<TABLE>
<CAPTION>

                                    As filed with the Securities and Exchange Commission on September 28, 1990.

                                                                                                   Registration No. 33-35580-D
====================================================================================================================================
                                                 SECURITIES AND EXCHANGE COMMISSION
                                                       Washington, D. C. 20549
                                                   -----------------------------
                                                         AMENDMENT NO. 2 TO
                                                             FORM S-18                                  Marked Copy
                                                       Registration Statement                              with
                                                                Under                                    Exhibits
                                                     The Securities Act of 1933
                                                   -----------------------------
                                                       CATALINA CAPITAL CORP.
                                       (Exact name of registrant as specified in its charter)


<S>                    <C>                                    <C>                                        <C>
                               Delaware                                7389                                    84-1141967
                       (State of Incorporation)              (Primary Standard Industrial                    (IRS Employer
                                                              Classification Code Number)                Identification Number)

                                                     12543-A East Pacific Circle
                                                       Aurora, Colorado 80014
                                                           (303) 337-1033
             (Address and telephone number of registrant's principal executive offices and principal place of business)

                                                    The Corporation Trust Company
                                                    The Corporation Trust Center
                                                         1209 Orange Street
                                                     Wilmington, Delaware 19801
                                      (Name, address and telephone number of agent for service)

                                                              Copy to:
                                                   Heather Zane Anderson, Esquire
                                                           Pred and Miller
                                                 501 South Cherry Street, Suite 500
                                                       Denver, Colorado 80222
                                                   -----------------------------
                                  Approximate date of commencement of proposed sale to the public:
                             As soon as practicable after this Registration Statement becomes effective.
                                                   -----------------------------
                                                   CALCULATION OF REGISTRATION FEE
              ======================================================================================================================
                     Title of                                                      Proposed           Proposed
                    Each Class                                Amount               Maximum            Maximum          Amount of
                   of Securities                               Being              Offering Price      Aggregate        Registration
                  Being Registered                            Registered           Per Unit         Offering Price(5)     Fee
              ----------------------------------------------------------------------------------------------------------------------
              Common Stock, $.00001 par value             3,000,000 Shares            $0.10          $  300,000          $ 75.00
              Class A Common Stock Purchase Warrants      3,000,000 Warrants          $--                    --              -- (1)
              Common Stock, $.00001 par value             3,000,000 Shares (2)        $0.30             900,000           225.00
              Class B Common Stock Purchase Warrants      3,000,000 Warrants          $--                    --              -- (1)
              Common Stock, $.00001 par value             3,000,000 Shares (3)        $0.75           2,250,000           562.50
              Class C Common Stock Purchase Warrants      3,000,000 Warrants          $--                    --              -- (1)
              Common Stock, $.00001 par value             3,000,000 Shares (4)        $1.30           3,900,000           975.00
              ----------------------------------------------------------------------------------------------------------------------
                                                                                                     $7,350,000          $1,837.50
              ======================================================================================================================
<FN>
              (1)  Pursuant to Rule 457(g), no separate registration fee is required for warrants.

              (2)  To be issued upon exercise of Class A Warrants. Pursuant to Rule 416, the number of shares issuable upon exercise
                   of the Warrants is subject to adjustment  under the  antidilution  provisions of the Unit Warrant  Agreement (see
                   Exhibit 4.1).

              (3)  To be issued upon exercise of Class B Warrants. Pursuant to Rule 416, the number of shares issuable upon exercise
                   of the Warrants is subject to adjustment  under the  antidilution  provisions of the Unit Warrant  Agreement (see
                   Exhibit 4.1).

              (4)  To be issued upon exercise of Class C Warrants. Pursuant to Rule 416, the number of shares issuable upon exercise
                   of the Warrants is subject to adjustment  under the  antidilution  provisions of the Unit Warrant  Agreement (see
                   Exhibit 4.1).

              (5)  Estimated solely for the purpose of calculating the registration fee.

              The  registrant  hereby  amends this  registration  statement  on such date or dates as may be  necessary to delay its
              effective date until the registration  statement shall thereafter  become effective in accordance with Section 8(a) of
              the Securities Act of 1933, or until the registration statement shall become effective on such date as the Commission,
              acting pursuant to said Section 8(a), may determine.

====================================================================================================================================
</FN>
</TABLE>
<PAGE>


<TABLE>
                                          CATALINA CAPITAL CORP.

                                          CROSS REFERENCE SHEET



<CAPTION>
         REGISTRATION ITEM                                                        LOCATION IN PROSPECTUS
------------------------------------------------------------------------------------------------------------------------------
<S>      <C>                                                                      <C>
1.       Forepart of the Registration Statement
         and Outside Front Cover of Prospectus .................................. Cover Page

2.       Inside Front and Outside Back Cover
         page of Prospectus ..................................................... Additional Information

3.       Summary Information, Risk Factors ...................................... Prospectus Summary; Risk Factors

4.       Use of Proceeds ........................................................ Use of Proceeds

5.       Determination of Offering Price ........................................ Cover Page; Terms of Offering

6.       Dilution ............................................................... Dilution and Other Comparative Data

7.       Selling Security Holders ............................................... Not applicable

8.       Plan of Distribution ................................................... Cover Page; Terms of Offering

9.       Legal Proceedings ...................................................... Legal Proceedings

10.      Directors and Executive Officers ....................................... Management

11.      Security Ownership of Certain Beneficial Owners and Management ......... Principal Stockholders; Certain Transactions
                                                                                  with Management and Others

12.      Description of Securities to be Registered ............................. Description of Securities

13.      Interests of Named Experts and Counsel ................................. Legal Matters; Experts

14.      Statement as to Indemnification ........................................ Not Applicable

15.      Organization Within 5 Years ............................................ Prospectus Summary; Business

16.      Description of Property ................................................ Prospectus Summary; Business

17A.     Description of Property -- Registrants Engaged or to be Engaged
         in Significant Mining Operations ....................................... Not Applicable

17B.     Supplementary Financial Information about Oil and
         Gas Producing Activities ............................................... Not Applicable

18.      Interest of Management and Others
         in Certain Transactions ................................................ Certain Transactions with
                                                                                  Management and Others
<PAGE>


19.      Certain Market Information ............................................. Not Applicable

20.      Executive Compensation ................................................. Management

21.      Financial Statements ................................................... Financial Statements
</TABLE>

<PAGE>

Prospectus

                             CATALINA CAPITAL CORP.
                            (A Delaware Corporation)
                                 3,000,000 Units
                                  $.10 per Unit

         By this Prospectus, Catalina Capital Corp. (the "Company"), is offering
to the public 3,000,000 units ("Units") of the Company's  securities.  Each Unit
consists of one share of common  stock,  par value  $.00001  per share  ("Common
Stock" or "Common Shares"),  and three redeemable Common Stock Purchase Warrants
("Warrants"), respectively denominated Class A, Class B, and Class C. Each Class
A Warrant  will  entitle the holder to purchase  one share of Common  Stock at a
price of $.30  for a period  commencing  with  the date of this  Prospectus  and
terminating on the second  anniversary  of such date.  Each Class B Warrant will
entitle the holder to purchase  one share of Common Stock at a price of $.75 for
a period  commencing  with the date of this  Prospectus  and  terminating on the
second anniversary of such date. Each Class C Warrant will entitle the holder to
purchase one share of Common  Stock at a price of $1.30 for a period  commencing
with the date of this  Prospectus and  terminating on the second  anniversary of
such date.  The Warrants are in  registered  form and,  upon  issuance,  will be
immediately  detachable and may be traded  separately  from the Common Stock, in
the event that a market exists  therefor.  The Company is entitled to redeem the
Warrants without prior notice to the warrantholders  should the  representatives
of a business opportuntiy with which the Company wishes to combine require, as a
condition to  consummation  of the  combination,  that the Warrants be redeemed.
Under  these  circumstances,  the  warrantholder  will  have no  opportunity  to
exercise the purchase  rights under the Warrants prior to redemption.  See "Risk
Factors - Possible  Redemption  of  Warrants  Without  Notice."  Otherwise,  the
Company  may redeem any or all of the  Warrants  upon 30 days'  written  notice,
reduce the exercise price thereof and  indefinitely  extend the exercise  period
thereof.  Except as otherwise provided in subparagraph (a) of the section herein
captioned  "Description of Securities - Warrants - Redemption," the Warrants can
be exercised or redeemed  only if a current  prospectus  is then in effect.  See
"Description of Securities - Warrants."


                 THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK.
          SEE "RISK FACTORS" AND "DILUTION AND OTHER COMPARATIVE DATA."

          THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
            SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
          PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
            ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
---------------------------------- ---------------------------- ----------------------------- ----------------------
                                            Price to                    Underwriting              Proceeds to
                                            Public                      Commissions(2)            the Company(3)
---------------------------------- ---------------------------- ----------------------------- ----------------------
<S>                                         <C>                             <C>                      <C>
Per Unit                                    $    .10                        -0-                      $    .10
---------------------------------- ---------------------------- ----------------------------- ----------------------
Total Minimum (1)                           $150,000                        -0-                      $150,000
---------------------------------- ---------------------------- ----------------------------- ----------------------
Total Maximum (1)                           $300,000                        -0-                      $300,000
---------------------------------- ---------------------------- ----------------------------- ----------------------
<FN>

                                          (See Notes on the pages following)
</FN>
</TABLE>

                     The date of this Prospectus is _________________, 1990
<PAGE>




         (1) This  offering  is not  underwritten.  The  Units  offered  by this
Prospectus  will be offered by John J. Micek III, the Company's  President,  who
has had no prior experience in the sale of securities.  See "Risk Factors - Lack
of Underwriting." American Aegis Securities,  Inc., a NASD member firm with whom
one of the Company's directors is associated,  will not be involved in the offer
and sale of the Units. No underwriting  discounts or commissions will be paid to
the Company's  President  for his  participation  in the offering,  although his
out-of-pocket  expenses  will be  reimbursed  by the Company.  This  offering of
1,500,000  Units  minimum,   3,000,000  Units  maximum,   is  being  made  on  a
"minimum-maximum,  best efforts"  basis for a period of 90 days from the date of
this  Prospectus,  which period may be extended by the Company for an additional
90 days, or until  completion or abandonment of this offering,  whichever occurs
sooner. All proceeds from the sale of the Units being offered will promptly (and
in no event  later than noon of the next  business  day  following  receipt)  be
placed into an escrow account with Omnibank Aurora, located in Aurora,  Colorado
("Escrow Agent"),  and no funds will be released to the Company unless and until
a minimum of 1,500,000  Units have been sold.  Unless  proceeds from the minimum
number of Units offered  hereby have been deposited with the Escrow Agent within
90 days from the date of this Prospectus (which period may be extended for up to
an additional  90 days by the  Company),  the offering will be withdrawn and all
monies  received will be refunded to  subscribers  by the Escrow Agent,  without
deduction  therefrom for offering costs or sales expenses incurred,  if any, and
without  payment  of any  interest  thereon.  All such  refunds  will be made as
promptly as shall be practicable.  The investor should be aware,  however,  that
under  specified  circumstances  federal  law,  including  the  Expedited  Funds
Availability  Act of 1988 and Regulation CC (pertaining to the  availability  of
funds and the collection of checks), permits a bank to withhold payment of funds
on a deposit made by a check drawn on a "nonlocal"  bank for up to seven working
days pending  collection of the check through the applicable bank check clearing
system. As a result,  monies derived from a subscription payment that shall have
been  made by check  may not be  available  to the  Company,  for  refund to the
subscriber  following the  abandonment  of the offering,  until as many as seven
business days following the subscriber's tender of the subscription funds to the
bank. Assuming that, consistent with federal law as described above, funds for a
particular  subscription  have become available to the Company for refund, it is
likely that  approximately  one working day will be required  for the Company to
confirm  to the  escrow  bank  that a refund  should be made and for the bank to
prepare and mail a refund check to the subscriber.  The date upon which a refund
check would be mailed will depend,  therefore, upon the relationship between the
date upon which a subscription  check shall have been tendered and the date upon
which the  offering  shall  have been  abandoned.  The closer in time the tender
shall be to the date of abandonment,  the longer the mailing of the refund check
is likely to be  delayed,  up to a total of  approximately  eight  working  days
following the abandonment.  Except as provided above, investors have no right to
the return of their funds during the term of the offering. If at least 1,500,000
Units are sold and the  proceeds  therefrom  deposited  into the escrow  account
within  the  period  set forth  above,  the  offering  will  continue  until the
remaining 1,500,000 Units being offered are sold, until 90 days from the date of
this Prospectus (up to 180 days if extended), or until the Company determines to
terminate the offering,  whichever  occurs first. The officers,  directors,  and
affiliates  of the Company may purchase in the  aggregate up to 20% of the Units
sold in this  offering.  Such  purchases,  if made,  will be made for investment
purposes and not for immediate resale.


          (2) The amounts shown do not reflect  expenses of the offering payable
by the Company. These expenses,  which include filing fees, printing,  legal and
accounting costs, and miscellaneous fees, are estimated to be $20,500, or $.0137
(13.7%)  per Unit if the minimum  number of Units is sold and $.0068  (6.8%) per
Unit if the maximum number of Units is sold. See "Use of Proceeds."

          (3) The amounts  shown do not include any proceeds  the Company  would
receive  upon the  exercise  of the  Warrants.  If the  maximum  number of Units
offered hereby is sold, the Company would receive  additional  gross proceeds of
$7,050,000 upon the exercise of all of the Warrants.

          Prior  to this  offering  there  has  been no  public  market  for the
Company's  securities and there can be no assurance that a public market for the
Units, Common Stock or Warrants will develop following this offering or that the
Units  can  be  resold  at or  near  the  offering  price.  The  Company  has no
arrangements   with   broker-dealers  to  maintain  a  trading  market  for  its
securities.  The initial public offering price of the Units has


                                       ii
<PAGE>


been  arbitrarily  determined  by the Company and bears no  relationship  to the
Company's assets, net worth or prospects, or to any other recognized criteria of
value.  The exercise price of the Warrants has been arbitrarily set and there is
no assurance, and little likelihood,  that the trading price of the Common Stock
will rise sufficiently to make exercise of any Warrants desirable.

         This offering involves special risks concerning the Company,  which has
not  engaged  in  business  operations  other  than  efforts  to raise  capital,
including  immediate and substantial  dilution to public  purchasers of Units in
the net  tangible  book  value  per  share  of the  Common  Stock  acquired  and
substantial  potential profits to present  stockholders of the Company by reason
of the  increase in the net  tangible  book value of their shares as a result of
purchases  of Units by the  public.  See  "Risk  Factors,"  "Dilution  and Other
Comparative Data," and "Certain Transactions with Management."

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

          THESE UNITS ARE OFFERED BY THE COMPANY FOR CASH SUBJECT TO PRIOR SALE,
TO ALLOTMENT AND WITHDRAWAL AND TO CANCELLATION OF THE OFFERING,  WITHOUT NOTICE
AT ANY TIME BY THE COMPANY  PRIOR TO THE RELEASE OR DELIVERY OF ANY  PROCEEDS OF
THIS  OFFERING TO THE  COMPANY  WHETHER OR NOT A  CONFIRMATION  OF SALE OF UNITS
OFFERED BY THIS PROSPECTUS PREVIOUSLY HAS BEEN ISSUED BY THE COMPANY. PAYMENT BY
A  SUBSCRIBER  OF THE FULL  SUBSCRIPTION  PRICE AND DEPOSIT OF THE SAME INTO THE
ESCROW  ACCOUNT  DOES NOT  CONSTITUTE  ACCEPTANCE  OF SUCH  SUBSCRIPTION  BY THE
COMPANY.  THE RIGHT IS  RESERVED  BY THE COMPANY TO REJECT ANY AND ALL OFFERS TO
PURCHASE AND TO CANCEL ANY AND ALL  CONFIRMATIONS  OF SALE OF ANY UNITS  OFFERED
HEREBY,  IN WHOLE OR IN PART, FOR CAUSE OR WITHOUT  CAUSE,  AT ANY TIME PRIOR TO
THE CLOSING OF THE OFFERING.  REFUNDS TO  SUBSCRIBERS  WHOSE  SUBSCRIPTIONS  ARE
CANCELED WILL BE MADE AS PROMPTLY AS PRACTICABLE AFTER CLOSING, AND ACCORDINGLY,
SUBSCRIBERS  MAY LOSE THE USE OF  SUBSCRIPTION  FUNDS,  WITHOUT  PAYMENT  OF ANY
INTEREST THEREON, FOR UP TO 190 DAYS.

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

          THIS  PROSPECTUS  DOES NOT  CONSTITUTE AN OFFER OR  SOLICITATION  WITH
RESPECT TO THESE  SECURITIES  BY ANYONE TO ANY PERSON IN ANY STATE IN WHICH THIS
OFFERING OR  SOLICITATION  IS NOT AUTHORIZED BY THE LAWS THEREOF OR IN WHICH THE
PERSON MAKING SAID OFFERING OR SOLICITATION IS NOT QUALIFIED TO ACT AS DEALER OR
BROKER OR OTHERW1SE TO MAKE SUCH OFFERING OR SOLICITATION.

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

         THE  SECURITIES  BEING  SOLD  PURSUANT  TO THIS  PROSPECTUS  ARE HIGHLY
SPECULATIVE IN NATURE AND NO GUARANTEES OR OTHER  WARRANTIES TO THE CONTRARY ARE
MADE BY THE COMPANY AS ISSUER.  THE DELIVERY OF THIS PROSPECTUS SHALL NOT, UNDER
ANY  CIRCUMSTANCES,  CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE OF THIS PROSPECTUS.

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

          THE COMPANY HAS NOT TAKEN ANY STEPS TO CREATE AN  AFTERMARKET  FOR THE
SECURITIES OFFERED HEREIN AND HAS MADE NO ARRANGEMENTS WITH ANY BROKERS TO TRADE
OR MAKE A MARKET IN THESE  SECURITIES.  AT SOME TIME IN THE FUTURE,  THE COMPANY
MAY ATTEMPT TO ARRANGE FOR INTERESTED BROKERS TO TRADE OR MAKE A MARKET IN THESE
SECURITIES AND TO QUOTE THE  SECURITIES OF THE COMPANY IN A PUBLISHED  QUOTATION
MEDIUM. NO ARRANGEMENTS HAVE BEEN MADE IN THAT REGARD, HOWEVER, AND NO ASSURANCE
IS  OFFERED  THAT ANY  BROKERS  WILL BE  WILLING  TO ENGAGE  IN SUCH  ACTIVITIES
RELATIVE  TO THESE  SECURITIES.  IN THE EVENT THAT ANY BROKER WERE


                                      iii
<PAGE>


TO BECOME THE EXCLUSIVE  MARKET MAKER IN THESE  SECURITIES,  THE BROKER WOULD IN
EFFECT DOMINATE AND CONTROL THE MARKET FOR THE COMPANY'S SECURITIES.

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

          THE COMPANY HAS  UNDERTAKEN,  DURING THE 90-DAY  PERIOD  FOLLOWING THE
DATE OF THIS PROSPECTUS AND DURING THE EXERCISE  PERIOD OF THE WARRANTS,  DURING
ANY  PERIOD IN WHICH  OFFERS  OR SALES  ARE BEING  MADE, TO FILE  POST-EFFECTIVE
AMENDMENTS TO THE REGISTRATION STATEMENT TO WHICH THIS PROSPECTUS RELATES AND TO
REFLECT  THEREIN  ANY  FACTS OR  EVENTS  ARISING  AFTER  THE DATE  HEREOF  WHICH
REPRESENT A FUNDAMENTAL OR MATERIAL  CHANGE IN THE  INFORMATION SET FORTH HEREIN
OR IN SUCH REGISTRATION  STATEMENT.  ANY SUCH AMENDMENTS WILL BE DISSEMINATED TO
STOCKHOLDERS AND  WARRANTHOLDERS  OF THE COMPANY AFTER THE REQUIRED FILINGS HAVE
BEEN MADE WITH THE  SECURITIES  AND EXCHANGE  COMMISSION  AND HAVE BEEN DECLARED
EFFECTIVE.

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

         THE COMPANY IS NOT  CURRENTLY  SUBJECT TO SECTION 14 OF THE  SECURITIES
EXCHANGE  ACT OF 1934.  THE  COMPANY  WILL  FURNISH TO ITS  STOCKHOLDERS  ANNUAL
REPORTS  CONTAINING  FINANCIAL  INFORMATION  EXAMINED AND REPORTED UPON, WITH AN
OPINION EXPRESSED BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS,  SO LONG AS IT IS
REQUIRED TO DO SO. IN ADDITION,  THE COMPANY MAY FURNISH UNAUDITED  QUARTERLY OR
OTHER INTERIM REPORTS TO ITS STOCKHOLDERS AS IT DEEMS APPROPRIATE.

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


         IF,  AFTER  FOUR (4) YEARS FROM THE DATE  FUNDS ARE  DEPOSITED  INTO AN
ESCROW ACCOUNT,  ESTABLISHED IN ACCORDANCE WITH THE COLORADO SECURITIES ACT (THE
"COLORADO  ESCROW  ACCOUNT"),   THE  COMPANY  HAS  NOT  CONSUMMATED  A  BUSINESS
COMBINATION THAT HAS RESULTED IN THE RELEASE OF THE FUNDS ESCROWED IN COMPLIANCE
WITH THE  COLORADO  SECURITIES  ACT, THE ESCROW  AGREEMENT  THAT THE COMPANY HAS
ENTERED INTO WITH OMNIBANK AURORA, LOCATED IN AURORA,  COLORADO (FOR PURPOSES OF
THIS  PARAGRAPH,  THE "ESCROW  AGENT")  PROVIDES THAT THE ESCROW AGENT SHALL, AS
PROMPTLY AS POSSIBLE, DISTRIBUTE THE FUNDS IN THE COLORADO ESCROW ACCOUNT TO THE
PERSONS  THEN  HOLDING THE SHARES OF THE  COMPANY'S  COMMON STOCK ISSUED IN THIS
OFFERING  ON A PRO RATA  BASIS  BASED ON THE  NUMBER OF SHARES  HELD.  SEE "RISK
FACTORS - IMPACT OF  AMENDMENTS  TO THE COLORADO  SECURITIES  ACT" AND "POSSIBLE
DISTRIBUTION OF ESCROWED FUNDS AFTER FOUR YEARS."  THEREFORE,  INVESTORS IN THIS
OFFERING  SHOULD BE AWARE THAT, IN THE EVENT OF A  DISTRIBUTION  AS DESCRIBED IN
THE PREVIOUS SENTENCE,  ONLY A PORTION OF THE FUNDS ORIGINALLY  INVESTED WILL BE
DISTRIBUTED TO THE PERSONS THEN HOLDING SHARES ISSUED IN THIS OFFERING,  WITHOUT
ANY INTEREST BEING PAID THEREON.  NEITHER THE COLORADO ESCROW AGREEMENT, NOR ANY
DISTRIBUTION MADE THEREUNDER, SHALL AFFECT OWNERSHIP OF THE UNITS ISSUED IN THIS
OFFERING,  I.E.,  THE  SHAREHOLDERS  WHO RECEIVE  THEIR PRO RATA  PORTION OF THE
AFOREMENTIONED  DISTRIBUTION  SHALL NOT BE REQUIRED TO RETURN THEIR UNITS TO THE
COMPANY'S TREASURY.  IN THE EVENT A DISTRIBUTION IS MADE, AS PROVIDED ABOVE, THE
COMPANY'S ABILITY TO ADEQUATELY  INVESTIGATE AND EVALUATE BUSINESS OPPORTUNITIES
AND TO ATTRACT FAVORABLE BUSINESS OPPORTUNITIES WILL BE ADVERSELY AFFECTED.



                                       iv

<PAGE>


                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----


Prospectus Summary ........................................................   1
Risk Factors ..............................................................   3
Dilution and Other Comparative Data .......................................  11
Use of Proceeds ...........................................................  13
Business ..................................................................  14
          General .........................................................  14
          Investigation and Selection
            of Business Opportunities .....................................  16
          Form of Acquisition .............................................  18
          Investment Company Act and Other Regulation .....................  19
          Competition .....................................................  20
          Administrative Offices ..........................................  20
          Employees .......................................................  20
Management ................................................................  21
          Biographical Information ........................................  21
          Remuneration ....................................................  23
          Indemnification of Officers and Directors .......................  23
          Exclusion of Liability ..........................................  23
Prior Blind Pool Activities ...............................................  24
Potential Conflicts of Interest ...........................................  25
Certain Transactions with Management and Others ...........................  26
Principal Stockholders ....................................................  27
Description of Securities .................................................  28
          Units ...........................................................  28
          Common Stock ....................................................  28
          Preferred Stock .................................................  28
          Warrants ........................................................  28
          Transfer and Warrant Agent ......................................  31
          Reports to Stockholders .........................................  31
Terms of Offering .........................................................  31
          Pricing of Units ................................................  32
          Escrow of Net Proceeds ..........................................  32
Legal Proceedings .........................................................  32
Legal Matters .............................................................  33
Experts ...................................................................  33
Additional Information ....................................................  33
Financial Statements ......................................................  F-1


<PAGE>


                               PROSPECTUS SUMMARY

          The  following  summary  is  intended  to  supply  selected  facts and
highlights from material contained in the body of this Prospectus. More detailed
information  may be found in the  remainder of the  Prospectus.  This summary is
qualified in its entirety by the detailed  information and financial  statements
appearing elsewhere herein.

The Company

         Catalina Capital Corp. (the "Company") was incorporated  under the laws
of Delaware on April 27, 1990.  Its offices are located at the  residence of its
Vice  President at 12543-A East Pacific  Circle,  Aurora,  Colorado  80014.  Its
telephone number is (303) 337-1033.

          The  Company  is  a  new  enterprise  in  the  early  promotional  and
development stage and has not engaged in any business other than  organizational
efforts.  It has no full-time  employees and owns no real property.  The Company
intends,  upon  successful  completion  of this  offering,  to  utilize  the net
proceeds realized to seek out and take advantage of business opportunities which
may have potential for profit and, to that end, intends to acquire properties or
businesses,  or a controlling  interest therein.  Management of the Company will
have virtually  unlimited  discretion in determining the business  activities in
which the Company will  engage.  The Company  believes  that its ability to take
advantage of business  opportunities  will be enhanced by (1) its willingness to
invest in high risk ventures and businesses,  (2) its flexibility in structuring
investments,  including  the probable  surrender of control and  replacement  of
management,  and (3) its status as a publicly  held company  with liquid  assets
that can be deployed quickly.


         The Company currently does not own any properties or an interest in any
business.   Moreover,   it  has  not   identified  any  properties  or  business
opportunities which it proposes to acquire,  has no understanding or arrangement
to acquire any  properties or business  interests,  and has not  identified  any
specific  geographical area,  industry or type of business in which it will seek
to  operate.  Accordingly,  this  offering  must be  considered  a "blind  pool"
offering. There can be no assurance that the Company will be able to acquire any
properties or business interests available, or that any such acquisition will be
profitable.  See "Risk  Factors" and  "Business."  Moreover,  if, after four (4)
years from the date funds are deposited into an escrow  account,  established in
accordance with the Colorado Securities Act (the "Colorado escrow account"), the
Company has not  consummated  a business  combination  that has  resulted in the
release of the funds escrowed in compliance  with the Colorado  Securities  Act,
the escrow  agreement  that the Company has entered into with  Omnibank  Aurora,
located in  Aurora,  Colorado  (for  purposes  of this  paragraph,  the  "escrow
agent"),  provides  that the  escrow  agent  shall,  as  promptly  as  possible,
distribute the funds in the Colorado  escrow account to the persons then holding
the shares of the  Company's  common stock issued in this offering on a pro rata
basis  based on the  number  of  shares  held.  See  "Risk  Factors  - Impact of
Amendments  to the  Colorado  Securities  Act"  and  "Possible  Distribution  of
Escrowed  Funds  After Four  Years." In that  event,  the  Company's  ability to
adequately  investigate  and  evaluate  business  opportunities  and to  attract
favorable business opportunities will be adversely affected.


                                       1

<PAGE>

The Offering

          The  Company  is  offering  a minimum  of  1,500,000  and a maximum of
3,000,000  Units, at the price of $.10 per Unit. Each Unit consists of one share
of Common Stock, par value $.00001 per share,  one Class A Warrant,  one Class B
Warrant and one Class C Warrant. Each Class A Warrant, Class B Warrant and Class
C  Warrant  will be  exercisable  for one share of  Common  Stock,  for a period
commencing  with the  date of this  Prospectus  and  terminating  on the  second
anniversary of such date, at a price of $.30, $.75 and $1.30, respectively. Upon
issuance, the Warrants will be detachable and may be transferred separately from
the Common  Stock.  The Company may redeem the Warrants at a price of $.0001 per
Warrant upon 30 days' written notice,  reduce the exercise price or indefinitely
extend the exercise period of the Warrants. See "Description of Securities."

Outstanding Shares

          There are  7,300,000  shares of the Company's  Common Stock  currently
outstanding.  Upon conclusion of this offering,  there will be 8,800,000  shares
outstanding if the minimum number of Units is sold and 10,300,000  shares if the
maximum  number of Units is sold.  The number of shares  stated does not include
any Common Stock issuable upon exercise of the Warrants.

Use of Proceeds

          The proceeds of this  offering,  net of all expenses of the  offering,
are estimated to be $129,500 if the minimum number of Units is sold and $279,500
if all of the  Units are  sold.  These  proceeds  will be used for  general  and
administrative  expenses, to investigate and evaluate business opportunities and
to acquire properties or business interests,  and for working capital.  However,
investors should be aware that eighty percent (80%) of the net offering proceeds
($103,600,  if the minimum  number of Units is sold and  $223,600 if the maximum
number of Units is sold)  will be  subject  to an escrow  for an  indeterminable
period. See "Use of Proceeds."

Risk Factors

          Investment  in the Units  involves an  extremely  high degree of risk.
Potential investors should consider that the Company is in the early development
stage and has not commenced commercial activities, has no revenues,  earnings or
operating  history and only limited  capitalization,  and is dependent  upon the
proceeds of this offering to commence operations.  Further, the proceeds of this
offering have been allocated only generally, no properties or business interests
for acquisition  have been identified,  and investors will experience  immediate
and substantial  dilution in the net tangible book value per share of the Common
Stock  acquired  as  compared  to  the  offering  price.  In  seeking   business
opportunities, the Company could incur substantial losses. The Company's present
management has very limited  experience in seeking,  investigating and acquiring
business opportunities.  Moreover, management has other business interests which
may conflict with the Company's interests and will devote relatively little time
to the Company's affairs. See "Risk Factors."

Selected Financial Information

          Selected  financial  information  concerning the Company as of June 6,
1990, is given below.  This  information  should be read in conjunction with the
financial statements and notes appearing elsewhere in this Prospectus.

    Assets

                 Cash                                      $10,791
                 Organizational Cost                           492
                 Deferred Offering Costs                     5,385
                                                           -------
                 Total Assets                                           $16,668
                                                                        =======
    Liabilities and Stockholders' Equity

                 Current Liabilities                       $   885
                 Stockholders' Equity                       15,783
                                                           -------

                 Total Liabilities and
                 Stockholders' Equity                                   $16,668
                                                                        =======


                                       2
<PAGE>

                                  RISK FACTORS

          The purchase of Units in this offering  involves extreme risks and the
possibility  of the loss of a  stockholder's  entire  investment.  A prospective
investor should  evaluate all  information  discussed in this Prospectus and the
risk factors discussed below in relation to his financial  circumstances  before
investing in the Units.

The Company

          1. No Operating History.  The Company was formed in April 1990 for the
purpose  of raising  capital  through a public  offering  of  securities  and to
acquire a business opportunity.  The Company has no operating history,  revenues
from  operations,  or assets  other than cash from private  sales of stock.  The
Company  faces all of the risks of a new business  and those risks  specifically
inherent in the  investigation,  acquisition,  or  involvement in a new business
opportunity.  Purchase of the  securities  in this  offering must be regarded as
placing  funds  at a high  risk in a new or "start-up"  venture  with all of the
unforeseen costs,  expenses,  problems,  and difficulties to which such ventures
are subject. See "Use of Proceeds" and "Business."

          2. No  Assurance  of Success or  Profitability.  There is no assurance
that the Company will  acquire a favorable  business  opportunity.  In addition,
even if the  Company  becomes  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 Common Stock will be increased thereby. See "Business."

          3. Unspecified Use of Proceeds.  Net proceeds of this offering are not
specifically  allocated.  They will be used generally to search for, acquire, or
participate  in  a  business   opportunity   deemed  beneficial  by  management.
Stockholders  of the  Company  will not be given  the  opportunity  to review or
evaluate the merits of a business  opportunity  before the Company enters into a
transaction involving such business or business  opportunity.  Investors will be
entrusting  their  funds  to  management,  which  will  determine  the  specific
expenditure  of the funds.  This type of offering is known as a "blind pool" and
involves  extreme  risk and  speculation  for  purchasers.  Because  the Company
intends to offer the Units to residents of the State of Colorado, investors will
benefit from the  protections  afforded by the Colorado  Securities  Act,  which
requires the  placement  in escrow of eighty  percent of the net proceeds of the
offering until the completion of a transaction or series of transactions whereby
at least fifty percent of the gross proceeds received from the sale of Units are
committed for use in one or more specific lines of business.  See "Business" and
"Use of Proceeds."

          4. 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 and therefore can only disclose the risks and hazards of a
business or opportunity  that it may enter into in a general manner,  and cannot
disclose the risks and hazards of any specific  business or opportunity  that it
may enter into. An investor can expect a potential  business  opportunity  to be
quite  risky.  The  Company's  acquisition  of or  participation  in a  business
opportunity  will likely be highly  illiquid and could result in a total loss to
the Company and its stockholders if the business or opportunity is unsuccessful.
See "Business."

          5. Type of Business Acquired.  The type of business to be acquired may
be one  which  desires  to  avoid  effecting  its own  public  offering  and the
accompanying  expense,  delays, 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 a  publicly  traded  company.
Moreover,  it is also  possible  that any business  opportunity  acquired may be
currently unprofitable or present other negative factors.


                                       3
<PAGE>

          6. Impracticability of Exhaustive Investigation. The Company's limited
funds and the lack of full-time  management will likely 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's  difficulties  are compounded by the effect of the proceeds  escrow
imposed by the Colorado  Securities  Act, which requires the placement in escrow
of eighty  percent of the net proceeds of the offering until the completion of a
transaction  or series of  transactions  whereby at least  fifty  percent of the
gross  proceeds  received from the sale of Units are committed for use in one or
more specific lines of business. 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. See "Business." and "Use of Proceeds."

         7.  Lack  of   Diversification.   Because  of  the  limited   financing
capabilities  of the Company at the  present  time and upon  completion  of this
offering,  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. See "Business."

          8. Possible Reliance upon Unaudited Financial Statements.  The Company
generally will require  audited  financial  statements  from companies which the
Company proposes to acquire.  No assurance can be given,  however,  that audited
financials will be available to the Company.  In cases where audited  financials
are  unavailable,  the  Company  will  have to rely upon  unaudited  information
received  from target  companies'  management  which has not been  independently
verified  by outside  auditors.  Moreover,  the  Company  will be subject to the
reporting  provisions  of the  Securities  Exchange Act of 1934 and thus will be
required  to  furnish  certain   information  about  significant   acquisitions,
including  certified  financial  statements  for any  business  that the Company
acquires. Consequently,  acquisition prospects that do not have or are unable to
obtain the required certified  statements may not be appropriate for acquisition
so long as the reporting requirements of the Securities Exchange Act of 1934 are
applicable.  In  addition,  Warrantholders  may not be able  to  exercise  their
Warrants if the Company acquires a business that does not have audited financial
statements until such time as audited  statements become available,  because the
Company would be unable to meet the  requirements  for  maintenance of a current
registration statement on file with the Securities and Exchange Commission.

          9.  Investment  Company  Regulation.  The  Company  does not intend to
become classified as an "investment company" under the Investment Company Act of
1940 (the  "Investment  Act").  The  Company  believes  that it will not  become
subject to regulation  under the Investment Act because (i) the Company will not
be engaged in the  business  of  investing  or trading in  securities,  (ii) any
merger or  acquisition  undertaken  by the Company will result in the  Company's
obtaining a majority interest in any such merger or acquisition  candidate,  and
(iii) the Company intends to discontinue any investment in a prospective  merger
or acquisition candidate in which a majority interest cannot be obtained. In the
event that the Company is required to  register  as an  investment  company,  it
could be expected to incur  significant  registration and compliance  costs. The
Company has obtained no formal  determination  from the  Securities and Exchange
Commission  (the  "Commission")  as to the  status  of  the  Company  under  the
Investment  Act and,  consequently,  any  violation of the  Investment  Act will
subject the Company to materially  adverse  consequences.  Should the Commission
find that the Company is subject to the  Investment  Act, and direct the Company
to register under such Act, the Company would  vigorously  resist any such order
or finding.  Irrespective of whether the Commission or the Company  prevailed in
such  dispute,  however,  the  Company  would be damaged by the costs and delays
involved.  Because the  Company  will not  register  under the  Investment  Act,
investors  in the Company  will not have the  benefit of the various  protective
provisions imposed on investment  companies by such Act, including  requirements
for independent directors. See "Business."

          10. 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


                                       4

<PAGE>
be expected to be a  time-consuming  and  expensive  process and may limit other
investment opportunities of the Company.

         11. Public Investors Will Bear Financial  Risks. The Company's  present
stockholders  have acquired their shares of the Company at an extremely low cost
and consequently have contributed only an insignificant amount of capital to the
Company.  The  purchasers  in this  offering  will provide  virtually all of the
capital that the Company  will use in carrying  out its  business  plan and thus
will  bear  most of the risk of  loss,  if any,  incurred  by the  Company.  See
"Principal Stockholders."

          12. Dependence upon Management.  The Company will be heavily dependent
upon the skills,  talents,  and  abilities of its  management  to implement  its
business plan. The Company's  officers and directors will each devote on average
between five and twenty hours per month to the affairs of the Company, which for
a  company  such as this  that is  heavily  dependent  upon  management,  may be
inadequate  for  Company  business,   and  may  delay  the  acquisition  of  any
opportunity  considered.  Furthermore,  management  does  not  have  substantial
experience in seeking,  investigating  and acquiring  businesses and will depend
upon its general business expertise in making decisions  regarding the Company's
operations. See "Management." Because investors will not be able to evaluate the
merits of possible business  acquisitions by the Company, they should critically
assess the information concerning the Company's management.

          13.  Lack of  Continuity  in  Management.  The  Company  does not have
employment  agreements  with its  management,  and  there is no  assurance  that
persons named herein will manage the Company in the future.  In connection  with
acquisition of a business opportunity,  some or all of the current management of
the Company probably will resign and appoint successors.  This may occur without
the vote or consent of the  stockholders  of the  Company.  See  "Business"  and
"Principal Stockholders."

          14. Conflicts of Interest.  Certain conflicts of interest have existed
and will continue to exist  between the Company and its officers and  directors.
All have other business  interests to which they devote their primary attention,
and each may be expected to continue to do so although management time should be
devoted to the business of the Company.  As a result,  conflicts of interest may
arise that can be resolved  only through  exercise by the officers and directors
of such judgment as is consistent  with their  fiduciary  duties to the Company.
See "Potential Conflicts of Interest."

          15.  Limited  Participation  of  Management.  Each of the officers and
directors has full-time outside  employment and will be available to participate
in  management  decisions  only on an "as  needed"  basis which may amount to on
average as little as five hours per month. The amount of time which officers and
directors are able to devote to Company  business may be inadequate  for Company
business and may delay the acquisition of any opportunity considered.

          16.   Indemnification   of  Officers  and  Directors.   The  Company's
Certificate of Incorporation  provides 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 may 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. See "Management - Indemnification of Officers and Directors."

          17. Director's Liability Limited.  Under the Company's  Certificate of
Incorporation, directors of the Company cannot be held liable to the Company for
monetary  damages for breach of fiduciary duty as a director  except (i) for any
breach of the  director's  duty of loyalty to the  Company or its  stockholders,
(ii) for acts or  omissions  not in good  faith  or  which  involve  intentional
misconduct or a knowing violation of law, (iii) for any violation of Section 174
of the Delaware General  Corporation Law, or (iv) for any transaction from which
the


                                       5

<PAGE>

director derived an improper  personal  benefit.  This provision does not affect
the liability of any director under federal or applicable state securities laws.
See "Management - Exclusion of Liability."

          18.  Dependence  upon Outside  Advisors.  To  supplement  the business
experience  of  management,  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 management without any input from
stockholders. 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.

          19.  Possible Need for Additional  Financing.  The Company's funds may
not be adequate to take advantage of any available business  opportunities.  The
offering  may  terminate  upon the receipt of only the  minimum net  proceeds of
$129,500,  substantially  less  than  the  maximum  net  proceeds  of  $279,500.
Moreover,  investors  should be aware that  eighty  percent of the net  proceeds
($103,600  if the  minimum  number of Units is sold and  $223,600 if the maximum
number of Units is sold)  will be  subject  to an escrow  for an  indeterminable
period.  See "Use of  Proceeds."  Even if the  Company has  sufficient  funds to
acquire  an  interest  in a  business  opportunity,  it may not have  sufficient
capital to exploit  the  opportunity.  The  ultimate  success of the Company may
depend  upon its  ability  to raise  additional  capital.  The  Company  has not
investigated  the   availability,   source,  or  terms  that  might  govern  the
acquisition of additional  capital and will not do so until it determines a need
for additional financing. If additional capital is needed, there is no assurance
that funds will be available from any source or, if available,  that they 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. See "Use of Proceeds" and "Business."

          20.   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 on
the assets of the business  opportunity to be acquired,  on the projected future
revenues, or the profitability 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,  and investors  should be aware
that the Company has not established any specific criteria or plan in connection
with analyzing whether, and to what extent, a particular  candidate's operations
can  support the  leverage  the  Company  would  incur in a  leveraged  buy-out.
Investors should also be aware of the high default rate experienced  recently by
entities entering into leveraged  transactions,  many of which defaults resulted
from overly optimistic analyses and income projections.

         21.  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. See "Business."

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

          23.  Loss of Control  by  Present  Management  and  Stockholders.  The
Company may consider an  acquisition  in which the Company  issues a substantial
amount of its  authorized  but unissued  Common  Stock (80% or more  control) as
consideration  for  any  business  opportunity  acquired.  The  result  of  such
acquisition  would be that the acquired  Company's  stockholders  and management
would  control the Company,  and the Company's  management  could be replaced by
persons  unknown at this time.  Such a merger could leave the  investors in this
offering  with  stock  worth  substantially  less  than the  price  paid in this
offering,  and a  greatly  reduced  percentage  of  ownership  of  the  Company.
Management  could  sell its  control  block of stock at a


                                       6
<PAGE>

premium price to the acquired company's stockholders, although management has no
present plans to do so. See "Certain Transactions with Management and Others."

          24.  Dilutive  Effects of Issuing  Additional  Common Stock.  The vast
majority of the  Company's  authorized  but  unissued  Common  Stock will remain
unissued  after  this  offering,  even if all  Units  offered  are  sold and all
Warrants  offered  are  exercised.  The board of  directors  of the  Company has
authority  to issue such  unissued  shares  without  the  consent or vote of the
stockholders of the Company. The issuance of these shares may further dilute the
interests  of  investors  purchasing  in this  offering  and will  reduce  their
proportionate ownership and voting power in the Company.


The Offering

          25.  Determination  of Offering and Exercise Price. The price at which
the  Units  are being  offered  to the  public  and the  exercise  prices of the
Warrants have been  arbitrarily  determined by the Company.  Such prices bear no
direct  relationship to the Company's assets, net worth or prospects,  or to any
other recognized criteria of value.

          26. Loss of Beneficial Use of Subscription  Funds.  Under the terms of
this  offering,  subscription  funds for Units will be deposited into escrow and
held for the offering period of 90 days (up to 180 days, if extended),  or until
this offering is abandoned or closed,  whichever  occurs first.  The Company has
reserved the right to reject any  subscription,  and cancel any  confirmation of
sale issued,  in whole or in part,  prior to closing,  even if the  subscriber's
funds are held in escrow until the  offering is abandoned or closed,  warranting
only to refund such funds as promptly as shall be practicable  after abandonment
or closing,  as the case may be. In this regard,  the  investor  should be aware
that under specified  circumstances  federal law,  including the Expedited Funds
Availability  Act of 1988 and Regulation CC (pertaining to the  availability  of
funds and the collection of checks), permits a bank to withhold payment of funds
on a deposit made by a check drawn on a "nonlocal"  bank for up to seven working
days pending  collection of the check through the applicable bank check clearing
system. As a result,  monies derived from a subscription payment that shall have
been made by check may not be available  to the  Company,  either for closing of
the offering or for possible  refund to the subscriber  following a rejection of
all or a portion of the  subscription or the abandonment of the offering,  until
as  many as  seven  business  days  following  the  subscriber's  tender  of the
subscription  funds to the bank. It is anticipated that a decision to reject all
or a portion of a given subscription shall not be made until on or near the date
of closing of the  offering.  Assuming  that,  consistent  with  federal  law as
described above,  funds for a particular  subscription  have become available to
the Company for refund, it is likely that  approximately one working day will be
required  for the  Company to notify  the escrow  bank that a refund of all or a
portion of the subscription funds should be made and for the bank to prepare and
mail a refund check to the subscriber.  The date upon which a refund check would
be mailed will depend,  therefore,  upon the relationship  between the date upon
which a subscription  check shall have been tendered and the date upon which the
offering shall have been closed or abandoned.  The closer the tender shall be to
the date of closing or  abandonment,  the longer the mailing of the refund check
is likely to be  delayed,  up to a total of  approximately  eight  working  days
following closing or abandonment. Subscribers could thus lose the beneficial use
of their  subscription  funds for up to approximately 190 calendar days, without
interest,  and there is no guarantee that the subscriber will receive any or all
of the Units  subscribed for, even if the offering closes.  Moreover,  no method
has been  determined  by which to prorate  subscriptions  should the offering be
over-subscribed, and no proration may be made.

          27.  Control  by  Present  Stockholders.   After  completion  of  this
offering, the present stockholders will own approximately 83% of the outstanding
Common  Stock,  assuming  that only the  minimum  number  of Units is sold,  and
approximately  71%,  assuming  that the maximum  number of Units is sold.  These
figures  do not take  into  account  any  Units in this  offering  which  may be
purchased by present  stockholders,  though no arrangements  have been made, and
the Company does not anticipate any future  arrangements,  whereby shares of the
offering  are  reserved  for  sale  to  such  persons.   Because  the  Company's
Certificate of Incorporation  does not permit


                                       7
<PAGE>

cumulative  voting for the  election  of  directors,  it is likely  that  public
purchasers of Units will not have the power to elect a single director and, as a
practical  matter,  the  present  stockholders  will have the power to elect all
directors and effectively  control the Company.  See "Description of Securities"
and "Principal Stockholders."

          28. Sale of Minimum Number of Units.  This offering is being made on a
"best efforts,  minimum-maximum"  basis.  If only the minimum number of Units is
sold, the Company's  operations and the scope of business  opportunities open to
it will be  significantly  curtailed.  The degree of risk to  investors  in that
event will be increased correspondingly.

          29. No Public Market Exists.  There  currently is no public market for
the Units, Common Stock or Warrants being offered, and no assurance can be given
that a market will develop  subsequent to this offering or that  purchasers will
be able to resell  their  securities  at the public  offering  price,  or that a
purchaser will be able to liquidate his investment without  considerable  delay,
if at all. If a market does 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.  Due to the low
price of the  securities,  many  brokerage  firms may not be  willing  to effect
transactions  in the  securities.  Even if a purchaser finds a broker willing to
effect  a  transaction  in  these  securities,   the  combination  of  brokerage
commissions,  state  transfer  taxes,  if any, and any other  selling  costs may
exceed the selling price. Further, many lending institutions will not permit the
use of such securities as collateral for any loans.

          30. No Market Maker - Possible  Dominance  of Market by Single  Market
Maker.  Even if the Company proves to be successful in selling the Units offered
hereunder,  and  the  Company's  securities  become  eligible  to be  traded  by
securities brokers and dealers which are members of the National  Association of
Securities  Dealers,  Inc.  ("NASD")  in the  "pink  sheets"  maintained  by the
National  Quotation  Bureau,  Inc.,  the Company has no agreement  with any NASD
member to act as a market maker for the Company's securities.  If the Company is
unsuccessful   in  obtaining  one  or  more  market  makers  for  the  Company's
securities,  the trading  level and price of the  Company's  securities  will be
materially  and  adversely  affected.  If the Company is successful in obtaining
only one market maker for the  Company's  securities,  the market maker would in
effect dominate and control the market for such securities.  Although management
intends  to   contact   several   broker-dealers   concerning   their   possible
participation  as a  market  maker in the  Company's  securities  following  the
conclusion of this offering, there is no assurance management will be successful
in obtaining any market makers for the Company's securities.

          31. Dilution. The Company's present stockholders,  including officers,
directors and founders,  have acquired their controlling interest in the Company
at an average weighted cost that is substantially  less than the public offering
price of the  Units.  Public  purchasers  of Units  will  suffer  immediate  and
substantial  dilution of $.0836 per share of Common Stock (83.6%),  assuming the
sale of only the minimum  number of Units,  and $.0714 per share of Common Stock
(71.4%), assuming the sale of all Units being offered. These calculations do not
take into account the issuance of up to an additional 9,000,000 shares of Common
Stock if all  Warrants  are  exercised,  which event  could  result in a further
dilution of the net tangible book value per share of the shares  outstanding  at
such time,  if the net tangible  book value of the Common Stock then exceeds the
Warrant exercise price. See "Dilution and Other Comparative Data."

          32. Benefit  to Present  Stockholders.  Because  present  stockholders
acquired their shares at prices  substantially  lower than the offering price of
the Units,  they will  experience  an increase in the present net tangible  book
value of their shares  amounting to $.0l51,  assuming sale of the minimum number
of  Units,  and  $.0273,  assuming  sale of all the  Units  being  offered.  See
"Dilution and Other Comparative Data."

          33. Preferred Shares  Authorized.  The Certificate of Incorporation of
the Company authorizes issuance of a maximum of 20,000,000 Preferred Shares, par
value  $.00001  per share.  While no  Preferred  Shares  have been issued or are
outstanding on the date of this  Prospectus and there is no plan to issue any in
the foreseeable  future,  if issued,  the terms of a series of Preferred  Shares
could  operate to the  significant  disadvantage  of the


                                       8
<PAGE>

holders of outstanding  Common Shares.  Such terms could include,  among others,
preferences  as to dividends,  possible  voting  rights,  and  distributions  on
liquidation. See "Description of Securities - Preferred Stock."

          34. Possible Rule 144 Sales.  All of the outstanding  shares of Common
Stock held by present  stockholders  are  "restricted  securities" as defined by
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  exemption  from
registration  under the Act and as required under  applicable  state  securities
laws.  Rule  144  provides  in  essence  that a person  who has held  restricted
securities for a period of two years may, under certain  conditions,  sell every
three  months,  in  brokerage  transactions,  a number of shares  which 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 the sale.
There is no limit on the amount of restricted  securities  that may be sold by a
nonaffiliate  after the restricted  securities have been held by the owner for a
period of three  years.  A sale under Rule 144 or any other  exemption  from the
Act, if  available,  or  subsequent  registrations  of shares of Common Stock of
present stockholders,  may have a depressive effect upon the price of the Common
Stock in any market  that may  develop.  A total of  5,000,000  shares of Common
Stock will become available for sale under Rule 144 beginning in April 1992, and
an  additional  2,300,000  shares will become  available for sale under Rule 144
beginning  in May  1992,  all of which  will be  subject  to  applicable  volume
restrictions under the Rule.

          35. Market Overhang of Warrants.  The Warrants  offered as part of the
Units are  detachable and may be separately  traded and quoted,  if a market for
the Warrants develops. Each Warrant is exercisable for one share of Common Stock
for a period  commencing on the date of this  Prospectus and  terminating on the
second anniversary thereof. Each Class A Warrant, each Class B Warrant and Class
C Warrant  carries  an  exercise  price of $.30,  $.75 and  $1.30, respectively.
Exercise  of the  Warrants  can be  expected  to have an  adverse  effect on the
trading price of and market for the Common Stock,  if any such market  develops.
Even if a public  market for the Common  Stock  develops,  it is  unlikely  that
normal market forces will cause an increase in the bid price of the Common Stock
to the level of the exercise price of the Warrants.  It is possible that so long
as the Warrants  remain  outstanding  their existence will prevent a rise in the
price of the Common Stock higher than the exercise price of any of the Warrants.
See "Description of Securities - Warrants."

          36.  Exercise of Warrants  Uncertain.  Because of the lack of a market
for the Warrants and the uncertainty of the Company's potential for success, the
Warrants  may not be  exercised  before  they  expire,  with the result  that no
Warrant proceeds would be received by the Company. The Warrants may be exercised
only at a time when a current prospectus is in effect and only if the shares are
qualified for sale under  applicable  securities laws of the states in which the
various  Warrantholders  reside.  Although  the Company  intends to use its best
efforts to keep this  Prospectus  current during the Warrant  exercise  periods,
there is no assurance that it will do so or that it will be financially  able to
do so. See  "Description  of Securities - Warrants."  Investors  should be aware
that  proceeds  received by the  Company  from the  exercise of Warrants  may be
subject to the escrow provisions  contained in the Colorado  Securities Act. See
"Use of Proceeds."

          37. Possible  Redemption of Warrants  without  Notice.  The Company is
entitled  to redeem the  Warrants  without  prior  notice to the  warrantholders
should the  representatives  of a business  opportunity  with which the  Company
wishes to combine  require,  as a condition to consummation of the  combination,
that the Warrants be redeemed. Under these circumstances, the warrantholder will
have no opportunity to exercise the purchase  rights under the Warrants prior to
redemption. See "Description of Securities - Warrants."

          38. Substantial Offering Expenses.  The Company estimates that it will
incur expenses of $20,500 in connection  with this offering.  These expenses are
substantial, especially in view of the amount to be raised by this offering, and
will significantly  decrease the amount of net offering proceeds which otherwise
would be available to the Company. See "Use of Proceeds."


                                        9
<PAGE>


          39. Lack of Underwriter.  The minimum number of Units is being offered
by the Company,  through its President,  on a "best efforts,  all-or-none" basis
and the Company has not retained an  underwriter  or selected  broker-dealer  to
assist the  Company  in  offering  the Units.  The  Company's  President  has no
experience  in the  offer  and  sale  of  securities  on  behalf  of an  issuer.
Consequently,  the Company  may be unable to effect a sale of the Units  without
the assistance of a broker-dealer.  Should it prove necessary for the Company to
retain a  broker-dealer,  the offering of the Units would be suspended  until an
amendment to the Company's  Registration  Statement,  including this Prospectus,
shall have been made to reflect such retention. The Registration Statement would
then require  additional  review and  clearance by the  Securities  and Exchange
Commission,  the National  Association  of Securities  Dealers,  Inc., and state
regulatory  authorities.  The Company  could be  expected  to incur  significant
additional legal and accounting costs if further reviews were


required to be undertaken  by  governmental  authorities.  There is no assurance
that the Company  shall prove to be capable of selling all, or any, of the Units
offered without the assistance of an underwriter or broker-dealer. See "Terms of
Offering."

         40. Blue Sky  Considerations.  It is entirely possible that, because of
exemptions from  registration  contained in certain state  securities  laws, the
Warrants contained in the Units lawfully may be sold to residents of such states
in any  aftermarket  which  may  develop  for the  Warrants.  Nevertheless,  the
securities  laws of such  states may prevent  the  exercise of such  Warrants by
residents of those states because the common shares underlying the Warrants were
never registered  there. In this event,  holders of the Warrants in those states
would be forced to sell their  Warrants or hold them until they expire,  without
any opportunity to exercise the Warrants.

          41.  Broker-Dealer  Sales  of  Company's  Registered  Securities.  The
Company's  Units,  Common Stock and  Warrants  are covered by a  Securities  and
Exchange Commission rule that imposes additional sales practice  requirements on
broker-dealers  who sell such  securities  to  persons  other  than  established
customers and accredited investors (generally institutions with assets in excess
of  $5,000,000 or  individuals  with net worth in excess of $1,000,000 or annual
income  exceeding   $200,000  or  $300,000  jointly  with  their  spouse).   For
transactions  covered  by the  rule,  the  broker-dealer  must  make  a  special
suitability  determination for the purchaser and receive the purchaser's written
agreement  to the  transaction  prior to the  sale.  Consequently,  the rule may
affect the ability of purchasers  in this  offering to sell their  securities in
the secondary market.


          42.  Impact of Amendments to the Colorado  Securities  Act.  Effective
July 1, 1990,  the State of  Colorado  repealed  its prior  securities  laws and
enacted  the  Colorado  Securities  Act,  which  provides  that  where less than
seventy-five  percent  of the net  proceeds  from  the  sale of  securities  are
committed for use in one or more specific  lines of business,  eighty percent of
the net  proceeds  received  by the issuer  shall be placed in escrow  until (i)
completion of a  transaction  or series of  transactions  whereby at least fifty
percent of the gross proceeds received from the sale of securities are committed
for use in one or more  specific  lines  of  business,  and (ii)  notice  of the
proposed  release  of the  escrowed  funds  has been on file  with the  Colorado
Division of Securities for at least ten days. The Company intends to make offers
of the Company's Units to residents of Colorado,  and, accordingly,  anticipates
that this offering will be subject to the above-described escrow provisions.  In
such event,  the use of proceeds table shall not be affected except that certain
allocated  funds may not be available  for payment until funds are released from
the escrow.  As such,  investors  should be aware that since many  providers  of
goods and services require  compensation for such goods and services at the time
or soon after the time  rendered,  the  inability of the Comapny to pay until an
indeterminate  future time may make it difficult to procure  goods and services.
Moreover,  while the Company  intends to set aside out of the  non-escrowed  net
proceeds  sufficient  funds for auditing  work,  investors  should be aware that
unpaid fees are generally regarded as an impediment to independence and may make
it  impossible  for the  Company's  auditors  to perform an  independent  audit.
Imposition of the escrow  provisions may require the Company to seek  additional
financing for payment of  administrative  and overhead expenses until such time,
if ever, the Company can successfully  complete a business  combination  whereby
proceeds  from the offering are committed to a specific line of business and the
proceeds in escrow are released.  The Company has entered into an agreement with
Omnibank Aurora, located in Aurora, Colorado, providing for the establishment of
an escrow  account to hold the proceeds,  subject to the  aforementioned  escrow
provisions. See "Terms of Offering - Escrow of Net Proceeds" and "Risk Factors -
Possible  Distribution of Escrow Funds After Four Years."  Investors should also
be aware  that the  provisions  of the  Colorado  Securities


                                       10

<PAGE>


Act will apply to proceeds of any exercise of Warrants  prior to the  completion
of a transaction  meeting the  requirements of the Colorado  Securities Act. See
"Use of Proceeds."

          43.  Possible  Distribution  of Escrowed  Funds After Four Years.  If,
after four (4) years from the date funds are deposited  into an escrow  account,
established in accordance with the Colorado Securities Act (the "Colorado escrow
account"),  the  Company has not  consummated  a business  combination  that has
resulted in the release of the funds  escrowed in  compliance  with the Colorado
Securities  Act,  the escrow  agreement  that the Company has entered  into with
Omnibank Aurora,  Colorado (for purposes of this paragraph,  the "escrow agent")
provides that the escrow agent shall,  as promptly as possible,  distribute  the
funds in the Colorado  escrow  account to the persons then holding the shares of
the Company's  common stock issued in this offering on a pro rata basis based on
the  number of shares  held.  See "Risk  Factors - Impact of  Amendments  to the
Colorado Securities Act." Therefore,  investors in this offering should be aware
that, in the event of a distribution as described in the previous sentence, only
a portion of the funds  originally  invested will be  distributed to the persons
then holding  shares issued in this  offering,  without any interest  being paid
thereon.  Neither the  Colorado  escrow  agreement,  nor any  distribution  made
thereunder,  shall affect ownership of the Units issued in this offering,  i.e.,
the  shareholders  who  receive  their pro rata  portion  of the  aforementioned
distribution  shall not be  required  to  return  their  Units to the  Company's
treasury.  See  "Terms of  Offering  - Escrow of Net  Proceeds."  In the event a
distribution  is made, as provided  above,  the Company's  ability to adequately
investigate  and  evaluate  business  opportunities  and  to  attract  favorable
business opportunities will be adversely affected.


                       DILUTION AND OTHER COMPARATIVE DATA


         The net tangible  book value of the Common  Stock at June 6, 1990,  was
$9,906,  or  approximately  $.0014  per  share.  That  per-share  value  will be
increased as a result of this offering to approximately $.0165 if the minimum is
sold and $.0286 if the maximum is sold (without  adjustment for other changes in
net  tangible  book value  subsequent  to such date),  resulting  in  immediate,
substantial  dilution  to public  investors  of $.0836  (83.6%) per share if the
minimum is sold and $.0714 (71.4%) per share if the maximum is sold. Dilution is
the reduction

in value of the purchaser's  investment  measured by the difference  between the
$.10 price per Unit in the public  offering and the net tangible  book value per
share after completion of the offering.

<TABLE>
         The following  table,  which assumes the  successful  completion of the
offering described herein by the sale of 1,500,000 Units (minimum) and 3,000,000
Units  (maximum),  illustrates  the  per-share  dilution  to  investors  in this
offering,  without  giving  effect to the issuance of up to 9,000,000  shares of
Common Stock upon exercise of the Warrants included in the Units.
<CAPTION>
                                                             Minimum                      Maximum
                                                             -------                      -------
<S>                                                           <C>                          <C>
         Public offering price per Unit                       $.10                         $.10

         Net tangible book value per share at
         June 6, 1990 (1)                                     $.0014                       $.0014



          Pro forma net tangible book value after
          the offering                                        $144,791(2)                  $294,791(3)

          Pro forma net tangible book value per share
          after the offering (1)                              $.0165                       $.0286

          Increase, attributable to purchases by
          investors in this offering, in net
          tangible book value per share of
          currently outstanding shares                        $.0151                       $.0273


                                       11
<PAGE>

          Dilution per share to public investors              $.0836                       $.0714

          Dilution as a percentage of offering price           83.6%                        71.4%

-------------------
<FN>
          (1)      Net tangible  book value per share is  determined by dividing
                   the  number  of  Common  Shares  outstanding  into the  total
                   tangible assets less total liabilities of the Company.

          (2)      The figure shown is the sum of the net tangible book value of
                   $9,906 at June 6, 1990,  plus  proceeds of $150,000  from the
                   sale of the minimum number of Units in this  offering,  minus
                   registration costs (anticipated registration costs of $20,500
                   less deferred offering costs of $5,385) of $15,115.

          (3)      The figure shown is the sum of the net tangible book value of
                   $9,906 at June 6, 1990,  plus  proceeds of $300,000  from the
                   sale of the maximum number of Units in this  offering,  minus
                   registration costs (anticipated registration costs of $20,500
                   less deferred offering costs of $5,385) of $15,115.
</FN>
</TABLE>

          Upon successful conclusion of this offering, the public investors will
own 1,500,000 shares (minimum) or 3,000,000 shares (maximum)  (approximately 17%
in case of the  minimum  or  approximately  29% in case of the  maximum)  of the
issued  and  outstanding  Common  Stock,  for which they will have paid $.10 per
Unit.  This compares  with  7,300,000  shares of Common Stock  acquired from the
Company  since  inception  by  officers,  directors  and  founders  at a cost of
$16,000,   or  approximately   $.0022  per  share,  and  which  will  constitute
approximately  83% of the issued and  outstanding  Common Stock  following  this
offering if the minimum is sold, or approximately 71% if the maximum is sold.

<TABLE>

          The table set forth below summarizes the difference between the number
of shares of Common  Stock  purchased  from the Company,  the average  price per
share, and the aggregate  consideration paid by existing stockholders and public
investors.

<CAPTION>

                                                       Minimum Offering

                                                 Pct. of        Average                            Percent
                                Shares             Total         Price/           Total            of Total
                              Purchased           Shares         Share        Consideration      Consideration
                              ---------          -------        -------       -------------      -------------
<S>                           <C>                 <C>            <C>             <C>                <C>
Present
   Stockholders               7,300,000            83.0%         $.0022          $ 16,000             9.6%
Public Investors              1,500,000            17.0%         $.10             150,000            90.4%
                              ---------           -----                          --------           -----
  Total                       8,800,000           100.0%                         $166,000           100.0%
                              =========           =====                          ========           =====

</TABLE>

<TABLE>
<CAPTION>


                                                    Maximum Offering


                                                 Pct. of        Average                            Percent
                                 Shares            Total         Price/           Total            of Total
                              Purchased          Shares          Share        Consideration      Consideration
                              ----------         -------        -------       -------------      -------------
<S>                            <C>                <C>            <C>             <C>                <C>
Present
  Stockholders                 7,300,000          70.9%          $.0022          $ 16,000             5.1%
Public Investors               3,000,000          29.1%          $.10             300,000            94.9%
                              ----------          ----                           --------           -----
  Total                       10,300,000          100.0%                         $316,000           100.0%
                              ==========          =====                          ========           =====

</TABLE>

                                       12
<PAGE>

                                 USE OF PROCEEDS

          The  Company  will  receive net  proceeds  from this  offering,  after
deducting  offering-related  expenses, of approximately  $129,500 if the minimum
number of Units is sold and  $279,500  if the maximum  number is sold;  however,
investors  should be aware that eighty percent of the net proceeds  ($103,600 if
the minimum  number of Units is sold and $223,600 if the maximum number of Units
is sold) will be subject to an escrow for an indeterminable period. See Note (6)
below.  Net proceeds are  anticipated  to be used in the order of priority shown
below:

                                                        Minimum          Maximum
                                                        Amount           Amount
                                                        ------           ------
General and Administrative:
     Legal (1)                                         $ 10,000         $ 10,000
     Accounting                                           2,000            2,000
     Miscellaneous                                        1,000            1,000
     Officer Salaries (2)                                 9,000            9,000
Expenses of Investigating and
Evaluating a Prospective
Business Opportunity:
     Travel                                            $  1,500         $  6,000
     Finders (3)(4)                                      15,000           30,000
     Legal (5)                                           14,000           14,000
     Accounting                                           2,500            2,500
Unallocated Proceeds
     Available for
     Acquisitions & Mergers (4)                        $ 75,000         $205,000
                                                       --------         --------
Total Proceeds (6)                                     $129,500         $279,500
                                                       ========         ========


          (1)  The  figures  shown  reflect  general  corporate  and  securities
compliance work only.

          (2)  Commencing  after  completion  of  this  offering,  each  of  the
Company's  two officers will be  compensated  at a rate of $45 per hour for time
devoted to the affairs of the Company in excess of five hours per month, limited
only by a cap of $1,500  per  month and a total cap of $4,500 on each  officer's
salary during the Company's first year in operation.

          (3)  Should  the  Company  complete  the  acquisition  of  a  business
opportunity,  the Board of  Directors  may award a finder's fee to an officer or
affiliate of the Company,  or to a third party, if the acquisition is originated
as a result of his efforts.  The cash portion of this fee, in the aggregate,  if
paid to officers or affiliates, will not exceed 10% of the gross proceeds of the
offering and may be less.

          (4) All of these proceeds will be segregated from the remainder of the
net  proceeds  and placed  into a bank  account or other  temporary  investment,
subject  to the  escrow  provisions  contained  in the  newly  enacted  Colorado
Securities Act. See Note (6).

          (5) A portion of these proceeds will be segregated  from the remainder
of the  net  proceeds  and  placed  into  a  bank  account  or  other  temporary
investment,  subject to the escrow  provisions  contained  in the newly  enacted
Colorado Securities Act. See Note (6) below.  Specifically,  all but $400 of the
proceeds  allocated  for  payment of legal fees will be subject to the escrow if
only the minimum  number of Units is sold,  and all but $6,800 of those proceeds
will be subject to the escrow if the maximum number of Units is sold.

          (6) Effective July 1, 1990,  the State of Colorado  repealed its prior
securities  laws and enacted the Colorado  Securities  Act,  which provides that
where  less  than  seventy-five  percent  of the net  proceeds  from the sale of
securities  are  committed  for use in one or more  specific  lines of business,
eighty  percent of the net  proceeds  received by the issuer  shall be placed in
escrow until (i) completion of a transaction or series of


                                       13

<PAGE>


transactions  whereby at least fifty percent of the gross proceeds received from
the sale of securities  are  committed for use in one or more specific  lines of
business, and (ii) notice of the proposed release of the escrowed funds has been
on file with the  Colorado  Division of  Securities  for at least ten days.  The
Company  intends to make offers of the Company's Units to residents of Colorado,
and,  accordingly,  anticipates  that  this  offering  will  be  subject  to the
above-described  escrow  provisions.  In such event,  the use of proceeds  table
shall not be affected  except that certain  allocated funds may not be available
for payment until funds are released from the escrow. As such,  investors should
be aware that since many  providers of goods and services  require  compensation
for such goods and  services  at the time or soon after the time  rendered,  the
inability of the Comapny to pay until an  indeterminate  future time may make it
difficult to procure goods and services.  Moreover, while the Company intends to
set aside out of the  non-escrowed  net proceeds  sufficient  funds for auditing
work,  investors  should be aware that unpaid fees are generally  regarded as an
impediment to independence and may make it impossible for the Company's auditors
to perform an independent audit. See "Risk Factors - Impact of Amendments to the
Colorado  Securities  Act." "Possible  Distribution of Escrowed Funds After Four
Years," and "Terms of Offering - Escrow of Net Proceeds."


          The table set forth above reflecting the use of proceeds is merely the
Company's  good-faith  estimate.  Because  the  Company  has  no  agreements  or
understandings, preliminary or otherwise, for any future acquisitions and has no
specific enterprises  targeted for acquisition,  the Company is unable to make a
specific allocation of the net proceeds of this offering.  Subsequent events may
require a  reallocation  of available  funds  affecting one or more of the above
listed  categories  of  expenditure.  Any  such  reallocation  will  be  at  the
discretion of the Company's Board of Directors. The allocations reflected in the
table  also  do  not  provide  for  any  revenues  generated  by  the  Company's
operations,  if any, or  operations  of any  business  opportunity  which may be
acquired,  during the one-year  period  following  the closing of this offering.
Should the sale of Units result in proceeds of less than the maximum  amount but
greater than the minimum amount,  the use of proceeds will be adjusted among the
categories of expenditure as management deems best.

          Since the Company does not know to what  extent,  if any, the Warrants
may be  exercised,  and because it is unlikely  that such  Warrants will ever be
exercised, the Company has not made specific plans for the use of proceeds which
might be received upon the exercise of such Warrants.  Investors should be aware
that if less than seventy-five  percent of the net proceeds from the exercise of
Warrants is committed  for use in one or more  specific  lines of business,  the
proceeds  from the  exercise  of  Warrants  will  likely  be placed in an escrow
pursuant to the Colorado Securities Act. See Note (6) above.

          Subject to certain escrow requirements  described above, all funds not
being  utilized  by the  Company  will be held in  interest-bearing  accounts or
investments in commercial  financial  institutions until such time as it appears
the funds will be required. See "Risk Factors - The Company - Investment Company
Regulation."  Other than  interest  income,  the  Company  does not at this time
anticipate  generating  revenues  unless and until an  acquisition  candidate is
identified, and a business combination consummated with such candidate, in which
case the Company may begin to generate  revenues from  operations,  depending on
the performance of the newly acquired business.

                                    BUSINESS

General

          The Company was  incorporated  under the laws of the State of Delaware
on April 27, 1990, and is in the early  developmental and promotional stages. To
date the Company's only  activities  have been  organizational,  directed at the
raising of capital. The Company has not commenced any commercial  operations and
is entirely dependent upon the successful  completion of this offering to do so.
The Company has no full-time employees and owns no real estate.


                                       14
<PAGE>

          The  Company   proposes  to   implement  a  business   plan  to  seek,
investigate,  and, if warranted,  acquire one or more  properties or businesses.
Such an  acquisition  may be made by  purchase,  merger,  exchange  of  stock or
otherwise, and may encompass assets or a business entity, such as a corporation,
joint venture or  partnership.  Even if the maximum number of Units is sold, the
Company will have 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.


         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.  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,  or that any acquisition that occurs
will  be on  terms  that  are  favorable  to the  Company  or its  stockholders.
Moreover,  if,  after four (4) years from the date funds are  deposited  into an
escrow account,  established in accordance with the Colorado Securities Act (the
"Colorado  escrow  account"),   the  Company  has  not  consummated  a  business
combination that has resulted in the release of the funds escrowed in compliance
with the  Colorado  Securities  Act, the escrow  agreement  that the Company has
entered into with Omnibank Aurora, located in Aurora,  Colorado (for purposes of
this paragraph,  the "escrow  agent"),  provides that the escrow agent shall, as
promptly as possible, distribute the funds in the Colorado escrow account to the
persons  then  holding the shares of the  Company's  common stock issued in this
offering  on a pro rata  basis  based on the  number of shares  held.  See "Risk
Factors - Impact of  Amendments  to the Colorado  Securities  Act" and "Possible
Distribution  of Escrowed Funds After Four Years." In that event,  the Company's
ability to adequately  investigate and evaluate  business  opportunities  and to
attract favorable business opportunities will be adversely affected.


          The Company's  search will be directed  toward small and  medium-sized
enterprises.  The Company anticipates that the business opportunities  presented
to it will (i) be recently organized with no operating history,  or a history of
losses   attributable   to   under-capitalization   or  other  factors; (ii)  be
experiencing financial or operating  difficulties;  (iii) be in need of funds to
develop a new product or service or to expand into a new market; (iv) be relying
upon an untested product or marketing concept;  or (v) have a combination of the
characteristics   mentioned  in  (i)  through  (iv).  The  Company   intends  to
concentrate  its  acquisition  efforts  on  properties  or  businesses  which it
believes to be  undervalued.  Given the above factors,  investors  should expect
that  any   acquisition   candidate   may  have  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 includes 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 those  opportunities,  economic
conditions and

other factors. In addition, because of the impact of the proceeds escrow imposed
by the  Colorado  Securities  Act,  it can be  expected  that the  Company  will
consider only those business combinations that, when consummated, will result in
at least fifty percent of the gross proceeds from the offering  being  committed
for use in one or more specific lines of business. See "Use of Proceeds."

          As a  consequence  of this  offering,  the  Company may be acquired by
another  entity  that  desires to become a public  company  while  avoiding  the
registration  requirements  of the federal  securities  laws. In connection with
such  acquisition,  it is highly  likely  that an  amount of stock  constituting
control of the Company would be issued by the Company or purchased  from current
officers  and  directors by the  acquiring  entity.  If stock is purchased  from
officers and directors,  the  transaction  could result in substantial  gains to
such officers and directors  relative to their original  purchase price for such
stock. In the Company's  judgment,  its officers and directors would not thereby
become  "underwriters" within the meaning of the Section 2(11) of the Securities
Act of 1933, as amended.


                                       15
<PAGE>

          It is  anticipated  that  business  opportunities  will  come  to  the
Company's attention from various sources,  including its officers and directors,
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  plans,
understandings,  agreements or commitments with any individuals for such persons
to act as a finder of opportunities for the Company.

          The Company does not foresee that it would  purchase an interest in or
enter into a contract with any business with which an officer or director of the
Company is affiliated.  Should the Company's management determine in the future,
contrary  to  management's  current  expectations,  that a  transaction  with an
affiliate  would be in the best  interests of the Company and its  stockholders,
the Company's  Certificate  of  Incorporation  would permit the Company to enter
into such a  transaction  only if (i) the Board of  Directors of the Company has
been apprised of the  relationship or interest of the officer and director and a
disinterested  majority of the board members have approved the  transaction,  or
(ii) the  stockholders of the Company have been informed of the  relationship or
interest  and  approve the  transaction,  or (iii) the  transaction  is fair and
reasonable to the Company.

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, 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 firm may not  necessarily be indicative
of the potential for the future because of the possible need to shift  marketing
approaches substantially,  expand significantly, change product emphasis, change
or substantially augment management,  or make other changes. Because of the lack
of training or  experience  of the  Company's  management,  the Company  will be
dependent  upon the owners of a business  opportunity  to identify such problems
and to  implement,  or be  primarily  responsible  for  the  implementation  of,
required changes.  Because the Company may participate in a business opportunity
with a newly  organized  firm or with a firm  which is  entering  a new phase of
growth, it should be emphasized that the Company will incur further risks, since
management   in  many   instances   will  not  have  proved  its   abilities  or
effectiveness,  the eventual market for such company's products or services will
likely not be established, and such company may not be profitable when acquired.

          It is anticipated that the Company will not be able to diversify,  but
will essentially be limited to one such venture 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.

          It  is   emphasized   that   management  of  the  Company  may  effect
transactions  having a  potentially  adverse   impact upon the public  investors
pursuant  to the  authority  of the  Company's  Board of  Directors  to complete
acquisitions  without  submitting  any  proposal to the  stockholders  for their
consideration.  In some  instances,  however,  the proposed  participation  in a
business   opportunity   may  be  submitted  to  the   stockholders   for  their
consideration,  either  voluntarily  by the  Board  of  Directors  to  seek  the
stockholders' advice and consent or because state law so requires.

         The analysis of business  opportunities  will be undertaken by or under
the  supervision of the officers and  directors,  none of whom is a professional
business  analyst or has any  previous  training or  significant  experience  in
business  analysis.   See  "Management."  The  Company  will  have  unrestricted
flexibility in seeking,  analyzing and participating in business  opportunities;
however,  because of the impact of the proceeds  escrow  imposed by the Colorado
Securities  Act, it can be expected  that the Company will  consider  only those
business  combinations  that,  when  consummated,  will result in at least fifty
percent of the gross proceeds from the offering  being


                                       16
<PAGE>

committed  for  use in one or more  specific  lines  of  business.  See  "Use of
Proceeds." Otherwise, the Company anticipates that it will consider, among other
things, the following factors:

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

         (b) 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;

         (c)  Strength  and  diversity  of existing  management,  or  management
prospects that are scheduled for recruitment;

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

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

         (f) The extent to which the business opportunity can be advanced;

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

          (h) The accessibility of required management expertise, personnel, raw
materials, services, professional assistance and other required items; and

          (i) Whether the financial condition of the business  opportunity would
be, or would have a significant  prospect in the  foreseeable  future to become,
such  as to  permit  the  securities  of the  Company,  following  the  business
combination,  to  qualify  to  be  listed  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  15c2-6  recently  adopted  by the
Securities and Exchange  Commission.  See "Risk Factors - Broker-Dealer Sales of
Company's Registered Securities."

          In regard to the last criterion  listed above,  the current  standards
for NASDAQ listing  include the  requirements  that the issuer of the securities
that are sought to be listed have total  assets of at least  $2,000,000  and net
assets of at least $1,000,000.  A proposal that is currently under consideration
would raise those requirements to $4,000,000 and $2,000,000, respectively.

          Many,  and perhaps most, of the business  opportunities  that might be
potential  candidates  for a combination  with the Company would not satisfy the
current and proposed  NASDAQ  listing  criteria.  To the extent that the Company
seeks potential NASDAQ listing,  therefore,  the range of business opportunities
that shall be available for evaluation and potential  acquisition by the Company
shall be significantly limited.

          In  applying  the  foregoing  criteria,   no  one  of  which  will  be
controlling,  management will attempt to analyze all factors  appropriate to the
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.


                                       17
<PAGE>

          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,  and
persons  should not  purchase  Units in the offering if they expect a short-term
appreciation in the value of the Company's securities. It is unlikely that prior
to  consummating  a  business  combination,  the  Company  will  have any  funds
available to be loaned to the target  company  because eighty percent of the net
proceeds  will be subject to an escrow and not  available for purposes of a loan
to the target company. See "Use of Proceeds."

          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  such items as a description  of
product, service 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 services  marks or rights  thereto;  present and proposed forms of
compensation to management;  a description of transactions  between such company
and its  affiliates  during  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; and other information deemed relevant.

          As part of the  Company's  investigation,  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.

Form of Acquisition

         It is  impossible  to  predict  the  manner  in which the  Company  may
participate  in a business  opportunity;  however,  because of the impact of the
proceeds escrow imposed by the Colorado  Securities Act, it can be expected that
the  Company  will  consider  only  those  business   combinations   that,  when
consummated,  will result in at least fifty  percent of the gross  proceeds from
the offering being  committed for use in one or more specific lines of business.
See "Use of Proceeds." 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 that  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,  and there is no assurance that the Company would be the surviving
entity. In addition,  the present management and the stockholders of the Company
purchasing  securities  in this  offering most likely will 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
stockholders.

          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,  depends upon the issuance to the stockholders of
the acquired  company of up to 80% 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  stockholders  in such
circumstances  would retain in the aggregate 20% or less of the total issued and
outstanding


                                       18
<PAGE>

shares.  This could result in substantial  additional  dilution in the equity of
those who were stockholders of the Company prior to such reorganization.

          It is  anticipated  that any securities  issued in any  reorganization
would  be  issued  in  reliance  upon  exemptions,  if any are  available,  from
registration  under  applicable  federal  and  state  securities  laws.  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 or at specified times thereafter.  The
issuance of substantial  additional securities and their potential sale into any
trading  market  which  may  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 will enter into a
letter of intent  with the  management,  principals  or owners of a  prospective
business  opportunity.  Such a letter of intent  will set forth the terms of the
proposed  acquisition  but will not bind  either  the  Company  or the  business
opportunity 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 the  business  opportunity  will be bound  unless  and until a
definitive  agreement  concerning the  acquisition as described in the preceding
paragraph is executed,  and then only if neither party has any contractual right
to terminate the agreement on specified 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 theretofore incurred in the related  investigation would
not be recoverable. Moreover, since many providers of goods and services require
compensation  for such  goods and  services  at the time or soon  after the time
rendered, the inability of the Company to pay until an indeterminate future time
may make it difficult to procure 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.

          Section  3(a) of the  Investment  Act provides  the  definition  of an
"investment  company," which excludes any entity that does not engage  primarily
in the business of investing, reinvesting or trading in securities, or that does
not engage in the business of investing,  owning, holding or trading "investment
securities"  (defined as "all  securities  other than  government  securities or
securities of  majority-owned  subsidiaries")  the value of which exceeds 40% 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  exception  from the  definition  of
"investment company." Consequently, the Company's participation in a business or
opportunity  through the  purchase  and sale of  investment  securities  will be
limited. In order to avoid  classification as an investment company, the Company
may use a major  portion of the net  proceeds  of this  offering  to search for,
analyze and acquire or  participate  in a business  or  opportunity  by use of a
method  which  does  not  involve  the  acquisition,  ownership  or  holding  of
investment securities.


                                       19
<PAGE>
          The  Company's  plan of business  may  involve  changes in its capital
structure,  management,  control and business,  especially  if it  consummates a
reorganization  as  discussed  above.  Each of these areas is  regulated  by the
Investment  Act,  which  regulation  has the  purported  purpose  of  protecting
purchasers of investment company securities. Since the Company will not register
as an investment company, purchasers in this offering will not be afforded these
protections.

          Even if the Company restricts its activities as described above, it is
possible  that it may be  classified  as an  inadvertent  investment  company if
significant  delays are experienced in locating and expending a major portion of
the net proceeds of this offering on a business or opportunity other than by the
method of acquiring or holding investment securities.

          The  Company  intends  vigorously  to  resist   classification  as  an
investment  company,  and to take advantage of any exemptions or exceptions from
application  of the  Investment  Act,  which allows an entity a one-time  option
during any three-year  period to claim an exemption as a "transient"  investment
company. The necessity of asserting any such resistance,  or making any claim of
exemption,  could be time consuming and costly, or even  prohibitive,  given the
Company's limited resources.

          Any  securities  which the Company  might  acquire in exchange for its
Common  Stock  will  be  "restricted  securities"  within  the  meaning  of  the
Securities Act of 1933, as amended (the "Act").  If the Company elects to resell
such  securities,  such sale cannot proceed unless a registration  statement has
been  declared  effective  by  the  Securities  and  Exchange  Commission  or an
exemption  from  registration  was  available.  Section  4(1) of the Act,  which
exempts  sales  of  securities  not  involving  a  distribution,  would  in  all
likelihood be available to permit a private sale. Although the plan of operation
does not contemplate  resale of securities  acquired,  if such a sale were to be
necessary,  the Company  would be required to comply with the  provisions of the
Act to effect such resale.

          An  acquisition  made by the Company  may be in an  industry  which is
regulated or licensed by federal,  state or local  authorities.  Compliance with
such regulations can be expected to be a time-consuming and expensive process.

Competition

         The Company expects to encounter substantial competition in its efforts
to  locate  attractive   opportunities,   primarily  from  business  development
companies,  venture  capital  partnerships  and  corporations,  venture  capital
affiliates  of  large  industrial  and  financial  companies,  small  investment
companies   and  wealthy   individuals.   Many  of  these   entities  will  have
significantly greater experience, resources and managerial capabilities than the
Company and will  therefore be in a better  position  than the Company to obtain
access to attractive  business  opportunities.  The Company also will experience
competition  from other public  "blind pool"  companies,  many of which may have
more funds available than does the Company.

Administrative Offices

         The Company  presently  maintains  its offices at 12543-A  East Pacific
Circle, Aurora, Colorado 80014, the home of its Vice President. Its phone number
there is (303) 337-1033.  The Company believes these facilities will be adequate
for its needs in the foreseeable future. The Company pays no rent for the use of
these facilities.


Employees

          The  Company is a  development  stage  company  and  currently  has no
employees,  other than its officers.  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


                                       20
<PAGE>

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.  No remuneration will be paid to the Company's
officers  except  as  set  forth  under  the  subheading  "Remuneration"  in the
"Management"  section,  and under  "Certain  Transactions  with  Management  and
Others."

                                   MANAGEMENT

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


                 Name              Age          Position Held and Tenure
                 ----              ---          ------------------------
         John J. Micek III          37          President, Director
                                                since April 27, 1990

         Frank L. Kramer            47          Secretary, Treasurer,
                                                Director since April 27, 1990,
                                                Vice President since May 2, 1990

         Donald R. McGahan          56          Director since
                                                April 27, 1990

          The directors named above will serve until the first annual meeting of
the Company's stockholders.  Thereafter,  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  are  no  family
relationships  among the  officers and  directors.  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.  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 on average as little as five hours per month.

Biographical Information

          John J. Micek III.  Mr.  Micek,  the  President  and a director of the
Company,  has  been  a  director  since  February  1988  of  Armanino  Foods  of
Distinction,  Inc.,  formerly  named  Falcon  Fund,  Inc.,  a blind pool company
("Armanino - Colorado"),  which  completed a reverse  acquisition  of a Delaware
company  ("Armanino  -  Delaware").  Mr. Micek has been a director of Armanino -
Delaware,  which is engaged in the production and marketing of gourmet,  upscale
specialty  food  products  since  May  1987,  and has been a vice  president  of
Armanino - Delaware  since  September  1989.  From February 1988 to December 31,
1988, he served as general  counsel and chief  financial  officer for Armanino -
Colorado,  and served in these  capacities for Armanino - Delaware from May 1987
to December 31, 1988.  Since  January  1989,  Mr.  Micek has  practiced  law and
currently  serves as a consultant  to Armanino - Colorado on  corporate  finance
matters.  Mr.  Micek also serves as a financial  consultant  to Artanis, L.P., a
partnership  which currently  markets a line of celebrity gourmet food products.
From 1979 until  December  1986,  Mr. Micek  served as corporate  counsel and as
assistant to the  president  of G.  Armanino & Son,  Inc. and Armanino  Farms of
California, which were engaged in the international food marketing business. Mr.
Micek has also  served as vice  president,  treasurer  and a director  of Laguna
Capital  Corporation,  a Colorado  based "blind pool"  company,  from April 1986
until February 1988, and as vice president,  treasurer and a director of Capital
Equity Resources, Inc. ("CER"), also a Colorado-based "blind pool" company, from
January 1986 until August 1986.  After CER  completed a reverse  acquisition  in
August 1986, it changed its name to Asha  Corporation.  Mr. Micek  remained as a
director of Asha  Corporation  until June 1989. He also has served as a director
of Universal  Group  Insurance  Companies,  an Omaha,  Nebraska-based  insurance
company,  since  1982,  and  as  a  director  of  Cole  Publishing  Company,  an
educational publisher,  located in Santa Rosa, California,  since March 1990. He
was Western  Finance  Coordinator for the


                                       21
<PAGE>

1984  Presidential  Campaign of Walter  Mondale.  He received a Bachelor of Arts
Degree  in  History  from  the  University  of  Santa  Clara in 1974 and a Juris
Doctorate from the University of San Francisco  School of Law in 1979. Mr. Micek
presently  devotes  only  as much  time as is  necessary  as an  officer  of the
Company.


         Frank L. Kramer. Mr. Kramer, the Vice President,  Secretary,  Treasurer
and a director  of the  Company,  served as  president  and a director of Fi-Tek
Corp., a blind pool company headquartered in Aurora,  Colorado,  from 1984 until
1987 when it  acquired  Boston  Technology,  Inc.  and moved its  operations  to
Cambridge,  Massachusetts.  From May 1987 to November 1988, Mr. Kramer served as
president,  treasurer  and the chairman of the board of Fi-Tek II, Inc., a blind
pool  company  headquartered  in Aurora,  Colorado,  until it  acquired  On Line
Communications,  Inc.  and moved its  operations  to San Jose,  California.  The
company has since changed its name to On Line Network,  Inc. Mr. Kramer has also
served since November 1988 as the president,  treasurer and a director of Fi-Tek
III, Inc., a  Delaware-chartered  "blind pool"  corporation  which  successfully
completed an offering of securities in September  1989, and which in August 1990
acquired  Videoconferencing  Systems,  Inc., a Norcross,  Georgia-based  company
engaged  in the  design,  system  integration,  sale,  and  service  of  turnkey
interactive  videoconferencing systems. Effective as of the date of acquisition,
Mr. Kramer resigned as president and treasurer, but retained his position on the
board of  directors.  From February  1987 until  December  1989, he was also the
treasurer and a director of Bluestone  Capital  Corp.,  a Colorado  "blind pool"
corporation which  successfully  completed an offering of securities in November
1988 and which moved its operations to Braintree,  Massachusetts after acquiring
Dialogue, Inc. in December 1989. Mr. Kramer also serves as president,  treasurer
and a director of Fi-Tek IV, Inc., a Delaware-chartered "blind pool" corporation
which  completed an offering of  securities  in September  1990.  Mr. Kramer has
recently  become an officer and director of three other "blind pool"  companies,
Fi-Tek V, Inc.,  Fi-Tek VI, Inc. and Fi-Tek VII, Inc.,  each of which intends to
conduct a public offering of securities.  See "Prior Blind Pool Activities." Mr.
Kramer was  affiliated  with New York Life  Insurance  Company ("New York Life")
from 1968 through 1981 and was engaged in sales,  sales  management,  and estate
planning.  He became a Chartered  Life  Underwriter  in 1972.  From 1973 through
1981, he was general  manager of two of New York Life's  general  offices.  From
1981  to  late  1987,  Mr.  Kramer  was  self-employed  as a  private  financial
consultant  in the Denver,  Colorado  area,  assisting  businesses  in arranging
interim financing for their business operations,  through private and commercial
borrowings.  He has also been engaged in the  structuring  and  implementing  of
private  financing for the oil and gas and  commercial  real estate  industries.
Since 1987,  Mr. Kramer has been  affiliated  with New York Life as an agent and
recruiter.  From 1986 until March of 1987,  he was an employee and a director of
Optimum  Manufacturing,  Inc.,  a public  company  engaged in  manufacturing  in
Denver,  Colorado.  He obtained a B.S.  Degree in Business  Administration  from
Louisiana State University in 1964.


         Donald R. McGahan.  Mr. McGahan,  a director of the Company,  currently
serves as a senior  vice  president  and  resident  manager for  American  Aegis
Securities,  Inc.  ("American  Aegis"),  an NASD member broker dealer engaged in
various  securities  and financing  activities and  headquartered  in San Diego,
California with offices in two other U.S. cities, including Boca Raton, Florida,
the office out of which Mr.  McGahan has been working  since joining the firm on
July 15, 1990.  From October 1989 until  joining  American  Aegis,  Mr.  McGahan
served as a senior  vice  president  and  Eastern  regional  manager  for Smith,
Mitchell & Associates,  Inc. ("Smith Mitchell"), an NASD registered firm engaged
in public  finance  activities and  headquartered  in Seattle,  Washington.  Mr.
McGahan served in Smith  Mitchell's Boca Raton,  Florida  office.  From May 1989
until October 1989,  Mr. McGahan served as senior vice president of R.W. Smith &
Associates,  Inc.,  a  municipal  bond  brokerage,  also  located in Boca Raton,
Florida.  From October 1987 until May 1989,  Mr.  McGahan  served as senior vice
president and a manager for Harry Downs & Co. Municipal Brokers, located in Boca
Raton,  Florida.  Mr.  McGahan served as senior vice president of MKI Securities
Corp.,  located in New York City,  from  March 1985 to  September  1987 where he
established  and managed a serial bond  revenue  desk,  and from October 1981 to
March 1985, he was senior vice president and a principal of Vierling,  Devaney &
Maguire,  Inc.,  a New York City  municipal  bond firm,  which  merged  with MKI
Securities  Corp. in 1985. From June 1980 to October 1981, Mr. McGahan served as
the  president  and  chief  executive  officer  of George  B.  Gibbons & Co.,  a
subsidiary  of  Carroll,   McEntee,   McGinley,  a  dealer  in  U.S.  government
securities,  located in New York City. Mr. McGahan was also an outside  director
of CM&M  Securities,  a  member  firm  of the  New  York  Stock  Exchange  and a


                                       22
<PAGE>

subsidiary of Carroll, McEntee,  McGinley, from October 1980 until October 1981.
From 1960 to June 1980, Mr.  McGahan worked in the municipal bond  department of
Fahnestock  & Co., a member  firm of the New York Stock  Exchange,  where he was
promoted to manager in 1968 and became a partner in 1969.  Mr. McGahan holds the
following  NASD  licenses:   Municipal  Securities   Representative,   Municipal
Securities  Principal,   Registration/General  Securities  Representative,   and
General Securities Principal.  Mr. McGahan obtained a B.A. degree in history and
political  science from  Villanova  University  in 1955. He served in the United
States Navy in various  capacities from 1956 until 1978 at which time he retired
with the rank of Commander.

Remuneration

          The  directors  and officers  will devote their time to the  Company's
affairs on an "as needed" basis,  which,  depending on the  circumstances,  will
likely  amount to on average as little as five hours per month spent each by Mr.
Micek and Mr.  McGahan,  and on  average  twenty  hours  per month  spent by Mr.
Kramer.  Commencing after completion of this offering, each of the Company's two
officers will be  compensated  at a rate of $45 per hour for time devoted to the
affairs of the Company, in excess of five hours per month, limited only by a cap
of $1,500 per month and a total cap on each  officer's  salary of $4,500  during
the Company's first year of operation. As stated previously,  it is not expected
that any one of the officers  will devote time each month that will entitle each
to draw a salary up to the maximum amount of $1,500 per month.

          Should the Company complete the acquisition of a business opportunity,
the Board of  Directors  may award a finder's  fee to an officer or affiliate of
the Company,  or to a third party,  if the acquisition is originated as a result
of his  efforts.  The cash  portion of this fee,  in the  aggregate,  if paid to
officers  or  affiliates,  will not  exceed  10% of the  gross  proceeds  of the
offering and may be less.

          Following  completion of this offering and until the Company  acquires
sufficient  capital through means other than this offering,  it is not intended,
except as provided in the previous two paragraphs,  that any officer or director
will  receive  compensation  from the  Company for  performance  of duties as an
officer or director other than reimbursement for out-of-pocket expenses incurred
on behalf of the  Company or a finder's  fee,  as  discussed  below in  "Certain
Transactions with Management and Others."

Indemnification of Officers and Directors

          As  permitted  by  Delaware   law,  the   Company's   Certificate   of
Incorporation  provides  that the  Company  will  indemnify  its  directors  and
officers  against  expenses and  liabilities  they incur to defend,  settle,  or
satisfy any civil or criminal  action  brought  against them on account of their
being or having been Company  directors or officers unless,  in any such action,
they are  adjudged to have acted with gross  negligence  or willful  misconduct.
Insofar as indemnification  for liabilities  arising under the Securities Act of
1933 may be permitted to directors,

officers  or  persons   controlling  the  Company   pursuant  to  the  foregoing
provisions, the Company has been informed that, in the opinion of the Securities
and  Exchange  Commission,  such  indemnification  is against  public  policy as
expressed in that Act and is, therefore, unenforceable.

Exclusion of Liability

          Pursuant  to the  Delaware  General  Corporation  Law,  the  Company's
Certificate of Incorporation  excludes personal  liability for its directors for
monetary  damages  based  upon  any  violation  of  their  fiduciary  duties  as
directors, except as to liability for any breach of the duty of loyalty, acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation  of law,  acts in  violation  of Section 174 of the  Delaware  General
Corporation Law, or any transaction  from which a director  receives an improper
personal  benefit.  This exclusion of liability does not limit any right which a
director may have to be indemnified and does not affect any director's liability
under federal or applicable state securities laws.


                                       23
<PAGE>

                           PRIOR BLIND POOL ACTIVITIES

          John J. Micek III, the Company's President and a director,  previously
served as vice president,  treasurer and a director of Capital Equity Resources,
Inc. ("CER"),  a development stage company that conducted a blind pool offering.
CER closed its public offering on May 8, 1986, and raised a total of $200,000 in
gross proceeds by selling 20,000,000 Units at $.01 per Unit. During August 1986,
CER completed a reverse acquisition of ASHA, Inc. ("ASHA") by which CER acquired
100% of ASHA in exchange for  approximately  92.4% of the outstanding  shares of
CER. ASHA was engaged in the  development of a full-time four wheel drive,  four
passenger  utility  automobile which was being developed around a new automotive
architecture invented by ASHA's President, Alain Clenet. ASHA was a newly formed
company  and had no  operations  prior to the  acquisition.  Mr.  Micek  did not
dispose of any of his stock holdings in CER or receive any compensation from CER
or from ASHA in connection with the ASHA acquisition.  Upon his resignation as a
director of ASHA in June 1989, Mr. Micek received  shares of stock in ASHA which
represented less than five percent of the total shares outstanding.

         Mr. Micek also previously  served as vice president,  treasurer,  and a
director of Laguna Capital Corp.  ("Laguna"),  which closed its public  offering
during  September  1986,  with  total  proceeds  raised of  $200,000  by selling
20,000,000 units at $.01 per unit. In February 1988,  Laguna completed a reverse
acquisition of Sporting Life,  Inc.  ("Sporting  Life") whereby Laguna  acquired
100% of the  outstanding  shares of Sporting Life in exchange for  approximately
90% of the  outstanding  shares of Laguna.  Sporting Life  distributes and sells
golf and tennis  equipment  and supplies for domestic and foreign  manufacturers
through  its Las  Vegas  Discount  Golf and  Tennis  franchises  and mail  order
business. Laguna/Sporting Life has changed its name to Las Vegas Discount Golf &
Tennis,  Inc. All of the officers and directors of Laguna resigned  effective as
of the closing of the  acquisition.  Mr. Micek did not receive any  compensation
from Laguna or Sporting Life and did not dispose of any of his stock holdings in
Laguna in connection with the Sporting Life acquisition.

         Frank L. Kramer, the Company's Vice President, Secretary, Treasurer and
a director,  previously  served as a director  and as  president of Fi-Tek Corp.
("Fi-Tek"),  a blind pool company. Fi-Tek initiated its public offering on April
2, 1986 and  closed the  offering  on June 11,  1986,  with  total  proceeds  of
$250,000 upon sale of 12,500,000  units  (consisting  of common stock and common
stock purchase  warrants),  at a price of $.02 per unit,  which  constituted all
units offered.

          During   January  1987,   Fi-Tek   completed  a  reverse   acquisition
(stock-for-stock  exchange). It acquired Boston Technology,  Inc. ("Boston"),  a
Delaware corporation based in Cambridge,  Massachusetts, which is engaged in the
design,  manufacture and marketing of computer-based  telecommunications systems
commonly known as "voice messaging systems." Fi-Tek issued 98,000,000 restricted
shares of its common stock in exchange for all the outstanding  capital stock of
Boston,  which shares  represented 80% of Fi-Tek's issued and outstanding common
stock following the acquisition.  Mr. Kramer, who still owns stock in Fi-Tek and
who  resigned  as a  director  and  officer of Fi-Tek as of  January  31,  1987,
received,  as total  compensation  from Fi-Tek, a consulting fee of $1,000.  Mr.
Kramer  did not  dispose of any of his stock  holdings  in Fi-Tek as part of the
acquisition of Boston.

         Frank L Kramer  previously  served also as a director  and as president
and treasurer of Fi-Tek II, Inc. ("Fi-Tek II"), a blind pool company.  Fi-Tek II
initiated its public  offering on March 10, 1988 and closed the offering in July
1988,  with  total  proceeds  of  $216,211.78  upon  sale  of  10,810,589  units
(consisting of common stock and common stock purchase  warrants),  at a price of
$.02 per unit. During November 1988,  Fi-Tek II completed a reverse  acquisition
(stock-for-stock  exchange).  It  acquired  On Line  Communications,  Inc.  ("On
Line"),  a California  corporation  based in San Jose,  California,  which is an
Alternate  Operator Services (AOS) provider of long distance  telephone services
for persons making credit card,  collect call and third party billing  telephone
calls.  Fi-Tek II issued  95,442,356  restricted  shares of its common  stock in
exchange  for all  the  outstanding  capital  stock  of On  line,  which  shares
represented 80% of Fi-Tek II's issued and outstanding common stock following the
acquisition.  Mr. Kramer, who currently owns stock in Fi-Tek II and resigned all
his  positions  with  Fi-Tek  II  as of  October  1988,  has  not  received  any
compensation from the Company other than


                                       24
<PAGE>

a  consulting  fee of $5,000.  Mr.  Kramer  did not  dispose of any of his stock
holdings in Fi-Tek II as a part of the acquisition of On Line.


         Frank L.  Kramer  currently  serves as  president,  treasurer  and as a
director of Fi-Tek III, Inc.  ("Fi-Tek  III"), a blind pool company.  Fi-Tek III
initiated  its  public  offering  on May 26,  1989 and closed  the  offering  on
September 12, 1989,  with total proceeds of $500,000 upon the sale of 25,000,000
Units  (consisting  of common stock and common stock  purchase  warrants),  at a
price of $.02 per unit, which  constituted all the units offered.  During August
1990, Fi-Tek III completed a reverse acquisition  (stock-for-stock exchange). It
acquired Video conferencing  Systems,  Inc. ("VSI"),  a Norcross,  Georgia-based
company engaged in the design, system integration,  sale, and service of turnkey
interactive  videoconferencing systems. Fi-Tek III issued 181,629,157 restricted
shares of  common  stock,  9,081,958  restricted  shares of series A  cumulative
convertible preferred stock and 500,000 restricted shares of series B cumulative
preferred  stock for all the outstanding  capital stock of VSI. Mr. Kramer,  who
currently owns stock of Fi-Tek III, has received total compensation of $5,000 as
a result of his position  with Fi-Tek III. Mr.  Kramer did not dispose of any of
his stock holdings in Fi-Tek III as part of the acquisition of VSI.

         Mr. Kramer also  currently  serves as an officer and director of Fi-Tek
IV, Inc.,  Fi-Tek V, Inc., Fi-Tek VI, Inc., and Fi-Tek VII, Inc. Fi-Tek IV, Inc.
completed a public offering of securities in September 1990, with total proceeds
of  $215,415  upon the sale of  10,770,750  units (the  maximum  number of units
offered was  15,000,000).  Fi-Tek V, Inc.,  and Fi-Tek VI, Inc.  and Fi-Tek VII,
Inc. each intend to conduct public offerings of their respective securities.


         Mr.  Kramer also served from  February  1987 until  December  1989 as a
director  and  as  secretary   and   treasurer   of  Bluestone   Capital   Corp.
("Bluestone"),  a blind pool company. Bluestone initiated its public offering on
July 13, 1988 and closed the offering on November 14, 1988,  with total proceeds
of $150,000 upon sale of 1,500,000 units  (consisting of common stock and common
stock purchase  warrants),  at a price of $.10 per unit, which  constituted  all
units  offered.  During  December  1989,  Bluestone  incorporated a wholly owned
subsidiary  for the  purpose  of  merging  it into  Dialogue,  Inc.,  a Delaware
corporation  ("Dialogue")  and in connection  therewith,  all of the outstanding
stock of Dialogue was converted into  30,000,000  shares of  Bluestone's  common
stock, which shares represented 80% of Bluestone's issued and outstanding common
stock  following  the  reorganization.  Dialogue,  Inc.,  which is a voice  mail
systems  distributor  located in  Braintree,  Massachusetts,  in December  1989,
became a wholly owned  subsidiary of Bluestone.  Mr. Kramer,  who currently owns
stock in Bluestone  and resigned all his  positions  with  Bluestone in December
1989,  has not received any  compensation  from the company.  Mr. Kramer did not
dispose  of  any  of  his  stock   holdings  in  Bluestone  as  a  part  of  the
reorganization with Dialogue.


         Mr. Kramer's  positions in Fi-Tek IV, Inc.,  Fi-tek V, Inc., Fi-Tek VI,
Inc., and Fi-Tek VII, Inc.,  create the potential for conflicts of interest with
the  Company,  especially  should  one or more of those  companies  happen to be
seeking a business opportunity at the same time that the Company is seeking such
an opportunity. See "Potential Conflicts of Interest."


         Mr.  McGahan  has  not  previously  participated  in any  "blind  pool"
offerings.

                         POTENTIAL CONFLICTS OF INTEREST

         Initially,  none of the officers of the Company will devote more than a
portion of his time to the affairs of the Company.  See "Management." All of the
officers have  employment  outside of the Company.  There will be occasions when
the time requirements of the Company's business conflict with the demands of the
officers' other  employment.  In this event, such conflicts may require that the
Company attempt to employ additional  personnel.  There is no assurance that the
services of such persons  will be  available  or that they can be obtained  upon
terms favorable to the Company.


                                       25
<PAGE>
         Frank L. Kramer, Vice President, Secretary, Treasurer and a director of
the  Company,  is also an officer and  director of two Denver,  Colorado,  based
development stage  corporations,  one of which is in the process of conducting a
public offering of securities,  and the second of which, Fi-Tek III, completed a
$500,000 offering in August 1989. See "Prior Blind Pool Activities."  Should the
Company  complete  the offering  made by this  Prospectus  before  Fi-Tek III or
Fi-Tek  IV  acquire  a  business  opportunity,  the  Company  would be in direct
competition with those companies for available opportunities.

          While Mr.  Kramer will  attempt to resolve any such  conflicts  in the
Company's  favor,  there is no  assurance  that his  efforts to that end will be
successful  The Company has not adopted any policy to deal with the conflicts of
interest that are likely to arise from Mr.  Kramer's  involvement in other blind
pool companies.  The resolution of such conflicts is to be made, if at all, only
by the exercise of such  business  judgment as is consistent  with Mr.  Kramer's
fiduciary  duties to the Company and to the other blind pool  companies of which
he is an  officer  or a  director.  Should  any of the  Company's  officers  and
directors  breach their  respective  fiduciary  duty of loyalty,  the  Company's
stockholders  will, under Delaware corporate law, have a cause of action against
those officers and directors.  The Company's  management does not intend to give
priority to other blind pool offerings in which Mr. Kramer is involved that were
declared  effective  prior to July 1, 1990 and,  therefore,  not  subject to the
proceeds escrow requirement  imposed by the Colorado Securities Act. See "Use of
Proceeds."

         The Company's officers,  directors,  and other management personnel are
subject to the doctrine of corporate opportunities only insofar as it applies to
business  opportunities  in which the Company has indicated an interest,  either
through  its  proposed  business  plan  or by way  of an  express  statement  of
interest, contained in the Company's minutes. No such indication of interest has
yet been  declared.  If such areas are  delineated,  all business  opportunities
within  each area of  interest  which  come to the  attention  of the  officers,
directors and key management personnel of the Company must be promptly disclosed
to the Board of Directors  and made  available to the Company.  In the event the
Board shall reject an opportunity so presented,  any of the Company's  officers,
directors,  or key management  personnel may avail himself of such  opportunity.
Every effort will be made to resolve any  conflicts  which may arise in favor of
the Company.  There can be no  assurance,  however,  that these  efforts will be
successful.

                 CERTAIN TRANSACTIONS WITH MANAGEMENT AND OTHERS

         Prior  to the  date of  this  Prospectus,  the  Company  issued  to its
officers,  directors, and others a total of 7,300,000 shares of Common Stock for
a total of  $16,000  in cash and  services,  or an  average of $.0022 per share.
Certificates  evidencing the Common Stock issued by the Company to these persons
have all  been  stamped  with a  restrictive  legend,  and are  subject  to stop
transfer  orders  by  the  Company.   For  additional   information   concerning
restrictions   that  are  imposed   upon  the  Common   Stock  held  by  current
stockholders,  and the  responsibilities  of such  stockholders  to comply  with
federal  securities  laws in the  disposition  of such Common  Stock,  see "Risk
Factors - The Offering - Possible Rule 144 Sales."

         No officer,  director,  promoter,  or  affiliate  of the Company has or
proposes to have any direct or indirect  material interest in any asset proposed
to be acquired by the Company through security holdings,  contracts, options, or
otherwise.

         The Company has adopted a policy wherein any consulting or finder's fee
paid will be paid to a third party for  consulting  services on an ad hoc basis,
to assist  management  in evaluating a prospective  business  opportunity.  Such
consulting or finder's fees may be paid to officers,  directors or affiliates of
the Company.

         The  Company  maintains  its  offices  at the  residence  of  its  Vice
President,  for  which it pays no  rent,  and for  which it does not  anticipate
paying  rent  in  the  future.  The  Company   anticipates  that  following  the
consummation  of a  business  combination  with an  acquisition  candidate,  the
Company's  office will be moved,  but cannot  predict  future office or facility
arrangements with officers, directors or affiliates of the Company.


                                       26
<PAGE>

         The Company may enter into an agreement with an  acquisition  candidate
requiring the sale of all or a portion of the Common Stock held by the Company's
current  stockholders to the acquisition  candidate or principals thereof, or to
other individuals or business entities,  or requiring some other form of payment
to the Company's  current  stockholders,  or requiring the future  employment of
specified  officers and payment of salaries to them.  It is more likely than not
that any sale of stock by the Company's  current  stockholders to an acquisition
candidate would be at a price substantially  higher than that originally paid by
such  stockholders.  Any  payment to current  stockholders  in the context of an
acquisition  involving the Company  would be determined  entirely by the largely
unforeseeable terms of a future agreement with an unidentified business entity.

                             PRINCIPAL STOCKHOLDERS
<TABLE>
         The following table sets forth, as of the date of this Prospectus,  the
number of shares of Common Stock owned of record and  beneficially  by officers,
directors and persons presently  holding 5.0% or more of the outstanding  Common
Stock of the  Company.  Also  included  are the shares held by all  officers and
directors as a group. The table further shows the effect on ownership  resulting
from the sale of both the minimum  number of Units  (1,500,000)  and the maximum
number of Units  (3,000,000),  without giving effect to the Warrants included in
the Units.

<CAPTION>
                                                                   Percent of Class Owned
                                        Owned              ------------------------------------
                                  Benifically Before        Before       After          After
Name and Address                      Offering             Offering     Minimum(1)    Maximum(1)
----------------                      --------             --------     ----------    ----------
<S>                                  <C>                     <C>          <C>           <C>
John J. Micek III*                   1,200,000               16.4%        13.6%         11.7%
430 Cowper St.
Palo Alto, CA 94301

Frank L. Kramer*                     1,200,000               16.4%        13.6%         11.7%
12543-A E. Pacific Circle
Aurora, CO 80014

Donald R. McGahan*                   1,200,000               16.4%        13.6%         11.7%
c/o Smith Mitchell & Assoc.
980 N. Federal Hwy #206
Boca Raton, FL 33432

Keith A. Koch                        1,200,000               16.4%        13.6%         11.7%
9171 Towne Centre Dr. #365
San Diego, CA 92122

Kenneth L. Maul                      1,200,000               16.4%        13.6%         11.7%
5160 S. Valley View Blvd. #106
Las Vegas, NV 89118

* All directors                      3,600,000               49.3%        40.9%         35.0%
and officers (3 persons)
<FN>
---------------------------

(1)      The figures  shown do not take into  account the Common  Stock that the
         listed persons may purchase in this offering.  No arrangements  for any
         such  purchases  have been made and the Company does not anticipate any
         future  arrangements  whereby  shares of the  offering are reserved for
         sale to such persons.
</FN>
</TABLE>


                                       27
<PAGE>

                            DESCRIPTION OF SECURITIES

Units

         Each Unit offered  consists of one share of the  Company's  $.00001 par
value Common  Stock,  one Class A Common  Stock  Purchase  Warrant,  one Class B
Common Stock  Purchase  Warrant and one Class C Common Stock  Purchase  Warrant.
Units will be evidenced by Common  Stock and Warrant  certificates,  and will be
mailed  to  purchasers  as soon as  practicable  following  the  closing  of the
offering.

Common Stock

         The Company's  Certificate of Incorporation  authorizes the issuance of
100,000,000  shares of Common  Stock with a par value of  $.00001.  Each  record
holder  of  Common  Stock is  entitled  to one vote for each  share  held on all
matters properly submitted to the stockholders for their vote. Cumulative voting
for  the  election  of  directors  is  not  permitted  by  the   Certificate  of
Incorporation.

         Holders of  outstanding  shares of Common  Stock are  entitled to those
dividends  declared by the Board of Directors  out of legally  available  funds;
and, in the event of  liquidation,  dissolution  or winding up of the affairs of
the  Company,  holders are entitled to receive,  ratably,  the net assets of the
Company  available to stockholders  after  distribution is made to the preferred
stockholders,  if any, who are given preferred rights upon liquidation.  Holders
of  outstanding  shares  of  Common  Stock  have no  preemptive,  conversion  or
redemptive rights. All of the issued and outstanding shares of Common Stock are,
and all unissued shares when offered and sold will be, duly authorized,  validly
issued,  fully paid and  nonassessable.  To the extent that additional shares of
the Company's Common Stock are issued,  the relative  interests of then existing
stockholders may be diluted.

Preferred Stock

         The Company's  Certificate of Incorporation  authorizes the issuance of
20,000,000 shares of preferred stock,  $.00001 par value. The Board of Directors
of the Company is authorized  to issue the preferred  stock from time to time in
series and is further  authorized to establish such series, to fix and determine
the variations in the relative rights and preferences as between series,  to fix
voting  rights,  if any, for each  series,  and to allow for the  conversion  of
preferred  stock into common  stock.  No preferred  stock has been issued by the
Company.  The Company anticipates that preferred stock may be utilized in making
acquisitions.

Warrants

         The Warrants  being  offered as part of the Units will be in registered
form and will be issued  pursuant to a Unit  Warrant  Agreement,  dated the same
date as this Prospectus,  between the Company and the Warrant Agent named below.
The following  information  is only a summary of that agreement and is qualified
in its entirety by the provisions of that agreement. Upon issuance, the Warrants
will be detachable and may be separately traded in the over-the-counter  market,
if any market for the Warrants should develop.

         Exercise Price and Periods. Subject to redemption by the Company and to
the current Registration  Statement  requirement,  both of which limitations are
described  below,  each Class A Warrant is  exercisable  for one share of Common
Stock  commencing with the date of this Prospectus and terminating on the second
anniversary of such date, at a price of $.30 per share.  Each Class B Warrant is
exercisable  for one  share  of  Common  Stock  at a price  of  $.75  per  share
commencing  with the  date of this  Prospectus  and  terminating  on the  second
anniversary of such date.  Each Class C Warrant is exercisable  for one share of
Common  Stock at a price of $1.30  per  share  commencing  with the date of this
Prospectus and  terminating on the second  anniversary of such date. The Warrant
expiration  dates (and the period during which the Warrants are exercisable) may
be  extended  indefinitely,  or  the  exercise  price  thereof  reduced,  at the
discretion of the Company,  upon giving  written notice to the Warrant Agent and
the  warrantholders.  Investors  should be aware that if less than  seventy-five
percent of the net proceeds  from the exercise of Warrants is committed  for use
in one or more  specific  lines of business,


                                       28
<PAGE>

the proceeds  from the  exercise of Warrants  will likely be placed in an escrow
pursuant to the Colorado Securities Act. See "Use of Proceeds."


         Manner  of  Exercise.  Class A,  Class B and  Class C  Warrants  may be
exercised  by  surrender  of the Warrant to the Warrant  Agent with  appropriate
instructions  accompanied  by payment of the full purchase  price for the Common
Stock  underlying  each Warrant being  exercised.  Payment of the purchase price
must be made in United  States  funds  payable to the  Company.  The Warrant and
payment  therewith must reach the Warrant Agent on or before the expiration date
(or the earlier  redemption  date,  as provided  in the next  paragraph)  of the
Warrant.

         Redemption of the Warrants. The Warrants shall be subject to redemption
by the Company as follows:

         (a) Subject to the  limitations  set forth  below in this  subparagraph
(a),  all, but not less than all, of the Class A Warrants and, in addition or in
the  alternative, all,  but not less than  all, of the Class B Warrants  and, in
addition  or in the  alternative,  all,  but not less than  all,  of the Class C
Warrants may be called for redemption by the Company,  at a redemption  price of
$.0001 per Warrant,  at any time prior to the  declaration by the Securities and
Exchange  Commission of the  effectiveness of a post-effective  amendment to the
Registration Statement of which this Prospectus is a part, without prior written
notice to the  registered  holders of the  Warrants and without any right on the
part of the holders of the Warrants to exercise their  purchase  rights prior to
the redemption date. Upon redemption,  the  warrantholder  will receive only the
redemption  price  and will  forfeit  his right to  purchase  the  Common  Stock
underlying  the  Warrants.  The  warrantholder  shall be entitled to receive the
redemption  price  provided above only if the  warrantholder  delivers a written
request for such payment,  accompanied by the warrant  certificate  representing
the Warrants to be redeemed, to the Company's warrant agent within 30 days after
the warrantholder  shall have been notified that the applicable class or classes
of Warrants have been redeemed in accordance with this subparagraph (a). Because
the Warrants may be exercised only so long as this Prospectus remains current or
after a  post-effective  amendment  shall have been  declared  effective  by the
Commission,  a redemption of the Warrants pursuant to this subparagraph (a) will
mean that the warrantholder shall never have received an opportunity to exercise
the Warrants following the acquisition of a business opportunity by the Company.
The Company's right to redeem the Warrants in accordance with this  subparagraph
(a) may be exercised,  however,  only in the event that management of a business
opportunity that is the target of a business  combination with the Company shall
have  required,  in writing,  that the  redemption  of the  Warrants  shall be a
condition precedent to the consummation of the business  combination between the
Company and the target company.  The redemption is to become effective only upon
the closing of such a business  combination.  Should the  contemplated  business
combination fail to close,  the redemption shall be void and the  exercisability
of the Warrants covered by the redemption shall not be affected.  The failure of
one or more  business  combinations  to close  shall  not,  however,  impair the
Company's  right to redeem Warrants under this  subparagraph  (a) if the Company
enters into  arrangements for a subsequent  business  combination  featuring the
warrant-redemption  condition  described above in this  subparagraph (a). To the
extent that the management of a business opportunity that consummates a business
combination  with the  Company  does not  require  redemption  of  Warrants as a
condition  of closing,  the right of the Company to redeem  Warrants  under this
subparagraph (a) shall be extinguished. Redemption of only one class of Warrants
pursuant to this  subparagraph  (a) shall not affect the  exercisability  of the
other classes of Warrants.

         (b) In addition to the redemption  mechanism  described in subparagraph
(a), above,  all or any number of the Warrants can be called for redemption at a
redemption  price of $.0001 per Warrant by the Company at any time during  their
exercise term upon a minimum of thirty (30) days' prior written notice mailed to
the registered  holders of the Warrants,  subject to the right of the holders of
the Warrants to exercise their purchase rights between the date of any notice of
redemption  up to and including the  redemption  date given by the Company.  The
notice period may be extended,  at the  discretion  of the Company,  upon giving
subsequent  notice  to the  Warrant  Agent  and  to  registered  holders  of the
Warrants.  Any holder who does not exercise  his Warrants  prior to the date set
for call will  receive only the  redemption  price and will forfeit his right to
purchase the Common Stock  underlying  the Warrants.  Warrantholders  who do not
exercise their Warrants during the


                                       29
<PAGE>

redemption  period will  receive the  redemption  price only if the Warrants are
received by the Warrant Agent prior to expiration of the redemption period.

         Limitations  Upon  Exercise  or  Redemption.  The  Warrants  may not be
exercised or redeemed,  except under circumstances set forth in subparagraph (a)
of the preceding paragraph,  unless the Company maintains a current Registration
Statement in effect during the respective  exercise or redemption periods of the
Warrants.  The  Company  will  use  its  best  efforts  to  file  post-effective
amendments to its Registration  Statement, if needed, to keep information on the
Company  current during the period during which the Warrants may be exercised or
redeemed.  However, the Company will have no obligation to keep the Registration
Statement  current when the market bid price for the  Company's  Common Stock is
below the exercise  price of the  Warrants.  The Common Stock  issuable upon the
exercise of the Warrants cannot be sold in various states without qualifying the
Common  Stock  under  state  law and the  Company  may  find it  impractical  or
impossible  to so qualify  the Common  Stock in those  states  where it does not
initially  qualify  this  offering.  Investors  should  be  aware  that  certain
exemptions from  registration  under state law for the exercise of the Warrants,
otherwise  available  to the  Company,  may not be  available  with  respect  to
exercise  of  Warrants by those  warrantholders  who have  disposed of all their
shares of common stock.  Warrantholders who are residents of states in which the
Company does not qualify the Common Stock  underlying the Warrants for sale will
have no choice but either to sell their Warrants or to let them expire.

         Rights of  Warrantholders.  Holders of the Warrants will have no voting
rights,  and will not be entitled  to  dividends.  In the event of  liquidation,
dissolution or winding up of the affairs of the Company, holders of the Warrants
will not be entitled to participate in any liquidation distribution.  Holders of
Warrants are protected  against  dilution of their interests  represented by the
underlying shares of Common Stock upon the occurrence of stock dividends,  stock
splits or reclassifications  of the Company's Common Stock.  Stockholders should
be aware that the Division of Market  Regulation of the Commission has taken the
position  that  where  an  issuer  materially  reduces  the  exercise  price  of
outstanding warrants for a specified period of time during the remaining term of
the  warrants,  and  warrantholders  are  therefore  required to make a decision
whether to tender their warrants to the issuer in exchange for another security,
then the  warrantholders  should be  provided  with  adequate  information  with
respect to the offer in compliance  with Rule 13e-4 (the  "Rule").  In the event
the Rule is deemed to be applicable to a particular action taken by the Company,
compliance with the Rule may require the filing of an appropriate schedule under
that Rule and  distribution  of an  offering  circular  to  warrantholders  with
appropriate disclosures.

         Effect of Warrants.  For the life of the Warrants,  warrantholders have
the opportunity to profit from a rise in the market value of the Common Stock of
the Company, if any, at the expense of the Common Stockholders.  A warrantholder
may be  expected  to  exercise  Warrants  at a time  when  the  Company,  in all
likelihood,  would be able to obtain  equity  capital,  if it so  desires,  by a
public sale of a new Common Stock  offering on terms more  favorable  than those
provided  in the  Warrants.  Exercise  of the  Warrants  will  dilute the equity
interest of other stockholders in the Company.

         Warrant  Solicitation  Fees.  The Company may employ  selected  brokers
and/or  dealers to solicit the  exercise of Warrants on its behalf.  The Company
may pay such brokers and dealers a Warrant  solicitation  fee of up to 3% of the
gross proceeds received from the exercise of Warrants  originated by or from the
broker's or dealer's  office.  No such fees will be paid if (i) the  exercise of
the  Warrants is made at a time when the market  price of the  Company's  Common
Stock is lower than the exercise price of the Warrants,  (ii) the Warrants to be
exercised are held in a  discretionary  account,  (iii) the  solicitation of the
exercise  of such  Warrants  would  violate  Rule  l0b-6  promulgated  under the
Securities Exchange Act of 1934, as amended,  (iv) the brokers or dealers failed
to notify the Company in writing at least 10 calendar days prior to commencement
of such solicitation,  (v) disclosure of compensation  arrangements was not made
in documents  provided to customers both as part of the original offering and at
the time of  exercise,  or (vi) the exercise of the Warrants is the result of an
unsolicited transaction.


                                       30
<PAGE>

Transfer and Warrant Agent

         American Securities  Transfer,  Inc., 1825 Lawrence Street,  Suite 444,
Denver, Colorado 80202, will act as the Transfer Agent and Warrant Agent for the
Common Stock and Warrants of the Company.

Reports to Stockholders

         The Company plans to furnish its stockholders for each fiscal year with
an annual report  containing  financial  statements  audited by its  independent
certified  public  accountants.  In the event the Company enters into a business
combination  with another  company,  it is the present  intent of  management to
continue  furnishing annual reports to stockholders.  Additionally,  the Company
may, in its sole discretion,  issue unaudited quarterly or other interim reports
to its  stockholders  when it deems  appropriate.  The Company intends to comply
with the periodic reporting  requirements of the Securities Exchange Act of 1934
for so long as it is subject to those requirements.

                                TERMS OF OFFERING


         This  offering  is being  conducted  by the  Company  and is not  being
underwritten.  The  Units  offered  hereby  are being  offered  on behalf of the
Company by the Company's President,  who has had no prior experience in the sale
of securities.  No  underwriting  discounts or commissions  will be paid to him,
although his out-of-pocket expenses will be reimbursed by the Company.


         The Units are offered on a "best efforts,  minimum-maximum"  basis. All
proceeds  from the sale of Units  will be  deposited  into an escrow  account at
Omnibank Aurora, located in Aurora,  Colorado (the "Escrow Agent"), by not later
than noon of the next business day following receipt.  No funds will be released
unless and until the minimum  1,500,000  Units have been sold.  Unless  proceeds
from the sale of the minimum number of Units have been deposited with the Escrow
Agent within 90 days following the date of this Prospectus  (which period may be
extended  for an  additional  90  days at the  Company's  sole  discretion)  the
offering  will be  withdrawn  and all monies  received  will be  refunded by the
Escrow Agent,  without deduction therefrom for offering costs or sales expenses,
if any, and without the payment of any interest  thereon.  If at least 1,500,000
Units are sold and the proceeds therefrom  deposited within the period set forth
above,  the offering will continue  until the  remaining  1,500,000  Units being
offered are sold,  until 90 days from the date of this  Prospectus  (180 days if
extended), or until the Company determines to terminate the offering,  whichever
event occurs first.  During the offering period,  investors will not have access
to their funds.

         The  Company  expects  to make  sales of the Units to  persons  whom it
believes  may be  interested  or who have  contacted  the  Company to express an
interest in purchasing the Units.  The Company may sell Units to such persons if
they reside in a state where the Units can lawfully be sold.  The Company is not
obligated to sell any Units to any such person and will do so only to the extent
that such sales  would not be  inconsistent  with a public  distribution  of the
Units.

         Officers,  directors, and affiliates of the Company may purchase in the
aggregate up to 20% of the Units sold in this offering.  Neither the Company nor
any of its officers or  directors  will  provide or  otherwise  arrange,  either
directly  or  indirectly,  financing  for any  such  purchases  and  none of the
proceeds  of this  offering  will be used,  directly or  indirectly,  to fund or
otherwise to finance any such purchases.

To the extent that such persons  purchase  Units in the offering,  the number of
Units  required  to be  purchased  by the  general  public in order to reach the
minimum  amount  for  closing  is  reached  will be  reduced  by a like  amount.
Moreover,  these  purchases may be used in order to reach the minimum amount for
closing in the event the minimum is not reached as a result of  purchases by the
general  public.  Consequently,  this offering could close with a  substantially
greater  percentage of Common Stock being held by present  stockholders and with
less participation by the public than would otherwise be the case.


                                       31
<PAGE>

Pricing of the Units

          There is no  public  market  for the  Units or any of their  component
securities  and  there is no  assurance  that a  market  will  develop  for such
following  the  offering.  The  offering  price  of the  Units to be sold in the
offering was determined  arbitrarily by the Company. In determining the offering
price and number of Units to be offered,  the Company considered such factors as
the financial  condition of the Company,  its net tangible  book value,  lack of
operating history and the general condition of the securities markets.

         Accordingly,  the  offering  price set forth on the cover  page of this
Prospectus  should not be  considered to be an indication of the actual value of
the Company.  The price bears no relation to the Company's  assets,  book value,
lack of earnings or net worth, or any other traditional criteria of value.


Escrow of Net Proceeds

          Because the  Company  intends to offer the Units to  residents  of the
State of Colorado,  the Company  will be subject to the new Colorado  Securities
Act,  which  requires  the  placement  in escrow of  eighty  percent  of the net
proceeds  of the  offering  ($103,600  - minimum,  $223,600  maximum)  until the
completion of a  transaction  or series of  transactions  whereby at least fifty
percent of the gross proceeds  received from the sale of Units are committed for
use in one or more specific lines of business.  The Company  intends to open the
required  escrow  account  immediately  following the closing of the offering in
accordance with the new Colorado Securities Act.


         The Company has entered into an escrow  agreement with Omnibank Aurora,
located  in  Aurora,  Colorado,  which  provides  for the  establishment  of the
aforementioned  escrow account. If, after four (4) years from the date funds are
deposited into an escrow  account,  established in accordance  with the Colorado
Securities Act (the "Colorado escrow account"),  the Company has not consummated
a business combination that has resulted in the release of the funds escrowed in
compliance  with the  Colorado  Securities  Act, the escrow  agreement  that the
Company has entered into with Omnibank  Aurora (for purposes of this  paragraph,
the  "escrow  agent")  provides  that the escrow  agent  shall,  as  promptly as
possible,  distribute  the funds in the Colorado  escrow  account to the persons
then holding the shares of the Company's common stock issued in this offering on
a pro rata basis based on the number of shares held.  See "Risk Factors - Impact
of Amendments to the Colorado  Securities  Act" and  "Possible  Distribution  of
Escrowed Funds After Four Years."  Therefore,  investors in this offering should
be aware that,  in the event of a  distribution  as  described  in the  previous
sentence, only a portion of the funds originally invested will be distributed to
the persons then holding  shares issued in this  offering,  without any interest
being paid thereon.  Neither the Colorado escrow agreement, nor any distribution
made  thereunder,  shall affect  ownership of the Units issued in this offering,
i.e., the shareholders who receive their pro rata portion of the  aforementioned
distribution  shall not be  required  to  return  their  Units to the  Company's
treasury.  In the event a distribution is made, as provided above, the Company's
ability to adequately  investigate and evaluate  business  opportunities  and to
attract favorable business opportunities will be adversely affected.


                               LEGAL PROCEEDINGS

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

         No  director,  officer or  affiliate  of the  Company,  and no owner of
record or beneficial  owner of more than 5.0% of the  securities of the Company,
or any  associate of any such  director,  officer or security  holder is a party
adverse  to the  Company or has a material  interest  adverse to the  Company in
reference to pending litigation.


                                       32

<PAGE>
                                  LEGAL MATTERS

         The Company has been  represented,  and the legality of the  securities
being  offered  hereby has been  passed  upon,  by the firm of Pred and  Miller,
Attorneys at Law, 501 South Cherry Street,  Suite 500,  Denver,  Colorado 80222.
Three  attorneys  of that firm own a total of  500,000  shares of the  Company's
outstanding Common Stock.

                                     EXPERTS

         The financial  statements included in this Prospectus beginning at page
F-1 have been examined by Wenner, Silvestain and Company,  Independent Certified
Public Accountants,  as set forth in their report herein and are included herein
in  reliance  upon the  authority  of said firm as  experts  in  accounting  and
auditing.

                             ADDITIONAL INFORMATION

         The Company has filed with the Denver Regional Office of the Securities
and Exchange Commission, Denver, Colorado, a Registration Statement on Form S-18
(herein,  together with all amendments  thereto,  the "Registration  Statement")
under the Securities Act of 1933, as amended, regarding the Units being offered.
This Prospectus,  filed as part of the Registration Statement,  does not contain
all of the  information  set forth in the  Registration  Statement.  For further
information regarding the Company and the securities offered,  reference is made
to the Registration Statement and the exhibits filed therewith. The Registration
Statement,  including exhibits, may be inspected at the office of the Securities
and Exchange  Commission,  410 Seventeenth Street,  Suite 700, Denver,  Colorado
80202, and at the Commission's  principal  office in Washington,  D.C.,  without
charge.  Copies  of the  Registration  Statement,  or any part  thereof,  may be
obtained  from the  Commission's  principal  office  at 450 Fifth  Street  N.W.,
Washington, D.C. 20549, upon payment of the fees prescribed by the Commission.

                                       33
<PAGE>

                         wenner, silvestain and company
          Certified Public Accountants, 8101 East Prentice, Suite 600,
                          Englewood Colorado 80111-2935
           Telephone (303) 771-5300              FAX (303) 771-7921
Stephen L. Wenner, CPA         Bennie Silvestain, CPA      Gary P. Saltzman, CPA
              Lawrence L. Greenberg, CPA        Barry H. Silvestain, CPA





                          INDEPENDENT AUDITORS' REPORT


Board of Directors
Catalina Capital Corp.
Aurora, Colorado

         We have  audited the  accompanying  balance  sheet of Catalina  Capital
Corp.  (a  development  stage  company)  as of June  6,  1990,  and the  related
statements  of  operations,  stockholders'  equity and cash flows for the period
April 27, 1990 (inception) to June 6, 1990.  These financial  statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audit.

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

         In our opinion,  the  financial  statements  referred to above  present
fairly,  in all material  respects,  the financial  position of Catalina Capital
Corp. (a  development  stage company) as of June 6, 1990, and the results of its
operations and its cash flows for the period April 27, 1990  (inception) to June
6, 1990 in conformity with generally accepted accounting principles.


/s/ Wenner, Silvestain and Company
Englewood, Colorado
June 20, 1990







Member, American Institute of Certified Public Accountants
                    Member, The Colorado Society of Certified Public Accountants
Member, SEC Practice Section of the AICPA
                         Member, Private Companies Practice Section of the AICPA


                                      F-1
<PAGE>




                             CATALINA CAPITAL CORP.
                          (A DEVELOPMENT STAGE COMPANY)

                                  BALANCE SHEET
                                  JUNE 6, 1990
                                  ------------


                                     ASSETS

 CURRENT ASSETS
   Cash                                                                $ 10,791
                                                                       --------

 OTHER ASSETS
   Organization costs, net of amortization                                  492
   Deferred offering costs                                                5,385
                                                                       --------
                                                                          5,877
                                                                       --------
 TOTAL ASSETS                                                          $ 16,668
                                                                       ========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

 CURRENT LIABILITIES
   Accounts payable                                                    $    885
                                                                       --------

 STOCKHOLDERS' EQUITY
   Preferred stock, $.00001 par value,
       20,000,000 shares authorized                                         --
   Common stock, $.00001 par value,
       100,000,000 shares authorized,
       7,300,000 shares issued and outstanding                               73
  Additional paid in capital                                             15,927
  (Deficit) accumulated during the development                             (217)
                                                                       --------
      Total Stockholders' Equity                                         15,783
                                                                       --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                             $ 16,668
                                                                       ========


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


                                       F-2
<PAGE>


                             CATALINA CAPITAL CORP.
                          (A DEVELOPMENT STAGE COMPANY)

                             STATEMENT OF OPERATIONS
            FOR THE PERIOD APRIL 27, 1990 (INCEPTION) TO JUNE 6, 1990

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


REVENUES                                                            $      --
                                                                    ------------
EXPENSES
   Amortization                                                               8
   General and administrative expenses                                      209
                                                                    ------------
         Total Expenses                                                     217
                                                                    ------------
NET (LOSS)                                                          $      (217)
                                                                    ===========
NET (LOSS) PER SHARE                                                $      --
                                                                    ===========
WEIGHTED AVERAGE NUMBER OF COMMON
  SHARES OUTSTANDING                                                  7,300,000
                                                                    ===========


The  accompanying  notes to financial  statements  are an integral part of these
statements.
                                       F-3
<PAGE>

<TABLE>
                                               CATALINA CAPITAL CORP.
                                            (A DEVELOPMENT STAGE COMPANY)

                                          STATEMENT OF STOCKHOLDERS' EQUITY
                              FOR THE PERIOD APRIL 27, 1990 (INCEPTION) TO JUNE 6, 1990

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

<CAPTION>
                                                                                                         Deficit
                                                           Common Stock                                 Accumulated
                                                       -----------------------        Additional        During the
                                         Preferred      Number            Par           Paid In         Development
                                           Stock       of Shares         Value          Capital            Stage
                                           -----       ---------         -----          -------            ------
<S>                                          <C>       <C>              <C>            <C>                <C>
Common stock issued for cash April
   27, 1990 at $.001 per share               --        5,000,000        $    50        $    4,950         $   --

Common stock issued for cash May
    2, 1990 at $.01 per share                            100,000              1               999             --

Common stock issued for cash May
    9, 1990 at $.01 per share                            100,000              1               999             --

Common stock issued for cash May
   11, 1990 at $.01 per share                            200,000              2             1,998             --

Common stock issued for cash May
   14, 1990 at $.01 per share                            200,000              2             1,998             --

Common stock issued for cash May
   16, 1990 at $.004 per share                           500,000              5             1,995             --

Common stock issued for cash May
   16, 1990 at $.001 per share                           200,000              2               198             --

Common stock issued for cash May
   18, 1990 at $.001 per share                           200,000              2               198             --

Common stock issued for cash May
   25, 1990 at $.001 per share                           200,000              2               198             --

Common stock issued for cash May
   29, 1990 at $.001 per share                           200,000              2               198             --

Common stock issued for cash May
   30, 1990 at $.01 per share                            100,000              1               999             --

Common stock issued for cash May
   31, 1990 at $.01 per share                            100,000              1               999             --

Common stock issued for cash June
    6, 1990 at $.001 per share                           200,000              2               198             --

Net (loss) for the period
    ended June 6, 1990                                      --             --                --               (217)
                                         ---------    ----------        -------        ----------         --------
                                             --        7,310,000        $    73        $   15,927         $   (217)
                                         =========    ==========        =======        ==========         =========
<FN>
The  accompanying  notes to financial  statements  are an integral part of these statements.
</FN>
</TABLE>


                                       F-4

<PAGE>

<TABLE>
                                     CATALINA CAPITAL CORP
                                 (A DEVELOPMENT STAGE COMPANY)

<CAPTION>
                                    STATEMENT OF CASH FLOWS
                   FOR THE PERIOD APRIL 27, 1990 (INCEPTION) TO JUNE 6, 1990

                                      ------------------
<S>                                                                                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Cash paid to suppliers                                                           $   (209)
                                                                                    --------

CASH FLOWS FROM  FINANCING  ACTIVITIES
   Proceeds  from  issuance of common stock                                           16,000
   Payment of deferred  offering  costs                                               (4,500)
   Payment of  organization costs                                                       (500)
                                                                                    --------
       Net Cash Provided by Financing Activities                                      11,000
                                                                                    --------

NET INCREASE IN CASH                                                                  10,791

CASH, Beginning of Period                                                                --
                                                                                    --------

CASH, End of Period                                                                 $ 10,791
                                                                                    ========

     RECONCILIATION OF NET INCOME TO NET CASH (USED) BY OPERATING ACTIVITIES


NET (LOSS)                                                                          $   (217)
  Adjustments to reconcile net (loss) to net
    cash (used) by operating activities
      Amortization                                                                         8
                                                                                    --------

NET CASH (USED) BY OPERATING ACTIVITIES                                             $   (209)
                                                                                    ========

             SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES

Increase in accounts payable for deferred public offering costs is $885.
<FN>
The  accompanying  notes to financial  statements  are an integral part of these statements.
</FN>
</TABLE>

                                      F-5
<PAGE>
                             CATALINA CAPITAL CORP.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

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

Note 1 - Summary of Significant Accounting Policies

         Organization - The Company was  organized as a Delaware corporation  on
         April 27, 1990.  The Company  intends to  implement a business  plan to
         seek,  investigate,  and if  warranted,  acquire  one or more  business
         properties.

         Basis of  Presentation - As  of June 6, 1990,  the  Company  was in the
         development stage and was primarily engaged in raising capital.

         Fiscal Year End - The  Company has  selected a March 31 fiscal year end
         for its financial and tax reporting.

Note 2 - Public Offering

         The Company  intends to offer to the public a minimum of 1,500,000 to a
         maximum of 3,000,000 units on a "best efforts,  minimum-maximum"  basis
         at a sales price of $.10 per unit.  Each unit consists of one (1) share
         of the Company's  $.00001 par value common stock and one (1) each Class
         A, Class B, and Class C common stock purchase warrant.

         This  offering  is being  conducted  by the  Company  and is not  being
         underwritten.  The units offered  hereby are being offered on behalf of
         the Company by the officers,  directors, and affiliates of the Company.
         No underwriting  discounts or commissions will be paid to such persons,
         although  their  out-of-pocket  expenses  will  be  reimbursed  by  the
         Company.

         The new Colorado  Securities Act, effective July 1, 1990, provides that
         where less than seventy-five  percent of the net proceeds from the sale
         of securities  are  committed for use in one or more specific  lines of
         business,  eighty  percent of the net  proceeds  received by the issuer
         shall be placed in escrow  until (i)  completion  of a  transaction  or
         series of  transactions  whereby  at least  fifty  percent of the gross
         proceeds  received from the sale of securities are committed for use in
         one or more specific lines of business, and (ii) notice of the proposed
         release  of the  escrowed  funds  had been on file  with  the  Colorado
         Division of Securities for at least ten days.  The Company  anticipates
         that this offering will be subject to the escrow provisions.


         The Company  estimates it will receive net proceeds  from this offering
         of $129,500 if the minimum  number is sold and  $279,500 if the maximum
         is sold.  As such,  eighty  percent of the net proceeds  required to be
         escrowed  would be $103,600 if the minimum is sold and  $223,600 if the
         maximum  is sold.  If after  four  years  from the date the  funds  are
         deposited  into  escrow  the  Company  has not  consumated  a  business
         combination  that has resulted in the release of the escrowed  funds as
         prescribed,  the funds will be  distributed to the persons then holding
         the shares of common stock issued in this  offering on a pro rata basis
         based on number of shares held.



                                       F-6
<PAGE>
                             CATALINA CAPITAL CORP.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

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

Note 2 - Public Offering (Continued)

         Deferred  offering  costs  represent  costs  incurred with the proposed
         offering of common  stock to the public.  In the event that the current
         offering is  successful,  costs  incurred  will be charged  against the
         proceeds of the offering. If the offering is not successful,  the costs
         will be charged to operations.

Note 3 - Warrants

         Subject to  redemption  by the Company and to the current  Registration
         Statement  requirement,  both of which limitations are described below,
         each  Class A warrant  is  exercisable  for one  share of common  stock
         commencing  with  the date of the  prospectus  and  terminating  on the
         second  anniversary  of such date,  at a price of $.30 per share.  Each
         Class B warrant is exercisable for one share of common stock at a price
         of $.75  per  share  commencing  with the  date of the  prospectus  and
         terminating  on the  second  anniversary  of such  date.  Each  Class C
         warrant  is  exercisable  for one share of  common  stock at a price of
         $1.30  per  share  commencing  with  the  date  of the  prospectus  and
         terminating  on the  second  anniversary  of  such  date.  The  warrant
         expiration  dates may be extended  indefinitely,  or the exercise price
         thereof reduced, at the discretion of the Company,  upon giving written
         notice to the warrant agent and the warrantholders.

         All of the  Class A,  Class B or Class C  warrants  may be  called  for
         redemption by the Company, at a redemption price of $.0001 per warrant,
         at any time prior to the  declaration  by the  Securities  and Exchange
         Commission of the  effectiveness of a  post-effective  amendment to the
         Registration Statement of which the prospectus is a part, without prior
         written  notice to the  registered  holders of the warrants and without
         any right on the part of the holders of the warrants to exercise  their
         purchase  rights  prior to the  redemption  date.  The  warrants may be
         exercised  only so long as the  prospectus  remains  current or after a
         post-effective  amendment  shall have been  declared  effective  by the
         Commission.

         In  addition,  all or any  number of the  warrants  can be  called  for
         redemption  at a redemption  price of $.0001 per warrant by the Company
         at any time during  their  exercise  term upon a minimum of thirty (30)
         days' prior  written  notice  mailed to the  registered  holders of the
         warrants,  subject  to the  right of the  holders  of the  warrants  to
         exercise  their  purchase  rights  between  the date of any  notice  of
         redemption  up to  and  including  the  redemption  date  given  by the
         Company.  The notice period may be extended,  at the  discretion of the
         Company,  upon giving  subsequent  notice to the  warrant  agent and to
         registered holders of the warrants.

         The Company may employ  selected  brokers and/or dealers to solicit the
         exercise of Warrants  on its behalf.  The Company may pay such  brokers
         and  dealers  a  warrant  solicitation  fee  of up to 3% of  the  gross
         proceeds  received from the exercise of warrants  originated by or from
         the broker's or dealer's office.


                                       F-7
<PAGE>
                             CATALINA CAPITAL CORP.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

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

Note 4 - Related Party Transactions

         The  Company  presently  maintains  its offices at the home of its Vice
         President for which it pays no rent.

         The Company has paid its present securities  counsel,  Pred and Miller,
         $5,000 to date for  services  rendered  in  connection  with the public
         offering  of  the  Company's  common  stock.  Three  of  the  Company's
         stockholders are partners in the law firm of Pred and Miller.

         Should the Company complete the acquisition of a business  opportunity,
         the  Board of  Directors  may award a  finder's  fee to an  officer  or
         affiliate of the Company,  or to a third party,  if the  acquisition is
         originated as a result of his efforts. The cash portion of this fee, in
         the aggregate,  if paid to officers or affiliates,  will not exceed 10%
         of the gross proceeds of the offering and may be less.


                                      F-8
<PAGE>

                                     PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

Item 22.          Indemnification of Officers and Directors

         The  Certificate  of  Incorporation  and  the  Bylaws  of the  Company,
respectively  flied as Exhibits  (3.1) and (3.2),  provide that the Company will
indemnify  its  officers  and  directors  for costs  and  expenses  incurred  in
connection with the defense of actions,  suits or proceedings  where the officer
or director acted in good faith and in a manner he reasonably  believed to be in
the Company's best interest and is a party by reason of his status as an officer
or director,  absent a finding of negligence or misconduct in the performance of
duty.

Item 23.          Other Expenses of Issuance and Distribution

                   Item                                      Amount
-----------------------------------             --------------------------------
                                                 Minimum               Maximum
Registration Fee --                              -------               -------
 Securities and Exchange Commission .........   $1,837.50             $1,837.50
Printing ....................................       2,000*                2,000*
Transfer Agent's Fees .......................         250*                  250*
Printing of Certificates ....................         600*                  600*
Legal Fees and Expenses .....................      11,500*               11,500*
Accounting Fees .............................       1,000*                1,000*
Blue Sky Fees and Expenses ..................       3,000*                3,000*
Miscellaneous Expenses ......................      312.50*               312.50*
                                                ---------             ---------
         Total ..............................   $  20,500*            $  20,500*

*Estimated

Item 24.          Recent Sales or Unregistered Securities
<TABLE>
         Since its inception, the Company has sold its Common Stock, $.00001 par
value,  to the  following  persons and entities in  transactions  summarized  as
follows:
<CAPTION>
                                                                         Aggregate        Purchase Price
Name of Purchaser              Date of Sale              Shares         Purchase Price       Per Share
-----------------              ------------              ------         --------------       ---------
<S>                             <C>                   <C>                 <C>                  <C>
John J. Micek III               4/27/90               1,000,000           $1,000              $.001
Keith A. Koch                   4/27/90               1,000,000            1,000               .001
Kenneth L. Maul                 4/27/90               1,000,000            1,000               .001
Frank L. Kramer                 4/27/90               1,000,000            1,000               .001
Donald R. McGahan               4/27/90               1,000,000            1,000               .001
Tony Acone                       5/2/90                 100,000            1,000               .01
Randel L. Perkins                5/9/90                 100,000            1,000               .01
Glen Holt                       5/11/90                 200,000            2,000               .01
T. David Clemans                5/14/90                 200,000            2,000               .01


                                      II-1


<PAGE>




Ronald J. Miller                5/16/90                 375,000            1,500               .004
Robert Neece                    5/16/90                  75,000              300               .004
Heather Anderson                5/16/90                  50,000              200               .004
Donald R. McGahan               5/16/90                 200,000              200               .001
John J. Micek III               5/18/90                 200,000              200               .001
Frank L. Kramer                 5/25/90                 200,000              200               .001
Keith A. Koch                   5/29/90                 200,000              200               .001
Dennis Yamamoto                 5/30/90                 100,000            1,000               .01
Charles M. Cunningham           5/31/90                 100,000            1,000               .01
Kenneth L. Maul                  6/6/90                 200,000              200               .001
</TABLE>

         These  sales  were all made for cash and were made in  reliance  on the
exemption  from  registration  offered by Section 4(2) of the  Securities Act of
1933. The Company had reasonable grounds to believe  immediately prior to making
an  offer  to  the  private   investors  for  cash,  and  believed,   when  such
subscriptions  were  accepted,  that such  purchasers  (1) were  purchasing  for
investment and not with a view to  distribution,  and (2) had such knowledge and
experience  in  financial  and  business  matters  that  they  were  capable  of
evaluating the merits and risks of their  investment and were able to bear those
risks. The purchasers had access to pertinent  information  enabling them to ask
informed questions.  The shares were issued without the benefit of registration.
An appropriate restrictive legend is noted on the certificates representing such
shares, and stop-transfer instructions have been noted in the Company's transfer
records.  All such sales were effected without the aid of  underwriters,  and no
sales commissions were paid.

Item 25.          Exhibits

         The following Exhibits are filed as part of the Registration Statement.



Exhibit
 No.                                   Document
-------           ------------------------------------------------------
 3.1              Certificate of Incorporation (1)
 3.2              Bylaws (1)
 4.1              Form of Unit Warrant Agreement (1)
 4.2              Specimen Stock Certificate (1)
 4.3              Form of Specimen A Warrant Certificate (1)
 4.4              Form of Specimen B Warrant Certificate (1)
 4.5              Form of Specimen C Warrant Certificate (1)
 5.1              Opinion of Pred and Miller regarding legality (1)
24.1              Consent of Wenner, Silvestain & Company (1)
24.2              Consent of Pred and Miller (included in 5.1, opinion
                    regarding legality) (1)
28.1              Form of Escrow Agreement (1)
28.2              Form of Post-Offering Escrow Agreement


(1) Previously filed and not included herein.


                                      II-2


<PAGE>




Item 26.          Undertakings

         The undersigned registrant hereby undertakes:

         (1) To provide at the closing,  Stock Certificates and Warrants in such
denominations and registered in such names as required to permit prompt delivery
to each purchaser.

         (2) Upon expiration of the Warrants, to deregister any shares of Common
Stock  reserved  for  issuance  upon  exercise  of  any  Warrants  which  expire
unexercised.

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

         (4) With  respect  to the  Warrants  and the shares  issuable  upon the
exercise thereof,  that (i) any prospectus revised to show the terms of offering
of  such  Warrants  and/or  shares  (other  than  a  transaction  on a  national
securities  exchange),  and (ii)  any  prospectus  revised  to  comply  with the
requirements of Section 10(a)(3) of the Securities Act of 1933, as amended, will
be filed as a post-effective  amendment to the  Registration  Statement prior to
any offering  thereof;  and that the effective date of each such amendment shall
be deemed the  effective  date of the  Registration  Statement  with  respect to
securities sold after such amendment shall have become effective.

         (5) To file, during any period in which offers or sales are being made,
a  post-effective  amendment to this  registration  statement (i) to include any
prospectus  required by Section  10(a)(3) of the Securities Act of 1933, (ii) to
reflect in the  prospectus  any facts or events arising after the effective date
of the  registration  statement  (or the most  recent  post-effective  amendment
thereof) which, individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement, and (iii) to include
any material information with respect to the plan of distribution not previously
disclosed  in  the  registration  statement  or  any  material  change  to  such
information in the registration  statement,  including,  but not limited to, any
addition or deletion of a managing underwriter.

         (6) That,  for the  purpose  of  determining  any  liability  under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such  securities at that time shall be deemed to be the initial bona
fide offering thereof.

         (7)  To  remove  from  registration,   by  means  of  a  post-effective
amendment,  any of the securities  being  registered  which remain unsold at the
termination of the offering.


                                      II-3
<PAGE>


                                   Signatures

         Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it meets
all of the  requirements  for  filing  on Form  S-18  and has duly  caused  this
Amendment No. 2 to its Registration  Statement to be signed on its behalf by the
undersigned,  thereunto  duly  authorized,  in the City of Palo Alto,  County of
Santa Clara, State of California on September 28, 1990.


                                          CATALINA CAPITAL CORP.


                                      By: /s/ John J. Micek III
                                          --------------------------------------
                                          John J. Micek III, President


         Pursuant to the requirements of the Securities Act of 1933, as amended,
this  Registration  Statement  has been signed by the  following  persons in the
capacities and on the dates indicated.

         Signature                     Title                     Date
         ---------                     -----                     ----


/s/ John J. Micek III               President and             September 28, 1990
---------------------               a Director
John J. Micek III

/s/ Frank L. Kramer                 Vice President,           September 28, 1990
---------------------               Secretary, Treasurer,
Frank L. Kramer                     and a Director

/s/ Donald R. McGahan               A Director                September 28, 1990
---------------------
Donald R. McGahan


                                      II-4

<PAGE>


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

<PAGE>




                                  Exhibit 24.1




<PAGE>

                         wenner, silvestain and company
 Certified Public Accountants, 8101 East Prentice, Suite 600,
                                                  Englewood, Colorado 80111-2935
       Telephone (303) 771-5300                  FAX (303) 771-7921
Stephen L. Wenner, CPA         Bennie Silvestain, CPA      Gary P. Saltzman, CPA
            Lawrence L. Greenberg, CPA        Barry H. Silvestain, CPA





                       CONSENT OF INDEPENDENT ACCOUNTANTS

We  hereby  consent  to the  use  in the  Prospectus  constituting  part  of the
Registration  Statement on Form S-18, and any amendments thereto, to be filed by
Catalina Capital Corp. of our Auditors' Opinion dated June 20, 1990 accompanying
the Financial  Statements of Catalina  Capital Corp. as of June 6, 1990,  and to
the use of our name under the caption "Experts" in the Prospectus.



                                              /s/ Wenner, Silvestain and Company
                                                  Wenner, Silvestain and Company

Englewood, Colorado
June 26, 1990



Member, American Institute of Certified Public Accountants
                    Member, The Colorado Society of Certified Public Accountants
Member, SEC Practice Section of the AICPA
                         Member, Private Companies Practice Section of the AICPA
--------------------------------------------------------------------------------


<PAGE>





                                  Exhibit 28.2