and selection of business
opportunities,  no policies have been adopted  regarding use of such consultants
or advisors,  the criteria to be used in selecting such consultants or advisors,
the  services to be provided,  the term of service,  or the total amount of fees
that may be paid.  However,  because of the limited resources of the Company, it
is likely that any such fee the Company agrees to pay would be paid in stock and
not in cash.

Otherwise,  in analyzing  potential business  opportunities,  Company management
anticipates that it will consider, among other things, the following factors:

Potential for growth and profitability indicated by new technology,  anticipated
market expansion, or new products;

The Company's  perception of how any  particular  business  opportunity  will be
received by the investment community and by the Company's stockholders;

Whether,  following the business  combination,  the  financial  condition of the
business  opportunity  would be, or would  have a  significant  prospect  in the
foreseeable  future of  becoming,  sufficient  to enable the  securities  of the
Company  to  qualify  for  listing on an  exchange  or on a  national  automated
securities quotation system, such as NASDAQ, so as to permit the trading of such
securities  to be exempt  from the  requirements  of Rule  15g-9  adopted by the
Securities and Exchange  Commission (See Risk Factors The Company Regulations of
Penny Stocks).

Capital  requirements  and  anticipated  availability  of required  funds, to be
provided  by the  Company or from  operations,  through  the sale of  additional
securities,  through  joint  ventures  or  similar  arrangements,  or from other
sources;

The extent to which the business opportunity can be advanced;

Competitive  position  as  compared  to  other  companies  of  similar  size and
experience  within the  industry  segment as well as within  the  industry  as a
whole;

Strength and diversity of existing  management or management  prospects that are
scheduled for recruitment;

The cost of participation  by the Company as compared to the perceived  tangible
and intangible values and potential; and

The accessibility of required management  expertise,  personnel,  raw materials,
services, professional assistance, and other required items.

In regard to the  possibility  that the shares of the Company  would qualify for
listing on NASDAQ,  the current  standards for initial  listing  include,  among
other  requirements,  that the Company (1) have net tangible  assets of at least
$4.0 million, or a market  capitalization of $50.0 million, or net income of not
less that $0.75  million in its latest  fiscal  year or in two of the last three
fiscal  years;  (2) have a public float  (i.e.,  shares that are not held by any
officer, director or 10% stockholder) of at least 1.0 million shares; (3) have a
minimum  bid  price  of at  least  $4.00;  (4)  have  at  least  300  round  lot
stockholders (i.e., stockholders who own not less than 100 shares); and (5) have
an operating history of at least one year or have a market  capitalization of at
least $50.0 million.  Many, and perhaps most, of the business opportunities that
might be  potential  candidates  for a  combination  with the Company  would not
satisfy the NASDAQ listing criteria.

                                                                               6

<PAGE>

No one of the factors  described above will be controlling in the selection of a
business  opportunity,  and  management  will  attempt  to analyze  all  factors
appropriate to each  opportunity and make a determination  based upon reasonable
investigative  measures  and  available  data.  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.
Potential  investors  must  recognize  that,  because of the  Company's  limited
capital  available for  investigation  and  management's  limited  experience in
business analysis,  the Company may not discover or adequately  evaluate adverse
facts about the opportunity to be acquired.

The  Company  is  unable  to  predict  when  it may  participate  in a  business
opportunity.  It expects,  however,  that the analysis of specific proposals and
the selection of a business opportunity may take several months or more.

Prior to making a decision to participate in a business opportunity, the Company
will generally request that it be provided with written materials  regarding the
business  opportunity  containing  as much  relevant  information  as  possible.
Including, but not limited to, such items as a description of products, services
and  Company  history;  management  resumes;  financial  information;  available
projections,  with related assumptions upon which they are based; an explanation
of proprietary products and services; evidence of existing patents,  trademarks,
or service marks, or rights thereto;  present and proposed forms of compensation
to  management;  a  description  of  transactions  between  such Company and its
affiliates  during the relevant  periods;  a description of present and required
facilities;,  an analysis of risks and competitive conditions;  a financial plan
of operation and estimated capital  requirements;  audited financial statements,
or if they are not  available,  unaudited  financial  statements,  together with
reasonable  assurance  that  audited  financial  statements  would be able to be
produced  within a  reasonable  period of time not to  exceed 60 days  following
completion of a merger or acquisition transaction; and the like.

As part of the Company's  investigation,  the Company's  executive  officers and
directors may meet personally  with management and key personnel,  may visit and
inspect  material  facilities,  obtain  independent  analysis or verification of
certain information provided,  check references of management and key personnel,
and take other reasonable investigative measures, to the extent of the Company's
limited financial resources and management expertise.

It is possible that the range of business  opportunities that might be available
for  consideration  by the Company  could be limited by the impact of Securities
and Exchange Commission regulations regarding purchase and sale of penny stocks.
The regulations would affect, and possibly impair, any market that might develop
in the  Company's  securities  until such time as they  qualify  for  listing on
NASDAQ or on an exchange which would make them exempt from  applicability of the
penny stock regulations. See Risk Factors Regulation of Penny Stocks.

Company   management   believes  that  various  types  of  potential  merger  or
acquisition  candidates might find a business combination with the Company to be
attractive.  These include  acquisition  candidates  desiring to create a public
market for their shares in order to enhance liquidity for current  stockholders,
acquisition  candidates  which have long-term  plans for raising capital through
public sale of  securities  and believe that the possible  prior  existence of a
public  market  for  their  securities  would  be  beneficial,  and  acquisition
candidates  which  plan  to  acquire   additional  assets  through  issuance  of
securities rather than for cash, and believe that the possibility of development
of a public market for their  securities  will be of assistance in that process.
Acquisition  candidates,  which have a need for an immediate cash infusion,  are
not likely to find a potential  business  combination  with the Company to be an
attractive alternative.

Form of Acquisition

It is impossible to predict the manner in which the Company may participate in a
business opportunity.  Specific business  opportunities will be reviewed as well
as the  respective  needs and desires of the Company  and the  promoters  of the
opportunity  and,  upon the basis of the  review  and the  relative  negotiating
strength of the Company and such promoters, the legal structure or method deemed
by management to be suitable will be selected.  Such structure may include,  but
is not limited to leases, purchase and sale agreements, licenses, joint ventures
and other contractual  arrangements.  The Company may act directly or indirectly
through an interest in a partnership, corporation or other form of organization.
Implementing   such   structure  may  require  the  merger,   consolidation   or
reorganization  of the  Company  with other  corporations  or forms of  business
organization.  In  addition,  the present  management  and  stockholders  of the
Company  most likely will not have  control of a majority of the voting stock of
the Company following a merger or reorganization  transaction. As part of such a
transaction,  the Company's  existing directors may resign and new directors may
be appointed without any vote by stockholders.

                                                                               7

<PAGE>

It is likely  that the Company  will  acquire  its  participation  in a business
opportunity  through the  issuance of Common  Stock or other  securities  of the
Company.  Although the terms of any such  transaction  cannot be  predicted,  it
should be noted that in  certain  circumstances  the  criteria  for  determining
whether or not an acquisition is a so-called tax free  reorganization  under the
Internal  Revenue  Code of 1986 as  amended,  depends  upon the  issuance to the
stockholders of the acquired  Company of a controlling  interest  (i.e.,  80% or
more) of the common stock of the combined  entities  immediately  following  the
reorganization.  If a transaction  were  structured  to take  advantage of these
provisions  rather than other tax free  provisions  provided  under the Internal
Revenue Code, the Company's current  stockholders  would retain in the aggregate
20% or less of the total  issued and  outstanding  shares.  This could result in
substantial  additional dilution in the equity of those who were stockholders of
the Company prior to such reorganization. Any such issuance of additional shares
might also be done simultaneously with a sale or transfer of shares representing
a  controlling  interest in the Company by the current  officers,  directors and
principal stockholders. See Description of Business General.

It is anticipated that any new securities issued in any reorganization  would be
issued  in  reliance  upon  one  or  more  exemptions  from  registration  under
applicable  federal and state securities laws to the extent that such exemptions
are available.  In some  circumstances,  however, as a negotiated element of the
transaction,  the Company may agree to register  such  securities  either at the
time the  transaction is  consummated  or under certain  conditions at specified
times thereafter.  The issuance of substantial  additional  securities and their
potential  sale into any  trading  market  that might  develop in the  Company's
securities may have a depressive effect upon such market.

The  Company  will  participate  in  a  business   opportunity  only  after  the
negotiation  and  execution of a written  agreement.  Although the terms of such
agreement  cannot  be  predicted,  generally  such an  agreement  would  require
specific  representations and warranties by all of the parties thereto,  specify
certain events of default,  detail the terms of closing and the conditions which
must be satisfied by each of the parties thereto prior to such closing,  outline
the manner of bearing costs if the transaction is not closed, set forth remedies
upon default, and include miscellaneous other terms.

As a general  matter,  the Company  anticipates  that it,  and/or its  principal
stockholders will enter into a letter of intent with the management,  principals
or owners  of a  prospective  business  opportunity  prior to  signing a binding
agreement.  Such a letter  of intent  will set  forth the terms of the  proposed
acquisition but will not bind any of the parties to consummate the  transaction.
Execution of a letter of intent will by no means indicate that  consummation  of
an acquisition is probable.  Neither the Company nor any of the other parties to
the letter of intent  will be bound to  consummate  the  acquisition  unless and
until a definitive  agreement is executed.  Even after a definitive agreement is
executed,  it is possible that the acquisition  would not be consummated  should
any party elect to exercise any right  provided in the agreement to terminate it
on specific grounds.

It is anticipated that the investigation of specific business  opportunities and
the  negotiation,  drafting  and  execution of relevant  agreements,  disclosure
documents and other  instruments  will require  substantial  management time and
attention and  substantial  costs for  accountants,  attorneys and others.  If a
decision is made not to  participate  in a specific  business  opportunity,  the
costs incurred in the related investigation would not be recoverable.  Moreover,
because many providers of goods and services require compensation at the time or
soon after the goods and services are provided,  the inability of the Company to
pay until an  indeterminate  future time may make it impossible to produce goods
and services.

Investment Company Act and Other Regulation

The Company may participate in a business opportunity by purchasing,  trading or
selling the securities of such business.  The Company does not, however,  intend
to engage  primarily in such  activities.  Specifically,  the Company intends to
conduct its activities so as to avoid being classified as an investment  Company
under the Investment  Company Act of 1940 (the Investment Act), and therefore to
avoid  application  of  the  costly  and  restrictive   registration  and  other
provisions of the Investment Act, and the regulations promulgated thereunder.

                                                                               8

<PAGE>

The  Company's  plan of business may involve  changes in its capital  structure,
management,   control  and   business,   especially   if  it   consummates   the
reorganization  as  discussed  above.  Each of these areas is  regulated  by the
Investment Act, in order to protect purchasers of investment Company securities.
Since the Company will not register as an investment company,  stockholders will
not be afforded these protections.

Competition

The  Company  expects to  encounter  substantial  competition  in its efforts to
locate attractive  business  combination  opportunities.  The competition may in
part come from business development companies,  venture capital partnerships and
corporations, small investment companies, brokerage firms, and the like. Some of
these  types of  organizations  are likely to be in a better  position  than the
Company to obtain access to attractive  business  acquisition  candidates either
because they have greater experience, resources and managerial capabilities than
the Company,  because they are able to offer immediate access to limited amounts
of cash,  or for a variety of other  reasons.  The Company also will  experience
competition from other public companies with similar business purposes,  some of
which may also have funds available for use by an acquisition candidate.

Administrative Offices

The Company  currently  maintains a mailing  address at 211 West Wall,  Midland,
Texas 79701. The Company's telephone number there is (915) 682-1761.  Other than
this mailing address,  the Company does not currently  maintain any other office
facilities,  and does not anticipate the need for maintaining  office facilities
at any time in the  foreseeable  future.  The Company pays no rent or other fees
for the use of the mailing address.

Employees

The  Company  is in the  development  stage  and  currently  has  no  employees.
Management of the Company expects to use consultants,  attorneys and accountants
as necessary,  and does not anticipate a need to engage any full-time  employees
so long as it is seeking and  evaluating  business  opportunities.  The need for
employees  and their  availability  will be  addressed  in  connection  with the
decision  whether  or  not  to  acquire  or  participate  in  specific  business
opportunities.

Risk Factors

Conflicts of Interest.  Certain  conflicts of interest exist between the Company
and its officers and directors. They have other business interests to which they
currently devote attention,  and are expected to continue to do so. As a result,
conflicts of interest may arise that can be resolved only through their exercise
of judgement in a manner which is consistent with their fiduciary  duties to the
Company. See Management, and Conflicts of Interest.

It is  anticipated  that  the  Company's  principal  shareholders  may  actively
negotiate  or  otherwise  consent to the  purchase of a portion of their  common
stock as a condition to, or in connection with, a proposed merger or acquisition
transaction.  In this process, the Company's principal shareholders may consider
their own  personal  pecuniary  benefit  rather than the best  interest of other
Company  shareholders.  Depending  upon the  nature of a  proposed  transaction,
Company  shareholders other than the principal  shareholders may not be afforded
the opportunity to approve or consent to a particular transaction. See Conflicts
of Interest.

Possible Need for Additional Financing.  The Company has very limited funds, and
such funds,  may not be adequate to take  advantage  of any  available  business
opportunities.  Even if the  Company's  currently  available  funds  prove to be
sufficient to pay for its operations until it is able to acquire an interest in,
or complete a transaction with, a business opportunity,  such funds will clearly
not be sufficient to enable it to exploit the  opportunity.  Thus,  the ultimate
success of the Company  will depend,  in part,  upon its  availability  to raise
additional  capital.  In the event that the Company  requires  modest amounts of
additional  capital  to fund  its  operations  until  it is able to  complete  a
business acquisition or transaction,  such funds, are expected to be provided by
the  principal  shareholders.  However,  the  Company has not  investigated  the
availability,  source,  or  terms  that  might  govern  the  acquisition  of the
additional  capital  which is  expected  to be  required  in order to  exploit a
business  opportunity,  and will not do so until it has  determined the level of
need for  such  additional  financing.  There is no  assurance  that  additional
capital  will be  available  from any  source or, if  available,  that it can be
obtained on terms  acceptable to the Company.  If not  available,  the Company's
operations  will be  limited  to those  that  can be  financed  with its  modest
capital.

                                                                               9

<PAGE>

Regulations  of Penny  Stocks.  The  Company's  securities,  when  available for
trading will be subject to a Securities and Exchange Commission rule that impose
special sales practice requirements upon broker-dealers who sell such securities
to persons other than established customers or accredited investors. For purpose
of  the  rule,  the  phrase   accredited   investor  means,  in  general  terms,
institutions  with assets in excess of $5,000,000,  or individuals  having a net
worth in excess of $1,000,000  or having an annual income that exceeds  $200,000
(or  that,  when  combined  with  a  spouse's  income,  exceeds  $300,000).  For
transactions   covered  by  the  rule,  the  broker  dealer  must  make  special
suitability  determination for the purchaser and receive the purchasers  written
agreement  to the  transaction  prior to the  sale.  Consequently,  the rule may
affect the ability of broker-dealers  to sell the Company's  securities and also
may affect the ability of purchasers of the  Company's  securities  and also may
affect the  ability  of  purchasers  of the  Company's  securities  to sell such
securities in any market that might develop therefor.

In addition,  the  Securities  and Exchange  Commission  has adopted a number of
rules to  regulate  penny  stocks.  Such rules  include  Rule  3a51-1  under the
Securities Act of 1933, an Rules 15g-1,  15g-2, 15g-3, 15g-4, 15g-5, 15g- 6, and
15g-7  under the  Securities  Exchange  Act of 1934,  as  amended.  Because  the
securities of the Company may constitute  penny stocks within the meaning of the
rules, the rules would apply to the Company and to its securities. The rules may
further affect the ability of the Company's shareholders to sell their shares in
any public market, which might develop.

Shareholders  should  be  aware  that,  according  to  Securities  and  Exchange
Commission  Release No.  34-29093,  the market for penny  stocks has suffered in
recent years form patterns of fraud and abuse. Such patterns include (I) control
of the market for the  security  by one or a few  broker-dealers  that are often
related  to  the  promoter  or  issuer;  (ii)  manipulation  of  prices  through
prearranged  matching  of  purchases  and sales and false and  misleading  press
releases;  (iii) boiler room practices involving high-pressure sales tactics and
unrealistic price projections by inexperienced sales persons; (iv) excessive and
undisclosed bid-ask differential and markups by selling broker- dealers; and (v)
the wholesale  dumping of the same  securities  by promoters and broker  dealers
after prices have been manipulated to a desired level,  along with the resulting
inevitable  collapse of those prices and with consequent  investor  losses.  The
Company's  management is aware of the abuses that have occurred  historically in
the penny stock market. Although the Company does not expect to be in a position
to dictate the behavior of the market or of broker  dealers who  participate  in
the market,  management will strive within the confines of practical limitations
to prevent the  described  patterns form being  established  with respect to the
Company's securities.

No  Operating  History.  The Company has no  operating  history,  revenues  from
operations,  or assets since  December 31,  1989.  The Company  faces all of the
risks of a new business  and the special  risks  inherent in the  investigation,
acquisition,  or involvement in a new business opportunity.  The Company must be
regarded  as a new  or  start-up  venture  with  all of  the  unforeseen  costs,
expenses, problems, and difficulties to which such ventures are subject.

No Assurance of Success or Profitability. There is no assurance that the Company
will acquire a favorable business opportunity. Even if the Company should become
involved in a business opportunity,  there is no assurance that it will generate
revenues  or  profits,  or that the market  price of the  Company's  outstanding
shares will be increased thereby.

Possible  Business  Not  Identified  and  Highly  Risky.  The  Company  has  not
identified and has no  commitments to enter into or acquire a specific  business
opportunity. As a result, it is only able to make general disclosures concerning
the risks and hazards of acquiring a business opportunity, rather than providing
disclosure  with respect to specific risks and hazards  relating to a particular
business opportunity.  As a general matter, prospective investors can expect any
potential  business  opportunity  to be quite risky.  See Item 1 Description  of
Business.

Type of Business  Acquired.  The type of business to be acquired may be one that
desires to avoid effecting its own public offering an the accompanying  expense,
delays,  uncertainties,  and federal  and state  requirements  which  purport to
protect investors.  Because of the Company's limited capital,  it is more likely
than not that any  acquisition  by the Company will involve  other parties whose
primary  interest is the  acquisition of control of a publicly  traded  Company.
Moreover,  any business  opportunity  acquired may be currently  unprofitable or
present other negative factors.

                                                                              10

<PAGE>

Impracticability  of Exhaustive  Investigation.  The Company's limited funds and
lack of full-time  management will make it  impracticable  to conduct a complete
and exhaustive  investigation and analysis of a business  opportunity before the
Company commits its capital or other resources  thereto.  Management  decisions,
therefore, will likely be made without detailed feasibility studies, independent
analysis,  market  surveys  and the like  which,  if the  Company had more funds
available to it, would be desirable.  The Company will be particularly dependent
in making decisions upon information provided by the promoter,  owner,  sponsor,
or  others  associated  with the  business  opportunity  seeking  the  Company's
participation.  A significant  portion of the Company's  available  funds may be
expended for  investigative  expenses and other expenses  related to preliminary
aspects of completing an  acquisition  transaction,  whether or not any business
opportunity investigated is eventually acquired.

Lack of  Diversification.  Because of the limited  financial  resources that the
Company  has, it is  unlikely  that the Company  will be able to  diversify  its
acquisitions or operations.  The Company's  probable  inability to diversify its
activities  into  more  than one area  will  subject  the  Company  to  economic
fluctuations within a particular business or industry and therefore increase the
risks associated with the Company's operations.

Need  for  Audited  Financial  Statements.  The  Company  will  require  audited
financial  statements  from any business that it proposes to acquire.  Since the
Company will be subject to the reporting  provisions of the Securities  Exchange
Act of 1934,  as amended  (the  Exchange  Act),  it will be  required to include
audited financial statements in its periodical reports for any existing business
it may acquire.  In addition,  the lack of audited  financial  statements  would
prevent the  securities  of the Company  from  becoming  eligible for listing on
NASDAQ,  the  automated   quotation  system  sponsored  by  the  Association  of
Securities Dealers, Inc., or on any existing stock exchange.  Moreover, the lack
of such  financial  statements  is  likely  to  discourage  broker-dealers  from
becoming  or  continuing  to serve as  market  makers in the  securities  of the
Company. Finally, without audited financial statements, the Company would almost
certainly be unable to offer securities under a registration  statement pursuant
to the  Securities  Act of 1933, and the ability of the Company to raise capital
would be significantly limited. Consequently, acquisitions prospects that do not
have, or are unable to provide  reasonable  assurances that they will be able to
obtain,  the required audited  statements would not be considered by the Company
to be appropriate for acquisition.

Other  Regulation.  An acquisition made by the Company may be of a business that
is subject to regulation or licensing by federal,  state, or local  authorities.
Compliance  with  such  regulations  and  licensing  can  be  expected  to  be a
time-consuming,  expensive process and may limit other investment  opportunities
of the Company.

Dependence upon Management;  Limited  Participation  of Management.  The Company
will be entirely  dependant upon the experience of its officers and directors in
seeking,  investigating,  and  acquiring  a  business  and in  making  decisions
regarding the Company's operations.  It is possible that, from time to time, the
inability of such persons to devote their full time attention to the business of
the Company could result in a delay in progress toward implementing its business
plan. See Management.  Because investors will not be able to evaluate the merits
of possible future business  acquisitions by the Company, they should critically
assess the information concerning the Company's officers and directors.

Lack of  Continuity  in  Management.  The  Company  does not have an  employment
agreement  with any of its officers or directors,  and as a result,  there is no
assurance  that they will  continue  to manage  the  Company in the  future.  In
connection with acquisition of a business opportunity,  it is likely the current
officers and  directors of the Company may resign.  A decision to resign will be
based  upon the  identity  of the  business  opportunity  and the  nature of the
transaction,  and is  likely  to  occur  without  the  vote  or  consent  of the
stockholders of the Company.

Indemnification of Officers and Directors. The Company's By-Laws provide for the
indemnification  of its,  directors,  officers,  employees,  and  agents,  under
certain  circumstances,  against  attorney's fees and other expenses incurred by
them in any  litigation  to  which  they  become  a  party  arising  from  their
association  with or activities on behalf of the Company.  The Company will also
bear  the  expenses  of  such  litigation  for any of its  directors,  officers,
employees,  or agents,  upon such person's promise to repay the Company therefor
if it is ultimately determined that any such person shall not have been entitled
to  indemnification.  This  indemnification  policy could result in  substantial
expenditures by the Company, which it will be unable to recoup.

                                                                              11

<PAGE>

Dependence upon Outside Advisors.  To supplement the business  experience of its
officers  and  directors,  the Company  may be  required to employ  accountants,
technical experts, appraisers,  attorneys, or other consultants or advisors. The
selection of any such advisors will, be made by the Company's officers,  without
any input by shareholders.  Furthermore, it is anticipated that such persons may
be  engaged  on an as needed  basis  without  a  continuing  fiduciary  or other
obligation to the Company.  In the event the officers of the Company consider it
necessary  to hire  outside  advisors,  they may elect to hire  persons  who are
affiliates, if those affiliates are able to provide the required services.

Leveraged  Transactions.  There  is a  possibility  that  any  acquisition  of a
business  opportunity  by the Company  may be  leveraged,  i.e.  the Company may
finance the  acquisition of the business  opportunity  by borrowing  against the
assets of the  business  opportunity  to be acquired,  or against the  projected
future revenues or profits of the business opportunity.  This could increase the
Company's exposure to larger losses. A business  opportunity  acquired through a
leveraged  transaction  is profitable  only if it generates  enough  revenues to
cover the  related  debt and  expenses.  Failure  to make  payments  on the debt
incurred to purchase  the  business  opportunity  could  result in the loss of a
portion or all of the assets  acquired.  There is no assurance that any business
opportunity  acquired through a leveraged  transaction will generate  sufficient
revenues to cover the related debt and expenses.

Competition.  The search for potentially  profitable  business  opportunities is
intensely  competitive.  The  Company  expects  to  be  at a  disadvantage  when
competing  with  many  firms  that  have  substantially  greater  financial  and
management  resources  and  capabilities  than the  Company.  These  competitive
conditions  will  exist  in  any  industry  in  which  the  Company  may  become
interested.

No Foreseeable Dividends. The Company has not paid dividends on its Common Stock
and does not anticipate paying such dividends in the foreseeable future.

Loss of Control by Present  Management and  Stockholders.  In  conjunction  with
completion of a business  acquisition,  it is anticipated  that the Company will
issue an amount of the  Company's  authorized  but  unissued  Common  Stock that
represents  the greater  majority of the voting power and equity of the Company.
In  conjunction  with  such  a  transaction,  the  Company's  current  Officers,
Directors,  and  principal  shareholders  could also sell all, or a portion,  of
their controlling block of stock to the acquired Company's stockholders.  Such a
transaction  would result in a greatly  reduced  percentage  of ownership of the
Company  by its  current  shareholders.  As a  result,  the  acquired  Company's
stockholders would control the Company, and it is likely that they would replace
the Company's management with persons who are unknown at this time.

No Public Market  Exists.  There is currently no public market for the Company's
common stock, and no assurance can be given that a market will develop or that a
shareholder will ever be able to liquidate his investment  without  considerable
delay, if at all. If a market should develop,  the price may be highly volatile.
Factors  such as  those  discussed  in this  Risk  Factors  section  may  have a
significant impact upon the market price of the securities offered hereby. Owing
to the low price of the  securities,  many brokerage firms may not be willing to
effect  transactions  in the  securities.  Even if a  purchasers  finds a broker
willing  to  effect a  transaction  in theses  securities,  the  combination  of
brokerage commissions, state transfer taxes, if any, and any other selling costs
may exceed the selling price. Further, many leading institutions will not permit
the use of such securities as collateral for any loans.

Rule 144  Sales.  Those  shares  held by  management  (8,548,899  shares) of the
outstanding  shares of Common Stock that are  restricted  securities  within the
meaning of Rule 144 under the Securities Act of 1933, as amended.  As restricted
shares,  these shares may be resold only  pursuant to an effective  registration
statement  or under  the  requirements  of Rule 144 or  other  applicable  state
securities  laws.  Rule 144  provides  in  essence  that a  person  who has held
restricted  securities for a prescribed  period,  may under certain  conditions,
sell every three months, in brokerage transactions, a number of shares that does
not exceed the greater of 1.0% of a Company's  outstanding  common  stock or the
average  weekly  trading  volume during the four  calendar  weeks prior to sale.
There is no limit on the amount of restricted  securities  that may be sold by a
non-affiliate after, the restricted  securities have been held by the owner, for
a period  of at least  two  years.  A sale  under  Rule 144 or under  any  other
exemption from the Act, if available, or pursuant to subsequent registrations of
common  stock of present  shareholders,  may have a  depressive  effect upon the
price of the Common Stock in any market that may develop.

                                                                              12

<PAGE>

Blue Sky  Consideration.  Because the securities  registered  hereunder have not
been registered for resale under the Blue Sky laws of any state,  the holders of
such shares and persons who desire to purchase  them in any trading  market that
might  develop in the  future,  should be aware,  that there may be  significant
state  Blue Sky law  restrictions  upon the  ability  of  investors  to sell the
securities and of purchasers to purchase the securities.  Accordingly, investors
should  consider  the  secondary  market for the  Company's  securities  to be a
limited one.

Item 2 - Description of Property

The Company has no property  and  currently  maintains a mailing  address at 211
West Wall,  Midland,  Texas 79701. The Company's telephone number there is (915)
682-1761.  Other than this  mailing  address,  the  Company  does not  currently
maintain  any other  office  facilities,  and does not  anticipate  the need for
maintaining office facilities at any time in the foreseeable future. The Company
pays no rent or other fees for the use of the  mailing  address or use of office
facilities.

Item 3 - Legal Proceedings

The  Company  is not a  party  to any  pending  legal  proceedings,  and no such
proceedings are known to be contemplated.






                                                                              13

<PAGE>

Item 4 - Submission of Matters to a Vote of Security Holders

There was no  shareholder  meeting and no matters were submitted to the security
holders for a vote during the fiscal year ended December 31, 2000.

PART II

Item 5 - Market for Company's Common Stock and Related Stockholder Matters

The stock does not trade on any  exchange or the OTC  market.  There is no known
public  market for this  security.  No dividends  have been paid to date and the
Company's  Board  of  directors  does not  anticipate  paying  dividends  in the
foreseeable future.

As of December 31, 2000,  there were 9,166,515  shares of $.001 par value common
stock (the "Common Stock") of the Company outstanding and owned by approximately
353 shareholders of record.

On December 26, 2000, the Company cancelled an aggregate total of 833,485 shares
of its issued and outstanding common stock.  Current management,  upon extensive
research  into  transactions  approved  by former  officers  and or  controlling
shareholders,  determined  that all of such shares had been  issued  improperly,
inasmuch  as  no  corporate  authorization  of  the  issuances  existed  and  no
consideration was received by the Company for such shares.

Specifically, the cancellations were as follows:

         400,000  shares were purchased by Glenn Little from a former officer of
         the Company  for a cash  consideration  of $15,000 and  returned to the
         Company's treasury with no consideration  received by Glenn Little from
         the Company.

         403,485 shares issued to former  officers,  directors and  individuals.
         These  shares  were  issued  improperly  as  (A) at the  time  of  such
         issuance,  the corporate charter of the Company had been revoked by the
         Secretary of State of Florida for failure to make required  filings and
         to pay  associated  fees and (B) no  consideration  was received by the
         Company for such shares.  Many of the certificates  representing  these
         shares were never  delivered and were in the possession of the transfer
         agent.

         30,000  shares  issued to a  company  in  anticipation  of fees due for
         investment banking  activities.  These shares were issued improperly as
         (A) there was no action by the Company's Board of Directors authorizing
         the  issuance  of any of  such  shares,  and  (2) at the  time  of such
         issuance,  the corporate charter of the Company had been revoked by the
         Secretary of State of Florida for failure to make required  filings and
         to pay associated fees.

As a result of the cancellation of these 833,485 shares of Company common stock,
the  Company  currently  has  9,166,515  shares  outstanding.  The effect in the
accompanying financial statements was to restate the par value of the issued and
outstanding shares with a corresponding offset to the additional paid-in capital
account.  There was no impact on the earnings of the Company as a result of this
event.

Item 6 - Management's Discussion and Analysis or Plan of Operation

The current  management  group intends to actively to seek,  investigate and, if
warranted,  acquire  an  interest  in  one or  more  business  opportunities  or
ventures.  As of the  date  hereof,  the  Company  has  divested  itself  of all
operating   assets  and  has  no  business   opportunities   or  ventures  under
contemplation   for   acquisition   but   proposes  to   investigate   potential
opportunities in the form of investors or entrepreneurs with a concept which has
not yet been placed in operation,  or in the form of firms which are  developing
companies in need of limited additional funds for expansion into new products or
services, and which are seeking to develop a new product or service. The Company
may also seek out established  businesses which may be experiencing financial or
operational  difficulties and are in need of the limited  additional capital the
Company could provide.  The Company  anticipates that it will seek to merge with
an  existing  business.  After the  merger,  the  surviving  entity  will be the
Company;  however,  management  from the acquired  entity will in all likelihood
operate the Company.  There is, however,  a remote  possibility that the Company
may seek to acquire and operate an ongoing business,  in which case the existing
management  might be  retained.  Due to the  absence  of capital  available  for
investment by the Company, the types of businesses seeking to be acquired by the
Company  will no  doubt be  smaller  and  higher  risks  of  businesses.  In all
likelihood,  a business  opportunity  will involve the  acquisition of or merger
with a  corporation  which does not need  additional  cash but which  desires to
establish  a public  trading  market  for its  Common  Stock.  Accordingly,  the
Company's ability to acquire any business of substance may be extremely limited.

                                                                              14

<PAGE>

The Company  experienced a change in control due a change in  management  due to
appointments to the Board of Directors and subsequent  election of officers.  It
is the intent of management to continue seeking a suitable  situation for merger
or acquisition.

Further,   the  Company  is  dependent  upon   management   and/or   significant
shareholders to provide  sufficient working capital to preserve the integrity of
the  corporate  entity  during this phase.  It is the intent of  management  and
significant  shareholders to provide  sufficient  working  capital  necessary to
support and preserve the integrity of the corporate entity.

Operation of the Company

The Company  intends to search  throughout the United States,  Canada and Europe
for a  merger/acquisition  candidate,  however,  because of lack of capital, the
Company  believes  that  the  merger/acquisition  candidate  will be  conducting
business within a limited geographical area. In the event of a consummation of a
merger or acquisition with a suitable candidate,  it is highly probable that the
Company's  principal  offices will be  relocated  to the existing  office of the
merger or  acquisition  candidate.  Further the Company may also have offices at
such other places as the Board of Directors  may from time to time  determine or
the future  business,  subsequent to the consummation of a merger or acquisition
of the Company may require.

The Officers and Directors will  personally seek  acquisition/merger  candidates
and/or orally contact individuals or broker(s)/dealer(s)  and advise them of the
availability  of the Company as an  acquisition  candidate.  The  Officers  will
review material furnished them by the proposed merger/acquisition  candidate and
decide if a  merger/acquisition  is in the best interests of the Company and its
shareholders.  The  proposed  merger/acquisition  will then be  submitted to all
stockholders for approval if required by Nevada statue.

The Company may also employ outside  consultants,  however,  no such consultants
will be engaged  until a  merger/acquisition  candidate has been targeted by the
Company.  Management  believes  that it is  impossible  to consider the specific
criteria that will be used to hire consultants; however, several of the criteria
may include the consultant's  relevant experience,  the services to be provided,
the term of service  required  by the  Company.  Management  cannot  predict the
probability that management will recommend any specific consultant(s) for future
use. As of the filing of this document,  the Company has not had any discussions
with or executed agreements with any outside consultants.

Other than  disclosed  herein,  there are no other plans for  accomplishing  the
business purpose of the Company.

Selection of Opportunities

The analysis of new business  opportunities  will be  undertaken by or under the
supervision  of the  Officers and  Directors  of the Company,  none of whom is a
professional  business  analyst  and have  limited  training  or  experience  in
business analysis. Inasmuch as the Company will have no funds available to it in
its search for business opportunities and ventures, the Company will not be able
to expend  significant funds on a complete and exhaustive  investigation of such
business  opportunity.  The Company will,  however,  investigate,  to the extent
believed  reasonable by Management,  such potential  business  opportunities  or
ventures.

As a part of the  Company's  investigation,  the Officers and Directors may meet
personally with management and key personnel of the firm sponsoring the business
opportunity,  may visit and inspect plants and  facilities,  obtain  independent
analysis or verification of certain  information  provided,  check references of
management and key personnel, and conduct other reasonable arrangements,  to the
extent of the Company's limited financial resources and management and technical
expertise.

                                                                              15

<PAGE>

Prior to making a decision  to  recommend  to  shareholders  participation  in a
business  opportunity or venture,  the Company will generally request that it be
provided with written materials  regarding the business  opportunity  containing
such  items  as  a  description  of  products,  services  and  company  history;
management resumes;  financial  information;  available  projections with elated
assumptions upon which the projections were based; evidence of existing patents,
trademarks or service  marks or rights  thereto;  present and proposed  forms of
compensation  to  management;   a  description  of   transactions   between  the
prospective  entity and its affiliates during relevant periods; a description of
resent and required facilities; an analysis of risks and competitive conditions;
and, other information deemed relevant.

It is anticipated that the investigation of specific business  opportunities and
the  negotiation,  drafting,  and execution of relevant  agreements,  disclosure
documents and other  instruments  will require  substantial  management time and
attention and costs for accountants, attorneys and others. If a decision is made
not to participate in a specific  business  opportunity,  the costs  theretofore
incurred in the related  investigation  would not be  recoverable.  Furthermore,
even if an agreement  is reached for the  participation  in a specific  business
opportunity,  the failure to consummate that  transaction may result in the loss
to the Company of the costs incurred.

The  Company  will  have  unlimited  flexibility  in  seeking,   analyzing,  and
participating  in business  opportunities.  In its  efforts,  the  Company  will
consider the following kinds of factors:

         a)       Potential for growth, indicated by new technology, anticipated
                  market expansion or new products,
         b)       Competitive  position as  compared  to other firms  engaged in
                  similar activities;
         c)       Strength of the merger/acquisition candidate's management;
         d)       Capital requirements and anticipated  availability of required
                  funds from future  operations,  through the sale of additional
                  securities,  through joint ventures or similar arrangements or
                  from other sources; and
         e)       Other relevant factors.

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.  Potential investors must recognize that due to
the Company's  limited  capital  available for  investigation  and  management's
limited  experience  in  business  analysis,  the  Company  may not  discover or
adequately evaluate adverse facts about the opportunity to be acquired.

The  Company  has not had any  substantive  conversations  and is not  currently
engaged in substantive  discussions  related to a proposed merger or acquisition
and,  further,  is unable to predict  when it may identify or  participate  in a
business  opportunity.  It  expects,  however,  that the  analysis  of  specific
proposals and the selection of a business opportunity may take several months or
more.

As of December 31, 2000,  management  has not  identified  any entity in which a
current  officer,  director or significant  shareholder has a direct or indirect
ownership  interest as a potential  merger or  acquisition  candidate.  Existing
corporate  policy is  silent to this  situation;  however,  it is the  intent of
management  to seek  candidates  in which  current  directors,  officers  and/or
significant shareholders do not have direct or indirect ownership interests.

Further, the consummation of a merger or acquisition  transaction may or may not
involve  the sale of  shares  of  common  stock  currently  held by  members  of
management,  directors or  significant  shareholders.  The terms and  conditions
related to any potential  sale of these shares may or may not be made  available
to other minority or non- controlling existing shareholders of the Company.

Prior to the consummation of any merger or acquisition, the Company will request
the  approval  of the  existing  shareholders  if  required  by  Nevada  statue.
Accordingly,  all shareholders  will be provided with the pertinent  information
related to the  proposed  merger or  acquisition,  including  audited  financial
statements, concerning the proposed target company of the merger or acquisition.

Additionally,  the  Company  will be subject  to all  disclosure  and  reporting
requirements  of The  Securities  and Exchange  Commission,  including,  but not
limited to, the filing of a Form 8-K Current  Report for the  disclosure  of any
pending  merger  or  acquisition  and the  dissemination  of  audited  financial
statements of the merger or acquisition candidate upon consummation.

                                                                              16

<PAGE>

Form of Acquisition

The manner in which the Company  participates in an opportunity will depend upon
the nature of the  opportunity,  the respective needs and desires of the Company
and the promoters of the opportunity,  and the relative  negotiating strength of
the Company and such  promoters.  The exact form or structure  of the  Company's
participation  in a business  opportunity  or venture will be dependent upon the
needs of the particular situation. The Company's participation may be structured
as an asset  purchase,  a lease, a license,  a joint venture,  a partnership,  a
merger or the acquisition of securities.

As set forth  above,  the Company may  acquire its  participation  in a business
opportunity  through the  issuance of Common  Stock or other  securities  in the
Company.  Although the terms of any such  transaction  cannot be  predicted,  it
should be noted that,  in certain  circumstances,  the criteria for  determining
whether or not an  acquisition is a so-called  "tax free"  reorganization  under
Section  368(a)(1) of the Internal Revenue Code of 1976, as amended,  may depend
upon the issuance to the  shareholders of the acquired company of at least 80.0%
of  the  Common  Stock  of  the  combined  entities  immediately  following  the
reorganization.  If a transaction  were  structured  to take  advantage of these
provisions  rather than other "tax free" provisions  provided under the Internal
Revenue Code, all prior shareholders may, in such circumstances, retain 20.0% or
less of the total issued and  outstanding  Common  Stock.  If such a transaction
were  available  to the  Company,  it will be  necessary  to obtain  shareholder
approval to effectuate a reverse stock split or to authorize  additional  shares
of Common  Stock prior to  completing  such  acquisition.  This could  result in
substantial  additional dilution to the equity of those who were shareholders of
the Company prior to such  reorganization.  Further,  extreme  caution should be
exercised by any investor relying upon any tax benefits in light of any existing
tax laws or any proposed  changes  thereto.  It is possible that no tax benefits
will exist at all.  Prospective  investors,  if any,  should  consult  their own
legal, financial and other business advisors.

In conjunction with a merger with or acquisition of a  privately-owned  company,
there  exists a  probability  that a  change  in  control  will  occur  upon the
consummation of the merger or  acquisition.  In order to make such a transaction
feasible,  it is  highly  probable  that  management  will  offer a  controlling
interest in the Company to any identified merger or acquisition candidate.

The present management and the current  shareholders of the Company may not have
control  of a  majority  of  the  voting  shares  of  the  Company  following  a
reorganization transaction. As part of such a transaction,  all or a majority of
the Company's  Directors  may resign and new Directors may be appointed  without
any vote by shareholders.

Present  shareholders  have not agreed to vote their respective shares of Common
Stock in accordance with the vote of the majority of all  non-affiliated  future
shareholders of the Company with respect to any business combination.

Not an "Investment Advisor"

The Company is not an "investment advisor" under the Federal Investment Advisers
Act  of  1940,  which   classification   would  involve  a  number  of  negative
considerations.  Accordingly, the Company will not furnish or distribute advise,
counsel,  publications,  writings, analysis or reports to anyone relating to the
purchase or sale of any  securities  within the language,  meaning and intent of
Section 2(a)(11) of the Investment Advisers Act of 1940, 15USC 80b2(a)(11).

Not an "Investment Company"

The Company may become involved in a business  opportunity through purchasing or
exchanging  the  securities  of such  business.  The  Company  does not  intend,
however,  to engage  primarily in such  activities  and is not  registered as an
"investment  company"  under the Federal  Investment  Company  Act of 1940.  The
Company believes such registration is not required.

                                                                              17

<PAGE>

The Company must conduct its  activities so as to avoid  becoming  inadvertently
classified  as a transient  "investment  company"  under the Federal  Investment
Company Act of 1940, which  classification would affect the Company adversely in
a number of respects.  Section 3(a) of the  Investment  Company Act provides the
definition of an  "investment  company"  which excludes an entity which does not
engage  primarily  in the  business  of  investing,  reinvesting  or  trading in
securities,  or which  does not engage in the  business  of  investing,  owning,
holding or trading  "investment  securities"  (defined as "all securities  other
than  United  States  government  securities  or  securities  of  majority-owned
subsidiaries")  the value of which  exceeds  forty  (40.0%)  of the value of its
total assets (excluding government securities,  cash or cash items). The Company
intends to  implement  its  business  plan in a manner  which will result in the
availability of this exemption from the definition of "investment company".  The
Company proposes to engage solely in seeking an interest in one or more business
opportunities or ventures.

Effective January 14, 1981, the U. S. Securities and Exchange Commission adopted
Rule  3a-2  which  deems  that an  issuer  is not  engaged  in the  business  of
investing, reinvesting, owning, holding or trading in securities for purposes of
Section  3(a)(1),  cited above,  if,  during a period of time not  exceeding one
year, the issuer has a bona fide intent to be engaged  primarily,  or as soon as
reasonably  possible  (in any event by the  termination  of a one year period of
time), in a business other that of investing,  reinvesting,  owning,  holding or
trading in  securities  and such intent is evidenced by the  Company's  business
activities and  appropriate  resolution of the Company's Board of Directors duly
adopted and duly recorded in the minute book of the Company. The Rule 3a-2 "safe
harbor" may not be relied on more than a single  time.  The  Company  expects to
have invested or committed  all, or  substantially  all, of the proceeds of this
public  offering  in  the  investigation   and/or   acquisition  of  a  business
opportunity  acquisition  within a year after  completion  of the  offering  and
thereafter to not encounter the  possibility of being  classified as a transient
investment company.

Item 7 - Index to Financial Statements

The  required  accompanying  financial  statements  begin  on  page  F-1 of this
document.

Item 8 -  Changes  in and  Disagreements  with  Accountants  on  Accounting  and
Financial Disclosures

None

PART III

Item 9 - Officers and Directors

The directors and executive officers serving the Company are as follows:

    Name                          Age                 Position Held and Tenure
    ----                          ---                 ------------------------

Glenn Little                       47                    President, Director
Matthew Blair                      43              Secretary, Treasurer Director

The  directors  named  above will  serve  until the next  annual  meeting of the
Company's  stockholders  or until  their  successors  are duly  elected and have
qualified.   Directors  will  be  elected  for  one-year  terms  at  the  annual
stockholders meeting.  Officers will hold their positions at the pleasure of the
board of directors,  absent any  employment  agreement,  of which none currently
exists or is contemplated.  There is no arrangement or understanding between any
of the  directors  or officers of the Company and any other  person  pursuant to
which any director or officer was or is to be selected as a director or officer,
and there is no arrangement,  plan or understanding as to whether non-management
shareholders  will exercise their voting rights to continue to elect the current
directors to the Company's board. There are also no arrangements,  agreements or
understandings  between   non-management   shareholders  that  may  directly  or
indirectly participate in or influence the management of the Company's affairs.

The directors and officers will devote their time to the Company's affairs on an
as needed  basis,  which,  depending  on the  circumstances,  could amount to as
little as two hours per month, or more than forty hours per month, but more than
likely will fall  within the range of five to ten hours per month.  There are no
agreements  or  understandings  for any  officer  or  director  to resign at the
request of another  person,  and none of the officers or directors are acting on
behalf of, or will act at the direction of, any other person.

                                                                              18

<PAGE>

Biographical Information

Glenn A.  Little,  is a  graduate  of The  University  of  Florida,  Gainesville
(Bachelor  of Science in  Business  Administration)  and the  American  Graduate
School of International  Management  (Master  International  Management) and has
been the  principal  of Little and  Company  Investment  Securities  (LITCO),  a
Securities  Broker/Dealer with offices in Midland,  Texas since 1979. Mr. Little
currently serves as an officer of other inactive public  corporations having the
same business purpose as the Company.

Before founding LITCO, Mr. Little was a stockbroker with Howard, Weil, Labouisse
Friedrich in New Orleans and Midland and worked for the First  National  Bank of
Commerce in New Orleans, Louisiana.

Matthew Blair was formerly a solo  practitioner of law in Midland,  Texas and is
presently  a Title IV-D  Master in Midland  County  Texas.  Before  opening  his
practice  he served in the Legal  Department  of the Federal  Deposit  Insurance
Corporation  (FDIC),  Midland,  Texas  where he  gained  exposure  to  corporate
structures and debt workouts.  His employment  before the FDIC  appointment  was
with Texas American Energy and Exxon Corporation.  Mr. Blair received a Bachelor
of Arts in  Government  from The  University of Texas at Austin (1975) and Juris
Doctor from Texas Tech University  School of Law (1979). He is licensed in every
state court in Texas,  United  States  District  Court (Texas) and in The United
States Supreme Court.

Item 10 - Executive Compensation

There was no compensation paid during the Fiscal year ended December 31, 2000.

None of the Company's current officers or directors receives or has received any
salary  from  Company  during the  preceding  five years.  The Company  does not
anticipate  entering  into  employment  agreements  with any of its  officers or
directors in the near future.  Directors do not receive  compensation  for their
services as directors and are not reimbursed for expenses  incurred in attending
board meeting.

Item 11 - Security Ownership of Certain Beneficial Owners and Management

The following table sets forth, as of the date of this  Registration  Statement,
the  number of  shares of Common  Stock  owned of  record  and  beneficially  by
executive officers, directors and persons who hold 5% or more of the outstanding
Common Stock of the Company.  Also included are the shares held by all executive
officers and directors as a group.

                                                                  % of Class
  Name and address                 Number of Shares           Beneficially Owned
  ----------------                 ----------------           ------------------

Glenn A. Little                        8,548,899                   93.26%
211 West Wall
Midland, Texas 79701

Matthew Blair                              0                        0.00%
200 West Wall
Suite 104
Midland, Texas 79701

All Directors and                      8,548,899                   93.26%
Executive Officers (2 persons)


Item 12 - Certain Relationships and Related Transactions

On December 26, 2000, the Company cancelled an aggregate total of 833,485 shares
of its issued and outstanding common stock.  Current management,  upon extensive
research  into  transactions  approved  by former  officers  and or  controlling
shareholders,  determined  that all of such shares had been  issued  improperly,
inasmuch  as  no  corporate  authorization  of  the  issuances  existed  and  no
consideration was received by the Company for such shares.

                                                                              19

<PAGE>

Specifically, the cancellations were as follows:

   400,000  shares were  purchased by Glenn Little from a former  officer of the
   Company for a cash  consideration  of $15,000 and  returned to the  Company's
   treasury with no consideration received by Glenn Little from the Company.

   403,485 shares issued to former officers,  directors and  individuals.  These
   shares  were  issued  improperly  as (A) at the  time of such  issuance,  the
   corporate  charter of the Company had been revoked by the  Secretary of State
   of Florida for failure to make required  filings and to pay  associated  fees
   and (B) no consideration was received by the Company for such shares. Many of
   the certificates  representing  these shares were never delivered and were in
   the possession of the transfer agent.

   30,000 shares issued to a company in  anticipation of fees due for investment
   banking  activities.  These shares were issued improperly as (A) there was no
   action by the Company's Board of Directors authorizing the issuance of any of
   such shares,  and (2) at the time of such issuance,  the corporate charter of
   the Company had been revoked by the Secretary of State of Florida for failure
   to make required filings and to pay associated fees.

As a result of the cancellation of these 833,485 shares of Company common stock,
the Company currently has 9,166,515 shares outstanding.

Item 13 - Exhibits and Reports on Form 8-K

Exhibit 27.1 - Financial Data Schedule

Reports on Form 8-K

   December  26,2000 - Reporting the  cancellation  of 833,485  shares of common
stock outstanding.

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

                                   SIGNATURES

In accord with Section 13 or 15(d) of the  Securities  Act of 1993,  as amended,
the Company  caused  this report to be signed on its behalf by the  undersigned,
thereto duly authorized.

                                                  Eldorado Financial Group, Inc.

Dated: January 4, 2001                               By:     /s/ Glenn A. Little
       ---------------                                   -----------------------

                                                                 Glenn A. Little
                                           President and Chief Executive Officer


In accordance with the Securities Exchange Act of 1934, as amended,  this report
has been signed below by the  following  persons on behalf of the Company and in
the capacities and on the date as indicated.

Dated: January 4, 2001                               By:     /s/ Glenn A. Little
       ---------------                               ---------------------------

                                                                 Glenn A. Little
                                                         President, Director and
                                                         Chief Executive Officer



                                                                              20

<PAGE>




                               ELDORADO FINANCIAL
                                   GROUP, INC.

                              Financial Statements
                                       and
                                Auditor's Report

                           December 31, 2000 and 1999





                               S. W. HATFIELD, CPA
                          certified public accountants

                      Use our past to assist your future sm


<PAGE>



                         Eldorado Financial Group, Inc.

                                    Contents

                                                                            Page
                                                                            ----

Report of Independent Certified Public Accountants                           F-3

Financial Statements

   Balance Sheets
     as of December 31, 2000 and 1999                                        F-4

   Statements of Operations and Comprehensive Income
     for the years ended December 31, 2000 and 1999                          F-5

   Statement of Changes in Shareholders' Equity
     for the years ended December 31, 2000 and 1999                          F-6

   Statements of Cash Flows
     for the years ended December 31, 2000 and 1999                          F-7

   Notes to Financial Statements                                             F-8




                                                                             F-2

<PAGE>


S. W. HATFIELD, CPA
certified public accountants

Member:    American Institute of Certified Public Accountants
               SEC Practice Section
               Information Technology Section
           Texas Society of Certified Public Accountants


               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
               --------------------------------------------------


Board of Directors and Stockholders
Eldorado Financial Group, Inc.

We have audited the  accompanying  balance sheets of Eldorado  Financial  Group,
Inc. (a Florida  corporation)  as of December  31, 2000 and 1999 and the related
statements of operations  and  comprehensive  income,  changes in  shareholders'
equity and cash flows for each of the two years then ended, respectively.  These
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of Eldorado Financial Group, Inc.
as of December 31, 2000 and 1999 and the related  statements of  operations  and
comprehensive income, changes in shareholders' equity and cash flows for each of
the two years then ended,  in  conformity  with  generally  accepted  accounting
principles.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue  as a  going  concern.  As  discussed  in  Note A to the
financial statements, the Company has no viable operations or significant assets
and is dependent upon  significant  shareholders to provide  sufficient  working
capital to maintain the integrity of the corporate entity.  These  circumstances
create  substantial  doubt  about the  Company's  ability to continue as a going
concern and are discussed in Note A. The financial statements do not contain any
adjustments that might result from the outcome of these uncertainties.

                                                    S. W. HATFIELD, CPA
Dallas, Texas
January 4, 2001

                      Use our past to assist your future sm

(secure mailing address)                   (overnight delivery/shipping address)
P. O. Box 820395                               9002 Green Oaks Circle, 2nd Floor
Dallas, Texas  75382-0395                               Dallas, Texas 75243-7212
214-342-9635 (voice)                                          (fax) 214-342-9601
800-244-0639                                                      SWHCPA@aol.com
                                       F-3

<PAGE>

<TABLE>
<CAPTION>

                         Eldorado Financial Group, Inc.
                                 Balance Sheets
                           December 31, 2000 and 1999


                                                                 2000           1999
                                                             -----------    -----------
<S>                                                          <C>            <C>
                                     ASSETS
                                     ------

Current assets
   Cash on hand and in bank                                  $      --      $      --
                                                             -----------    -----------

   Total Assets                                              $      --      $      --
                                                             ===========    ===========



                      LIABILITIES AND SHAREHOLDERS' EQUITY
                      ------------------------------------

Liabilities
   Current liabilities
     Accounts payable - trade                                $      --      $      --
                                                             -----------    -----------

   Total Liabilities                                                --             --
                                                             -----------    -----------


Commitments and contingencies

Shareholders' equity (deficit)
   Common stock - $0.001 par value
     100,000,000 shares authorized
     9,166,515 and 10,000,000 shares
     issued and outstanding,  respectively                         9,167         10,000
   Additional paid-in capital                                  2,001,570      2,000,101
   Accumulated deficit                                        (2,010,737)    (2,010,101)
                                                             -----------    -----------

   Total Shareholders' Equity (Deficit)                             --             --
                                                             -----------    -----------

   Total Liabilities and Shareholders' Equity                $      --      $      --
                                                             ===========    ===========

</TABLE>




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

                                                                             F-4

<PAGE>

                         Eldorado Financial Group, Inc.
                Statements of Operations and Comprehensive Income
                     Years ended December 31, 2000 and 1999


                                                       2000            1999
                                                  ------------    ------------

Revenues                                          $       --      $       --
                                                  ------------    ------------

Expenses
   General and administrative expenses                     636           2,016
                                                  ------------    ------------

     Total operating expenses                              636           2,016
                                                  ------------    ------------

Loss from Operations                                      (636)         (2,016)

Provision for Income Taxes                                --              --
                                                  ------------    ------------

Net Loss                                                  (636)         (2,016)

Other Comprehensive Income                                --              --
                                                  ------------    ------------

Comprehensive Income                              $       (636)   $     (2,016)
                                                  ============    ============


Earnings per share of common stock
   outstanding computed on net income
   - basic and fully diluted                               nil             nil
                                                  ============    ============

Weighted-average number of shares
   outstanding - basic and fully diluted             9,986,336      10,000,000
                                                  ============    ============




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

                                                                             F-5

<PAGE>

<TABLE>
<CAPTION>

                         Eldorado Financial Group, Inc.
                  Statement of Changes in Shareholders' Equity
                     Years ended December 31, 2000 and 1999




                                 Common Stock           Additional
                                 ------------            paid-in     Accumulated
                            Shares         Amount        capital       deficit         Total
                         -----------    -----------    -----------   -----------    -----------
<S>                      <C>            <C>            <C>           <C>            <C>

Balances at
   January 1, 1999        10,000,000    $    10,000    $ 1,996,483   $(2,008,085)   $    (1,602)

Capital contributed to
   support operations           --             --            3,618          --            3,618

Net loss for the year           --             --             --          (2,016)        (2,016)
                         -----------    -----------    -----------   -----------    -----------

Balances at
   December 31, 1999      10,000,000         10,000      2,000,101    (2,010,101)          --

Stock cancelled on
   December 26, 2000        (833,485)          (833)           833          --             --

Capital contributed to
   support operations           --             --              636          --              636

Net loss for the year           --             --             --            (636)          (636)
                         -----------    -----------    -----------   -----------    -----------

Balances at
   December 31, 2000       9,166,515    $     9,167    $ 2,001,570   $(2,010,737)   $      --
                         ===========    ===========    ===========   ===========    ===========

</TABLE>





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

                                                                             F-6

<PAGE>



                         Eldorado Financial Group, Inc.
                            Statements of Cash Flows
                     Years ended December 31, 2000 and 1999


                                                            2000       1999
                                                            -------    -------

Cash Flows from Operating Activities
   Net loss for the year                                    $  (636)   $(2,016)
   Adjustments to reconcile net loss
     to net cash provided by operating activities
       Increase (Decrease) in
         Accounts payable - trade                              --       (1,602)
                                                            -------    -------

Net cash used in operating activities                          (636)    (3,618)
                                                            -------    -------


Cash Flows from Investing Activities                           --         --
                                                            -------    -------


Cash Flows from Financing Activities
   Cash contributed to support operations                       636      3,618
                                                            -------    -------

Net cash provided by financing activities                       636      3,618
                                                            -------    -------

Increase (Decrease) in Cash                                    --         --

Cash at beginning of period                                    --         --
                                                            -------    -------

Cash at end of period                                       $  --      $  --
                                                            =======    =======


Supplemental Disclosure of Interest and Income Taxes Paid
     Interest paid for the year                             $  --      $  --
                                                            =======    =======
     Income taxes paid for the year                         $  --      $  --
                                                            =======    =======



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

                                                                             F-7

<PAGE>

                         Eldorado Financial Group, Inc.

                          Notes to Financial Statements


Note A - Organization and Description of Business

Eldorado  Financial Group, Inc. (Company) was incorporated under the laws of the
State of Florida on February 26, 1980 as Eldorado  Gold &  Exploration,  Inc. On
January 13, 1987, the Company  amended its Articles of  Incorporation  to change
the corporate name to Eldorado  Financial Group, Inc. and modified the Company's
capital  structure  to allow for the  issuance  of up to  100,000,000  shares of
common stock at $0.001 par value per share.

The Company has effectively had no operations,  assets or liabilities  since its
fiscal year ended December 31, 1989. Accordingly,  the Company is dependent upon
management and/or significant shareholders to provide sufficient working capital
to preserve the integrity of the corporate entity at this time. It is the intent
of management and significant shareholders to provide sufficient working capital
necessary to support and preserve the integrity of the corporate entity.

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.

Note B - Summary of Significant Accounting Policies

1.   Cash and cash equivalents
     -------------------------

     For  Statement of Cash Flows  purposes,  the Company  considers all cash on
     hand  and  in  banks,  including  accounts  in  book  overdraft  positions,
     certificates of deposit and other highly-liquid investments with maturities
     of three months or less, when purchased, to be cash and cash equivalents.

2.   Income Taxes
     ------------

     The Company uses the asset and liability  method of  accounting  for income
     taxes. At December 31, 2000 and 1999, respectively,  the deferred tax asset
     and deferred  tax  liability  accounts,  as recorded  when  material to the
     financial  statements,  are entirely  the result of temporary  differences.
     Temporary  differences  represent  differences in the recognition of assets
     and  liabilities  for  tax  and  financial  reporting  purposes,  primarily
     accumulated depreciation and amortization,  allowance for doubtful accounts
     and vacation accruals.

     As of December 31, 2000 and 1999,  the  deferred  tax asset  related to the
     Company's net operating loss  carryforward  is fully  reserved.  Due to the
     provisions  of Internal  Revenue  Code Section 338, the Company may have no
     net operating loss carryforwards available to offset financial statement or
     tax  return  taxable  income in future  periods  as a result of a change in
     control   involving  50  percentage  points  or  more  of  the  issued  and
     outstanding securities of the Company.

3.   Income (Loss) per share
     -----------------------

     Basic  earnings  (loss) per share is computed  by  dividing  the net income
     (loss) by the weighted-average  number of shares of common stock and common
     stock  equivalents  (primarily  outstanding  options and warrants).  Common
     stock equivalents  represent the dilutive effect of the assumed exercise of
     the  outstanding  stock  options and  warrants,  using the  treasury  stock
     method.  The calculation of fully diluted earnings (loss) per share assumes
     the dilutive effect of the exercise of outstanding  options and warrants at
     either the  beginning  of the  respective  period  presented or the date of
     issuance,   whichever  is  later.   As  of  December  31,  2000  and  1999,
     respectively,  the Company has no outstanding  stock  warrants,  options or
     convertible  securities  which could be considered as dilutive for purposes
     of the loss per share calculation.

                                                                             F-8

<PAGE>

                         Eldorado Financial Group, Inc.

                    Notes to Financial Statements - Continued


Note C - Common Stock Transactions

On December 26, 2000, the Company cancelled an aggregate total of 833,485 shares
of its issued and outstanding common stock.  Current management,  upon extensive
research  into  transactions  approved  by former  officers  and or  controlling
shareholders,  determined  that all of such shares had been  issued  improperly,
inasmuch  as  no  corporate  authorization  of  the  issuances  existed  and  no
consideration was received by the Company for such shares.

Specifically, the cancellations were as follows:

     400,000 shares were purchased by the current  majority  stockholder  from a
     former  officer of the  Company  for a cash  consideration  of $15,000  and
     returned to the Company's  treasury with no  consideration  received by the
     majority stockholder.

     403,485 shares issued to former officers, directors and individuals.  These
     shares  were issued  improperly  as (A) at the time of such  issuance,  the
     corporate charter of the Company had been revoked by the Secretary of State
     of Florida for failure to make required  filings and to pay associated fees
     and (B) no consideration was received by the Company for such shares.  Many
     of the certificates representing these shares were never delivered and were
     in the possession of the transfer agent.

     30,000  shares  issued  to a  company  in  anticipation  of  fees  due  for
     investment banking  activities.  These shares were issued improperly as (A)
     there was no action by the  Company's  Board of Directors  authorizing  the
     issuance of any of such shares,  and (2) at the time of such issuance,  the
     corporate charter of the Company had been revoked by the Secretary of State
     of Florida for failure to make required filings and to pay associated fees.

As a result of the cancellation of these 833,485 shares of Company common stock,
the  Company  currently  has  9,166,515  shares  outstanding.  The effect in the
accompanying financial statements was to restate the par value of the issued and
outstanding shares with a corresponding offset to the additional paid-in capital
account.  There was no impact on the earnings of the Company as a result of this
event.





                                                                             F-9