SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549
                               _________________

                                FORM 10-KSB/A-2
(Mark One)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934

For the fiscal year ended June 30, 1998

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

For the transition period from ______________ to _________________

Commission file number 0-22450

                          COUNTRY WORLD CASINOS, INC.
              (Name of Small Business Issuer in its charter)

             Nevada                                      13-3140389
(State or Other Jurisdiction of            (IRS Employer Identification Number)
 Incorporation or Organization)

       200 Monument Road, Suite 10, Bala Cynwyd, Pennsylvania     19004
             (Address of Principal Executive Offices)          (Zip Code)

         Issuer's Telephone Number, Including Area Code: (610) 617-9990

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

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

                            $.001 Par Value Common Stock
                                  (Title of Class)

<PAGE>

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

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

State the issuer's revenues for its most recent fiscal year. $ None

The aggregate market value of the approximately 21,448,359 shares of the
Company's voting stock held by non-affiliates, computed at the average bid and
asked prices of such stock in the over-the-counter market, as quoted on the
Electronic Bulletin Board on September 30, 1998 was approximately $3,431,737.


Issuers Involved in Bankruptcy Proceedings During the Past Five Years

Check whether the issuer has filed all documents and reports to be filed by
Section 12, 13 or 5(d) of the Exchange Act of the distribution of securities
under a plan confirmed by a court.

Yes X                  No

Indicate the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: At September 30, 1998, there
were outstanding 54,331,687 shares of the issuer's Common Stock, par value
$.001.

<PAGE>

                                     PART I
                            Description of Business
Item 1
General Development of Business

Country World Casinos, Inc., the Registrant (the "Company" or "Country World")
was incorporated on November 9, 1982 under the name, Innovative Medical
Technology, Inc. The Company was organized to engage in the medical industry.
The Company effected a public offering in 1983. The Company was essentially
inactive until 1990 when it undertook the manufacturing of monolithic composite
panels for use in the construction of semi-truck trailers, shipping containers
and industrial buildings. The Company discontinued this business in September
1992.

In 1993, the Company changed the focus of its planned business operations to the
construction of a large, full service, first class casino in Black Hawk,
Colorado. In August 1993, the Company completed the acquisition from New Allied
Development Corporation and its subsidiary, Tommyknocker Casino Corp., of
certain real property located in Black Hawk, Colorado known as Mill Sites 12 and
13, and the Smith Lode Mining Claim, U.S. Survey No. 502 (the "Property").
Except as specifically provided elsewhere herein to the contrary, New Allied
Development Corporation and Tommyknocker Casino Corp. will be referred to
hereinafter collectively as "New Allied."

Since the Company's purchase of the Property in August 1993, the Company's
activities have focused on obtaining the necessary financing and making
preparations for construction of the casino on the Property. In July 1997, the
Company signed a financing agreement with U2 Consulting, LLC., an affiliate of
Pacific Genesis, Inc. and Western Equities, Inc., to raise $79.5 million through
the issuance of corporate bonds. The parties had 180 days to provide for the
financing, were unable to complete same and said agreement with U2 Consulting
was terminated in December 1997.

In January 1998, the Company again began the process of acquiring financing.
After much discussion and many contacts with a wide range of financing groups,
the Company has entered into three separate agreements to provide the necessary
financing. Although the Company is confident in the abilities of these three
organizations to provide the necessary capital, there can be no assurance that
any funds will be provided immediately or in the future.

Each of the three agreements, which are strictly confidential until completed,
obligates the respective parties to provide at least $80 million for the
development and construction of the project. Each agreement provides for
distinctly different means of raising the required funds, as well as distinctly
different means of repayment and different levels of equity participation.

Once financed, the Company's ability to operate the casino will be dependent
upon substantial other conditions, including the obtaining of licenses and
compliance with governmental regulations, grading and construction of the
casino, obtaining the necessary permits and approvals from the City of Black
Hawk and other regulatory bodies, procuring gaming equipment on satisfactory
terms, and accomplishing these objectives in a timely manner.

                          -3-
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In order to begin the process of timely completing its goals, in July 1997, the
Company contracted with Colorado Gaming Development Company, Inc., Semple Brown
Roberts, P.C. and PCL Construction Services, Inc., all of Denver, Colorado to
design and construct the planned casino and hotel complex. In addition, the
Company signed a management agreement with Signature Hospitality Resources, Inc.
of Denver, Colorado to manage its Radisson Black Hawk Hotel, a separate
agreement to use the national flag of Radisson on the hotel and contract with
Luciani & Associates, LLC of Atlantic City, New Jersey, to manage the casino
operations. All parties assisted the architect in design of their respective
operations. The Agreement with Luciani & Associates, LLC has expired and they
advised the Company of such in writing in February 1998. Once financing has been
secured, the Company will attempt to negotiate a new agreement, either with
Luciani & Associates or others yet to be determined.

The Company is engaged in the design, development and construction of the Hotel
and Casino (the "Hotel Casino") in Black Hawk, Colorado. The revised plan for
the Hotel Casino will be an eight level complex, featuring three stories of
hotel rooms above a two-story, 75,000 square foot casino, and a three story
parking garage. Other amenities will include one or more full service
restaurants, a buffet, entertainment lounge and retail shops. When completed as
planned, the Hotel Casino will be largest hotel and casino complex in Colorado.
Construction and opening of the Hotel Casino is dependent upon the Company's
ability to successfully raise the required capital discussed above.

The casino level of the project, at approximately 75,000 square feet, will be
the largest in Colorado and will be capable of accommodating 1,800 slot machines
and 32 gaming tables. The Company will open the facility with 1,000 slot
machines, 20 blackjack tables and 12 poker tables, and may add up to 800
additional slot machines if management determines that the additional gaming
devices will produce equal per square foot revenue and will not create excess
capacity. The Company expects that slot machines will be the greatest source of
its gaming revenues. Slot machines are less labor intensive and require less
square footage than table games, and also generate higher profit margins.

The Country World Casino's atmosphere will feature a country western music theme
similar to the rock and roll music theme successfully employed by the Hard Rock
Cafe. The Casino decor is planned to include memorabilia from the great country
singers, both past and present. The country western theme has not been
established in the Black Hawk/Central City, Colorado gaming market, and
therefore will give the Country World Casino its own unique identity. Management
believes that as casinos have become more numerous, the gaming industry has
begun to recognize that popular themes and amenities such as quality dining and
hotel accommodations play an important role in attracting customers to casinos.
The theme is intended to appeal to the Hotel Casino's target customer base,
which consists primarily of residents of the Denver metropolitan area as well as
other Colorado communities located within driving distance of Black Hawk.

                          -4-
<PAGE>

The Hotel and Casino will provide overnight accommodations with 200 +/- rooms
and suites, making it one of the first destination resort of its kind in Black
Hawk. Complimenting both the casino and hotel will be a three story underground
parking facility for approximately 1,000 cars featuring both valet and self
parking options, and the only covered on-site bus turnaround currently available
in Black Hawk for the convenience of day trip customers.

Black Hawk is a picturesque mountain town approximately 40 miles west of Denver.
In the past year, Black Hawk hosted approximately 3 million visitors and
generated almost 60% of the state's gaming revenues. The 536,000 square foot
Hotel Casino facility on the northern most end of the Black Hawk gaming district
will be in a most highly visible location as it is in a direct line of site to
all visitors approaching Black Hawk's Gregory Street intersection on State
Highway 119. The eight story structure will tower high above all existing
facilities. The Black Hawk and nearby Central City casino market includes many
small, privately held gaming facilities that the Company believes offer limited
amenities and are characterized by a shortage of convenient on-site parking.
There are a few large facilities currently operating with varying levels of
services and amenities, as well as new facilities planned. The Country World
Casino's country western music theme, country hospitality, ample parking, modern
hotel accommodations and a full line of amenities, will set it apart from, and
should give it a competitive advantage over, the other casinos in the Black
Hawk/Central City market.

The Hotel Casino complex will be designed and constructed pursuant to a
guaranteed maximum price agreement which is to be finalized prior to
construction. The design and construction team consists of Semple Brown Roberts,
P.C., a Denver based architectural firm (the "Architect") and PCL Construction
Services, Inc., a multi-million dollar North American construction firm with
U.S. headquarters located in Denver. The Architect is the designer of
Fitzgerald's Casino in Black Hawk, while the Contractor's gaming credits include
the MGM Grand Hotel Casino and Stratosphere Tower in Las Vegas, Nevada, as well
as the Chinook Winds Gaming and Convention Center in Lincoln City, Oregon.
Gaming operations at the Country World Casino were to be under the management of
Luciani & Associates of Atlantic City, New Jersey, who are leaders in casino
design and management services. At this time, the agreement has expired, however
once financing has been secured, the Company will attempt to negociate a new
agreement or seek another management company.

Hotel operations will be under the management of Signature Hospitality
Resources, Inc. of Denver, Colorado (the "Hotel Manager'), which provides a full
range of hotel and resort support services including operations, sales,
marketing, food, beverage, human resources, MIS and technical services. The
Hotel Manager's current portfolio of facilities under management includes 16
hotel and resort properties, comprising 4,398 rooms, in eight states and the
Caribbean. Signature's executive team represents over 120 years of combined
hospitality related experience, spanning 200 properties in 34 states and three
countries.

                          -5-
<PAGE>

COLORADO GAMING REGULATIONS

The State of Colorado created the Division of Gaming (the "Division") within the
Department of Revenue to license, implement, regulate and supervise the conduct
of limited gaming under the Colorado Limited Gaming Act and the regulations
promulgated thereunder (the "Colorado Gaming Act"). The Director of the
Division, under the supervision of a five-member Colorado Limited Gaming Control
Commission (the "Colorado Gaming Commission"), has been granted broad power to
ensure compliance with the Colorado Gaming Act. The Director may inspect,
without notice, impound or remove any gaming device. He may examine and copy any
licensee's records, may investigate the background and conduct of licensees and
their employees, and may bring disciplinary actions against licensees and their
employees. He also may conduct detailed background investigations of persons who
loan money to the Company.

The Colorado Gaming Commission is empowered to issue five types of gaming and
gaming related licenses. The licenses are revocable and non-transferrable. The
failure or inability of the Company or the Casino Manager to obtain and maintain
the necessary gaming licenses could prevent the Company from operating the
Casino and could have a material adverse effect on the Company. All persons
employed by the Company and the Casino Manager and involved, directly or
indirectly, in gaming operations in Colorado also are required to obtain a
Colorado gaming license. All licenses must be renewed annually.

The Company's President, Roger Leclerc currently holds a key employee license
which entitles him to operate a casino in the State of Colorado. The Company,
its Chairman and Chief Executive Officer, Larry Berman, and its
Secretary/Treasurer, William Patrowicz will apply for their respective licenses
at the conclusion of financing to coincide with the start of construction.

As a general rule, under the Colorado Gaming Act, it is a criminal violation for
any person to have a legal, beneficial, voting or equitable interest, or right
to receive profits, in more than three retail gaming licenses in Colorado. The
Colorado Gaming Commission has ruled that a person does not have an interest in
a licensee for purposes of the multiple-license prohibition if: (i) such person
has less than a five percent (5%) interest in an institutional investor which
has an interest in a publicly traded licensee or publicly traded company
affiliated with a licensee (such as the Company); (ii) a person has a five
percent (5%) or more financial interest in an institutional investor, but the
institutional investor has less than a five percent (5%) interest in a publicly
traded licensee or publicly traded company affiliated with a licensee; (iii) an
institutional investor has less than a five percent (5%) financial interest in a
publicly traded licensee or publicly traded company affiliated with a
licensee;(iv) an institutional investor possesses securities in a fiduciary
capacity for another person, and does not exercise voting control over five
percent (5%) or more of the outstanding voting securities of a

                          -6-
<PAGE>

publicly traded licensee or of a publicly traded company affiliated with a
licensee; (v) a registered broker or dealer retains possession of securities of
a publicly traded licensee or of a publicly traded company affiliated with a
licensee for its customers in street name or otherwise, and exercises voting
rights for less than five percent (5%) of the publicly traded licensee's voting
securities or of a publicly traded company affiliated with a licensee; (vi) a
registered broker or dealer acts as a market maker for the stock of a publicly
traded licensee or of a publicly traded company affiliated with a licensee and
possesses a voting interest in less than five percent (5%) of the stock of the
publicly traded licensee or of a publicly traded company affiliated with a
licensee; (vii) an underwriter is holding securities of a publicly traded
licensee or of a publicly traded company affiliated with a licensee as part of
an underwriting for no more than 90 days if it exercises voting rights of less
than five percent (5%) of the outstanding securities of a publicly traded
licensee or of a publicly traded company affiliated with a licensee; (viii) a
stock clearinghouse holds voting securities for third parties, if it exercises
voting rights with respect to less than five percent (5%) of the outstanding
securities of a publicly traded licensee or of a publicly traded company
affiliated with a licensee; or (ix) a person owns less than five percent (5%) of
the voting securities of the publicly traded licensee or publicly traded company
affiliated with a licensee. Hence, the Company's and its stockholders' business
opportunities in Colorado are limited to such interests that comply with the
statute and Commission's rule.

Although attorneys for the Colorado legislature initially expressed concern that
the promulgation of the above-described regulation was beyond the Colorado
Gaming Commission's statutory delegated authority, they appear to have retreated
from this position. Therefore, unless the Colorado legislature repeals the
regulation, it is likely that it will continue in effect.

In addition, pursuant to the Colorado Gaming Act, no manufacturer or distributor
of slot machines may have an interest in any casino operator, allow any of its
officers to have such an interest, employ any person if such person is employed
by a casino operator, or allow any casino operator or person with a substantial
interest therein to have an interest in a manufacturer's or distributor's
business. The Colorado Gaming Commission has ruled that a person does not have a
"substantial interest" if it directly or indirectly has less than five percent
(5%) of such voting securities of a licensee.

Under the Colorado Gaming Act, any person or entity having any direct or
indirect interest in a gaming licensee or an applicant for a gaming license,
including, but not limited to, the Company and stockholders of the Company,
maybe required to supply the Colorado Gaming Commission with substantial
information, including, but not limited to, background information, source of
funding information, a sworn statement that such person or entity is not holding
his interest for any other party, and finger prints. Such information,
investigation and licensing as an "associated person" automatically will be
required of all persons (other than certain institutional investors discussed
below) which directly or indirectly own ten percent (10%) or more of a direct or
indirect legal, beneficial or voting interest in the Company. Such persons must
report their interest and file appropriate applications within 45 days after
acquiring such interest. Persons directly or indirectly having a five percent
(5%) or more interest (but less than 10%) in the Company, must report their
interest to the Colorado Gaming Commission within ten (10) days after acquiring
such interest and may be required to provide additional information and to be
found suitable. If certain institutional investors provide certain information
to the Colorado Gaming Commission, such investors, at the Colorado Gaming
Commission's discretion, may be permitted to own up to 14.99% of the Company,
before being required to be found suitable. All licensing and investigation fees
will have to be paid for by the person in question. The associated person
investigation fee currently is $48 per hour.

                          -7-
<PAGE>

The Colorado Gaming Commission also has the right to request information from
any person directly or indirectly interested in, or employed by, a licensee, and
to investigate the moral character, honesty, integrity, prior activities,
criminal record, reputation, habits and associations of (i) all persons licensed
pursuant to the Colorado Limited Gaming Act, (ii) all officers, directors and
stockholders of a licensed privately held corporation, (iii) all officers,
directors and stockholders holding either a five percent (5%) or greater
interest or a controlling interest in a licensed publicly traded corporation,
(iv) all general partners and all limited partners of a licensed partnership,
(v) all persons which have a relationship similar to that of an officer,
director or stockholder of a corporation (such as members and managers of a
limited liability company), (vi) all persons supplying financing or loaning
money to any licensee connected with the establishment or operation of limited
gaming, and (vii) all persons having a contract, lease or ongoing financial or
business arrangement with any licensee, where such contract, lease or
arrangement relates to limited gaming operations, equipment, devices or
premises. For purposes of the Colorado Gaming Act, a note secured by a deed of
trust on casino property is considered a "lease."

In addition, under the Colorado Gaming Act regulations, every person who is a
party to a "gaming contract" with an applicant for a license, or with a
licensee, upon the request of the Colorado Gaming Commission or the Director,
promptly must provide to the Colorado Gaming Commission or Director all
information which may be requested concerning financial history, financial
holdings, real and personal property ownership, interests in other companies,
criminal history, personal history and associations, character, reputation in
the community, and all other information which might be relevant to a
determination whether a person would be suitable to be licensed by the Colorado
Gaming Commission. Failure to provide all information requested constitutes
sufficient grounds for the Director or the Colorado Gaming Commission to require
a licensee or applicant to terminate its "gaming contract" (as defined below)
with any person who failed to provide the information requested. In addition,
the Director or the Colorado Gaming Commission may require changes in "gaming
contracts" before an application is approved or participation in the contract is
allowed. A "gaming contract" is defined as an agreement in which a person does
business with or on the premises of a licensed entity.

An application for licensure or suitability may be denied for any cause deemed
reasonable by the Colorado Gaming Commission or the Director, as appropriate.
Specifically, the Colorado Gaming Commission and the Director must deny a
license to any applicant who (i) fails to prove by clear and convincing evidence
that the applicant is qualified; (ii) fails to provide information and
documentation requested; (iii) fails to reveal any fact material to
qualification, or supplies information which is untrue or misleading as to a
material fact pertaining to qualification; (iv) has been, or has any director,
officer, general partner, stockholder, limited partner or other person who has a
financial or equity interest in the applicant who has been, convicted of certain
crimes, including the service of a sentence upon conviction of a felony in a
correctional facility, city or county jail, or community correctional

                          -8-
<PAGE>

facility or under the state board of parole or any probation department within
ten years prior to the date of the application, gambling-related offenses, theft
by deception or crimes involving fraud or misrepresentation, is under current
prosecution for such crimes (during the pendency of which license determination
may be deferred), is a career offender or a member or associate of a career
offender cartel, or is a professional gambler; or (v) has refused to cooperate
with any state or federal body investigating organized crime, official
corruption or gaming offenses.

If the Colorado Gaming Commission determines that a person or entity is
unsuitable to own interests in the Company, then the Company may be sanctioned,
which may include the denial or revocation of the approvals and licenses
required to operate the Casino.

The Colorado Gaming Commission does not need to approve in advance a public
offering of securities, but rather requires a filing of notice and additional
documents with regard to such public offering prior to such public offering.
Under the regulations, the Colorado Gaming Commission may, in its discretion,
require additional information and prior approval of such public offering.

In addition, the Colorado Gaming Act regulations prohibit a licensee or
affiliated company thereof, such as the Company, from paying dividends, interest
or other remuneration to any unsuitable person, or recognizing the exercise of
any voting rights by any unsuitable person. Further, the Company may repurchase
the shares of anyone found unsuitable at the lesser of the cash equivalent to
the original investment in the Company or the current market price. Further, the
regulations require anyone with a material involvement with a licensee,
including a director or officer of a holding company, such as the Company, to
file for a finding of suitability if required by the Colorado Gaming Commission.

In addition to its authority to deny an application for a license or
suitability, the Colorado Gaming Commission has jurisdiction to disapprove a
change incorporate position of a licensee and may have such authority with
respect to any entity which is required to be found suitable by the Colorado
Gaming Commission. The Colorado Gaming Commission has the power to require the
Company to suspend or dismiss managers, officers, directors and other key
employees or sever relationships with other persons who refuse to file
appropriate applications or whom the authorities find unsuitable to act in such
capacities, and may have such power with respect to any entity which is required
to be found suitable.

Once the Company obtains the required gaming licenses, a person or entity will
not be permitted to sell, lease, purchase, convey or acquire a controlling
interest in the Company without the prior approval of the Colorado Gaming
Commission, and the Company will be prohibited from selling any interest in the
Casino without the prior approval of the Colorado Gaming Commission.

The Casino may operate only between 8:00 am. to 2:00 am., and may permit only
individuals 21 years or older to gamble. Only slot machines, blackjack and
poker, with a maximum single bet of $5.00, are permitted. A Colorado casino may
not provide credit to its gaming patrons. The Casino must not exceed certain
gaming square footage limits as a total of each floor and the full building.

                          -9-
<PAGE>

GAMING TAXES

The Colorado Constitution permits a gaming tax of up to 20% on adjusted gross
gaming proceeds. The Colorado Gaming Commission has set a gaming tax rate of 2%
on adjusted gross gaming proceeds of up to and including $2 million, 4% from $2
million to $4 million, 14% from $4 million to $5 million, 18% from $5 million to
$10 million, and 20% above $10 million for the period ended June 30, 1998. The
Colorado Gaming Commission also has imposed an annual device fee of $75 per
gaming device. The Colorado Gaming Commission may revise the gaming tax rate and
device fee from time to time. Black Hawk has imposed an annual device fee of
$700 per gaming device and may revise the same from time to time.

OTHER REGULATIONS

The sale of alcoholic beverages is subject to licensing, control and regulation
by the Colorado Liquor Agencies. All persons who directly or indirectly own 10%
or more of the Company must file applications and possibly be investigated by
the Colorado Liquor Agencies. The Colorado Liquor Agencies also may investigate
those persons who, directly or indirectly, loan money to or have any financial
interest in liquor licensees. All licenses are revocable and not transferable.
The Colorado Liquor Agencies have the full power to limit, condition, suspend or
revoke any such license and any such disciplinary action could (and revocation
would) have a material adverse effect upon the operations of the Company. No
person with an interest in any holder of a hotel and restaurant liquor license
can have an interest in a liquor licensee which holds anything other than a
hotel and restaurant liquor license, and specifically cannot have an interest in
an entity which holds a gaming tavern license.

The Company's operations will be subject to a wide variety of other federal,
state and local laws and government regulations that could increase its costs of
construction and its operating expenses. Such regulations include architectural
and requirements, building codes, health and safety laws, environmental laws,
minimum wage and employment laws, and laws such as the Americans With
Disabilities Act that require public facilities such as the Company's Hotel and
Casino to be assessable and usable by people in wheel chairs.

Slot machines are the most popular gaming devices in Colorado, and the Company
expects that slot machines will be the greatest source of its gaming revenues.
Slot machines are less labor intensive and require less square footage than
table games, and also generate higher profit margins. Slot machines in Colorado
permit play in denominations of nickels, quarters, half dollars, dollars and
five dollars. Casinos are permitted to provide "progressive jackpots" that
increase with continued play at the designated slot machines. Slot machines come
in both the mechanical spinning reels variety and video slot machines.

Twenty-five varieties of poker are authorized for play in Colorado casinos.
Sixteen varieties of poker are "traditional" games in which the players play
against each other to win a "pot" built upon their own wagers. These games
include a variety of five-card draw, five-card and seven-card stud,

                          -10-
<PAGE>

and "hold 'em" games. In those games, the casino takes a fee or "rake" from
each pot. Nine other poker games the players play against the casino to win
payout. The casino does not take a "rake" from the pot in those games, but
rather retains players' losses.

Five varieties of blackjack or "21" are authorized for play in Colorado casinos.
Under Colorado rules, dealer must draw to hands of 16 or less and must stand on
hands of 17 or higher. Players are allowed to split pairs, double down (doubling
the wager after seeing the first two cards, but drawing not more than one
additional card) and purchase "insurance". An "insurance" wager may be made when
the dealer's face up card is an ace. The insurance wager is up to 50% of the
original wager and entitles the player to 2 to 1 payout if the dealer has a 10
or face card in the whole (a natural 21), but the insurance wager is lost if the
dealer's whole card has a value other than 10.

ITEM 2. DESCRIPTION OF PROPERTY

The Company's Property is located in the town of Black Hawk. The town of Black
Hawk is part of the Central City and Black Hawk National historic Landmark,
established in 1989 by the United States Department of Interior, National Park
Service. In conformance with this designation, the town of Black Hawk in October
1990 established the Architectural and Design Review Guidelines, authorizing the
town to regulate historical and architectural matters within the town. These
guidelines are used by Black Hawk's Historic Architectural Review Commission
("HARC") to evaluate and approve all applications for construction.

Furthermore, the amendment to the Colorado Constitution authorizing limited
stakes gaming provides that such gaming shall be conducted in structures which
conform, as determined by the respective municipal governing body, to the
architectural styles and designs common to the area prior to World War I and
which conform to the requirements of applicable respective municipal ordinances,
regardless of the age of the structure. Accordingly, the Company is designing
its building in conformance with the requirements of HARC, and the building
design will reflect the architectural style consistent with the guidelines.

The site is located on Colorado State Highway 119, approximately one-quarter
mile past the Gregory Street turn-off that leads to Central City through Black
Hawk. As such, the Company's casino facility will not be contiguous to the many
casinos which are located on Gregory Street and Main Street in Black Hawk. The
facility will be designed to allow for a maximum exposure to approaching
traffic, and will be in a direct site line from the turn from the Highway into
the town of Black Hawk. The Company believes that it is this ability, and ease
of access that should provide the Company a competitive benefit as compared to
the other casinos which are located in the central portion of town. Moreover,
many casinos in Black Hawk/Central City lack contiguous or convenient parking
and, as a result, have had difficulty in attracting and retaining customers. In
contrast, the Company's site will offer convenient valet and self parking to its
customers, as well as the only covered on-site bus turnaround to date for the
convenience of day trip customers.

                          -11-
<PAGE>

COMPETITION

Most of the 32 casinos in the Black Hawk/Central City market are small
facilities that provide limited or no parking and do not provide hotel
accommodations. Presently, the largest hotel in the Black Hawk/Central City
market is the 118 room Harvey's Wagon Wheel located in Central City, which has
on-site parking for 195 cars. In contrast, the Company's Hotel Casino will have
200+/- hotel rooms and suites and will have a parking garage that can
accommodate approximately 1,000 cars. Several of the larger casinos are planning
to expand their facilities to provide additional casino space, hotel rooms and
parking, and several new casinos are either planned, under construction, or
recently opened, including the Black Hawk/Jacobs Casino which will include 1,000
gaming devices and parking for 280 cars with provision for a 50 room hotel. Now
under construction, the Isle of Capri, will purportedly have more than 1,100
slot machines, 24 card tables (for blackjack and poker) and a parking garage for
1,000 cars. The Isle of Capri Casino will not initially provide any hotel
accommodations, although it purportedly will be designed to permit the
construction of a hotel on top of the casino. Riviera Holdings Corporation has
recently broke ground to construct a large casino with 1,000 slot machines and
parking for 500 cars.

The following table presents certain information about the six largest casinos
currently operating in the Black Hawk/Central City market, which control
approximately 61% of the slot machines, 65% of the blackjack tables and 100% of
the poker games in the Black Hawk/Central City market.

<TABLE>
                                    Size        Date         Number of Gaming Devices*
Casino                            Sq. Ft.*     Opened    Slots  Blackjack   Poker
<S>                                 <C>         <C>       <C>      <C>       <C>
Harvey's Wagon Wheel               40,000      12/94      850      18         9
Colorado Central Station           44,300      12/93      720      10         9
Bullwhackers                       33,200       7/92      649       8         6
Canyon Casino                      62,600      12/93      607       8        --
Gilpin Hotel/Black Hawk Gaming     35,300       1/95      520       8         8
Fitzgeralds Casino                 26,700       2/95      492       6         5
</TABLE>
*Estimated

The Company plans to attain a competitive advantage over the established casinos
by offering superior lodging, an entertainment lounge, indoor self-parking, and
dining facilities, as well as a casino that is larger than the rest. In
comparison to the casinos that are presently operating in the Black Hawk/Central
City market, and those that are planned, the Company's Hotel Casino will offer a
75,000 square foot casino featuring 1,000 mechanical and video slot machine, 20
blackjack tables, and 12 poker tables, all located on a single level.

Guests will be able to access the Company's Hotel Casino directly from State
Highway 119, without having to drive through Main Street or Gregory Street,
which are the two main streets that comprise the town of Black Hawk. The
location of the Hotel Casino at the north end of the town will enable guests to
avoid traffic congestion on the two main streets of the town. There is presently
a shortage of parking space in Black Hawk and

                          -12-
<PAGE>

Central City, especially parking spaces located close to the casinos. The
Company's Hotel Casino will have an underground parking garage that will be
sheltered from inclement weather and will permit customers to quickly park and
retrieve their cars. Valet parking will also be provided. In addition, the
Company plans to build a covered bus stop and turn-around that will facilitate
access to the Hotel Casino by customers on one-day, over-night or weekend
excursions. The Company may also sponsor charter bus services from the Denver
metropolitan area as a promotional consideration.

THE BLACK HAWK GAMING MARKET

Black Hawk, Colorado is a picturesque mountain town approximately 40 miles west
of Denver and approximately one mile from Central City. The Black Hawk/Central
City casino industry draws its customers primarily from the Denver metropolitan
area. The Company's Hotel Casino will target middle to upper income customers
who seek a quality gaming experience, convenient parking and overnight
accommodations. Statistics released by the Denver Regional Council of
Governments ("DRCOG") in September 1992 indicate that the eight county Denver
metropolitan area had a population of nearly 2,000,000 people at January 1,
1992. The DRCOG estimates that the population of the region will grow by more
than 300,000 during the ten year period ending in the year 2000 and will exceed
2,700,000 by the year 2020.

According to information provided by the Colorado Department of Revenue Division
of Gaming, based upon unaudited information reported by the owners of gaming
establishments, during the 12 months ended June 30, 1996, the Black Hawk/Central
City casinos generated more than $300,000,000 of gaming revenues. Gaming
revenues in the Black Hawk/Central City market were derived from slot machines,
black jack and poker in the following amounts: slot machines -- $278,901,209;
blackjack -- $13,089,446; and poker -- $8,866,760. Food and beverage sales
(including complimentary sales) for the 12 months exceeded $25,000,000.

Gaming revenues in the Black Hawk/Central City market have grown steadily since
gaming began in 1991. The following table shows the growth in Black Hawk/Central
City gaming revenues for the last six full 12 month periods ended September 30,
1997, as reported by the Colorado Department of Revenue Division of Gaming. The
Company believes that growth in gaming revenues will continue to increase in the
Black Hawk area sufficient in number to support the Company's Hotel Casino, as
well as new casinos and hotels planned by other operators. Management also
believes that the Company's planned theme, parking, hotel accommodations,
entertainment and other amenities will draw additional customers.

Twelve Months Ended September 30,
(In Millions)
    1992         1993         1994         1995         1996         1997
    $110        $177.9       $229.5      $280.6        $288.8       $319.6


                          -13-
<PAGE>

ITEM 3. LEGAL PROCEEDINGS

The Company was the plaintiff and a counterclaim defendant in a lawsuit pending
in Denver, Colorado District Court, Case No. 95CV2310. This lawsuit was
commenced by the Company on May 26, 1995. The lawsuit between the Company and
New Allied and TKCC was stayed upon the filing of the Company's bankruptcy
petition in October 1995. That stay was lifted when the bankruptcy case was
dismissed in March 1997, and the Company moved forward with these proceedings.
The Company filed for Summary Judgment in this matter and hearings were held
September and October 1998. Such Summary Judgement was granted in favor of the
Company in October 1998. In addition, the Company filed an appeal of the
Bankruptcy Court's ruling. New Allied cross appealed. Such appeals were denied
by the United States District Court in August 1998 and the appeals matters are
continuing as the Company has appealed this matter to a higher court unopposed.


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

No matters were submitted during the fiscal year covered by this Report to a
vote of security holders.

                        -14-
<PAGE>

                             PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Company's Common Stock is traded in the over-the-counter market and is
quoted and is listed on the Electronic Bulletin Board under the symbol, "CWRC".
The market for the Company's Common Stock must be characterized as a limited
market due to the relatively low trading volume. Set forth in the following
table are high and low bid quotations for the Company's common stock for the
fiscal years ended June 30, 1997 and 1998. The quotations represent inter-dealer
quotations without retail markups, markdowns or commissions and may not
represent actual transactions.

Quarter Ended          High      Low
September 30, 1996      .41      .12
December 31, 1996       .38      .19
March 31, 1997          .38      .15
June 30, 1997           .40      .20
September 30, 1997      .15      .13
December 31, 1997       .34      .25
March 31, 1998          .24      .11
June 30, 1998           .19      .10

At June 30, 1998, there were approximately 1,090 record holders of the Company's
Common Stock.

The Company has not paid or declared cash distributions or dividends on its
common stock and does not intend to pay cash dividends in the foreseeable
future. Future cash dividends will be determined by the Company's Board of
Directors based on the Company's earnings (if any), financial condition, capital
requirements and other relevant factors. The Company may not pay dividends on
its common stock without the consent of the holders of at least a majority of
the outstanding Series A preferred stock. In addition, the holders of the Series
A preferred stock shall be entitled to receive dividends, when and if declared
by the Board of Directors of the Company, on an equal share-per-share basis with
all outstanding shares of the Company's common stock.

                          -15-
<PAGE>

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
CERTAIN STATEMENTS INCLUDED HEREIN OR INCORPORATED BY REFERENCE CONSTITUTE
"FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995 (THE "REFORM ACT"). THE COMPANY DESIRES TO TAKE
ADVANTAGE OF CERTAIN "SAFE HARBOR" PROVISIONS OF THE REFORM ACT AND IS INCLUDING
THIS SPECIAL NOTE TO ENABLE THE COMPANY TO DO SO. FORWARD-LOOKING STATEMENTS
INCLUDED OR INCORPORATED BY REFERENCE IN THIS PART INVOLVE KNOWN AND UNKNOWN
RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH WOULD CAUSE THE COMPANY'S ACTUAL
RESULTS, PERFORMANCE (FINANCIAL OR OPERATING) OR ACHIEVEMENTS TO DIFFER
MATERIALLY FROM THE FUTURE RESULTS, PERFORMANCE (FINANCIAL OR OPERATING) OR
ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD LOOKING STATEMENTS.

Since the Company's purchase of the Black Hawk Property in August 1993, the
Company's activities have focused on obtaining the necessary financing and
making preparations for construction of the casino on the Property. In July
1997, the Company signed a financing agreement with U2 Consulting, LLC., an
affiliate of Pacific Genesis, Inc. and Western Equities, Inc., to raise $79.5
million through the issuance of corporate bonds. The parties had 180 days to
provide for the financing, were unable to complete same and said agreement with
U2 Consulting was terminated in December 1997.

In January 1998, the Company again began the process of acquiring financing.
After much discussion and many contacts with a wide range of financing groups,
the Company has entered into three separate agreements to provide the necessary
financing. Although the Company is confident in the abilities of these three
organizations to provide the necessary capital, there can be no assurance that
any funds will be provided immediately or in the future.

Each of the three agreements, which are strictly confidential until completed,
obligates the respective parties to provide at least $80 million for the
development and construction of the project. Each agreement provides for
distinctly different means of raising the required funds, as well as distinctly
different means of repayment and different levels of equity participation.
Once financed, the Company's ability to operate the casino will be dependent
upon substantial other conditions, including the obtaining of licenses and
compliance with governmental regulations, grading and construction of the
casino, obtaining the necessary permits and approvals from the City of Black
Hawk and other regulatory bodies, procuring gaming equipment on satisfactory
terms, and accomplishing these objectives in a timely manner.

In order to begin the process of timely completing its goals, in July 1997 the
Company contracted with Colorado Gaming Development Company, Inc., Semple Brown
Roberts, P.C. and PCL Construction Services, Inc., all of Denver, Colorado to
design and construct the planned casino and hotel complex. In addition, the
Company signed a management agreement with Signature Hospitality Resources, Inc.
of Denver, Colorado to

                          -16-
<PAGE>

manage its Radisson Black Hawk Hotel, a separate agreement to use the national
flag of Radisson on the hotel and a contract with Luciani & Associates, LLC of
Atlantic City, New Jersey, to manage the casino operations. All parties assisted
the architect in design of their respective operations. The Agreement with
Luciani & Associates, LLC has expired and they advised the Company of such in
writing in February 1998. Once financing has been secured, the Company will
attempt to negotiate a new agreement, either with Luciani & Associates or others
yet be determined.

The Company is engaged in the design, development and construction of the
Radisson Hotel and Country World Casino (the "Hotel Casino") in Black Hawk,
Colorado. The revised plan for the Hotel Casino will be an eight level complex,
featuring three stories of hotel rooms above a two-story, 75,000 square foot
casino, and a three story parking garage. Other amenities will include one or
more full service restaurants, a buffet, entertainment lounge and retail shops.
When completed as planned, the Hotel Casino will be largest hotel and casino
complex in Colorado. Construction and opening of the Hotel Casino is dependent
upon the Company's ability to successfully raise the required capital discussed
above.

The casino level of the project, at approximately 75,000 square feet, will be
the largest in Colorado and will be capable of accommodating 1,800 slot machines
and 32 gaming tables. The Company will open the facility with 1,000 slot
machines, 20 blackjack tables and 12 poker tables, and may add up to 800
additional slot machines if management determines that the additional gaming
devices will produce equal per square foot revenue and will not create excess
capacity. The Company expects that slot machines will be the greatest source of
its gaming revenues. Slot machines are less labor intensive and require less
square footage than table games, and also generate higher profit margins.

The Country World Casino's atmosphere will feature a country western music theme
similar to the rock and roll music theme successfully employed by the Hard Rock
Cafe. The Casino decor is planned to include memorabilia from the great country
singers, both past and present. The country western theme has not been
established in the Black Hawk/Central City, Colorado gaming market, and
therefore will give the Country World Casino its own unique identity. Management
believes that as casinos have become more numerous, the gaming industry has
begun to recognize that popular themes and amenities such as quality dining and
hotel accommodations play an important role in attracting customers to casinos.
The theme is intended to appeal to the Hotel Casino's target customer base,
which consists primarily of residents of the Denver metropolitan area as well as
other Colorado communities located within driving distance of Black Hawk.

The Hotel will provide overnight accommodations with 200 +/- rooms and suites,
making it one of the first destination resort of its kind in Black Hawk.
Complimenting both the casino and hotel will be a three story underground
parking facility for approximately 1,000 cars featuring both valet and self
parking options, and the only covered on-site bus turnaround currently available
in Black Hawk for the convenience of day trip customers.

                          -17-
<PAGE>
LIQUIDITY & CAPITAL RESOURCES

The Company's ability to obtain the financing and to proceed with its plans for
a gaming facility had been affected by the Company's disputes with New Allied,
which had culminated in litigation and foreclosure proceedings on the Property
in 1995, and the Company's filing of a bankruptcy petition under Chapter 11. The
Bankruptcy Case was dismissed in March 1997 and Summary Judgement was granted in
favor of the Company with regard to all other litigation issues.

In March 1996, the Company borrowed $5 million from Kennedy Funding, Inc. The
Company issued a Promissory Note effective May 20, 1996 payable at the rate of
15% per annum until May 19, 1997 (the "First Year Interest Obligation") and at a
rate of 24% per annum thereafter. Payments of principal and interest are payable
as follows: (a) the First Year Interest Obligation was prepaid at closing; (b)
commencing on May 19, 1997 and for each month thereafter, the Company is to make
interest only payments, in advance, in the amount of 2% of the then existing
principal balance due under the Note; and (c) the entire outstanding principal
balance, together with all accrued and unpaid interest, if not previously paid,
shall be finally due and payable on May 19, 1999. The holder of the Note may
accelerate the due date for the entire balance of principal, interest and other
sums due upon maturity in the event of default under the Note. The default rate
of interest is 24% during the first loan year and 36% thereafter. The Note is
secured by a first deed of trust on the Property.

In May 1997, the Company issued a promissory note and second deed of trust on
the property to Norlar, Inc. for a maximum of $600,000 (First Norlar Note), or
so much thereof as may have been advanced by maker, for payments due on the
Kennedy loan and for general corporate purposes. As of June 1998, the Company
owed $600,000 on the First Norlar Note. In October 1997, the Company issued a
second promissory note (Second Norlar Note) and a fourth deed of trust on the
property to Norlar, Inc., again for a maximum of $600,000. As of June 1998, the
Company owed $600,000 on the Second Norlar Note. In April 1998, the Company
issued a third promissory note (Third Norlar Note) and fifth deed of trust on
the property to Norlar, Inc. again for a maximum of $600,000. As of August 1998,
the Company owed $600,000 on the Third Norlar Note. In August 1998, the Company
issued a fourth promissory note (Fourth Norlar Note) and sixth deed of trust on
the property to Norlar, Inc. again for $600,000. As of September 1998, the
Company owed $177,773 on the Fourth Norlar note. In addition, for each $100,000
Norlar, Inc. has loaned to the Company, it has authorized the issuance of
500,000 warrants to purchase shares of common stock at $0.20 per share. Norlar,
Inc. is a closely-held corporation beneficially owned by Larry Berman and his
wife. Mr. Berman is Chairman and Chief Executive Officer of the Company. The
loans bear interest at 12% per annum and is to be repaid upon the earlier of the
sale of the property, refinance of the property or the financing of the project.

In September and October of 1997, PCL Construction Services, Inc. advanced the
Company $998,000 to begin the development and design process in advance of
funding. As of June 1998, the Company owes PCL Construction approximately
$1,075,000, including interest.

                          -18-
<PAGE>
In July 1997, the Company issued 1,000,000 shares of its common stock to Eastern
Equities Consultants, Ltd. As full and final compensation for the placement of
financing.

In September 1997, the Company issued 395,000 shares of common stock to Sommer &
Schneider LLP, its securities attorneys, for payment of legal fees and a six
month retainer.

In March 1998, the Company issued 850,000 shares for the same purpose as
described above.

In May 1998, the Company issued 100,000 shares of Series B preferred stock to
Gold Coast Consortium to retire an outstanding debt owed by the Company. Gold
Coast Consortium is a company owned by the spouse of Mr. Roger Leclerc, the
Company's President.

In July 1998, the Company settled an ongoing dispute with New Allied Development
Corporation with regard to a piece of property outside the gaming district in
Black Hawk, Colorado. Title to such property was returned to New Allied,
therefore reducing the Company's debt by $750,000, plus applicable taxes due.

RESULTS OF OPERATIONS

The Company has had no revenues from operations. The Company continues to incur
losses of approximately $100,000 per month to service the debt to Kennedy
Funding, Inc. and other ongoing obligations such as rent and utilities for the
Company's corporate office. This estimated loss of $1,200,000 in the fiscal year
ended June 30, 1998 compares to a loss of operations of $1,080,391 for the year
ended June 30, 1997. The ability of the Company to achieve revenues in the
future will be dependent upon realization of its plans to develop a gaming and
hotel complex on the property.

ITEM 7. FINANCIAL STATEMENTS

See attached pages F1 - F22 for audited financials which fairly represent the
Company's status for the year ended June 30, 1998.

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

On November 13, 2000, the Company filed a Form 8-K with The Securities and
Exchange Commission with regard to a change in auditing firms to be used by the
Company. The new firm is Stefanou & Company, LLP of McLean, Virginia.

                          -19-
<PAGE>

                               PART 111

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

The following persons serve as officers and directors or the Company:
Name                         Position
Larry S. Berman              Chairman of the Board and Chief Executive Officer
Roger D. Leclerc             President and Director
William H. Patrowicz         Secretary, Treasurer and Director

The following is brief biographical information concerning the Company's
officers, directors and significant employees:

Larry S. Berman, age 62, has served as Chief Executive Officer of the Company
since June 1995. Mr. Berman served as Chairman of the Board of Directors and
Secretary of Holly Holdings, Inc. from June 1992 until December 1997. Since
1982, Mr. Berman has been Vice President of Coastal Leasing and Investment, Inc.
where he is responsible for restructuring and otherwise assisting companies to
raise debt and equity funds.

Roger D. Leclerc, age 48, has served as President of the Company since December
1994. Prior thereto Mr. Leclerc served as the Company's project manager for its
proposed facility since May 1994. Prior to his involvement with the Country
World Casino project, Mr. Leclerc was the General Manager for the Bull Durham
Casino in Black Hawk. Immediately prior thereto, he served as a General Manager
of the Miner's Pick Casino in Central City. From March 1990 to June 1992, he was
the General Manager of A&L Enterprises Inc. in Deadwood, South Dakota, which
operated Ms. Kitty's Wilderness Edge Casino and Days Inn Hotel and Casino.

William H. Patrowicz, age 50, has served as Secretary, Treasurer or the Company
since April 1995 and was formerly President of Holly Holdings, Inc. from June
1992 to March 1998. From 1982 to December 1991, Mr. Patrowicz was employed by
Gunnebo Fastening Corp., as Senior Vice President of Operations.

Section 16(a) of the Exchange Act requires the Company's officers and directors
and persons who own more than 10% of a registered class of the Company's equity
securities, to file reports of ownership and changes in ownership to the
Securities and Exchange Commission. Officers, directors and greater than 10%
stockholders are required by the regulations of the Commission to furnish the
Company with copies of all Section 16(a) reports received by it, the Company
believes that all filing requirements applicable to its current officers and
directors were complied with for the fiscal year ended June 30, 1998. The
Company is unaware of the compliance of its 10% shareholders and its former
officers and directors.

                          -20-
<PAGE>

ITEM 10. EXECUTIVE COMPENSATION

The following table sets forth all cash compensation paid by the Company to each
Executive Officer whose total annual salary and bonus exceeded $100,000,
including all cash compensation paid the Company's Chief Executive Officer.

Name and Principal            Fiscal       Salary                  Other Annual
Position                       Year          $        Bonus        Compensation
None

The Company has no stock option, defined benefit or restricted stock award
plans.

The Company estimates that Mr. Berman and Mr. Patrowicz spend substantially all
of their time in management activities relating to the Company. Neither party,
although holding employment contracts, has received any payment for current or
previously rendered services to date. Consideration for remuneration will be
addressed after completion of the Company's financing activities.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the persons known to the Company to own
beneficially more than 5% of the outstanding share of common stock on June 30,
1998 and information as of June 30, 1998 with respect to the ownership of common
stock by each director of the Company and by all officers and directors as a
group.

Name of                            Shares Beneficially
Beneficial Owner                          Owned                  Percent

Western Equities, Inc.                 16,000,000                 29.4%
Holly Holdings, Inc.                    8,850,453                 16.3%
Larry S. Berman                        19,380,000                 35.7%
Roger D. Leclerc                                0                    0%
William H. Patrowicz                    4,120,000                  7.6%
All Officers and Directors             23,500,000                 43.3%
 as a Group (3 Persons)
___________


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The sole holder of the Company's Series A Convertible Preferred stock, New
Allied, acquired its shareholdings in connection with a sale to the

                          -21-
<PAGE>

Company in August 1993, of the Property upon which the Company proposes to
construct its casino and hotel complex. New Allied also received cash and a
promissory note (secured by a deed of trust on the Property) in connection with
this transaction. In June 1994, the Company completed the acquisition of an
additional 375,000 square feet of vacant land located in close proximity to the
land which is the site for the proposed casino and hotel complex. The Company
paid $200,000 to New Allied, delivered a promissory note in the amount of
$725,000 and issued 250,000 shares of its common stock. In April 1997, the
Company elected and New Allied has accepted a return of the property for the
balance due on the note as it is of no value to the Company within its current
plans. In July 1998, such transaction was completed.

During the fiscal year ended June 30, 1995, the Company borrowed $1,000,000 from
Holly, which indebtedness plus accrued interest was then canceled by the
issuance to Holy of 5,000,000 shares of the Company's common stock. The Company
also agreed with Holly that Holly would have the right to purchase up to an
additional 20,000,000 shares of common stock at $0.20 per share if additional
funding were provided within a reasonable time and progress continued to be made
concerning financing for the proposed casino and hotel complex. In April 1997
Holly exercised its right under said agreement and converted $250,000 of its
debt into 1,250,000 shares of the Company's common stock.

Holly had continually provided advances to the Company throughout the bankruptcy
proceedings. Prior to the conversion of debt to equity by Holly and assumption
of certain parties' debt by the Company, the Company was indebted to Holly in
the amount of approximately $1,449,588. In May 1997, the Company eliminated
$1,000,000 of its debt to its shareholder, Holly Holdings, Inc. in an exchange
of debt with two directors of the Company and a non-affiliate of the Company. As
of June 1998, the Company is no longer indebted to Holly.

In April 1997, the Company filed with the State of Nevada, under Section
78.1055, a Designation of Rights Privileges and Preferences for 5,000,000 shares
of Class B preferred stock. In May 1997, the Company issued 4,000,000 shares to
two directors and a non-affiliate of the Company in exchange for $1,000,000 in
debt to the parties. The terms of the class B preferred stock rank it junior to
all classes of the Company's stock now issued and on parity with any class of
capital stock hereafter created. The Class B preferred stock shall be voted with
the common stock as a single class and shall not be entitled to vote as a
separate class nor shall the Class B preferred be entitle to receive dividends
of any kind. Each share of Class B preferred stock can be converted into common
stock of the corporation one year after the date of issuance at the rate for 10
for 1 and the holders are entitled to vote the underlying shares as if
converted. In May 1998, all such shares were converted to common stock.

In March 1996, the Company borrowed $5 million from Kennedy Funding, Inc. The
Company delivered to the lender a Promissory Note effective May 20, 1996 payable
at the rate of 15% per annum until May 19, 1997 (the "First Year Interest
Obligation") and at a rate of 24% per annum thereafter. Payments of principal
and interest are payable as follows: (a) the First Year Interest Obligation was
prepaid at closing; (b) commencing on May 19, 1997 and for each month
thereafter, the Company is to make interest only payments, in advance, in the
amount of 2% of the then existing

                          -22-
<PAGE>

principal balance due under the Note; and (c) the entire outstanding principal
balance, together with all accrued and unpaid interest, if not previously paid,
shall be finally due and payable on May 19, 1999. The holder of the Note may
accelerate the due date for the entire balance of principal, interest and other
sums due upon maturity in the event of default under the Note. The default rate
of interest is 24% during the first loan year and 36% thereafter. The Note is
secured by a first deed of trust on the Property.

In May 1997, the Company issued a promissory note and second deed of trust on
the property to Norlar, Inc. for a maximum of $600,000 (First Norlar Note), or
so much thereof as may have been advanced by maker, for payments due on the
Kennedy loan and for general corporate purposes. As of June 1998, the Company
owed $600,000 on the First Norlar Note. In October 1997, the Company issued a
second promissory note (Second Norlar Note) and a fourth deed of trust on the
property to Norlar, Inc., again for a maximum of $600,000. As of June 1998, the
Company owed $600,000 on the Second Norlar Note. In April 1998, the Company
issued a third promissory note (Third Norlar Note) and fifth deed of trust on
the property to Norlar, Inc. again for a maximum of $600,000. As of August 1998,
the Company owed $600,000 on the Third Norlar Note. In August 1998, the Company
issued a fourth promissory note (Fourth Norlar Note) and sixth deed of trust on
the property to Norlar, Inc. again for $600,000. As of September 1998, the
Company owed $177,773 on the Fourth Norlar note. In addition, for each $100,000
Norlar, Inc. has loaned to the Company, it has authorized the issuance of
500,000 warrants to purchase shares of common stock at $0.20 per share. Norlar,
Inc. is a closely-held corporation beneficially owned by Larry Berman and his
wife. Mr. Berman is Chairman and Chief Executive Officer of the Company. The
loans bear interest at 12% per annum and is to be repaid upon the earlier of the
sale of the property, refinance of the property or the financing of the project.

In September and October of 1997, PCL Construction Services, Inc. advanced the
Company $998,000 to begin the development and design process in advance of
funding. As of June 1998, the Company owes PCL Construction approximately
$1,075,000, including interest.

In July 1997, the Company issued 1,000,000 shares of its common stock to Eastern
Equities Consultants, Ltd. as full and final compensation for the placement of
financing.

In September 1997, the Company issued 395,500 shares of its Common Stock to
Sommer & Schneider LLP, its securities attorneys, for payment of legal fees and
a six month retainer.

In March 1998, the Company issued 850,000 shares of its Common Stock to Sommer &
Schneider LLP, its securities attorneys, for payment of legal fees and a six
month retainer.

In May 1998, the Company issued 100,000 shares of Series B preferred stock to
Gold Coast Consortium to retire an outstanding debt owed by the Company. Gold
Coast Consortium is a company owned by the spouse of Mr. Roger Leclerc, the
Company's President.

                          -23-
<PAGE>

In July 1998, the Company settled an ongoing dispute with New Allied Development
Corporation with regard to a piece of property outside the gaming district in
Black Hawk, Colorado. Title to such property was returned to New Allied,
therefore reducing the Company's debt by $750,000, plus applicable taxes due.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

None for the required filing period.

                          -24-
<PAGE>

SIGNATURES


In accordance with the requirements of Sections 13 or 15(d) of the
Securities Exchange Act of 1934, as amended, the Registrant has
caused this Report to be signed on its behalf by the undersigned,
there unto duly authorized.
                                     COUNTRY WORLD CASINOS, INC.
Dated: January 10, 2001              By: /s/ Roger D. Leclerc
                                     Roger D. Leclerc, President

In accordance with the Securities Exchange Act of 1934, as amended, this
Report has been signed below by the following persons on behalf of the
Registrant and int he capacities and on the dates indicated.

Dated: January 10, 2001              /s/ Roger D. Leclerc
                                     Roger D. Leclerc, President and Director

Dated: January 10, 2001              /s/ William H. Patrowicz
                                     William H. Patrowicz, Secretary,
                                     Treasurer and Director

                          -25-
<PAGE>

                    SECURITIES AND EXCHANGE COMMISSION

                          WASHINGTON, D.C. 20549



                    FINANCIAL STATEMENTS AND SCHEDULES

                          JUNE 30, 1998 AND 1997



                      FORMING A PART OF ANNUAL REPORT
              PURSUANT TO THE SECURITIES EXCHANGE ACT OF 1934


                        COUNTRY WORLD CASINOS, INC

<PAGE>
                        COUNTRY WORLD CASINOS, INC.

                       Index to Financial Statements

                                                                     Page No
Report of Independent Certified Public Accountants                     F-3
Balance Sheet at June 30, 1998 and 1997                             F-4 to F5
Statements of Losses for the two years ended June 30, 1998
and 1997, and for the period November 9, 1982 (date of                 F-6
inception) to June 30, 1998
Statements of Stockholders' Equity for the period November
9, 1982 (date of inception) to June 30, 1998                        F-7 to F-8
Statements of Cash Flows for the two years ended June 30,
1998 and 1997, and for the  period November 9, 1982 (date              F-9
of inception) to June 30, 1998
Notes to Financial Statements                                      F-10 to F-22

<PAGE>
                          STEFANOU & COMPANY, LLP
                       Certified Public Accountants

                             1360 Beverly Road
                                 Suite 305
                          McLean, VA  22101-3621
                               703-448-9200
                            703-448-3515 (fax)
                                                           Philadelphia, PA

            REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


Board of Directors
Country World Casinos, Inc
Bala Cynwyd, PA

      We  have  audited  the accompanying balance sheet  of  Country  World
Casinos,  Inc. (a development stage Company) as of June 30,  1998  and  the
related  statement of losses, stockholders' equity, and cash flows for  the
year then ended.  These financial statements are the responsibility of  the
company's management.  Our responsibility is to express an opinion on these
financial  statements  based upon our audit. The  financial  statements  of
Country World  Casinos,  Inc. as of June 30, 1997  were  audited by another
auditor  whose  report  October 10, 1997 on those  statements  included  an
explanatory  paragraph describing conditions that raised substantial  doubt
about the Company's ability to continue as a going concern.

      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 misstatements.  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  our  audit
provides a reasonable basis for our opinion.

     In  our  opinion, the June 30, 1998 financial statements  referred  to
above  present fairly, in all material respects, the financial position  of
Country  World Casinos, Inc. (a development stage Company) as of  June  30,
1998  and  the results of its operations and  its cash flows for  the  year
then ended in conformity with generally accepted accounting principles.  We
express no opinion on the cumulative period from inception through June 30,
1998.


                                   /s/ STEFANOU & COMPANY, LLP
                                       Stefanou & Company., LLP

McLean, Virginia
December 15, 2000
                                      F-3

<PAGE>

                        COUNTRY WORLD CASINOS, INC.
                      (A developmental stage company)
                               BALANCE SHEET
                          June 30, 1998 and 1997

                                       1998           1997

        ASSETS
        CURRENT ASSETS:
        Cash                        $     180      $   4,961
        Prepaid Expenses               61,290         73,140
              Total Current Assets     61,470         78,101


        Property and Equipment,    17,448,883     12,891,412
        net (Note B)

        OTHER ASSETS:
        Deposits                       35,630            630

                                  $17,545,983    $12,970,143



              See accompanying notes to financial statements
                                    F-4

<PAGE>

                        COUNTRY WORLD CASINOS, INC.
                      (A developmental stage company)
                               BALANCE SHEET
                          June 30, 1998 and 1997

                                           1998        1997

            LIABILITIES
       CURRENT LIABILITIES
       Accounts payable and accrued    $3,244,869  $  343,275
        liabilities
       Due to officers and Parent         417,000     196,878
       (Note H)
       Other liabilities                   14,304       4,198
       Notes payable (Note C)           5,998,000   5,000,000

       Notes payable to related parties 2,199,200     880,000
       (Note D)
          Total current liabilities    11,873,373   6,424,351

       COMMITMENTS & CONTINGENCIES
       (Note G)

       STOCKHOLDER'S EQUITY (NOTE F):       2,250       2,250
       Series A Preferred Stock , par
       value $.001 per share,
       25,000,000 shares authorized,
       2,250,000 shares outstanding at
       June 30, 1998 and 1997

       Class B Preferred Stock, par        25,000   1,000,000
       value $.25 per share, 5,000,000
       shares authorized, 100,000
       shares outstanding at June 30,
       1998 and 4,000,000 at June 30,
       1997

       Common Stock, par value $.001       54,332      12,086
       per share, 75,000,000 shares
       authorized, 54,331,687 shares
       outstanding at June 30, 1998 and
       12,086,187 at June 30, 1997

       Additional paid In capital      11,176,312   9,871,301
       Deficiency accumulated during   (5,585,284) (4,339,845)
       development stage

         Total stockholder's equity     5,672,610   6,545,792

                                      $17,545,983  $12,970,143

       See accompanying notes to financial statements

                                    F-5

<PAGE>

                      COUNTRY WORLD CASINOS, INC.
                    (A developmental stage company)
                         STATEMENTS OF LOSSES



                                                                  For the
                                        Year Ended   Year Ended   period from
                                         June 30,     June 30,    November 9,
                                           1998         1997       1982 (Date
                                                                     of
                                                                 Inception)
                                                                  through
                                                                  June 30,
                                                                    1998
Costs and expenses:
    Research & Development              $        -   $        -   $  122,000
    General and Administrative           1,120,428    1,030,257    5,257,139
    Depreciation                             7,905        6,867       50,419
    Interest Expense                       131,784       71,445      203,229
            Total costs and expenses     1,260,117    1,108,569    5,632,787

            Operating loss              (1,260,117)  (1,108,569)  (5,632,787)

Other Expense and Income
    Interest Income                         14,678       27,443      109,490
    Other Income                                 -          735          735
    Rental Income                                -            -       45,126
    Loss on Non-Marketable Securities            -            -      (85,000)
    Write Off of Loan Receivable                 -            -      (90,000)
    Forfeited Deposit                            -            -     (100,000)
         Net other income (expenses)        14,678       28,178     (119,649)

Loss from continuing operations before  (1,245,439)  (1,080,391)  (5,752,436)
 extraordinary item and income taxes
Provision for income taxes (benefit)             -            -            -
Loss from continuing operations, before (1,245,439)  (1,080,391)  (5,752,436)
 extraordinary item

Extraordinary Item:
  Extraordinary gain on forgiveness              -            -      167,152
  of debt, primarily related party,
  net of related income taxes

 Net loss                              $(1,245,439) $(1,080,391) $(5,585,284)


Loss per common share (basic and           $ (0.05)     $ (0.10)     $ (1.32)
assuming dilution)

Weighted average common shares          23,668,479   10,985,493    4,201,701
outstanding (see Note I)


              See accompanying notes to financial statements


                                    F-6
<PAGE>
<TABLE>
                           COUNTRY WORLD CASINOS, INC.
                         (A developmental stage company)
                         STATEMENTS STOCKHOLDERS' EQUITY


                                Preferred Stock                    Common Stock                Additional     Deficit        Total
                          Series A          Class B                              Subscribed      Paid In       During  Stockholder's
                      Shares   Amount    Shares   Amount       Shares  Amount   Shares Amount    Capital    Development    Equity
                                                                                                               Stage
<S>                     <C>      <C>       <C>      <C>           <C>     <C>      <C>    <C>        <C>          <C>         <C>

November 9, 1982           -       -        -          -            -       -        -      -          -            -           -
 (Date of Inception)

Issuance of shares         -       -        -          -        2,971      15        -      -      1,510            -       1,525
 for Cash

Issuance of Common         -       -        -          -        1,474       8        -      -    644,992            -     645,001
 Stock pursuant to
 private placement, net

Deferred offering costs    -       -        -          -            -       -        -      -   (115,690)           -    (115,690)

Cancellation of common     -       -        -          -         (800)     (4)       -      -          4            -           -
 stock

Issuance of shares in      -       -        -          -       85,714     429        -      -     14,571            -      15,000
 exchange for services

Issuance of shares for     -       -        -          -    1,339,212   6,696        -      -     13,304            -      20,000
 cash


Capital contribution       -       -        -          -            -       -        -      -      2,850            -       2,850

Net loss of the period     -       -        -          -            -       -        -      -          -     (221,169)   (221,169)
 ended June 30, 1992


Balance at June 30, 1992   -       -        -          -    1,428,571   7,144        -      -    561,541     (221,169)    347,517

Issuance of shares in      -       -        -          -      714,287   3,571        -      -      8,929            -      12,500
 exchange for services

Net loss of the year       -       -        -          -            -       -        -      -          -    (373,401)   (373,401)
 ended June 30, 1993

Balance at June 30, 1993   -       -        -          -    2,142,858  10,715        -      -    570,470    (594,570)    (13,384)

Adjustment for change      -       -        -          -            -  (8,572)       -      -      8,572           -           -
 in par value from
 $.005 to $.001

Issuance of stock for      -       -        -          -    1,500,000   1,500        -      -  1,498,500           -   1,500,000
 cash

Issuance of         2,250,000  2,250        -          -            -       -        -      -  2,247,750           -   2,250,000
 Convertible
 Preferred Stock
 in exchange for
 Land

Issuance of Common         -       -        -          -      600,000     600        -      -    599,400           -     600,000
  Stock for cash

Issuance of Common         -       -        -          -      250,000     250        -      -    249,750           -     250,000
 Stock for Cash and
 Services Pursuant
 to Exercise of
 Options

Acquisition and            -       -        -          -     (125,000)   (125)       -      -   (124,875)          -    (125,000)
 cancellation of
 Treasury Stock

Issuance of Stock          -       -        -          -      140,000     140        -      -    349,860           -     350,000
 for Cash

Issuance of Stock          -       -        -          -       60,662      60        -      -    149,941           -     150,000
 for Cash

Issuance of Common         -       -        -          -      250,000     250        -      -    249,750           -     250,000
 Stock in exchange
 for Land

Issuance of Common         -       -        -          -       95,000      95        -      -    237,405           -     237,500
 Stock for Cash and
 Services Pursuant to
 Exercise of Options

Issuance of Common         -       -        -          -      200,000     200        -      -    499,800           -     500,000
 Stock in exchange
 for services

Issuance of Common         -       -        -          -            -       -  262,667    263    787,737           -     788,000
 Stock Pursuant to
 Private Placement

Net Loss of the            -       -        -          -            -       -        -      -          -  (1,490,785) (1,490,785)
 Period Ending
 June 30, 1994

Balance at         2,250,000   2,250        -          -    5,113,520   5,113  262,667    263  7,324,060  (2,085,355)  5,246,331
 June 30, 1994

Issuance of common         -       -        -          -      460,000     460        -      -  1,229,040           -   1,229,500
 stock pursuant to
 Private Placement
 offering

Issuance of common         -       -        -          -      262,667     263 (262,667)  (263)         -           -           0
 stock subscribed

Issuance of Stock to       -       -        -          -    5,000,000   5,000        -      -  1,009,451           -   1,014,451
 Parent in exchange
 for debt

Net Loss for year          -       -        -          -            -       -        -      -          -    (757,659)   (757,659)
 ended June 30, 1995

Balance at         2,250,000   2,250        -          -   10,836,187  10,836        -      -  9,562,550  (2,843,014)  6,732,623
June 30, 1995

Net loss for year          -       -        -          -            -       -        -      -          -    (416,440)   (416,440)
 ended June 30, 1996


Balance at         2,250,000   2,250        -          -   10,836,187  10,836        -      -  9,562,551  (3,259,454)  6,316,183
 June 30, 1996

See accompanying notes to financial statements
                                       F-7

</TABLE>
<PAGE>
<TABLE>


                           COUNTRY WORLD CASINOS, INC.
                         (A developmental stage company)
                        STATEMENTS OF STOCKHOLDERS' EQUITY
                                   (continued)

                                Preferred Stock                    Common Stock                Additional     Deficit        Total
                          Series A          Class B                              Subscribed      Paid In       During  Stockholder's
                      Shares   Amount    Shares   Amount       Shares  Amount   Shares Amount    Capital    Development    Equity
                                                                                                               Stage
<S>                     <C>      <C>       <C>      <C>           <C>     <C>      <C>    <C>        <C>          <C>         <C>



Issuance of Preferred      -   $   - 4,000,000 $1,000,000           -  $    -        -  $   -    $     -    $      -  $1,000,000
 Stock - Class B in
 exchange for debt
 to Parent

Common Stock Issued        -       -        -          -    1,250,000   1,250        -      -    248,750           -     250,000
 in Exchange for
 Parent Debt

Warrant to purchase        -       -        -          -            -       -        -      -     60,000           -      60,000
 common stock issued
 in exchange for services

Net loss for the year      -       -        -          -            -       -        -      -          -  (1,080,391) (1,080,391)
 ended June 30, 1997

Balance at         2,250,000   2,250 4,000,000 1,000,000   12,086,187  12,086        -      -  9,871,301  (4,339,845)  6,545,792
 June 30, 1997

Issuance of Common         -       -        -          -    1,000,000   1,000        -      -    199,000           -     200,000
 Stock in exchange
 for services

Issuance of Common         -       -        -          -      395,500     396        -      -     73,761           -      74,157
 Stock in exchange
 for debt and services

Issuance of Common         -       -        -          -      850,000     850        -      -     72,250           -      73,100
 Stock for in exchange
 for debt and services

Issuance of Stock          -       -  100,000     25,000            -       -        -      -          -           -      25,000
 in exchange for services

Conversion of Preferred    -       -(4,000,000)(1,000,000) 40,000,000  40,000        -      -    960,000           -           -
 Stock to Common Stock

Net Loss of Period         -       -        -          -            -       -        -      -          -  (1,245,439) (1,245,439)
 Ended June 30, 1998

Balance at         2,250,000  $2,250  100,000    $25,000   54,331,687 $54,332        -   $  - $11,176,312 $(5,585,284) $5,672,610
 June 30, 1998

                 See accompanying notes to financial statements
                                       F-8
</TABLE>
<PAGE>
<TABLE>
                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
                   STATEMENTS OF CASH FLOWS

                                        Year         Year         For the period from
                                        Ended        Ended          November 9, 1982
                                      June 30,      June 30,      (Date of Inception)
                                        1998         1997        through June 30, 1998
<S>                                     <C>           <C>               <C>
Cash flows from operating
activities:
     Net income from operating     $(1,245,439)   $(1,080,391)       $(5,752,436)
       activities
     Adjustments to reconcile
       net income to net cash:
         Depreciation                    2,353         21,867             59,867
         Common stock issued in              -              -             14,451
          exchange for interest
         Common stock issued in        347,257              -          1,184,757
          exchange for services
         Preferred stock issued         25,000              -             25,000
          in exchange for services
         Loss on nonmarketable               -              -            (85,000)
          Securities
         Write off of loan                   -              -            (90,000)
          receivable
         Extraordinary Item,                 -              -            167,152
          primarily related party
        Allocation of management             -        408,000            408,000
         fees - related party
            Change in:
               Prepaid expenses         11,850        (73,140)          (748,790)
                and other assets
               Accounts payable      2,911,700        (637,075)        3,302,512
                and accrued expenses

      Discontinued Operations:
       Net loss                               -              -          (389,286)

      Adjustments to reconcile
       loss to net cash
           Used in operating
            activities
           Gain on disposal                   -              -           389,286
            of assets
      Net cash (used in) provided     2,052,721     (1,360,739)       (1,514,487)
       by operating activities

Cash flows (used in) provided
by investing activities:
     Acquisition of property,        (4,559,824)      (126,860)       (9,832,101)
      improvements and equipment
     Investment in patent                     -              -           (62,000)
     Deposits and other                 (35,000)          (190)          (35,630)
     Decrease in restricted cash              -         49,994                 -
     Net cash used in investing      (4,594,824)       (77,056)       (9,929,731)
      activities

Cash flows (used in) provided by
 financing activities:
     Repayment of capital lease               -         (1,515)           (4,233)
      obligation
     Proceeds from notes              2,537,322       (329,238)        6,224,946
      payable, net
     Proceeds from stock and                   -              -        5,220,835
      warrant Issuance
     Capital contribution                      -              -            2,850
     Net cash (used in) provided      2,537,322        (330,753)      11,444,398
      by financing activities
Net increase (decrease) in cash          (4,781)     (1,768,548)             180
 and cash equivalents
Cash and cash equivalents at              4,961       1,773,509                -
 beginning of period
Cash and cash equivalents at end      $     180      $    4,961      $       180
 of period
Supplemental Disclosure of Cash Flow:
Cash paid during the period for       $       -      $    3,931      $     5,761
 interest
Cash paid during the period for               -               -                -
 income taxes
Common stock issued for property              -               -          250,000
Preferred stock issued for                    -               -        2,250,000
 property
Common stock issued for services        347,257               -        1,184,757
Preferred stock issued for               25,000               -           25,000
 services
Non cash acquisition of               3,871,790               -        3,871,790
 property, improvements and
 equipment
Non cash proceeds from notes            378,432     $         -          378,432
 payable


       See accompanying notes to  financial statements
                             F-9
</TABLE>
<PAGE>


                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
                NOTES TO FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE A-SUMMARY OF ACCOUNTING POLICIES

A  summary of the significant accounting policies applied  in
the  preparation  of  the accompanying  financial  statements
follows.

Business and Basis of Presentation

Country  World  Casinos,  Inc., (the  "Company"  or  "Country
World")  is  incorporated under the  laws  of  the  state  of
Nevada. The Company is engaged in the development of  a  full
service  hotel and casino in Blackhawk, Colorado. As of  June
30,  1998, the Company has not commenced construction of  the
planned  casino,  nor has it realized any revenues  from  its
planned operations. Accordingly, the Company is considered to
be in the development stage.

The   Company  was  a  majority  owned  subsidiary  of  Holly
Holdings, Inc. ("Parent") until May 1997.

Certain  prior  year  amounts  have  been  reclassified   for
comparative purposes.

Revenue Recognition

Casino  revenues  will consist of the  net  win  from  gaming
activities, which is the difference between gaming  wins  and
losses.  Revenues  exclude the retail value of  complimentary
food,  beverages and hotel services furnished  to  customers.
All revenues will be recognized as occurred.

Advertising

The  Company  follows  the policy of charging  the  costs  of
advertising to expenses incurred. The Company  did not  incur
any  advertising costs during the years ended June  30,  1998
and 1997.

Income Taxes

Income  taxes are provided based on the liability method  for
financial   reporting   purposes  in  accordance   with   the
provisions  of  Statements of Financial  Standards  No.  109,
"Accounting  for  Income Taxes".  Under this method  deferred
tax  assets and liabilities are recognized for the future tax
consequences   attributable  to   differences   between   the
financial  statement carrying amounts of existing assets  and
liabilities are measured using enacted tax rates expected  to
apply to taxable income in the years in which those temporary
differences  are  expected to be  removed  or  settled.   The
effect on deferred tax assets and liabilities of a change  in
tax  rates is recognized in the  statements of operations  in
the period that includes the enactment date.


                            F-10

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
               NOTES TO  FINANCIAL STATEMENTS
                   JUNE 30, 1998 AND 1997

NOTE A-SUMMARY OF ACCOUNTING POLICIES (continued)

Cash Equivalents

For  purposes  of the Statements of Cash Flows,  the  Company
considers all highly liquid debt instruments purchased with a
maturity date of three months or less to be cash equivalents.

Property and Equipment

For  financial statement purposes, property and equipment are
depreciated  using  the  straight-line  method   over   their
estimated  useful  lives of the related assets  ranging  from
three  to  seven years. An accelerated method of depreciation
is used for tax purposes.

Depreciation  expense for the years ended June 30,  1998  and
1997  is $ 7,905 and $ 6,867, respectively.

Costs   incurred   in   connection  with   the   acquisition,
development  and  preparation  of  the  Company's  land   are
capitalized  and  stated at cost. In  addition,  interest  on
borrowings incurred during the preparation period related  to
acquisition  and development of the land are capitalized.

The  Company  reviews the carrying value of the property  for
impairment  whenever events and circumstances  indicate  that
the  carrying value of the asset may not be recoverable  from
the  estimated future cash flows expected to result from  its
use  and eventual disposition. In the case where undiscounted
expected future  cash flows are less than the carrying value,
an  impairment loss is recognized equal to an amount by which
the carrying value exceeds the fair value of assets.


Long-Lived Assets

The  Company  has  adopted Statement of Financial  Accounting
Standards  No.  121 (SFAS 121).  The Statement requires  that
long-lived  assets and certain identifiable intangibles  held
and  used  by the Company be reviewed for impairment whenever
events or changes in circumstances indicate that the carrying
amount of an asset may not be recoverable.  SFAS No. 121 also
requires assets to be disposed of be reported at the lower of
the carrying amount or the fair value less costs to sell.

                            F-11

<PAGE>


                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
               NOTES TO   FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE A-SUMMARY OF ACCOUNTING POLICIES (continued)

Use of Estimates

The  preparation  of financial statements in conformity  with
generally  accepted accounting principles requires management
to   make  estimates  and  assumptions  that  affect  certain
reported amounts and disclosures.  Accordingly actual results
could differ from those estimates.

Concentrations of Credit Risk

Financial  instruments  and related items  which  potentially
subject  the Company to concentrations of credit risk consist
primarily  of  cash, cash equivalents and trade  receivables.
The  Company  places its cash and temporary cash  investments
with  high  credit  quality  institutions.   At  times,  such
investments may be in excess of the FDIC insurance limit.

Stock Based Compensation

The  Company  accounts for stock transactions  in  accordance
with  APB  Opinion  25,  "Accounting  for  Stock  Issued   to
Employees."   In  accordance  with  statement  of   Financial
Accounting  Standards No. 123, "Accounting  for  Stock  Based
Compensation,"   the   Company  has  adopted   the   proforma
disclosure requirements.

Liquidity

As  shown  in  the  accompanying  financial  statements,  the
Company incurred a net loss of  $ 1,245,439  during  the year
ended  June  30,  1998  and  $1,080,391 during the year ended
June 30, 1997.  The Company's current liabilities exceeded its
current assets by $11,811,904 as of June 30, 1998. Substantially
all the company's assets are illiquid.

Comprehensive Income

The  Company does not have any items of comprehensive  income
in any of the periods presented.


                            F-12

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
               NOTES TO   FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE A-SUMMARY OF ACCOUNTING POLICIES (continued)
Segment Information

The   Company  adopted  Statement  of  Financial   Accounting
Standards   No.  131,  Disclosures  about  Segments   of   an
Enterprise and Related Information (SFAS 131) in  the  year
ended   June  30,  1998.   SFAS  establishes  standards   for
reporting information regarding operating segments in  annual
financial  statements and requires selected  information  for
those  segments to be presented in interim financial  reports
issued  to stockholders.  SFAS 131 also establishes standards
for  related  disclosures  about products  and  services  and
geographic  areas.  Operating  segments  are  identified   as
components  of  an  enterprise about which separate  discrete
financial  information  is available for  evaluation  by  the
chief operating decision maker, or decision making group,  in
making   decisions  how  to  allocate  resources  and  assess
performance.   The  information disclosed herein,  materially
represents  all of the financial information related  to  the
Company's principal operating segment.

Net Loss Per Share

The  Company  has  adopted Statement of Financial  Accounting
Standard  No.  128,  "Earnings  Per  Share,"  specifying  the
computation,  presentation  and  disclosure  requirements  of
earnings per share information.  Basic earnings per share has
been  calculated  based upon the weighted average  number  of
common shares outstanding.  Stock options and warrant's  have
been  excluded  as common stock equivalents  in  the  diluted
earnings  per share because they are either antidilutive,  or
their effect is not material.  There is no effect on earnings
per  share  information  for the year  ended  June  30,  1998
relating to the adoption of this standard.

New Accounting Pronouncements

The   Company  adopted  Statement  of  Financial   Accounting
Standards  No. 132, Employers' Disclosures about Pension  and
Other  -Post  Employment Benefits (SFAS 132)  in  the  year
ended  June  30,  1998.  SFAS No. 132 establishes  disclosure
requirements   regarding   pension   and   post    employment
obligations. SFAS No. 132 does not effect the Company  as  of
June 30, 1998.

In  March  1998, Statement of Position No. 98-1  was  issued,
which specifies the appropriate accounting for costs incurred
to  develop or obtain computer software for internal use. The
new pronouncement provides guidance on which costs should  be
capitalized,  and  over  what period  such  costs  should  be
amortized and what disclosures should be made regarding  such
costs.  This  pronouncement  is effective  for  fiscal  years
beginning after December 15, 1998, but earlier application is
acceptable.   Previously  capitalized  costs  will   not   be
adjusted.   The  Company  believes  that  it  is  already  in
substantial  compliance with the accounting  requirements  as
set  forth in this new pronouncement, and therefore  believes
that  adoption will not have a material effect  on  financial
condition or operating results.

                            F-13

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
               NOTES TO   FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE A-SUMMARY OF ACCOUNTING POLICIES (continued)

In  April  1998,  Statement of Position No. 98-5  was  issued
which  requires  that  company's expense  defined  previously
capitalized start-up costs including organization  costs  and
expense  future start-up costs as incurred. Adoption of  this
statement  does not have an effect on financial condition  or
operating results.

The Company adopted Statement of Financial Standards No. 133,
Accounting   for  Derivative  Instruments  and  for   Hedging
Activities (SFAS No. 133) in the year ended June 30,  1998.
SFAS No. 133 requires that certain derivative instruments  be
recognized in balance sheets at fair value and for changes in
fair   value  to  be  recognized  in  operations.  Additional
guidance  is also provided to determine when hedge accounting
treatment is appropriate whereby hedging gains and losses are
offset  by  losses and gains related directly to  the  hedged
item.  SFAS  No.  133's impact on the Company's  consolidated
financial  statements is not expected to be material  as  the
Company  has  not  historically  used  derivative  and  hedge
instruments.

In  December  1999,  the Securities and  Exchange  Commission
issued  Staff Accounting Bulletin No. 101     ("SAB  101"),
Revenue  Recognition  in  Financial  Statements,  which  will
become  effective  December 31, 2000.  The Company  does  not
expect  the  standard  to  have  a  material  effect  on  its
financial position or results of operations.

In  March  2000,  the  Financial Accounting  Standards  Board
issued  FIN  No.  44,  Accounting  for  Certain  Transactions
Involving   Stock   Compensation,   an   interpretation    of
Accounting Principles Board No. 25 for (a) the definition  of
an  employee  for purposes of applying APB No.  25,  (b)  the
criteria  for  determining whether  a  plan  qualifies  as  a
noncompensatory  plan,  (c)  the accounting  consequences  of
various  modifications  to the terms of  a  previously  fixed
stock option or award, and (d) the accounting for an exchange
of  stock compensation awards in a business combination.  FIN
44  was effective July 1, 2000, but certain conclusions cover
specific events that occur after either December 15, 1998, or
January  12, 2000. Management does not anticipate  that  this
interpretation will have a material impact on  the  Company's
consolidated financial statements.

In  September 2000, The Financial Accounting Standards  Board
issued  SFAS No. 140, Accounting for Transfers and  Servicing
of  Financial  Assets and Extinguishments of  Liabilities,  a
replacement  of SFAS Statement No. 125. SFAS No. 140  revises
the  standards for accounting for securitizations  and  other
transfers  of  financial  assets and collateral  and  require
certain disclosures, but carries  over most of the provisions
of  SFAS  No. 125  without reconsideration. SFAS No.  140  is
effective for transfers and servicing of financial assets and
extinguishments of liabilities occurring after March 31, 2001
and  is  effective  for recognition and  reclassification  of
collateral  and  for disclosures relating  to  securitization
transactions and collateral for the fiscal years ending after
December  15, 2000. Management does not anticipate that  this
interpretation will have a material impact on  the  Company's
consolidated financial statements.

                            F-14

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
               NOTES TO  FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE B- PROPERTY AND EQUIPMENT, NET

Property and equipment at June 30 were as follows:

                                      1998           1997
  Land and improvements          $ 17,433,349   $ 12,864,346
  Furniture and fixtures               38,889         48,068
                                   17,472,238     12,912,414

  Less: accumulated depreciation      (23,355)        (21,002)
                                 $ 17,448,883   $ 12,891,412



Interest capitalized during the years ended June 30, 1998 and
1997 amounted to $ 1,275,284 and $ 887,663, respectively.


NOTE C :NOTES PAYABLE

Notes payable at June 30, 1998 and 1997 are as follows:

                                      1998           1997
Mortgage note payable in monthly    $ 998,000       $       -
installments of interest only at
the   bank  prime  rate  +   3%;
payable   on demand and  secured
by a third deed of trust on real
property  and improvements.  The
Company is in default under  the
terms of the mortgage note.

Mortgage note payable in monthly    5,000,000       5,000,000
installments of interest only at
24% per annum; due on  or before
May,  1999 and secured by a first
deed of trust on real property and
improvements. The Company is  in
default under the terms  of  the
mortgage note (see Note J).

                                 $  5,998,000     $ 5,000,000


                            F-15

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
               NOTES TO  FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE D-NOTES PAYABLE TO RELATED PARTIES

Notes payable to related parties  at June 30, 1998 and 1997
are as follows:

                                            1998        1997

Mortgage  note  payable  to  an   entity  $ 600,000  $ 155,000
controlled  by a significant stockholder
of   the  Company,  payable  in  monthly
installments of interest only  at  12  %
per  annum;  payable on demand  due  and
secured by a second deed of trust on real
property  and improvements. The  Company
is  in  default under the terms  of  the
mortgage note (see Note F).

Mortgage  note  payable  to  an   entity    600,000          -
controlled  by a significant stockholder
of   the  Company,  payable  in  monthly
installments of interest only  at  12  %
per annum; payable on demand due and secured
 by  a  fourth  deed   of trust on   real
property  and improvements. The  Company
is  in  default under the terms  of  the
mortgage note  (see Note F).

Mortgage  note  payable  to  an   entity    274,200          -
controlled  by a significant stockholder
of   the  Company,  payable  in  monthly
installments of interest only  at  12  %
per  annum;  payable on demand  due  and
secured by a fifth deed of trust on real
property and  improvements.  The  Company
is  in default  under the terms of the
mortgage note  (see Note F).

Mortgage  note  payable  to  an   entity   725,000     725,000
controlled  by a significant stockholder
of   the  Company,  payable  in  monthly
installments of interest only at 8 % per
annum; payable on demand due and secured
by deed of trust on real  property  and
improvements. The Company is in  default
under  the  terms of the  mortgage  note
(see Note J).

                                       $ 2,199,200  $  880,000

                            F-16

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
               NOTES TO  FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE E-INCOME TAXES

Financial   Accounting   Standard  No.   109   requires   the
recognition  of deferred tax liabilities and assets  for  the
expected  future tax consequences of events  that  have  been
included  in  the financial statement or tax returns.   Under
this   method,  deferred  tax  liabilities  and  assets   are
determined   based   on  the  difference  between   financial
statements  and  tax  bases of assets and  liabilities  using
enacted  tax  rates  in  effect for the  year  in  which  the
differences  are expected to reverse.  Temporary  differences
between  taxable  income  reported  for  financial  reporting
purposes and income tax purposes are insignificant.

At  June  30,  1998,  the Company has available  for  federal
income  tax purposes a net operating loss carryforward  of  $
5,585,284 expiring through the year 2013, that may be used to
offset future  taxable income.  The Company has provided a
valuation reserve against the full amount of the net operating
loss benefit, since in the opinion of management based upon the
earnings  history of the Company, it is more likely than  not
that  the  benefits will not be realized.  Due to significant
changes in the Company's ownership, the Company's future  use
of its existing net operating losses may be limited.

Components of deferred tax assets as of June 30, 1998 are  as
follows:

Non current:
Net operating loss           $  1,898,997
 carryforward
Valuation allowance            (1,898,997)
Net deferred tax asset       $          -


NOTE F-CAPITAL STOCK

Preferred Stock

The  Company  is  authorized to issue  25,000,000  shares  of
preferred  stock,  $.001  par  value,  with  certain  rights,
preferences and designations, to be issued in a manner to  be
determined by the Company's Board of Directors.


                            F-17

<PAGE>
                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
                NOTES TO FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE F-CAPITAL STOCK  (continued)


Series A Convertible Preferred Stock

The  Company's preferred stock includes Series A  Convertible
Preferred ("Convertible Preferred") stock valued at $.001 per
share.   The  maximum issuable shares under  the  series  are
2,250,000  shares.   Holders  of  the  Convertible  Preferred
shares  shall  be  entitled to dividends as declared  by  the
Board of Directors.

The  Convertible  Preferred stockholders,  in  the  event  of
liquidation of the Company, will receive an amount  equal  to
$3.33 per share plus declared and unpaid dividends before any
holder of common stock.  A sale, lease, or transfer of all or
substantially all of the Company's assets shall be deemed  to
be a liquidation for purposes of the liquidation preference.

Each  Convertible  Preferred share is  convertible  into  one
share  of common stock at any time or automatically upon  the
conversion of the majority of the Convertible Preferred stock
or  in the event of a public offering of the Company's common
stock at not less than $6.66 per share.

As  of  June  30, 1998, there were 2,250,000  shares  of  the
Series  A  Convertible Preferred Stock issued and outstanding
(see Note J).


Class B Convertible Preferred Stock

In  April  1997, the Board of Directors created a  series  of
Class  B  convertible preferred stock ("Class B")  valued  at
$.25  per share.  The maximum issuable shares under the Class
B  preferred stock is 5,000,000 shares.  The holders  of  the
Class B shares are not entitled to receive dividends, and the
shares are entitled to vote with the common stock as a single
class.   In  the  event of liquidation of  the  Company,  the
holders  of  the Class B shares will receive  an  amount  per
share equal to the sum of $0.25 for each outstanding share of
Class B preferred stock.

Each  share  of  Class B preferred stock is convertible  into
common  stock at the rate of ten (10) shares of common  stock
for  each share of Class B Preferred.  Each share of Class  B
may  be converted one year following the date of issuance  at
the  election of the holder.  The Company is not required  to
reserve and keep available out of its authorized but unissued
shares of common stock, common stock sufficient to effect the
conversion of the Class B.  In the event that the  number  or
authorized share of common stock is not sufficient to  effect
the  conversion  of the outstanding shares of  Class  B,  the
Company  will  increase  the number authorized  but  unissued
shares of common stock.
                            F-18

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
                NOTES TO FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE F-CAPITAL STOCK  (continued)

During  the  year  ended June 30, 1997,  the  Company  issued
4,000,000  shares  of Class B in exchange for  $1,000,000  in
cash  advances  that  had been made to  the  Company  by  the
Parent.

During  the  year ended June 30, 1998, the Company  converted
4,000,000  shares of its Class B shares to 40,000,000  shares
of its Common Stock.

During  the  year  ended June 30, 1998,  the  Company  issued
100,000  shares  of  its  Class  B  shares  in  exchange  for
professional services.

As of June 30, 1998, there were 100,000 shares of the Class B
Convertible Preferred Stock issued and outstanding.

Common Stock

The  Company  is  authorized to 75,000,000 shares  of  common
stock having a par value of   $ .001 per share.

During  the  year  ended June 30, 1997,  the  Company  issued
1,250,000  shares of common stock to the Parent  in  exchange
for   $250,000 owed to the Parent. During the year ended June
30,  1998, the Company issued 2,245,500 shares of its  common
stock to non-employees for services rendered in exchange  for
debts owed.

At  June  30,  1998, there were 54,331,687 shares  of  common
stock outstanding.

Warrants to Purchase  Common Stock

As  of  June 30, 1998, the Company had outstanding  1,000,000
warrants to purchase 1,000,000 shares of the Company's common
stock at $.06 per share with no expiration. The warrants were
issued  as compensation for financial consulting services  to
an  entity  controlled by a family member  of  the  Company's
Chairman of the Board.

As   of    June  30,  1998  ,  the  Company  had  outstanding
7,000,000  warrants  to  purchase  7,000,000  shares  of  the
Company's  common stock at $.20 per share with no expiration.
The  warrants were issued as additional consideration  to  an
entity  controlled  by the Company's Chairman  of  the  Board
which  advanced  the Company funds in the  form  of  mortgage
notes payable secured by deeds of trust on the Company's land
and improvements (see Note D).

                            F-19

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
                NOTES TO FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997



NOTE G-COMMITMENTS AND CONTINGENCIES

  Lease Commitments

The  Company leases office space on a month-to-month basis  .
During  the  years ended June 30, 1998 and 1997, the  Company
incurred rental expense of $ 29,020 and $ 0, respectively.


Employment and Consulting Agreements

The  Company  has  employment agreements with  the  Company's
Executive Chairman and Vice Chairman.  In addition to  salary
and   benefit  provisions,  the  Agreements  include  defined
commitments  should the Company terminate the  employment  of
the Executives   without cause.

The   Company   has   consulting  agreements   with   outside
contractors. The Agreements are generally for a  term  of  12
months  from inception and renewable automatically from  year
to  year  unless either the Company or Consultant  terminates
such engagement by written notice.

Litigation

In  June  1995,  Tommyknocker Casino  Corp.  and  New  Allied
Development Corporation ("Tommyknocker") filed a counterclaim
against  the  Company in the District Court of the  state  of
Colorado.   The  counterclaim  alleged  the  non-payment   of
principal  and  interest of amounts owed by  the  Company  in
connection with a mortgage loan agreement by and between  the
Company   and  Tommyknocker  Casino  Corp.  and  New   Allied
Development Corporation (see Note J).


                            F-20

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
                NOTES TO FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE G- COMMITMENTS AND CONTINGENCIES (continued)

In  1995,  James  Hamilton,  a  private  investor,  filed   a
complaint   against  the  Company and Robert  Todd  Financial
Corporation  in  the District Court of Travis County,  Texas.
The  Complaint alleges Robert Todd Financial Corporation, and
its   agents   and/or   employees,  made   misrepresentations
regarding  the Company's common stock, and allegedly  induced
the  Plaintiff  to purchase the stock. The Plaintiff  alleges
the   Company is liable for the wrongful conduct of  the  co-
defendant.  The Company denies liability in all respects  and
vigorously intends to defend.  In 1996 the Company  moved  to
dismiss  the action and no decision has been reached  by  the
Court  on the pending motion.  While the ultimate outcome  of
the litigation cannot be ascertained at this time, based upon
current  knowledge  of applicable law and facts,  and  taking
into  consideration  the  opinion of  the  Company's  general
counsel  that  the  Plaintiff's claims  lack  merit  and  the
Company   should  prevail  ultimately  in  this   litigation,
management  believes the lawsuit should not have  a  material
adverse  effect  on  the   financial  position,  results   of
operations or cash flows of the Company.

Environmental Indemnification

  The  Company  has  entered into an environmental  indemnity
agreement  with the holders of the  $5,000,000 mortgage  loan
payable  (see  Note  C) pursuant to which  the  Company  will
defend  and  hold harmless the Lender from any  environmental
claims  connected  to the property which secures   the  loan.
The  Company  through independent environmental  consultants,
has  conducted environmental examinations on the property and
has   made   environmental   remediation   pursuant   to   an
administrative  consent  order with  the  U.S.  Environmental
Protection   Agency.   The  remediation  was   performed   in
accordance with the approved work plan.  Based upon the  work
performed, the Company does not believe that further remedial
activity  will  be  required.   However,  there  can  be   no
assurance what costs, if any, the Company might incur in  the
future  in  connection with environmental matters related  to
the property.


                            F-21

<PAGE>

                 COUNTRY WORLD CASINOS, INC.
               (A developmental stage company)
                NOTES TO FINANCIAL STATEMENTS
                   JUNE 30, 1998 and 1997

NOTE H-RELATED PARTY TRANSACTIONS

Due to Officers and Parent

The amounts due to the Company's officers and Parent  at June
30,  1998  and  1997  represents aggregate  advances  to  the
Company  (net  of  repayments).   No  formal  agreements   or
repayment terms exist.

NOTE I-LOSSES PER SHARE

The  following table presents the computation  of  basis  and
diluted loss per share:

                                       1998           1997
Net (loss) available for common    $(1,245,439)   $(1,080,391)
shareholders

Basic  and  fully diluted  loss       $(0.05)        $(0.10)
per share
Weighted average common  shares
outstanding                         23,668,479     10,985,493

Net  loss  per  share is based upon the weighted  average  of
shares of common stock outstanding June 30, 1998 and 1997.

NOTE J- SUBSEQUENT EVENTS

In  July 1998, the Company executed and delivered a deed  for
the  real property in lieu for foreclosure to the holders  of
the $ 725,000 mortgage note  (see Note D).

In  October  1999,  the  Company  settled  the  lawsuit  with
Tommyknocker  at  no cost to the Company. In connection  with
the  settlement,  the  Company  issued  2,250,000  shares  of
Company  common  stock  to   Tommyknocker  in  exchange   for
2,250,000  shares  of  Series A Convertible  Preferred  stock
held by Tommyknocker (see Note F).

In   July   2000,   the  Company  signed  a   memorandum   of
understanding with Dartmouth General Capital Management, Ltd.
(Dartmouth)  to acquire certain Company  assets,  retire  the
outstanding debts of Country World and provide $80 million in
financing to begin  construction and development of its Black
Hawk,  Colorado casino and hotel project. Subject to  certain
conditions,   the   Dartmouth  will  commence   funding   the
commitment on or before January 15, 2001.


                            F-22

<PAGE>