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

                                   FORM 10-KSB


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


                  For the fiscal year ended: December 31, 1998


                         Commission file number: 0-1519


                              LEADVILLE CORPORATION

                 (Name of small business issuer in its charter)

           COLORADO                                        84-0388216
(State or other jurisdiction of                 (IRS Employer Identification No)
incorporation or organization)

               7002 Graham Road, Suite 106, Indianapolis, IN 46220

                    (Address of principal executive offices)

                                 (317) 596-0735

                            Issuer's telephone number


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

                 Securities registered Pursuant to Section 12(g)
                              of the Exchange Act:
                                  COMMON STOCK


Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. YES X

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  registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. [ ]

Issuer's operating revenues for its most recent fiscal year:   NONE

The aggregate market value of the Common Stock (the  Registrant's  only class of
voting stock) held by non-affiliates of the Registrant on December 31, 1998, was
approximately  $3,939,399  based upon the  reported  closing  sale price of such
shares on the NASD  OTC-Bulletin  Board for that date.  As of December 31, 1998,
there were 10,505,065 shares of Common Stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE:  NONE
TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMAT:  NO   X

<PAGE>



Item 1. Description of Business

GENERAL

     Leadville  Corporation   ("Leadville"  or  the  "Company")  is  a  Colorado
corporation  that was organized in 1945 to acquire,  explore and develop  mining
properties,  primarily in Lake and Park Counties, Colorado. The Company's Common
Stock is traded on the NASD OTC-Bulletin Board, under symbol "LEAD".

     Historical  mining  activities  began in Lake and Park Counties  during the
1860s.  The most  productive  area in the Counties became known as the Leadville
Mining District  ("District") of central Colorado.  Since 1860, the District has
produced  over 2.5  million  ounces of gold,  240  million  ounces of silver,  2
billion  pounds of lead,  1.4 billion  pounds of zinc and 100 million  pounds of
copper.  Leadville's  properties,  which  are  located  in or  adjacent  to  the
District,  have produced gold,  silver,  lead,  zinc and copper during  previous
mining operations.

     The  Company   controls  two  significant   blocks  of  contiguous   mining
properties,  the  approximately  5.0 square mile  Sherman-Hilltop  Consolidation
("Sherman Mine"), historically a silver, lead and zinc producer, with some gold,
and  the  approximately  1.5  square  mile  Diamond-Resurrection   Consolidation
("Diamond  Mine"),  primarily a gold and silver producer,  along with lead, zinc
and copper.  The  Company's  properties  are located near the town of Leadville,
Colorado and are  accessible  year around,  although  access to the mines can be
interrupted  at times due to severe  winter  weather  conditions.  Access to the
mineral resources at the Diamond and Sherman Mines is gained through underground
workings.

     Due to the  collapse  of  silver  prices  in the  1890s,  coupled  with the
exhaustion  of easily  minable  high grade  surface  ore,  the District was left
relatively  inactive  for almost 50 years.  During  that  period,  property  and
mineral rights were  abandoned or divided to the point of not being  manageable.
Beginning in 1949 and continuing  into the 1980s one of the Company's  strategic
corporate  objectives  was to  consolidate,  under its control,  promising  land
positions in the District which would serve to support large,  long-term  mining
operations.  Under the direction of Dr.  Robert G. Risk,  President and Chairman
from 1949 to 1997, the Company  commissioned  reviews of historical mining data,
conducted  geophysical  studies and  researched  title records for the Leadville
area in an effort to identify land positions which held promising  prospects for
acquisition  and mining.  After years of effort and  considerable  expense,  the
Company successfully  consolidated  ownership interests and mining rights in the
Sherman-Hilltop and Diamond-Resurrection properties.

     In the late 1960s the  Company  acquired a third  block of ground,  the 0.5
square mile Stringtown Mill site ("Stringtown Mill"). This property was acquired
to provide a location for  construction of a mill for processing of Sherman Mine
ore.

     The  information  contained  in this Form 10-KSB  contains  forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995,  which  can be  identified  by the use of  words  such as  "may",  "will",
"expect",  "anticipate",  "estimate" or "continue", or such variation thereon or
comparable terminology.

                                       -2-


<PAGE>



In addition,  all  statements  other than  statements of  historical  facts that
address activities, events or developments that the Company expects, believes or
anticipates,  will or may occur in the  future,  and  other  such  matters,  are
forward-looking statements.

     The  future  results  of  the  Company  may  vary   materially  from  those
anticipated  by  management,  and may be affected by various  trends and factors
which are beyond the control of the Company. These risks include lack of capital
of the Company, its substantial  dependence on Dr. Risk to fund operations,  the
uncertainties  surrounding  the EPA Superfund  site in which  approximately  ten
percent of the Company's  properties are located, the uncertainties of obtaining
additional capital,  the competitive  environment in which the Company operates,
changing metal and mineral prices, and other significant risks described herein.


Item 2. DESCRIPTION OF PROPERTIES

SHERMAN MINE

     In 1974,  Leadville  leased the Sherman Mine and Stringtown Mill properties
to Day Mines, Inc. ("Day Mines") of Wallace,  Idaho. The Sherman Mine properties
consist of  approximately  1,854 acres of patented mining claims and 1,760 acres
of unpatented mining claims in Lake and Park Counties.  The Stringtown Mill site
includes  approximately 340 acres and is the location of the Stringtown Mill and
Malta  Gulch  tailings  ponds.  Unpatented  claims  require  payment  of  annual
assessment fees to maintain the right to mine on these federally owned lands.

     Hecla Mining Company ("Hecla"),  began to operate the Sherman Mine in 1981,
as a result of the merger of Day Mines into Hecla.  During the early 1980s,  low
silver prices  resulted in the  suspension  of mining  operations at the Sherman
Mine for periods of time. In November of 1984, the Company reached agreement, in
principle,  with Hecla whereby all  properties  and mining rights subject to the
1974 lease agreement would be reacquired by the Company. During October of 1987,
the Company reached a final agreement with Hecla for  reconveyance of the lease,
in consideration for $500,000 cash and a convertible  debenture in the amount of
$381,000. In December 1993, as a result of the Company's efforts to re-structure
its debt obligations,  Hecla agreed to cancel the $381,000 debenture, along with
accrued interest of approximately $402,000.

     Since May of 1987 and continuing through 1998, the Company's  activities at
the Sherman Mine have been limited to care, maintenance and permit related work.
During  1985,  the  Sherman  Mine  was  placed  in  temporary  cessation  due to
suspension of mining  activities.  During 1995, the temporary  cessation  period
expired  and the  Company  will be  required  to  conduct  a  program  of study,
exploration and sampling to maintain existing  regulatory  permits. In the event
that the required work is not performed,  the Company may be required to reclaim
the Sherman Mine site. The Company maintains a reclamation bond in the amount of
$91,600, which relates to the Sherman and Stringtown Mill sites.

                                       -3-

<PAGE>




     Substantially  all of the Company's real properties,  including the Sherman
Mine, serve as security for outstanding convertible debentures.

DIAMOND MINE

     Leadville acquired the initial Diamond Mine claims in 1964 and continued to
add land  positions into the early 1980s.  Although the Diamond Mine  properties
were  under  lease to Day  Mines,  and  then  Hecla,  as part of the 1974  lease
agreement, no mining activities occurred on the properties during the years 1974
through 1982. In 1983,  Hecla released the Diamond Mine from the lease agreement
and the Company initiated a program of study and exploration of the property.

The Diamond Mine property consists of approximately 1,181 acres and its shaft is
located approximately 4.5 miles east of Leadville,  Colorado.  Substantially all
of the  mining  claims  in the  block of ground  are  patented  and owned by the
Company. The property carries only minimal royalty obligations.

     Beginning in 1983 and continuing  into 1989, the Company's  efforts focused
on achieving  production at the Diamond Mine. As a result of work  conducted and
investment made by the Company during this six year period,  management believes
the property is positioned to re-open for production and further exploration and
development  with  additional  capital  investment.   Furthermore,   significant
financing will be required to take the mining operations to positive cash flow.

     During the years 1986 through 1988, the Company constructed a surface plant
at the Diamond Mine, drove  underground  access and development  drifts and made
modifications  to the Stringtown Mill facility.  Sustained ore processing at the
Stringtown  Mill was  achieved  in late 1988,  after  significant  delays due to
equipment and circuit failures. Once ore processing at the mill was sustainable,
however,   the  Company  lacked  necessary   financial  resources  to  construct
additional mine infrastructure required to continue mining operations.

     Ultimately, financing necessary to continue mining activities in early 1989
could not be secured and operations  were  suspended.  Management  believes that
significant financing has not been available to the Company due to environmental
litigation surrounding the Leadville, Colorado area since the mid-1980s.

     During 1996, the Company  signed a letter of intent with a Canadian  mining
corporation to joint-venture the Company's  Diamond Mine properties.  In January
1997, the Canadian  corporation advised the Company that it would not be able to
secure the financing  required to  participate on the property and the letter of
intent  then  expired.  Under terms of the letter,  the Company  issued  500,000
shares of stock to the Canadian  corporation for cash consideration of $500,000.
Leadville used the proceeds for general corporate purposes and to settle certain
long past due obligations.

                                       -4-

<PAGE>




STRINGTOWN MILL SITE

     The Stringtown Mill site encompasses an area of approximately 340 acres and
is located immediately southwest of Leadville, Colorado. The Stringtown Mill and
tailings  ponds were  constructed  and placed in service on the site in the late
1960s.  The  facility  was  used to mill  Sherman  Mine  ore  until  1984,  when
substantially  all Sherman  Mine  activities  were  suspended  due to low silver
prices.

     During the years 1986 though 1988, modifications and improvements were made
to the Stringtown Mill in anticipation of processing  Diamond Mine ore. The mill
operated  sporadically  from mid-1988 until early 1989  processing  Diamond Mine
ore. Administrative,  laboratory,  warehouse and residential facilities are also
located on the 340 acre site.

     As of March 15, 1999,  the Company  employed one  individual to monitor the
properties and to perform necessary administrative and field duties.

COMPETITION

     Leadville competes with other mining companies producing,  or attempting to
develop mines which  produce,  precious and base metals.  Most  competitors  are
larger mining  companies  with greater  financial and technical  resources  than
Leadville.  In addition,  management believes that the Company's properties have
been at a competitive  disadvantage in the industry since the late 1980s, due to
environmental  litigation  involving the Leadville Mining District.  (See "LEGAL
PROCEEDINGS", under Item 3., hereof).

     Resumption of mining  operations at the Company's two mines is dependent on
attracting  significant  operating  capital and on the market prices of precious
metals,  primarily  silver  and gold.  At  current  silver  prices,  many of the
industry's silver mines can not be operated  profitably,  including possibly the
Sherman Mine.

     At a minimum,  the Sherman Mine will require significant capital investment
for  acquisition  of equipment and financing mine  development  before it can be
made  operational.  Operating  issues for the mine also include milling facility
location and capacity, and reserve augmentation.

     The Diamond Mine has operating  permits in place,  identified  ore reserves
and plant and equipment positioned to resume mining activities. The Company will
have to invest significant additional funds for development work before the mine
can be put into  production.  Milling  considerations  must also be addressed in
conjunction with mining operations at the Diamond Mine.

     In years  past and  continuing  into 1999,  the  Company  has been  heavily
dependent  on its  past-President,  Dr.  Robert  G.  Risk,  to  raise  necessary
financing. The loss of Dr. Risk, for any reason, would have a material impact on
the Company's ability to raise additional funds and continue as a going concern.

                                       -5-


<PAGE>



GOVERNMENTAL REGULATIONS

     As discussed in "LEGAL PROCEEDINGS",  under Item 3, hereof, the Company was
named as a defendant in several legal actions initiated by the state of Colorado
and the United States  involving  environmental  matters in the California Gulch
Superfund site.  Portions of the Company's  Diamond Mine property and Stringtown
Mill site are located within the boundaries of the Superfund site.

     In an  effort  to  limit  its  financial  exposure  and move  forward  with
financing  efforts,  the Company ultimately reached a settlement with the United
States which was entered by the United States  District Court in August of 1993.
The  settlement  is in the  form  of a  consent  decree.  As a  result  of  that
settlement,  the Company  will be  required to make annual cash  payments to the
United States in order to maintain certain  protections  afforded by the consent
decree.  Additionally,  the Company  has agreed to advise the United  States and
certain  other  parties  of  its  mining  plans,  if  planned  activities  could
potentially  have an adverse  impact on  remedial  work being  performed  in the
Superfund site.

     Under  the  consent  decree,  the  Company  retains  the  right  to use the
Stringtown  Mill  facility  for ore  processing,  although  use of the  existing
tailing ponds for future  storage of mill  tailings may require  approval by the
United States. The Company's mine and mill facilities are currently permitted by
the State of Colorado for the respective operations.

     The costs of  defending  against the  environmental  claims  alleged in the
consolidated  cases,  negotiating  a  settlement  and  general  operations  have
exhausted  all of the Company's  financial  resources.  In addition,  management
believes the  designation  of the  Leadville,  Colorado area as a Superfund site
could  continue  to  complicate  efforts to raise  financing  for the  Company's
properties.



Item 3. LEGAL PROCEEDINGS

UNITED STATES (ENVIRONMENTAL PROTECTION AGENCY)

In 1983, the Company was named as one of several defendants in an action (United
States of America vs. Apache Energy and Mineral Company,  et al.) brought by the
United  States in Federal  District  Court in Colorado  under the  Comprehensive
Environmental  Response,  Compensation  and Liability Act of 1980  ("CERCLA") in
connection with the  approximately  11.5 square mile California  Gulch Superfund
site in Lake County,  Colorado.  In 1986,  the Company was also named as a third
party defendant in a suit (State of Colorado vs. Asarco, Inc., et al.) involving
the same site. The cases were subsequently consolidated.

From 1983 through 1988,  the Company  negotiated  with the United States to have
its  involvement in the  consolidated  case dismissed or settled on a de minimis
basis.  That  effort  was  ultimately  unsuccessful.  During  the years 1989 and
continuing  into 1993,  the Company  attempted to negotiate a settlement  of its
alleged liability to the United States. Management believed that financing might
be  obtained by the  Company if the claims  asserted  by the United  States were
settled and the financial exposure limited. 

                                       -6-


<PAGE>



     During August 1993, a consent decree was entered by the U.S. District Court
in Colorado  whereby the United States  agreed to settle the  Company's  alleged
liability,  with  the  exception  of  natural  resources  damages,  if  any,  in
consideration for $3,000,000.  Under the terms of the consent decree, a total of
$250,000 is to be paid by the Company over 15 years, with a contingent liability
of $2,750,000 to be paid based on profitable  operations or sale of  properties.
Minimum cash  payments  are to be $10,000 for years 1-5,  $15,000 for years 6-10
and $25,000 for years 11-15.

COWIN & COMPANY, INC.

     In 1990, Cowin & Company,  Inc. Mining Engineers and Contractors filed suit
against  Leadville  in Lake  County,  Colorado  District  Court  asserting  that
Leadville  was  obligated  to Cowin &  Company  for  approximately  $45,000  for
contract mining fees.  Cowin & Company,  Inc. is requesting  damages,  equipment
possession and general relief  relating to a contract mining  agreement  entered
into March 3, 1987.

     Leadville  counter-claimed for damages resulting from improper construction
of the Diamond Mine shaft and damages resulting from an accident at the site. No
action has been taken in the case since  October 1993 and the Court ordered that
a Status Report be filed on the matter by August 30, 1996. The Report was timely
filed, but no action has occurred in the case since that date.

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

     There were no matters submitted to a vote of the Company's security holders
during the fourth quarter of 1998.

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters.

     On August 11, 1998, as the result of a change in  requirements  for listing
on the NASDAQ  Small-Cap  System,  the Company's Common Stock was moved from the
Small-Cap System to the NASD OTC-Bulletin Board.

     The following  table sets forth the low and high bid price  quotations  per
share of Common Stock, as reported on the NASDAQ  Small-Cap  System and the NASD
OTC-Bulletin  Board  for  the  periods   indicated.   These  quotations  reflect
inter-dealer prices,  without retail markup, mark down or commission and may not
necessarily represent the actual price of transactions.


Quarter Ended
-------------
                                Low      High
                                ---      ----

December 31, 1997             $ .38      3.13
March 31, 1998                  .625     1.25
June 30, 1998                   .4375     .9375
September 30, 1998              .25       .5625
December 31, 1998               .0625     .5625

     As of December 31, 1998,  the Company had  approximately  2,050  holders of
record of its Common Stock;  management  estimates that the number of beneficial
holders is greater.


                                       -7-


<PAGE>




     There can be no assurance  that,  if the Company is  successful  in raising
significant investment capital, future mining operations will be profitable.  No
dividends on the Common  Stock have been paid during the past several  years and
due to the significant investment of cash required by planned mining activities,
management  does  not  anticipate  that  any  dividends  will  be  paid  in  the
foreseeable future.

     See Page F-5 to the Financial  Statements  for issuance of shares of common
stock during 1998, all of which are unregistered.

Item 6. Management's  Discussion and Analysis of Financial Condition and Results
of Operations.

     The following  discussion  should be read in conjunction with the Company's
consolidated  financial  statements and related notes included elsewhere herein.
The  Company's  results may be affected by various  trends and factors which are
beyond the Company's control. These include factors discussed elsewhere herein.

     With the exception of historical  information,  the matters discussed below
under the headings "Results of Operations" and "Liquidity and Capital Resources"
may include forward-looking statements that involve risks and uncertainties. The
Company cautions the reader that a number of important factors discussed herein,
and in other reports filed with the  Securities and Exchange  Commission,  could
affect  the  Company's  actual  results  and  cause  actual  results  to  differ
materially from those discussed in forward-looking statements.

Results of Operations

     The Company  earned no revenues from  operations in 1998 and reported a net
loss of $1,268,116.  The most significant expenses incurred during 1998 included
$591,961 of interest, $31,500 for property taxes, $68,000 for depreciation,  and
$43,500 for  write-down of parts  inventory.  Approximately  57% of the loss for
1998 was attributable to these expenses. The Company also expensed approximately
$395,000 in salaries in 1998, of which  $225,000 was paid in  restricted  common
stock of the Company.

     The Company has had no active mining operations since 1989 and continues to
carry a significant  investment in property,  equipment and parts inventory.  In
1995, the Company  initiated  policies to recognize a declining  useful life and
value of these assets.  Approximately  $110,300 of such expenses were recognized
in 1998.

     During 1998, the Company  continued to incur  significant  interest expense
relating to outstanding  notes and debentures  payable and their related accrued
interest.  As of December 31, 1998,  principal  amounts due on notes payable and
debentures payable was $2,671,803 and $3,300,329 , respectively.

     Substantially  all other  expenses in 1998 were  incurred to meet  general,
administrative and property holding expenses.

                                       -8-
<PAGE>



1998 COMPARED TO 1997

     The net loss for 1998, before extraordinary items, increased  approximately
$161,,453  compared to 1997.  Interest expense for 1998 increased  approximately
$151,300 over 1997, due primarily to interest expense associated with additional
borrowing  during  1998.  Depreciation  expense  did not change in 1998,  as the
Company  continued  its  policy to provide  for  depreciation  on mining  assets
maintained on a stand-by basis.  General and  administrative  expenses increased
slightly in 1998.

Liquidity and Capital Resources

     The Company is severely  undercapitalized.  As of December  31,  1998,  the
Company has a working capital deficit of $6,429,955 and minimal  operating cash.
Substantially  all of the  Company's  cash needs have been met by loans from the
Company's  management  and by  proceeds  from short term  notes.  Management  is
hopeful that cash needs for 1999 will be met from  existing  cash  resources and
short-term  borrowings,  although additional loans from previous sources can not
be assured.

     In 1998, the Company used cash to meet general, administrative and property
obligations.  During 1998, the Company borrowed  approximately  $175,000 through
the placement of various secured and unsecured  notes.  No capital  expenditures
were made during the year.

     The Company's  certificates of deposit, in the amount of $104,265, are held
as mining reclamation bonds and classified as long term assets.


     In order for the  Company to  continue  as a going  concern  and attempt to
operate its mining  properties,  a  significant  amount of capital  from sources
outside the Company will be required.

     During 1999,  management will continue its efforts to obtain  financing for
the Company's properties through  joint-venture,  cash investment or a secondary
offering of the Company's stock. No assurance can be given that the Company will
be successful in securing financing. In order to improve the financing prospects
for the  Company,  management  has made  efforts  to lessen  the  financial  and
operating burdens of the consent decree with the United States. Discussions with
the EPA have been very encouraging and supportive.

As of December 31, 1998, the Company is obligated to promissory  note holders in
the face amount of $1,430,037, plus accrued interest of $1,263,638.  Outstanding
convertible  debentures  at December 31,  1998,  in the face amount of $440,000,
plus accrued  interest of  $2,860,329,  are secured by all of the Company's real
property.

     Substantially  all of Leadville's note and debenture  payable  obligations,
including  accrued  interest,  are  convertible  into Common Stock at a price of
generally  $1.00  per  share.  The  demand  note  obligations  due to Dr.  Risk,
including interest, have no stock conversion features.  Management is optimistic
that a substantial  amount of the debt will be converted to stock,  if Leadville
can secure significant financing for its properties.


                                       -9-


<PAGE>



Impact of Year 2000 Issue

     The Year 2000 Issue is the result of computer  programs being written using
two digits rather than four digits to define years.  This could possibly  result
in computer malfunction and miscalculations. Based upon a recent assessment, the
Company has  determined  that it will not be  necessary to modify or replace any
significant  portions of its  equipment or software so that its  computers  will
properly use dates beyond December 31, 1999. The Year 2000 Issue is not expected
to have material  impact on the Company's  operations.  In that the Company does
not rely significantly on third parties' computer systems for the continuance of
its operations,  the Company has determined that it has very little exposure, if
any, to contingencies related to the Year 2000 Issue and no costs to the Company
are anticipated.


Item 7. Financial Statements.

See "Index to Financial Statements" on page F-1 hereof.

Item  8.  Changes  In and  Disagreements  With  Accountants  on  Accounting  and
Financial Disclosure.

None

Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
with Section 16(a) of the Exchange Act.

     The  following  table sets forth  information  regarding  the  officers and
directors of the Company.

Name               Age   Positions Held    Officer/Director since
----               ---   --------------    ----------------------

Robert G. Risk      89   Director                   1949

Lloyd L. Morain     81   Director                   1967

James C. Tiffany    68   Director                   1990

John H. Gasper      40   President, Chairman        1997

Scot B. Hutchins    43   CEO                        1998

Mr. Tiffany is the nephew of Dr. Risk. Mr. Gasper and Mr.  Hutchins are cousins.
There is no other family  relationship  between or among any of the above listed
officers and directors.

Robert G. Risk has been the Chairman and a Director  since  January 1949. He has
been a practicing dentist in Indianapolis, Indiana for many years.

Lloyd L.  Morain has been a Director  since  1967.  He is  currently  a personal
business  advisor and  Chairman of the Board of the  Illinois  Gas  Company,  an
Illinois  corporation  which he has been  associated  with for many  years.  Mr.
Morain holds office with several other utility companies.

James C. Tiffany has spent his entire  business career in various aspects of the
mining  business;  most recently serving with Reynolds Metal Company since 1964.
Reynolds is engaged in the  manufacture  of aluminum and aluminum  products.  He
received his Engineer of Mines degree from the Colorado School of Mines in 1951.
Mr.  Tiffany was employed by the Company in the position of  operations  manager
during the years 1953 through 1959.

                                      -10-


<PAGE>



John H. Gasper, MSEM, P.E., President of Leadville Corporation since July ,1997,
is a registered professional mining engineer with fifteen years of experience in
mining  engineering  design and restoration of lands impacted by mining.  He has
served  as  the  chief  mining   engineer  for  Atec   Associates,   a  national
geotechnical/environmental  engineering  consulting  firm,  for twelve years and
President of EnviRESTORE Engineering, LLP since 1996.

Scot B.  Hutchins,  CEO of  Leadville  since March 1998,  is an attorney who has
practiced  law at the  U.S.  Department  of  Justice  and a  major  law  firm in
Washington, D.C.

Item 10. Executive Compensation

The only current officers of Leadville who earned  compensation during 1998 were
Mr.  Gasper and Mr.  Hutchins.  Mr.  Gasper's  salary was  $120,000 for the year
ending December 31, 1998. Including  compensation earned in 1997,  approximately
$133,500  remains unpaid to Mr. Gasper.  Mr Hutchins' salary was $50,000 through
December 31, 1998, of which the total amount remains  unpaid.  In addition,  Mr.
Hutchins  received as compensation  300,000 shares of restricted Common Stock in
1998.

Item 11. Security Ownership of Certain Beneficial Owners and Management.

     As of December  31,  1998, a total of  10,505,065  shares of the  Company's
Common  Stock were  outstanding.  The table  below sets forth the  ownership  by
management and principal stockholders of the Company as of December 31, 1998:

                                       Share
                                     Ownership
Name                 Title             Direct         Percent
----                 -----             ------         -------

Robert G. Risk     Director          2,686,179 (b)     25.57%

Lloyd L. Morain    Director            459,408 (b)      4.37%

James C. Tiffany   Director             27,631 (b)      0.26%

John H. Gasper     President Chairman  150,000 (b)      1.43%

Scot B. Hutchins   CEO                 336,200 (b)      3.20%

All officers and directors as
 a group                                               34.83%

(a) The  address  of each  management  person is 7002  Graham  Road,  Suite 106,
Indianapolis, IN 46220.

(b) Members of the Board of Directors and officers hold debt  instruments of the
Company which can be generally  converted  into Common Stock at a price of $1.00
per share. If such debt  instruments  were converted to stock as of December 31,
1998,  officers  and  directors  would hold the  following  number of shares and
percentages of outstanding  stock:  Robert G. Risk  3,689,676  shares,  (31.8%);
Lloyd L. Morain 532,016 shares, (4.2%); James C. Tiffany 27,631 shares, (0.22%);
John H. Gasper 150,000 shares, (1.3%) Scot B. Hutchins 336,200 shares, (2.9%).

     If holders of all convertible debt instruments of the Company had exercised
their option to convert the obligations to Common Stock as of December 31, 1998,
approximately  4,398,363  shares  would have been  issued and total  outstanding
shares would have been 14,903,428. Officers and directors, as a group, would own
4,735,523 shares representing 31.8% of the outstanding Common Stock.

                                      -11-


<PAGE>




Item 12. Certain Relationships and Related Transactions.

Substantially all of Leadville's financing since 1983 has been provided by loans
from the Company's  directors  through  proceeds  from the private  placement of
equity and debt  instruments.  The  following  table sets forth  amounts  due to
officers and directors of the Company as of December 31, 1998:


Name              Obligation        Principal   Interest     Total
----              ----------        ---------   --------     -----

Robert G. Risk    Debenture payable $  -0-    $1,003,497   $1,003,497

Robert G. Risk    Demand notes      $15,000     $880,168     $895,168

Lloyd L. Morain   Note payable      $50,000      $22,608      $72,608


Substantially  all of the debenture  payable,  notes payable and related accrued
interest  amounts are convertible  into the Company's  Common Stock at $1.00 per
share. However, the demand notes and associated accrued interest due to Dr. Risk
have no stock conversion features.

     During the years 1997  through  1998,  Dr.  Risk has  advanced  the Company
$5,000, and $ $15,000,  respectively.  The advances bear interest at 10% and are
due on demand.  In earlier years, Dr. Risk agreed to convert  substantially  all
principal on the demand notes into Common Stock.

     During 1995 and 1996, Mr. Morain  provided loans to the Company in the form
of unsecured promissory notes, bearing interest at 10% per annum and convertible
into the Company's Common Stock at a price of $1.00 per share.  During 1997, Mr.
Morain loaned the Company $50,000. Mr. Morain has provided significant financing
to the Company in years  prior to 1995 and he has  converted  substantially  all
such loans and accrued interest into restricted Common Stock.

     During 1998, Mr. Hutchins advanced the Company $115,000.

     During the years 1995 through 1998,  Leadville  was  successful in securing
conversion of certain debt obligations into Common Stock. During these and prior
years,  officers  and  directors  of the Company  also  exercised  Common  Stock
conversion rights for obligations they held.

     The Company believes that the terms of the transactions discussed above are
comparable to those which have been attainable from non-affiliated sources.

     During  February  1997,  the  Securities  and Exchange  Commission  adopted
amendments  to  Rule  144  which   shortened  the  holding  period  after  which
"restricted securities" can be resold. Generally, the holding period will be one
year from the date of purchase under which a shareholder can sell under Rule 144
and two years from the date of purchase under which a shareholder can sell under
Rule 144(k).

     See  Footnote  1 to  the  Financial  Statements  regarding  new  accounting
standards and their future affect on the Company's financial statements.


                                      -12-


<PAGE>




Item 13. Exhibits and Reports on Form 8-K.

(a) Exhibits Filed  Herewith or  Incorporated  by Reference to Previous  Filings
with the Securities and Exchange Commission.

Exhibit
Number                 Description
------                 -----------

 (2)      Plan  of  Acquisition,  reorganization,  arrangement,  liquidation  or
          succession

 (3)      Articles of Incorporation and By-laws

 (4)      Instruments  defining  the  rights  of  security  holders,   including
          indentures

 (9)      Voting Trust Agreement

(10)      Material Contracts

(11)      Statement  Regarding  Computation of Earning Per Share is not required
          since the  information is  ascertainable  from  Leadville's  financial
          statements filed herewith.

(13)      Annual Report to security  holders,  Form 10-Q or quarterly  report to
          security holders

(16)      Letter re:  change in accounting principles

(19)      Documents not previously filed

(21)      Subsidiaries of the Registrant

(22)      Published  report  regarding  matters  submitted  to vote of  security
          holders

(23)      Consents of experts and counsel

(24)      Power of Attorney

(27)      Financial Data Schedule

(28)      Information from reports furnished to state insurance authorities

(29)      Additional Exhibits

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

(3)  The Articles of Incorporation of Leadville were filed with its Form 10-K on
     May 6, 1965;  the By-laws of  Leadville  were filed with its Report on Form
     10-K for the year ended December 31, 1980.

(4)  Filed with Form 10-K for year ended December 31, 1987.

(28) Consent Decree,  State of Colorado vs. Asarco,  Inc., et al, Defendants and
     Third  Party  Plaintiffs  vs.  Leadville  Corporation,  et al,  Third Party
     Defendants;  United  States of  America  vs.  Apache  Energy  and  Minerals
     Company, et al. Submitted on Form 8-K, dated February 11, 1993.
 
(b)  Reports on Form 8-K Filed During the Registrant's Fourth Fiscal Quarter:

         None


                                      -13-
<PAGE>


                          INDEX TO FINANCIAL STATEMENTS



                                                                           PAGE
                                                                           ----

Independent Auditor's Report.................................................F2

Balance Sheets - December 31, 1998 and 1997..................................F3

Statements of Operations and Comprehensive Loss - 
    For the Years Ended December 31, 1998 and 1997...........................F4

Statement of Stockholders' Equity - 
    From January 1, 1997 through December 31, 1998...........................F5

Statements of Cash Flows - 
    For the Years Ended December 31, 1998 and 1997...........................F6

Notes to Financial Statements................................................F7




                                       -F1-

<PAGE>

                          INDEPENDENT AUDITOR'S REPORT



Board of Directors
Leadville Corporation
Indianapolis, Indiana


We have audited the  accompanying  balance sheet of Leadville  Corporation as of
December 31, 1998 and the related  statements  of operations  and  comprehensive
loss,  stockholders' equity and cash flows for the years ended December 31, 1998
and 1997.  These financial  statements are the  responsibility  of the Company's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial  position of Leadville  Corporation as of
December 31, 1998,  and the results of its operations and its cash flows for the
year ended  December 31, 1998 and 1997, in conformity  with  generally  accepted
accounting principles.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue  as a  going  concern.  As  discussed  in  Note 2 to the
financial statements,  the Company has suffered recurring losses from operations
and has a working  capital  deficiency  that raise  substantial  doubt about its
ability to continue as a going  concern.  Management's  plans in regard to these
matters are also  described in Note 2. The  financial  statements do not include
any adjustments that might result from the outcome of this uncertainty.




HEIN + ASSOCIATES LLP


Denver, Colorado
April 8, 1999


                                      -F2-

<PAGE>

                              LEADVILLE CORPORATION

                                  BALANCE SHEET
                                DECEMBER 31, 1998



                                     ASSETS
                                     ------

CURRENT ASSETS -
    Prepaid expenses and other                                     $      9,279

PROPERTY AND EQUIPMENT, at cost:
    Mining properties                                                 7,356,979
    Buildings and equipment:
         Mine                                                         1,219,564
         Mill                                                           829,032
         Other                                                          108,143
    Land                                                                 22,429
                                                                   ------------
                                                                      9,536,147

    Less accumulated depreciation and depletion                      (2,938,232)
                                                                   ------------
                                                                      6,597,915
OTHER ASSETS:
    Investments - certificates of deposits                              104,265
    Inventories                                                         272,689
                                                                   ------------
             Total other assets                                         376,954
                                                                   ------------

TOTAL ASSETS                                                       $  6,984,148
                                                                   ============


                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------

CURRENT LIABILITIES:
    Related parties:
         Convertible debentures                                    $    440,000
         Notes payable, stockholders                                  1,311,037
         Accrued interest payable                                     4,108,625
         Payables to officers/directors/stockholders                     36,203
         Accrued salaries - officers                                    184,000
    Notes payable - other                                               119,000
    Accounts payable                                                     41,852
    Accrued expenses                                                    198,517
                                                                   ------------
             Total current liabilities                                6,439,234

SETTLEMENT OF LITIGATION, net of current portion                         65,000

COMMITMENTS AND CONTINGENCIES (Notes 2 and 5)

STOCKHOLDERS' EQUITY:
    Capital stock, par value $1 per share; 15,000,000
         shares authorized; 10,505,065 shares issued
         and outstanding at December 31, 1998                        10,505,065
    Additional paid-in capital                                        8,332,482
    Accumulated deficit                                             (18,357,633)
                                                                   ------------
             Total stockholders' equity                                 479,914
                                                                   ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                         $  6,984,148
                                                                   ============




              See accompanying notes to these financial statements.

                                       -F3-

<PAGE>

                              LEADVILLE CORPORATION

                 STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS



                                                       FOR THE YEARS ENDED
                                                           DECEMBER 31,
                                                  -----------------------------
                                                      1998             1997
                                                      ----             ----

OPERATING REVENUES                                $       --       $       --

OPERATING COSTS AND EXPENSES:
    General and administrative                         616,731          605,383
    Depreciation                                        67,718           67,718
                                                  ------------     ------------
         Total operating costs and expense             684,449          673,101
                                                  ------------     ------------

OPERATING LOSS                                        (684,449)        (673,101)

OTHER INCOME AND EXPENSE:
    Interest expense                                  (591,961)        (440,685)
    Other                                                8,294            7,123
                                                  ------------     ------------
         Total other income and expense               (583,667)        (433,562)
                                                  ------------     ------------

NET LOSS AND COMPREHENSIVE LOSS                   $ (1,268,116)    $ (1,106,663)
                                                  ============     ============

NET LOSS PER SHARE (Basic and Diluted)            $       (.12)    $       (.11)
                                                  ============     ============

WEIGHTED AVERAGE NUMBER OF CAPITAL SHARES
   OUTSTANDING                                      10,438,645        9,930,439
                                                  ============     ============




              See accompanying notes to these financial statements.

                                       -F4-

<PAGE>
<TABLE>
<CAPTION>


                                                    LEADVILLE CORPORATION

                                              STATEMENT OF STOCKHOLDERS' EQUITY
                                        FROM JANUARY 1, 1997 THROUGH DECEMBER 31, 1998


                                                                                                                           Total
                                                                 Capital Stock            Paid-in       Accumulated    Stockholder's
                                                             Shares         Amount        Capital         Deficit          Equity
                                                             ------         ------        -------         -------          ------

<S>                                                        <C>         <C>            <C>             <C>             <C>         
BALANCES, January 1, 1997                                   9,810,992   $  9,810,992   $  8,450,682    $(15,982,854)   $  2,278,820

    Conversion of notes payable, convertible debentures
           and accrued interest for common stock              169,905        169,905           --              --           169,905
    Stock for services:
           Officers                                           178,000        178,000        (37,500)           --           140,500
           Others                                              43,168         43,168         (5,700)           --            37,468
    Net loss                                                     --             --             --        (1,106,663)     (1,106,663)
                                                         ------------   ------------   ------------    ------------    ------------

BALANCES, December 31, 1997                                10,202,065     10,202,065      8,407,482     (17,089,517)      1,520,030

    Stock for services:
           Officers                                           300,000        300,000        (75,000)           --           225,000
           Other                                                3,000          3,000           --              --             3,000
    Net loss                                                     --             --             --        (1,268,116)     (1,268,116)
                                                         ------------   ------------   ------------    ------------    ------------

BALANCES, December 31, 1998                                10,505,065   $ 10,505,065   $  8,332,482    $(18,357,633)   $    479,914
                                                         ============   ============   ============    ============    ============



                                  See accompanying notes to these financial statements.

                                                          -F5-
</TABLE>

<PAGE>
<TABLE>
<CAPTION>


                                  LEADVILLE CORPORATION

                                STATEMENTS OF CASH FLOWS


                                                                   FOR THE YEARS ENDED
                                                                       DECEMBER 31,
                                                               --------------------------
                                                                   1998           1997
                                                                   ----           ----
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                            <C>            <C>         
  Net loss                                                     $(1,268,116)   $(1,106,663)
  Adjustments to reconcile net loss to net
      cash from operating activities:
           Stock for services                                      228,000        177,968
           Depreciation                                             67,718         67,718
           Provision for inventory obsolescence                     45,300         45,300
           Changes in assets and liabilities:
                (Increase) decrease in -
                      Prepaid Expenses and other                     2,810         (4,255)
                Increase (decrease) in:
                      Accrued interest to related parties          594,604        404,786
                      Officer payables and accrued salaries        141,681         21,246
                      Accounts payable                              33,518        (61,479)
                      Accrued expenses                              (8,432)      (697,816)
                                                               -----------    -----------
           Net cash used in operating activities                  (162,917)    (1,153,195)

CASH FLOW FROM INVESTING ACTIVITIES -
  Proceeds from certificates of deposit                             28,735           --

CASH FLOWS FROM FINANCING ACTIVITIES:
  Payments on borrowings                                           (50,000)          --
  Proceeds from borrowings                                         175,000      1,016,037
                                                               -----------    -----------
           Net cash provided by financing activities               125,000      1,016,037

INCREASE (DECREASE) IN CASH                                         (9,182)      (137,158)

CASH, beginning                                                      9,182        146,340
                                                               -----------    -----------

CASH, ending                                                   $      --      $     9,182
                                                               ===========    ===========


SUPPLEMENTAL DISCLOSURES OF NON-CASH
  INVESTING AND FINANCING ACTIVITIES -

      Capital stock issued for forgiveness of notes payable,
           convertible debentures and other liabilities to
           stockholders and/or officers                        $      --      $   169,905
                                                               ===========    ===========


                  See accompanying notes to these financial statements.

                                           -F6-
</TABLE>

<PAGE>

                              LEADVILLE CORPORATION

                          NOTES TO FINANCIAL STATEMENTS



1.   NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES:

     Nature of Business - Leadville  Corporation  (the  "Company") is engaged in
     the development and mining of hard rock mineral properties.

     Inventories - Inventories are stated at the lower of cost (average  method)
     or market value. Inventories consist of operating and maintenance supplies.

     Property and Equipment - Mining  properties  consist  primarily of patented
     and  unpatented  mining  claims.  Mining  properties  include  the  cost of
     acquisition  and  accumulated  exploration  and  development  expendi tures
     incurred in the pre-production stage.

     In  the  event  such  mining   properties   are  developed  into  producing
     properties,  depletion  of these  related  costs  will be  computed  on the
     unit-of-production  method,  based on  estimated  tons of  recoverable  ore
     reserves.  If the  properties  are  determined to be incapable of producing
     commercial  quantities  of ore, the costs will be charged to  operations in
     the period in which the determination is made.

     The Company  provides for  depreciation  of buildings  and equipment on the
     straight-line method, to apportion costs over the estimated useful lives of
     the assets which range principally from five to twenty years.

     Income Taxes - The Company  accounts  for income taxes under the  liability
     method,  whereby  deferred tax assets and  liabilities are recorded for the
     expected  future tax  consequences of events that have been included in the
     financial statements or tax returns. Under this method, deferred tax assets
     and  liabilities  are  determined  based  on  the  difference  between  the
     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.

     Net Loss Per Share - The loss per common share is  presented in  accordance
     with the provisions of Statement of Financial  Accounting  Standards (SFAS)
     No. 128,  Earnings Per Share.  SFAS No. 128 replaced  the  presentation  of
     primary  and  fully  diluted   earnings  (loss)  per  share  (EPS)  with  a
     presentation  of basic EPS and  diluted  EPS.  Basic EPS is  calculated  by
     dividing  the  income  or loss  available  to  common  shareholders  by the
     weighted  average  number  of common  shares  outstanding  for the  period.
     Diluted EPS reflects the potential  dilution that could occur if securities
     or other  contracts to issue common stock were  exercised or converted into
     common stock.  All potential  dilutive  securities  are  antidilutive  as a
     result of the Company's net loss for the years ended  December 31, 1998 and
     1997.  Accordingly,  basic and diluted  earnings per share are the same for
     each year.

     Capitalization  of Interest - The Company  capitalizes  interest expense as
     part of the  historical  cost of acquiring  certain assets which require an
     extended  period of time to prepare  them for their  intended use (see Note
     3). Subsequent to 1988, interest has been expensed due to the suspension of
     development activities.

     Use of Estimates - The preparation of the Company's financial statements in
     conformity  with  generally  accepted  accounting  principles  requires the
     

                                       -F7-

<PAGE>

                              LEADVILLE CORPORATION

                          NOTES TO FINANCIAL STATEMENTS



     Company's  management  to make  estimates and  assumptions  that affect the
     amounts  reported in these  financial  statements and  accompanying  notes.
     Actual  results  could  differ  from those  estimates.  The  Company  makes
     significant  assumptions  concerning the realizability of its investment in
     property  and  equipment,  and the  ultimate  liabilities  associated  with
     asserted  claims  (see Note 5). Due to the  uncertainties  inherent  in the
     estimation  process and the  significance  of these  costs,  it is at least
     reasonably possible that its estimates in connection with these items could
     be further materially revised within the next year.

     Impairment  of  Long-Lived  Assets  -  Management   periodically   assesses
     recoverability  of all  long-lived  assets.  In the  event  that  facts and
     circumstances  indicate that the cost of long-lived assets may be impaired,
     an evaluation  of  recoverability  would be performed.  If an evaluation is
     required,  the estimated future undiscounted cash flows associated with the
     asset would be compared to the asset's  carrying  amount to  determine if a
     write-down  to market  value or  discounted  cash flow  value is  required.
     Adoption of SFAS No. 121 had no effect on the financial statements.

     New  Pronouncements - SFAS No. 133,  Accounting for Derivative  Instruments
     and Hedging Activities, was issued in June 1998. This statement establishes
     accounting  and reporting  standards  for  derivative  instruments  and for
     hedging activities. It requires that an entity recognize all derivatives as
     either assets or  liabilities  in the  statement of financial  position and
     measure those  instruments  at fair value.  This statement is effective for
     the Company's financial statements for the year ended June 30, 2001 and the
     adoption of this standard is not expected to have a material  effect on the
     Company's financial statements.

     SFAS  No.   132,   Employers'   Disclosures   about   Pensions   and  Other
     Postretirement  Benefits,  was  issued in  February  1998.  This  statement
     revises the disclosure  requirement  for pensions and other  postretirement
     benefits.   This  statement  is  effective  for  the  Company's   financial
     statements  for the year  ended  June 30,  1999  and the  adoption  of this
     standard  is not  expected  to  have a  material  effect  on the  Company's
     financial statements.


2.   CONTINUING OPERATIONS:

     The accompanying financial statements have been prepared on a going concern
     basis which  contemplates  the  realization  of assets and  liquidation  of
     liabilities in the ordinary  course of business.  At December 31, 1998, the
     Company has a significant  investment in non-producing  mining  properties,
     recovery  of which is  dependent  upon the  production  of ore  reserves in
     commercial  quantities or sale of these properties at an amount equal to or
     in excess of cost. In addition,  the Company has suffered  recurring losses
     from operations and at December 31, 1998 has a working  capital  deficiency
     of approxi mately $6,429,955 which includes approximately $6,079,865 due to
     related parties.  The Company also has significant  inventories,  which the
     Company  intends  to utilize  in the start up and  operation  of its mining
     properties.  As the  ultimate  realization  of the  mining  properties  and
     related  inventories  depends on  circumstances  which cannot  currently be
     evaluated, it is not possible to determine whether any loss will ultimately
     be realized from their disposition.  All real properties are collateral for
     convertible debentures.  The Company has no property or liability insurance
     coverage.  Past litigation  concerning  environmental  matters (Note 5) has
     

                                       -F8-

<PAGE>

                              LEADVILLE CORPORATION

                          NOTES TO FINANCIAL STATEMENTS



     made it difficult to date for the Company to obtain working capital through
     additional  equity or  financing.  Annual  fees are  required  to  maintain
     possessory titles to unpatented mining claims. However,  without additional
     working  capital,  the  Company  may be  unable to pay the  required  fees.
     Working capital must be obtained to allow for future operations.

     The Company believes a substantial  portion of the convertible  debentures,
     notes payable,  accrued interest and certain other  obligations may at some
     future time be converted into capital shares.  Manage ment is continuing to
     investigate  alternatives to raise additional working capital which will be
     required to meet current and future obligations.

     If the Company cannot  successfully  restructure  its debt,  obtain working
     capital, and ultimately achieve profitable operations, there is substantial
     doubt about the ability of the Company to continue as a going concern.  The
     financial statements do not include any adjustments which might result from
     the outcome of these uncertainties.


3.   MINING PROPERTIES:

     As of December 31, 1998, the Company  controls two mining  properties;  the
     approximately   5-square-mile   Sherman  Hilltop   Consolidation   and  the
     approximately  1.5-square-mile  Diamond-  Resurrection  Consolidation.   In
     addition, the Company owns the .5-square-mile Stringtown Mill Site.

     In February  1986,  the Company  gained access to historic mine workings by
     way of the  Diamond  shaft  located on the  Company's  Diamond-Resurrection
     Consolidation  property.  At  that  time,  the  Company  began  activities,
     including  mineralization sampling and the construction and modification of
     the milling  facility at the Stringtown Mill Site,  necessary to place this
     property in a revenue producing stage.  During 1987, the Company reacquired
     all mining,  milling and other  properties  and rights held by Hecla Mining
     Company (HMC) under a previous lease agreement.

     Since May 1989 and continuing into 1998, the Company's activities have been
     limited to care,  maintenance,  and  permit-related  work.  The  Company is
     required  to  conduct a program  of study,  exploration,  and  sampling  to
     maintain existing regulatory permits. In the event the required work is not
     performed,  the Company  may be required to reclaim the Sherman  Mine site.
     The Company  maintains a reclamation  bonds in the amount of  approximately
     $91,600  for the  Sherman  and  Stringtown  Mill sites and  $12,665 for the
     Diamond-Resurrection Mine Site.


                                       -F9-

<PAGE>

                              LEADVILLE CORPORATION

                          NOTES TO FINANCIAL STATEMENTS



     Presented  below is a summary of mining  property  costs as of December 31,
     1998:


                                      DIAMOND-        SHERMAN
                                    RESURRECTION      HILLTOP
                                    CONSOLIDATION  CONSOLIDATION     TOTAL
                                    -------------  -------------     -----

 Mining claims                       $   221,445   $    78,110    $   299,555
 Exploration and development costs     4,445,428     1,784,979      6,230,407
 Interest                                795,741        31,276        827,017
                                     -----------   -----------    -----------
     Total                             5,462,614     1,894,365      7,356,979
 Accumulated depletion                      --      (1,821,078)    (1,821,078)
                                     -----------   -----------    -----------

                                     $ 5,462,614   $    73,287    $ 5,535,901
                                     ===========   ===========    ===========


4.   LONG-TERM DEBT, NOTES PAYABLE, AND CONVERTIBLE DEBENTURES:

     The notes payable as of December 31, 1998 are summarized as follows:


   Note payable, at 18% to stockholder, due June 1999,
       collateralized by mining  properties                       $  867,037

   Notes payable, at 10%, to stockholders and/or officers/
       directors, due dates range from April 1997 through
       December 1998                                                 444,000
                                                                  ----------

           Total related party notes payable                      $1,311,037
                                                                  ==========

   Notes  payable, at 10%, due dates range from January 1, 1997
       through December 31, 1998                                  $  119,000
                                                                  ==========


     Notes payable and certain related accrued interest (totaling  approximately
     $1,069,000) are convertible to the Company's capital stock at the option of
     noteholders at a conversion  price of generally  $1.00 per share during the
     term of notes.  As of December  31,  1998,  $383,000 of the notes were past
     due. During 1998, the $867,037 past due note was extended and management of
     the Company believes the remaining past due notes will also be extended.


                                      -F10-

<PAGE>

                              LEADVILLE CORPORATION

                          NOTES TO FINANCIAL STATEMENTS



     Convertible debentures as of December 31, 1998 are summarized as follows:


     Ten percent convertible  debentures,  interest and principal
     due  December  1998.  The  debentures  and  related  accrued
     interest are  convertible to the Company's  capital stock at
     the option of the debenture holders at a conversion price of
     $1.00 per share, collateralized by mining properties.           $440,000
                                                                     ========


5.   COMMITMENTS AND CONTINGENCIES:

     Environmental  Litigation - In the mid-1980s,  the Company was named as one
     of several  defendants  in certain legal  actions  involving  environmental
     matters.  The  plaintiffs in these  actions,  the State of Colorado and the
     Federal  Government,  alleged  that the  defendants  were liable  under the
     Comprehensive  Environmental  Response,  Compensation  and Liability Act of
     1980  (CERCLA) in  connection  with mining and  related  activities  in the
     California Gulch Superfund Site near Leadville,  Colorado. The actions were
     consolidated.

     The  Company and  litigation  counsel  believed  they had  substantial  and
     meritorious  defenses to the claims  being made.  However,  in an effort to
     expedite a conclusion and to minimize legal costs,  the Company agreed to a
     settlement of the cases.

     During August 1993, a consent decree was entered by the U.S. District Court
     in  Colorado  whereby  the United  States  agreed to settle  the  Company's
     alleged liability, with the exception of natural resources damages, if any,
     in consideration for $3,000,000 to be paid to the Environmental  Protection
     Agency (EPA). Under the terms of the consent decree, a total of $250,000 is
     to be paid by the Company  over 15 years,  with a  contingent  liability of
     $2,750,000 to be paid based on profitable operations or sale of properties.
     Minimum payments are to be $10,000 for years 1 through 5, $15,000 for years
     6 through 10, and  $25,000  for years 11 through 15. This total  amount has
     been  recorded  as a  liability  and with the  amounts  currently  past due
     included in accrued  liabilities  and the long-term  portion  included as a
     settlement  of  litigation  liability.  The  Company  has not made any cash
     payments towards this liability.

     The EPA has acknowledged the receipt of soil and rock materials from one of
     Leadville's  mining  property.  The Company has invoiced the EPA $3,880,330
     for what it  believes  to be the fair  market  value of this soil and rock.
     However,  the EPA has not yet agreed to the fair value of the soil and rock
     and as such, the Company will not record this transaction until the parties
     have agreed to its value and collectibility is assured.  Under the terms of
     the  settlement,  the EPA has the  right  to  demand  full  payment  of the
     $3,000,000  if the yearly  payments are not paid  according to the terms of
     the  agreement.  The Company,  however,  believes  that, at a minimum,  the
     transfer to soil and rock  material has  satisfied the minimum cash payment
     obligation under the consent decree.

     Certificates  of  Deposit  - The  Company  is  required  by  the  State  of
     Colorado/Mined  Land Reclamation Board to maintain  certificates of deposit
     for future reclamation costs. No future reclamation costs have been accrued
     as of December 31, 1998.

                                      -F11-

<PAGE>

                              LEADVILLE CORPORATION

                          NOTES TO FINANCIAL STATEMENTS



6.   RELATED PARTY TRANSACTIONS:

     As discussed in Note 4, certain  officers,  directors and stockholders have
     provided  significant  loans to the Company.  The  aggregate  indebtedness,
     including accrued interest,  and other payables,  amounted to approximately
     $5,859,662 at December 31, 1998.  Total interest expense to these officers,
     directors  and  stockholders  was $485,572 and $385,648 for the years ended
     December 31, 1998 and 1997, respectively.

     The  Company  leases  office  space on a  month-to-month  basis from a past
     officer of the Company for $125 per month.  This individual is a partner in
     an  accounting  firm  which  performs  bookkeeping,  accounting  and  other
     administrative  services for the  Company.  Fees for such rent and services
     totaled $23,225 and $64,235 for the years ended December 31, 1998 and 1997,
     respectively.  As of December 31, 1998 and 1997,  the Company owed the firm
     $3,543 and  $2,116,  respectively,  which is  included  in  amounts  due to
     officers/directors/stockholders.

     As of  December  31,  1998,  the Company  owed two  officers  $183,500  for
     compensation,  including an office,  equipment, and management allowance of
     approximately $2,000 each per month.

     See Note 8 for additional related party transactions.


7.   INCOME TAXES:

     The  following  items  give rise to a  long-term  deferred  tax asset as of
     December 31, 1998, which has been fully reserved:


       Inventory reserve for obsolescence                    $    68,000
       Adjusted basis differential - depletable properties       672,000
       EPA settlement liability                                   75,000
       Net operating loss carryforward                         3,570,000
       Other                                                      65,000
                                                             -----------
       Deferred tax asset                                      4,450,000
       Less valuation allowance                               (4,450,000)
                                                             -----------

             Net deferred tax asset                          $      --
                                                             ===========


     At December 31, 1998,  the Company has  available  tax net  operating  loss
     carryforwards of approxi mately $9,575,000, which can be utilized to offset
     future  taxable  income.  Utilization  of these loss  carryforwards  may be
     limited due to changes in ownership  of the  Company,  and they expire from
     1998 through 2018.  The valuation  allowance was $4,202,000 at December 31,
     1997 and increased by $248,000 for the year ended December 31, 1998.


                                      -F12-

<PAGE>

                              LEADVILLE CORPORATION

                          NOTES TO FINANCIAL STATEMENTS


8.   STOCKHOLDERS' EQUITY:

     During     the     year     ended     December     31,     1997     certain
     officers/directors/stockholders  of the Company agreed to convert principal
     amounts  of  notes  payable  and  accrued  interest  totaling  $169,205  to
     restricted capital stock at a price of $1.00 per share.

     During the year ended December 31, 1998,  the Company  issued  officers and
     others  300,000 and 3,000 shares of common stock,  respectively,  valued at
     $228,000, for services.

     During the year  ended  December  31,  1997,  the  Company  issued  certain
     officers   and  others   178,000  and  43,168   shares  of  common   stock,
     respectively, valued at $177,968, for services.


9.   FAIR VALUE OF FINANCIAL INSTRUMENTS:

     The  estimated  fair values for  financial  instruments  are  determined at
     discrete  points  in time  based  on  relevant  market  information.  These
     estimates  involve  uncertainties  and cannot be determined with precision.
     The carrying amounts of cash,  certificates of deposit,  accounts  payable,
     accrued  liabilities,  notes  payable,  convertible  debentures,  and other
     payables  approximates  fair value  because of the  short-term  maturity of
     those  instruments.  The carrying  amount of the  settlement  of litigation
     liability  approximates  fair value as a result of the Company  discounting
     this liability at the Company's effective borrowing rate.


10.  CONCENTRATIONS OF CREDIT RISK:

     Credit risk  represents the accounting loss that would be recognized at the
     reporting  date  if   counterparties   failed   completely  to  perform  as
     contracted. Concentrations of credit risk (whether on or off balance sheet)
     that arise from  financial  instruments  exist for groups of  customers  or
     counterparties when they have similar economic  characteristics  that would
     cause  their  ability  to  meet  contractual  obligations  to be  similarly
     effected by changes in economic or other conditions.

     Financial  instruments  that  subject the Company to credit risk consist of
     certificates  of deposit  which are $4,265 in excess of  Federally  insured
     amounts.


                                      -F13-



<PAGE>


                                   SIGNATURES


     Pursuant to the  requirements of Section 13 of the Securities  Exchange Act
of 1934,  the  Registrant  has duly caused this Report to be signed on April 15,
1999 on its behalf by the undersigned, thereto duly authorized.


                                            LEADVILLE CORPORATION


Date:      April 15, 1999                   By: /s/ John H. Gasper
                                               John H. Gasper
                                               President, Chairman


Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities and on the date indicated.


Dated:      April 15, 1999                  By: /s/ John H. Gasper
                                                     John H. Gasper
                                                     President, Chairman

Dated:      April 15, 1999                  By: /s/ Dr. Robert G. Risk
                                                     Dr. Robert G. Risk
                                                     Director, Chairman Emeritus

Dated:      April 15, 1999                  By: /s/ Lloyd L. Morain
                                                     Lloyd L. Morain
                                                     Director

Dated:      April 15, 1999                  By: /s/ James C. Tiffany
                                                     James C. Tiffany
                                                     Director



                                      -14-