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

                                   FORM 10-QSB

(MARK ONE)

         [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED June 30, 2000

         [ ]      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 ______________

                              ISM HOLDING CORP.
                              -----------------
       (EXACT NAME OF SMALL BUSINESS ISSUER AS SPECIFIED IN ITS CHARTER)

           INDIANA                                        35-2020266
           -------                                        ----------
 (State or other jurisdiction                           (IRS Employer
of incorporation or organization)                      Identification No.)

                   5811 W. 73RD STREET, INDIANAPOLIS, IN 46268
                   -------------------------------------------
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                 (317) 328-4858
                                  --------------
                           (ISSUER'S TELEPHONE NUMBER)

                                 NOT APPLICABLE
                                 --------------
         (FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF CHANGED
                               SINCE LAST REPORT)

         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act of 1934 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  [ ]

         On September 30, 2000 the Registrant had outstanding 16,257,480 shares
of Common Stock par value $0.01 per share.

<PAGE>

                               ISM HOLDING CORP.
                                -----------------

                                   FORM 10-QSB
                                   -----------

PART I
------

ITEM 1            DESCRIPTION OF BUSINESS

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

ITEM 3            DESCRIPTION OF PROPERTIES

ITEM 4            SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
                  OWNERS AND MANAGEMENT

ITEM 5            DIRECTORS, OFFICERS, PROMOTERS & CONTROL PERSONS

ITEM 6            EXECUTIVE COMPENSATION

ITEM 7            CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

ITEM 8            DESCRIPTION OF SECURITIES


PART II
-------

ITEM 1            MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON
                  EQUITY AND OTHER SHAREHOLDER MATTERS

ITEM 2            LEGAL PROCEEDINGS

ITEM 3            CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
                  AND FINANCIAL DISCLOSURE

ITEM 4            RECENT SALES OF UNREGISTERED SECURITIES

ITEM 5            INDEMNIFICATION OF DIRECTORS AND OFFICERS

ITEM 6            SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

PART F/S
--------

                  FINANCIAL STATEMENTS


PART III
--------

ITEM I            INDEX TO EXHIBITS

ITEM 2            DESCRIPTION OF EXHIBITS

SIGNATURES

                                       2


<PAGE>

                                     PART I


ITEM 1. DESCRIPTION OF BUSINESS

THE COMPANY

From 1993 to 1998 the Company operated primarily in the sports management
business servicing clients requiring corporate sponsorship. The Company either
represented entities needing sponsorship, or corporations who required entities
as their representatives. In the fourth quarter of 1999 and all of 2000 the
Company focused efforts on reorganization. Potential acquisitions have been
evaluated for their contribution to earnings and use of capital as a return on
investment.

The Company is evaluating acquisition opportunities, as well as additional
strategic partners for expanding the incremental revenue opportunities the
Company's worldwide network provides.

MARKET ENVIRONMENT

The Company operates in the sports management and sales industry. The Company
has reduced it's overhead by concentrating sales efforts with commissioned
agents in lieu of a dedicated salaried sales force. Additionally the Company has
concentrated efforts on higher margin sales, and eliminated capital intensive
and lower margin sales. The company has been focusing on alliance partners and
acquisition opportunities outside their existing markets.

INDUSTRY ANALYSIS

The Company has used it's experience in motorsports to create
business-to-business alliances where the Company receives a percentage of the
sale from the alliance. This moves the Company from a narrow focus of sports, to
a focus of creating alliances, which increase clients overall business. This
change in focus has lessened the competition, and at the same time broadened the
base for the Company's sales activity. Acquisition candidates are being reviewed
outside the industry and will be evaluated on shareholder value.

MARKET SEGMENT

The company has been focusing on alliance partners and acquisition opportunities
outside their existing markets. At the present time it is not known what market
the company will pursue, but the acquisition will be evaluated based on cash
flow and return on shareholder equity.

<PAGE>

COMPETITION

The sports marketing industry is there are over 10,000 companies that provide
services in the sports marketing and management business. Specialization in
motorsports allows the Company to compete with approximately 200 companies with
extensive business experience in sports, the Company is in a position to provide
expertise to corporate clients who desire representation in sports.


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

The following is a discussion of the financial condition and results of
operation of the Company as of the date of this Registration Statement. This
discussion and analysis should be read in conjunction with the Company's audited
Consolidated Financial including the Notes thereto which are included elsewhere
in this form 10-SB.

GENERAL

ISM Holding is located in Indianapolis Indiana. For all of 2000 the Company
focused efforts on reorganization. Potential acquisitions have been evaluated
for their contribution to earnings and use of capital as a return on investment.

The company continued with programs begun before the reorganization. These
revenues assisted in the companies reorganization. It is expected that an
alliance with a merger partner will be finalized in the first 6 months of 2001.


         2000 vs. 1999
         -------------

NET INCOME

For the quarter ended December 31, 2000, revenue was $21,500 a decrease of
$181,584. The Company produced a profit for the three months Year to Date of
$60. As the company focused on acquisitions revenues from existing operations
was limited to existing contracts and revenues. The company continues to honor
existing contracts, and will have revenues associated with those contracts in
future periods.

COSTS AND EXPENSES

Total Operating Expenses in the quarter were reduced to $15,120. Labor and
operations expenses continued to decreased significantly as the Company focused
on acquisition, and eliminated expenditures that did not directly effect
profits. Overhead was reduced allowing for profitability with reduced sales.

                                       4
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

         2000 vs. 1999
         -------------

As of December 31, 2000, the Company had paid in capital of $2,947,475. The
Company did not change paid in capital in the quarter.

The Company's Officers have provided funds to the Company from time to time to
provide additional working capital. The Company has negotiated a line of credit
from an equity investor should the Company need additional funding for expansion
or acquisition. The officers of the Company will provide the stock from their
holdings to the accredited investor eliminating the need for dilution at this
time.

         3 Months Ended , 2000 AND 1999
         ------------------------------

As of December 31, 1999, the Company had paid in capital of $2,947,475. The
Company did not change paid in capital in the period. The Company has loans and
notes payable totaling $1,021,000, a reduction of $20,000 in the quarter. The
Company also reduced Accounts payable in the period by $6,094.

RECENT ACCOUNTING PRONOUNCEMENTS

There is no impact on the Company's financial statement.

FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISKS

This Registration Statement on Form 10-SB contains forward-looking statements
made pursuant to the safe harbor provisions of the Securities Litigation Reform
Act of 1995. Such statements consist of any statement other than a recitation of
historical facts and can be identified by words such as "may," "expect,"
"anticipate," "estimate," "hopes," "believes," "continue," "intends," "seeks,"
"contemplates," "suggests," "envisions" or the negative thereof or other
variations thereon or comparable terminology. These forward-looking statements
are based largely on the Company's expectations and are subject to a number of
risks and uncertainties, including but not limited to, those risks associated
with economic conditions generally and the economy in those areas where the
Company has or expects to have assets and operations. Competitive and other risk
factors affecting the Company's operations, markets, products and services and
risks relating to existing litigation, attorney general investigations, taxes
owed, and associated costs arising out of the Company's activities and the
matters discussed in this report; risks relating to changes in interest rates
and in the availability, cost and terms of financing; risks related to the
performance of financial markets; risks related to changes in domestic and
foreign laws, regulations and taxes; risks related to changes in business
strategy or development plans; risks related to the outcomes of the pending
lawsuits against the Company and the associated costs; risks associated with
future profitability; and other factors discussed elsewhere in this report and
in documents filed by the Company with the Securities and Exchange Commission.
Many of these factors are beyond the Company's control. Actual results could
differ materially from these forward-looking statements. In light of these risks
and uncertainties, there can be no assurance that the forward-looking
information contained in this registration on Form 10-SB will, in fact, occur.
The Company does not undertake any obligation to revise these forward-looking
statements to reflect future events or circumstances and other factors discussed
elsewhere in this report and the documents filed by the Company with the
Securities and Exchange Commission.


ITEM 3. DESCRIPTION OF PROPERTIES

The Company's principal executive and administrative offices are located in a
leased premises in Indianapolis Indiana . The Company does not expect to require
additional facilities, however acquisitions may have existing facilities that
may or may not allow for consolidation.

                                       5
<PAGE>

ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following tables set forth certain information regarding the beneficial
ownership of the Company's Common Stock as of December 31, 1999 by (i) each
person (or group of affiliated persons who to the knowledge of the Company is
the beneficial owner of five percent or more of the Company's outstanding Common
Stock, (ii) each director and each Named Executive Officer of the Company and
(iii) all directors and executive officers of the Company as a group. Except as
otherwise noted, the Company believes that the persons listed in this table have
sole voting and investment power respecting all shares of Common Stock owned by
them. The business address of each director and named Executive Officer listed
below is the Company's corporate address, 5811 W. 73rd Street Indianapolis, IN
46268.

Table 1.  Security Ownership of Certain Beneficial Owners
---------------------------------------------------------

Asia Equities is an accredited investor in accordance with the rules and
regulations of the 504D. Asia Equities has no beneficial ownership in the
securities owned by Management. There are no options, warrants or any
instruments allowing for acquisition of shares outstanding at this time.


TITLE OF CLASS        NAME AND ADDRESS          AMOUNT AND           PERCENT
                    OF BENEFICIAL OWNER         NATURE OF            OF CLASS
                                             BENEFICIAL OWNER
--------------------------------------------------------------------------------
Common Stock           Asia Equities            4,900,000             30.14%

The increases came from Mr. Hancher and Mr. Outlaw agreeing to provide
restricted shares for equity infusion as agreed to avoid general dilution of
shareholder value.


Table 2.  Security Ownership of Management
------------------------------------------

TITLE OF CLASS        NAME AND ADDRESS            AMOUNT AND          PERCENT
                    OF BENEFICIAL OWNER           NATURE OF           OF CLASS
                                              BENEFICIAL OWNER
--------------------------------------------------------------------------------
Common Stock           L.G. Hancher Jr.           3,635,000            22.36%
Common Stock           G.B. Outlaw                1,600,000             9.8%


ITEM 5.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The following table sets forth certain information as of the date of this
Registration Statement with respect to the directors and executive officers of
the Company. A summary of the background and experience of each of these
individuals is set forth after the table. The executive officers serve at the
discretion of the Company's Board of Directors. None of the officers are related
to the other. At the present time the directors do not hold directors positions
with other Public companies.


      NAME                AGE         POSITION WITH THE COMPANY
      ----                ---         -------------------------
L.G. Hancher Jr.          46          C.E.O., Director
Kevin Simpson             47          Director
G.B. Outlaw               42          Director


Mr. Hancher and Mr. Outlaw have been board members since the Company's 504D
filing in July of 1998.

Mr. Hancher has extensive sports management experience, and has operated
Motorsports teams for 15 years.

Mr. Outlaw has been a marketing executive in sports for 10 years, with extensive
Experience in corporate sports sales.

Mr. Simpson has over 15 years experience operationally in Public companies.

Mr. Hancher, Simpson, and Outlaw have 2-year terms. Mr. Hancher and Mr. Outlaw
Expiring in 2000, and Mr. Simpson in 2001. The elections will take place at the
annual Board of Director and Shareholder meeting in 2000.

                                       6
<PAGE>

ITEM 6. EXECUTIVE COMPENSATION

As of the date of filing, the officers of the company, Mr. Hancher, Mr. Simpson,
and Mr. Outlaw do not take a salary, Mr. Hancher had commissions payable of
$30,250 as compensation covered by Item 402 of Reg S-B.

ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

During the preceding two years the Company has received loans from management
from time to time. The loans were at market interest rates, and unsecured.
Additionally, the Company has negotiated an equity credit facility with Asia
Equities, a shareholder of record holding greater than 5% of the Company's
common stock. This equity facility is exclusively for acquisition or Debt
reduction. The company is in negotiation at the present time for an acquisition
with this credit line.


ITEM 8. DESCRIPTION OF SECURITIES

COMMON STOCK

The Company has 50,000,000 authorized shares of Common Stock, $0.01 par value
per share, of which 16,257,480 shares are issued and outstanding as of December
30, 1999. All shares of Common Stock outstanding are legally issued, fully paid
and non-assessable. Holders of the Common Shares are entitled to one vote per
share with respect to all matters that are required by law to be submitted to a
vote of the shareholders. Holders of the Common Stock are not entitled to
cumulative voting. The common Stock has no redemption, preemptive or sinking
fund rights. Holders of the Common Stock are entitled to dividends, when, as and
if declared by the Board of Directors from funds legally available therefore.
Future dividend policy will be determined by the Board of Directors of the
Company in light of financial need and earnings, if any, of the Company and
other relevant factors. In the event of liquidation, dissolution or winding up
of the Company, holders of Common Stock are entitled to share proportionately
all the remaining assets of the Company, after satisfaction of the liabilities
of the Company.

PREFERRED STOCK

The Company is authorized to issue 10,000,000 shares of preferred stock, par
value $0.01 per share, issuable in such series and bearing such voting,
dividend, conversion, liquidation and other rights and preferences as the Board
of Directors may determine without further action by the Company's shareholders.
As of the date hereof, there are no shares of Preferred Stock issued and
outstanding.

TRANSFER AGENT

The transfer agent for the Company is Atlas Stock Transfer Company, whose
address is 5899 S. State Street, Salt Lake City, Utah 84107.

                                       7
<PAGE>

                                     PART II


ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
        OTHER STOCKHOLDER MATTERS

The Company's Common Stock is quoted on the OTC Bulletin Board under the symbol
"ISMH." On December 11, 1997 the Board of Governors of the National Association
of Securities Dealers, Inc. ("NASD") approved a series of changes for the OTC
Bulletin Board which affect the Company. The principal changes include: (i) a
rule that only those companies that report their current financial information
to the Securities and Exchange Commission, banking or insurance regulators will
be included for quotation on the OTC Bulletin Board, (ii) that brokers must
review current financial statements on a Company they are recommending before
they recommend a transaction in an OTC security, and (iii) that prior to the
initial purchase of an OTC security, every investor must receive a standard
disclosure statement prepared by the NASD emphasizing the differences between
the OTC securities and other market-listed securities, such as those traded on
the NASDAQ Stock Market, Inc. This Registration Statement is being filed on Form
10-SB with the Securities and Exchange Commission to register the Company's
Common Stock under Section 12(g) of the Securities Exchange Act of 1934, as
amended, to comply with the above-stated rule change. In the event the Company's
proposed Registration Statement is not declared effective, the Company's
securities would not be eligible for continued quotation on the OTC Bulletin
Board, which would materially and adversely affect the liquidity in the
Company's Common Stock.

PRICE RANGE OF COMMON STOCK

In January of 1999, the Company obtained the symbol, "ISMH" and application was
made for trading on the NASD OTC Bulletin Board system. The first active trading
in the shares of the Company began in January 1999. The following table sets
forth for the periods indicated the high and low closing prices of the Company's
Common Stock as reported on the OTC Bulletin Board. The following quotations are
over-the-market quotations and, accordingly, reflect inter-dealer prices,
without retail mark-up, mark-down or commission and may not represent actual
transactions.

                COMMON STOCK


    QUARTER                          TRADE
                                      HIGH
                                       LOW

----------------------------------------------
4th Quarter 1999                      1.250
                                       .06
----------------------------------------------
1st Quarter 2000                       .50
                                       .06
----------------------------------------------
2nd Quarter 2000                       .35
                                       .06
----------------------------------------------
3rd Quarter 2000                       .3750
                                       .03


NO DIVIDENDS ANTICIPATED TO BE PAID

The Company has not paid any cash dividends on its Common Stock since its
inception and does not anticipate paying cash dividends in the foreseeable
future. The future payment of dividends is directly dependent upon future
earnings of the Company, its financial requirements and other factors to be
determined by the Company's Board of Directors, in its sole discretion. For the
foreseeable future, it is anticipated that any earnings which may be generated
from the Company's operations will be used to finance the growth of the Company,
and that cash dividends will not be paid to Common Stockholders.

                                       8


<PAGE>

CONTROL OF THE COMPANY; POSSIBLE ISSUANCES OF PREFERRED STOCK

Due to the widely dispersed ownership of the issued and outstanding shares of
Common Stock of the Company and the number of shares owned by management, the
Company's officers and directors and will be able to influence the election of
all of the Company's directors and thereby control the operations of the
Company. In addition, the Board of Directors has the authority to issue up to
10,000,000 shares of preferred stock and to fix the dividend, liquidation,
conversion, redemption and other rights, preferences and limitation of such
shares without any further vote or action of the shareholders. Accordingly, the
Board of Directors is empowered, without shareholder approval, to issue
preferred stock and dividend, liquidation, conversion, voting or other rights
which could adversely affect the voting power or the rights of the holders of
the Company's Common Stock. In the event of issuance, the preferred stock could
be utilized, under certain circumstances, as a method of discouraging, delaying
or preventing a change in control of the Company. Although the Company has no
present intention to issue any additional shares of its preferred stock, there
can be no assurance that the Company will do so in the future. See Part 1, Item
8. "DESCRIPTION OF SECURITIES."


ITEM 2. LEGAL PROCEEDINGS

The Company is subject to claims and lawsuits that arise in the ordinary course
of business. It is the opinion of management that the disposition or ultimate
resolution of such claims and lawsuits will not have a material adverse effect
on the consolidate financial position of the Company.


ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

T.J. Sullivan & Company is the Company's independent auditor at the present
time. Geo. S. Olive Company was the auditor for the Company in 1997. Upon review
by the board of directors, the Company decided to change companies in 1998,
based on costs for like services. The Company has no disagreements with the
reports issued by either auditors.


ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES

The Company has not offered unregistered securities since the 504D placement in
1998.


ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Company's Bylaws provide that the Company will indemnify its directors and
executive officers and may indemnify its other officers, employees and agents.
The Company is also empowered under its Bylaws to enter into indemnification
agreements with its directors and officers and to purchase insurance on behalf
of any person it is required or permitted to indemnify.

There is no pending litigation or proceeding involving a director or officer of
the Company as to which indemnification is being sought, nor is the Company
aware of any pending or threatened litigation that may result in claims for
indemnification by any director or officer.


ITEM 6. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters have been submitted to a vote of the stockholders of the Company
during the past three years through the date of this Registration Statement.

                                       9


<PAGE>

                       ISM HOLDING CORP. AND SUBSIDIARIES

                        Consolidated Financial Statements
                                  June 30, 2000
                       ISM HOLDING CORP. AND SUBSIDIARIES
                                    UNAUDITED


                                TABLE OF CONTENTS


                                                                            PAGE
                                                                            ----
FINANCIAL STATEMENTS

         Consolidated Statement of Income .................................  11

         Consolidated Balance Sheet .......................................  12

         Consolidated Statement of Stockholders' Equity (Deficit)..........  13

         Consolidated Statement of Cash Flows .............................  13

         Notes to Consolidated Financial Statements .......................  14

                                       10


<PAGE>

ISM HOLDING CORP. AND SUBSIDIARIES

                        CONSOLIDATED STATEMENT OF INCOME

                                  Quarter ENDED
                                December 31,2000
                                    UNAUDITED
                                               1st QUARTER

                                          2000            2001
                                      ------------    ------------
REVENUE
     Sponsorship                      $     5,000     $   16,500
     Other sales                      $    40,183     $    5,000
                                      ------------    ------------
          TOTAL REVENUE               $    45,183     $   21,500


OPERATING EXPENSES

     Salaries and wages               $         -     $        -
     Rent                             $     7,000     $    4,000
     Travel                           $         -     $      199
     Payroll taxes                    $         -     $        -
     Other operating expenses         $    88,042     $    2,800
     Depreciation                     $     8,340     $    8,121
                                      ------------    ------------
          TOTAL OPERATING EXPENSES    $   103,382     $   15,120
                                      ------------    ------------

OPERATING INCOME (LOSS)               $   (58,199)    $    6,380

INTEREST EXPENSE                      $   (14,000)    $    6,320
                                      ------------    ------------

NET INCOME (LOSS)                     $   (44,199)    $       60
                                      ============    ============

<PAGE>

                                ISM HOLDING CORP.
                           CONSOLIDATED BALANCE SHEET
                                SEPTEMBER 30,2000
                                     AUDITED

                                                        2000            1999
                                                    ------------    ------------
ASSETS

CURRENT ASSET
    Cash                                            $    11,229     $    15,719
PROPERTY AND EQUIPMENT
    Transportation equipment                        $    85,868     $    98,476
    Telephone and computer equipment                $   238,420     $   238,420
    Furniture, fixtures, & equipment                $   146,820     $   146,820
                                                    ------------    ------------
           Total Cost                               $   471,108     $   483,716
    Accumulated depreciation                        $  (385,504)    $  (377,383)
                                                    ------------    ------------
                                                    $    85,604     $   106,333
                                                    ------------    ------------

                                                    $    96,833     $   122,052
                                                    ============    ============
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)

CURRENT LIABILITIES
    Lines of credit                                 $   240,000     $   260,660
    Note payable                                    $   781,049     $   781,049
    Accounts payable                                $   665,820     $   671,914
    Other accrued expenses                          $         0     $    21,025
                                                    ------------    ------------
           Total current liabilities                $ 1,686,869     $ 1,734,648

LONG-TERM DEBT
    Notes payable - related parties                 $    22,500     $    22,500
                                                    ------------    ------------
                                                    $ 1,709,369     $ 1,757,148

STOCKHOLDERS' EQUITY (DEFICIT)
    Common stock, $.01 par value                    $   162,575     $   162,575
        Authorized - 50,000,000 share
        Issued and outstanding - 16,257,480
          shares
    Additional paid-in capital                      $ 2,947,475     $ 2,947,475
    Accumulated deficit                             $(4,722,586)    $(4,722,646)
                                                    ------------    ------------
                                                    $(1,612,536)    $(1,612,596)
                                                    ------------    ------------

                                                    $    96,833     $   122,052
                                                    ============    ============

<PAGE>
<TABLE>


                           ISM HOLDING CORP. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)

<CAPTION>
                                 ADDITIONAL
                                   NUMBER          COMMON      PAID-IN      ACCUMULATED
                                   SHARES          STOCK       CAPITAL         DEFICIT        TOTAL
----------------------------------------------------------------------------------------------------------

<S>                               <C>             <C>         <C>            <C>           <C>
BALANCES: September 30, 2000      16,257,480      $162,575    $2,947,475     $(4,722,646)  $(1,612,596)

          December 31, 2000       16,257,480       162,575     2,947,475     $(4,722,586)  $(1,612,536)

=========================================================================
</TABLE>



See notes to Consolidated Financial Statements.

<PAGE>
<TABLE>

                       ISM HOLDING CORP. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENT OF CASH FLOWS

                          Quarter Ended December 31,2000
----------------------------------------------------------------------------------------------------
<CAPTION>


                                                                           2000             2001
                                                                        ------------    ------------
<S>                                                                     <C>             <C>
OPERATING ACTIVITIES
         Net Income (loss)                                              $   118,009     $        60
         Adjustments to reconcile
         net cash used by operating activities
                  Depreciation                                               80,860           8,121
                  Gain on sale of assets
                  Changes in assets and liabilities
                           Accounts payable                                (116,404)         (6,094)
                           Accrued expenses                                 (82,766)              0
                                                                        ------------    ------------
                                    Net cash by operating activities    $      (301)    $     2,087

INVESTING ACTIVITIES
         Sales of property & equipment                                       51,365           5,288
         Payments on notes receivable - related party                             0               0
                                                                        ------------    ------------
                  Net cash by investing activities                           51,365           5,288

FINANCING ACTIVITIES
         Proceeds from Paid in capital                                            0               0
         Reduction of long-term debt - related parties                            0               0
         Reduction of debt                                                 (120,320)        (11,865)
                                                                        ------------    ------------
                  Net cash provided by financing activities                (120,320)        (11,865)
                                                                        ------------    ------------

NET CHANGE IN CASH                                                          (69,256)         (4,490)

CASH: BEGINNING OF YEAR                                                      84,975          15,719
                                                                        ------------    ------------

CASH: END OF YEAR                                                       $    15,719     $    11,229
                                                                        ============    ============

</TABLE>


See notes to Consolidated Financial Statements.
<PAGE>

                       ISM HOLDING CORP. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF OPERATIONS

ISM Holding Corp. (the Company) became a public company, receiving its
OTCBB:ISMH symbol December 4, 1998 and began trading January 4, 1999. The
Company's core business is sponsorship solicitation for Company owned teams, or
for others.

The Company funds its operations through corporate sponsorship for its teams and
obtains sponsorship commissions from various people and entities. The
preparation of financial statements in conformity with generally accepted
accounting principals requires management to make estimates and assumptions that
effect reported amounts of assets, liabilities, and disclosure of contingent
assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual results may
differ from those estimates.

CASH

Cash consists of bank deposits in federally insured accounts.

PROPERTY AND EQUIPMENT

Property and equipment are carried at cost. Depreciation is computed using the
straight-line methods over a useful life of three to seven years. Racecars and
car parts are expensed in the year purchased due to the short life span of such
assets. This is consistent with accounting practices and standards within the
racing industry. When assets are retired or otherwise disposed of, the costs and
related accumulated depreciation are removed from the accounts, and any
resulting gain or loss is recognized in income for the period. The cost of
maintenance and repairs is charged to income as incurred; significant renewals
and improvements are capitalized.

INCOME TAXES

The Company has elected to be treated as an C - Corporation for income tax
purposes as provided in Section 1362(a) of the Internal Revenue Code. The
Company is currently amending returns for 1998,1999,2000 and expect a small
refund.

SPONSORSHIP REVENUE

The Company obtains a significant amount of financing through sponsorship
agreements. Various commercial enterprises will fund the Company's automobile
racing activities (in the form of cash or in-kind contributions) in exchange for
advertising on Company racecars and other equipment.


NOTE 2 - LINES OF CREDIT

The Company has converted the lines of credit to a note. At December 31, 2000,
there was a total of $260,000 borrowed and principle and interest at 8.5% is
payable monthly.


NOTE 3 - NOTE PAYABLE

The Company has a $750,000 90-day note payable that has matured at December 31,
1999. The note is collateralized by substantially all of the Company's assets
and is guaranteed by two stockholders. Interest is 8.5% and is payable monthly.

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<PAGE>

NOTE 4 - LEASES

The Company leases operating facilities and various items of equipment and
vehicles under noncancellable operating lease arrangements. These leases expire
at various dates during 2000. Rental expense for these leases included in the
income statement for the year ended December 31, 1999 was $142,465.

During 1999 all leases, with the exception of the operating facility and one
vehicle, were transferred to eliminate liability for the Company. No new leases
will be entered into without Board of Director approvals.

Minimum annual rental payments required under operating leases that have
remaining terms in excess of one year as of December 31, 1998 are as follows:

YEARS ENDING DECEMBER 31
--------------------------------------------------------------------------------
2000                                                                   $ 24,304
                                                                       ---------

NOTE 5 - EMPLOYEE BENEFITS

The employee benefit plan for Company contribution to the 401K plan was
cancelled in June of 1999.The employees received their vested share from the
plan. No additional expenses were incurred.


NOTE 6 - RELATED PARTY TRANSACTIONS

At December 31, 1998, the Company had an outstanding note payable to one of its
stockholders totaling $22,500. This note is unsecured, payable upon demand, and
bears no interest. However, payment is not expected within the next fiscal year,
therefore the amount is classified as Long Term.


NOTE 7 - CONTINGENT LIABILITIES

The Company is subject to claims and lawsuits that arise in the ordinary course
of business. It is the opinion of management that the disposition or ultimate
resolution of such claims and lawsuits will not have a material adverse effect
on the consolidate financial position of the Company.


NOTE 8 - YEAR 2000

The Company was properly prepared and had no effect of year 2000 problems.


NOTE 9 - CONCENTRATIONS

The Company purchases significant components (such as chassis and engine parts)
for its racecars from a limited number of suppliers. Although few suppliers
exist, the Company believes components can be purchased from others on
comparable terms and prices without adversely affecting the Company.

As noted, the Company obtains a significant amount of financing through
sponsorship agreements. The sponsorship agreements typically have lives of one
to several years. The Company must continually renew such agreements or obtain
new ones in order to remain in operations without an adverse impact on the
organization. The Company is working to avoid concentrations, but has no
guarantee concentrations will not continue to be a problem.


NOTE 10 - SUBSEQUENT EVENTS

There have not been significant changes to the Company's corporate structure in
2000. The Company had already reduced overhead, and eliminated salaries not tied
to a specific income stream. The company maintains focus on acquisition
opportunities and is concentrating on a completion of such activities in the
next 90 days. The company is currently evaluating a non-binding letter of intent
and will announce the results of the evaluation when they are available.

In 2000 the Company has made principal payments against the lines bringing the
balance to $200,000 and has reached an agreement with the lender to pay the
remaining balance in monthly installments.

The Company is currently negotiating payment arrangements with National City
Bank, the holder of the $750,000 note. The Company's management believes
satisfactory arrangements will be agreed.

                                       15


<PAGE>

                                   SIGNATURES


In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                                  ISM Holding



                                              By: /S/ L.G. Hancher Jr.
                                                  ------------------------------
                                                  L.G. Hancher Jr. C.E.O.

Date:   February 20, 2001

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