UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                                     Form 10-KSB



(Mark one)

[X]  Annual Report Under Section 13 or 15(d) of the  Securities  Exchange Act of
     1934

       For the fiscal year ended June 30, 2007

[ ]  Transition Report Under Section 13 or 15(d) of the Securities  Exchange Act
     of 1934

       For the transition period from ______________ to _____________



                         Commission File Number: 0-21071

                               Nevstar Corporation
        (Exact name of small business issuer as specified in its charter)

        Nevada                                               88-0309578
-----------------------                              --------------------------
(State of incorporation)                               (IRS Employer ID Number)

                      12890 Hilltop Road, Argyle, TX 76226
                      ------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (972) 233-0300
              (Registrant's telephone number, including area code)



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

        Securities registered under Section 12(g) of the Exchange Act: -
                         Common Stock - $0.01 par value



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

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

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act): Yes X    No


The issuer's revenues for the fiscal year ended June 30, 2007 were $-0-.

The aggregate market value of voting common equity held by  non-affiliates as of
September 12, 2007 was approximately  $25,417,  based on a quoted price of $0.15
per share and 169,449 shares held by non-affiliates.

As of September 12, 2007, there were 1,250,090 shares of Common Stock issued and
outstanding.

Transitional Small Business Disclosure Format : Yes    No X




<PAGE>


                               Nevstar Corporation

                                Index to Contents

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

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

Part II

Item 5     Market for Company's Common Stock and Related
              Stockholders Matters                                            14
Item 6     Management's Discussion and Analysis or Plan of Operation          15
Item 7     Financial Statements                                              F-1
Item 8     Changes in and Disagreements with Accountants
              on Accounting and Financial Disclosures                         17
Item 8A    Controls and Procedures                                            17

Part III

Item 9     Directors, Executive Officers, Promoters and Control Persons;
              Compliance with Section 16(a) of the Exchange Act               18
Item 10    Executive Compensation                                             22
Item 11    Security Ownership of Certain Beneficial Owners and Management
              and Related Stockholder Matters                                 23
Item 12    Certain Relationships and Related Transactions                     23
Item 13    Exhibits and Reports on 8-K                                        23
Item 14    Principal Accountant Fees and Services                             23

Signatures                                                                    25





                                                                               2

<PAGE>

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

Certain  statements  contained  in  this  annual  filing,   including,   without
limitation, statements containing the words "believes", "anticipates", "expects"
and  words  of  similar  import,  constitute  forward-looking  statements.  Such
forward-looking  statements  involve known and unknown risks,  uncertainties and
other factors that may cause the actual results,  performance or achievements of
the Company,  or industry  results,  to be materially  different from any future
results,   performance   or   achievements   expressed   or   implied   by  such
forward-looking statements.

Such factors include, among others, the following:  international,  national and
local general economic and market conditions:  demographic  changes; the ability
of the Company to sustain,  manage or  forecast  its growth;  the ability of the
Company to successfully make and integrate acquisitions;  raw material costs and
availability;  new product  development and  introduction;  existing  government
regulations  and  changes  in,  or  the  failure  to  comply  with,   government
regulations;  adverse publicity;  competition; the loss of significant customers
or suppliers;  fluctuations  and  difficulty in forecasting  operating  results;
changes in business strategy or development  plans;  business  disruptions;  the
ability  to attract  and  retain  qualified  personnel;  the  ability to protect
technology; and other factors referenced in this and previous filings.

Given  these  uncertainties,  readers  of this Form  10-KSB  and  investors  are
cautioned not to place undue reliance on such  forward-looking  statements.  The
Company  disclaims  any  obligation  to update any such  factors or to  publicly
announce the result of any  revisions to any of the  forward-looking  statements
contained herein to reflect future events or developments.


                                     PART I

Item 1 - Description of Business

Background and Historical Operations
------------------------------------

Nevstar  Corporation  (Company) was incorporated  under the laws of the State of
Nevada on December  2, 1993 as Mesquite  Gaming  Corp.  On October 3, 1995,  the
Company  changed its name to NevStar  Gaming  Corporation  and on September  18,
1997, changed its name to NevStar Gaming & Entertainment Corporation.

The  Company  was  formed  to  acquire,  develop,   construct,  own  and  manage
hotel/casino  projects. The Company's strategy was to concentrate its efforts on
"niche" markets, such as "local" or "neighborhood" casinos. The Company obtained
its license and related  approvals from the Nevada Gaming  Commission to conduct
gaming at its initial hotel/casino, Mesquite Star Hotel and Casino (The Mesquite
Star) in Mesquite,  Nevada,  pursuant to an Order of Registration dated June 23,
1998. On July 1, 1998,  the Mesquite  Star,  opened for business and the Company
began receiving  revenues from  operations.  The Mesquite Star was located on an
approximately 25-acre property in Mesquite, Nevada.

The Company filed a Quarterly  Report on Form 10-Q with the U. S. Securities and
Exchange  Commission ("SEC") on Form 10-Q, for the quarter ended March 31, 1999.
At that time,  the Company  owned and operated  the  Mesquite  Star, a hotel and
casino in Mesquite,  Nevada.  The Company filed no further  reports with the SEC
until  September  2002.  The  Company  has  insufficient  financial  records  or
suppporting  documentation  to recreate  these  records  for the interim  period
because those records were lost or destroyed as a result of the  foreclosure  of
the principal asset of the Company, the Mesquite Star Hotel and Casino.

During 2002,  the SEC was apprised of the Company's  deficiencies,  and a report
was filed on Form 8-K dated September 30, 2002  summarizing the events which had
occurred during the period since its last reporting.  No reports on Form 10-K or
Form 10-KSB were filed by the  Company for the any annual or  quarterly  periods
through November 22, 2002.

On December 1, 1999,  the Company  filed a voluntary  petition  for relief under
Chapter 11 (the First Chapter 11  Proceeding)  in the United  States  Bankruptcy
Court, District of Nevada (Bankruptcy Court), Case No. 99-19566RCJ.  The Company
acted as debtor in possession during the First Chapter 11 Proceeding. In part as
a result of the objections of certain of the Company's secured creditors and the
Bankruptcy Court's belief that the Company could not be successfully reorganized
in view of such objections,  the Bankruptcy Court dismissed the First Chapter 11
Proceeding on or about March 2, 2000.



                                                                               3
<PAGE>

On March 3, 2000,  Randy Black  (Black) was  appointed by the District  Court of
Clark  County,  Nevada as receiver for the  Company.  On or about March 8, 2000,
Black caused the casino to cease all  meaningful  operations  and the casino was
closed.  The Company has not  engaged in  business  operations  since that date.
Subsequently,  Black  acquired  the first trust deed on the casino from the bank
and he began foreclosure proceedings against the casino.

On July 10, 2000, the Company again filed a voluntary  petition for relief under
Chapter 11 (the Second Chapter 11 Proceeding) in the Bankruptcy  Court, Case No.
BK-S-00-15075-LBR. During the Second Chapter 11 Proceeding, the Company acted as
debtor in possession. During the course of the Second Chapter 11 Proceeding, the
Bankruptcy  Court permitted Black to foreclose on the casino,  which occurred on
November 13, 2000. In April,  2001, the Company and W/F Investment  Corp.  (W/F)
submitted to the Bankruptcy  Court a plan of  reorganization,  which was amended
from  time to time (the Plan of  Reorganization).  On  February  20,  2002,  the
Bankruptcy  Court  issued an order  confirming  the Plan of  Reorganization.  On
November 22, 2002,  the Plan of  Reorganization  became  effective.  The Company
issued 15,141,674 shares of common stock to holders of unsecured claims; 156,428
shares of common stock to certain  administrative  claimants and to a previously
secured  claim  holder,  and  27,807,219  shares  of  common  stock  to the Plan
Proponents.   The  7,583,687   shares  of  Common  Stock  that  were  previously
outstanding  were retained by the holders of those shares.  There are a total of
50,715,008 shares of common Stock outstanding after the issuance of shares under
the Plan of  Reorganization.  The Plan of  Reorganization  authorized  a reverse
split of the Common Stock, which occurred on January 12, 2006. The effect of the
reverse stock split is reflected in the accompanying  financial statements as of
the first day of the first period presented.

On September 6, 2005, the United States  Bankruptcy  Court,  District of Nevada,
issued a final  decree in the  Chapter  11  proceeding,  formally  removing  the
Company from the  oversight of the  Bankruptcy  Court and ending all  bankruptcy
proceedings.

Current Status

On October 11, 2005, the Company  entered into a Stock  Purchase  Agreement with
Halter Financial  Investments,  L.P., a Texas limited partnership (HFI) pursuant
to which the Company sold 250,000 newly issued,  restricted  post-reverse  split
shares  (75,000,000  pre-reverse  split  shares)  of its  common  stock  to HFI,
constituting a change of control of the Company.

The Company's emergence from Chapter 11 of Title 11 of the United States Code on
November 22, 2002 created the combination of a change in majority  ownership and
voting control - that is, loss of control by the then-existing  stockholders,  a
court-approved reorganization, and a reliable measure of the entity's fair value
- resulting in a fresh start,  creating,  in substance,  a new reporting entity.
Accordingly,   the  Company,   post  bankruptcy,   has  no  significant  assets,
liabilities or operating activities.  Therefore, the Company, as a new reporting
entity, qualifies as a "development stage enterprise" as defined in Statement of
Financial Accounting Standard No. 7, as amended.

The  Company's  post-bankruptcy  business  plan is to locate and combine with an
existing,  privately-held  company which is profitable or, in management's view,
has growth  potential,  irrespective  of the  industry  in which it is  engaged.
However, the Company does not intend to combine with a private company which may
be deemed to be an investment  company subject to the Investment  Company Act of
1940. A combination  may be structured as a merger,  consolidation,  exchange of
the  Company's  common  stock for stock or assets or any other  form  which will
result in the combined enterprise's becoming a publicly-held corporation.

As of the date of the accompanying  financial statements and subsequent thereto,
the Company does not have any  operations.  Accordingly,  the Company and Halter
Financial Investments, LP (HFI), an entity controlled by the Company's President
and Chief Executive Officer,  have acknowledged that outside funds are necessary
to  support  the  corporate  entity  and  comply  with  the  periodic  reporting
requirements  of the Securities  Exchange Act of 1934, as amended.  To this end,
HFI has agreed to lend the Company up to $50,000  with a maturity  period not to
exceed two (2) years from the initial  funding date at an interest  rate of 6.0%
per annum. Through June 30, 2007, HFI has advanced  approximately  $45,700 under
this agreement, with an initial scheduled maturity date in May 2008.

During  Fiscal  2007,  the Company  settled  certain  outstanding  post-petition
liabilities with various creditors  providing  professional  services during the
Company's  bankruptcy period and prior to the October 11, 2005 change in control
transaction and certain  pre-petition  liabilities with the Nevada Department of
Taxation.  As of the  date of this  report,  the  Company  has  nominal  assets,
consisting  only of cash in bank and periodic  trade accounts  payable  directly
related to the  maintenance  of the  corporate  entity and  compliance  with the
Company's  responsibilities  under  the  Securities  Exchange  Act of  1934,  as
amended; as well as the aforementioned loan payable to HFI.

The Company's equity securities are currently quoted on the Pink Sheets and have
irregular trading volumes and pricing.



                                                                               4
<PAGE>

Since the October 15, 2003 auction of the Company's  assets,  the Company may be
referred to as a reporting shell  corporation.  Shell  corporations have zero or
nominal  assets  and  typically  no stated or  contingent  liabilities.  Private
companies  wishing to become publicly  trading may wish to merge with a shell (a
reverse merger or reverse  acquisition)  whereby the shareholders of the private
company become the majority of the  shareholders  of the combined  company.  The
private  company may purchase for cash all or a portion of the common  shares of
the shell  corporation  from its major  stockholders.  Typically,  the Board and
officers  of the  private  company  become  the new  Board and  officers  of the
combined  Company and often the name of the private  company becomes the name of
the combined entity.

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

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

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

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

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

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



                                                                               5
<PAGE>

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

The  Company  does not foresee  that it will enter into a merger or  acquisition
transaction with any business with which its officers or directors are currently
affiliated. Should the Company determine in the future, contrary to the forgoing
expectations,  that a  transaction  with  an  affiliate  would  be in  the  best
interests  of the  Company  and its  stockholders,  the  Company is, in general,
permitted by Delaware law to enter into a transaction  if: The material facts as
to the  relationship  or interest  of the  affiliate  and as to the  contract or
transaction are disclosed or are known to the Board of Directors,  and the Board
in good faith  authorizes,  approves or ratifies the contract or  transaction by
the affirmative vote of a majority of the disinterested  directors,  even though
the disinterested directors constitute less than a quorum; or the material facts
as to the  relationship  or interest of the  affiliate and as to the contract or
transaction  are  disclosed  or are known to the  stockholders  entitled to vote
thereon, and the contract or transaction is specifically authorized, approved or
ratified  in  good  faith  by  vote  of the  stockholders;  or the  contract  or
transaction is fair as to the Company as of the time it is authorized,  approved
or ratified, by the Board of Directors or the stockholders.

Investigation and Selection of Business Opportunities

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

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

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

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

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

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

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



                                                                               6
<PAGE>

     o    The Company's  perception of how any particular  business  opportunity
          will be  received by the  investment  community  and by the  Company's
          stockholders;
     o    Whether,  following the business combination,  the financial condition
          of the  business  opportunity  would be, or would  have a  significant
          prospect in the foreseeable  future of becoming,  sufficient to enable
          the securities of the Company to qualify for listing on an exchange or
          on a national automated  securities  quotation system, such as NASDAQ,
          so as to permit the trading of such  securities  to be exempt from the
          requirements  of Rule 15g-9  adopted by the  Securities  and  Exchange
          Commission (See Risk Factors The Company Regulations of Penny Stocks).
     o    Capital  requirements and anticipated  availability of required funds,
          to be provided by the Company or from operations,  through the sale of
          additional securities, through joint ventures or similar arrangements,
          or from other sources;
     o    The extent to which the business opportunity can be advanced;
     o    Competitive  position as compared to other  companies  of similar size
          and  experience  within  the  industry  segment  as well as within the
          industry as a whole;
     o    Strength and diversity of existing management or management  prospects
          that are scheduled for recruitment;
     o    The cost of  participation by the Company as compared to the perceived
          tangible and intangible values and potential; and
     o    The accessibility of required  management  expertise,  personnel,  raw
          materials,  services,  professional  assistance,  and  other  required
          items.

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

No one of the factors  described above will be controlling in the selection of a
business  opportunity,  and  management  will  attempt  to analyze  all  factors
appropriate to each  opportunity and make a determination  based upon reasonable
investigative  measures  and  available  data.  Potentially  available  business
opportunities  may occur in many  different  industries and at various stages of
development,  all of which will make the task of comparative  investigation  and
analysis  of  such  business  opportunities  extremely  difficult  and  complex.
Potential  investors  must  recognize  that,  because of the  Company's  limited
capital  available for  investigation  and  management's  limited  experience in
business analysis,  the Company may not discover or adequately  evaluate adverse
facts about the opportunity to be acquired.

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

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

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

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



                                                                               7
<PAGE>

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

Form of Acquisition

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

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

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

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

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



                                                                               8
<PAGE>

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

Investment Company Act and Other Regulation

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

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

Competition

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

Employees

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

Risk Factors
------------

The  Company's  business  and plan of  operation  is  subject to  numerous  risk
factors, including, but not limited to, the following:

Limited Operating History makes Potential Difficult to Assess
-------------------------------------------------------------

The  Company has had no  operating  history  nor any  revenues or earnings  from
operations  since  2003.  All  efforts  from our  inception  through  2003  were
unsuccessful.  The Company  has no assets or  financial  resources.  The Company
will,  in  all  likelihood,  continue  to  sustain  operating  expenses  without
corresponding   revenues,   at  least  until  the  consummation  of  a  business
combination.  This  will  most  likely  result in the  Company  incurring  a net
operating loss which will increase continuously until the Company can consummate
a business  combination  with a target  company.  There is no assurance that the
Company  can  identify  such a target  company  and  consummate  such a business
combination.

There is No Agreement for a Business Combination and No Minimum Requirements for
a Business Combination
----------------------

The Company has no current arrangement,  agreement or understanding with respect
to engaging in a business  combination with a specific  entity.  There can be no
assurance  that the Company will be successful  in  identifying  and  evaluating
suitable  business  opportunities  or in concluding a business  combination.  No
particular  industry or specific  business  within an industry has been selected
for a target  company.  The Company  has not  established  a specific  length of
operating history or a specified level of earnings,  assets,  net worth or other
criteria  which it will require a target  company to have  achieved,  or without
which the Company would not consider a business  combination  with such business
entity.  Accordingly,  the Company may enter into a business  combination with a
business entity having no significant operating history,  losses,  limited or no
potential for immediate  earnings,  limited assets,  negative net worth or other
negative characteristics. There is no assurance that the Company will be able to
negotiate a business combination on terms favorable to the Company.



                                                                               9
<PAGE>

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

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

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

Only One Director and Officer
-----------------------------
Because  management  consists  of only one  person,  while  seeking  a  business
combination, Timothy P. Halter, the Company's President, will be the only person
responsible in conducting the day-to-day  operations of the Company. The Company
does not benefit from multiple  judgments  that a greater number of directors or
officers would provide,  and the Company will rely completely on the judgment of
its one  officer  and  director  when  selecting a target  company.  Mr.  Halter
anticipates  devoting only a limited amount of time per month to the business of
the Company. Mr. Halter has not entered into a written employment agreement with
the Company and he is not  expected  to do so. The Company  does not  anticipate
obtaining key man life insurance on Mr. Halter.  The loss of the services of Mr.
Halter would  adversely  affect  development  of the Company's  business and its
likelihood of continuing operations.

Dependence Upon Management, Limited Participation of Management
---------------------------------------------------------------
The Company will be entirely  dependant  upon the  experience of its officer and
director  in seeking,  investigating,  and  acquiring  a business  and in making
decisions regarding the Company's operations. Because investors will not be able
to evaluate the merits of possible future business  acquisitions by the Company,
they should critically assess the information  concerning the Company's officers
and directors. (See Management.)

Conflicts of Interest
---------------------
Certain  conflicts  of  interest  exist  between the Company and its officer and
director.  He has  other  business  interests  to  which  he  currently  devotes
attention  and is  expected  to  continue  to do so. As a result,  conflicts  of
interest  may arise that can be resolved  only through his exercise of judgement
in a manner which is consistent with his fiduciary  duties to the Company.  (See
Management, Conflicts of Interest.)

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

Possible Need For Additional Financing
--------------------------------------
The Company has very limited funds,  and such funds, may not be adequate to take
advantage  of any  available  business  opportunities.  Even  if  the  Company's
currently available funds prove to be sufficient to pay for its operations until
it is able to acquire an interest in, or complete a transaction with, a business
opportunity,  such funds will clearly not be  sufficient to enable it to exploit
the opportunity. Thus, the ultimate success of the Company will depend, in part,
upon its availability to raise additional capital. In the event that the Company
requires modest amounts of additional capital to fund its operations until it is
able to complete a business acquisition or transaction, such funds, are expected
to be  provided  by the  principal  shareholder.  However,  the  Company has not



                                                                              10
<PAGE>

investigated  the   availability,   source,  or  terms  that  might  govern  the
acquisition of the additional  capital which is expected to be required in order
to exploit a business  opportunity,  and will not do so until it has  determined
the level of need for such  additional  financing.  There is no  assurance  that
additional  capital will be available from any source or, if available,  that it
can be  obtained on terms  acceptable  to the  Company.  If not  available,  the
Company's  operations  will be limited to those  that can be  financed  with its
modest capital.

Dependence Upon Outside Advisors
--------------------------------

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

Regulation of Penny Stocks
--------------------------

The U. S. Securities and Exchange Commission (SEC) has adopted a number of rules
to regulate "penny stocks." Because the securities of the Company may constitute
"penny stocks" within the meaning of the rules (as any equity  security that has
a market  price of less than $5.00 per share or with an  exercise  price of less
than $5.00 per share,  largely traded in the National  Association of Securities
Dealers'  (NASD) OTC Bulletin Board or the "Pink Sheets",  the rules would apply
to the Company and to its  securities.  The  Commission  has adopted  Rule 15g-9
which established sales practice  requirements for certain low price securities.
Unless the transaction is exempt, it shall be unlawful for a broker or dealer to
sell a penny stock to, or to effect the purchase of a penny stock by, any person
unless  prior to the  transaction:  (i) the  broker or dealer has  approved  the
person's  account for transactions in penny stock pursuant to this rule and (ii)
the broker or dealer has  received  from the person a written  agreement  to the
transaction  setting  forth the  identity  and quantity of the penny stock to be
purchased.  In order to approve a person's  account  for  transactions  in penny
stock,  the  broker or dealer  must:  (a)  obtain  from the  person  information
concerning  the  person's  financial  situation,   investment  experience,   and
investment objectives; (b) reasonably determine that transactions in penny stock
are suitable for that person,  and that the person has sufficient  knowledge and
experience in financial matters that the person reasonably may be expected to be
capable of evaluating the risks of transactions  in penny stock;  deliver to the
person a written statement setting forth the basis on which the broker or dealer
made the determination  (i) stating in a highlighted  format that it is unlawful
for the  broker or dealer to affect a  transaction  in penny  stock  unless  the
broker or dealer has received, prior to the transaction,  a written agreement to
the  transaction  from the  person;  and (ii)  stating in a  highlighted  format
immediately  preceding  the  customer  signature  line that  (iii) the broker or
dealer is required to provide  the person with the written  statement;  and (iv)
the person  should not sign and return the  written  statement  to the broker or
dealer if it does not  accurately  reflect  the  person's  financial  situation,
investment  experience,  and  investment  objectives;  and (C) receive  from the
person a manually  signed and dated copy of the  written  statement.  It is also
required that disclosure be made as to the risks of investing in penny stock and
the  commissions  payable  to  the  broker-dealer,  as  well  as  current  price
quotations  and the  remedies  and rights  available  in cases of fraud in penny
stock transactions. Statements, on a monthly basis, must be sent to the investor
listing recent prices for the Penny Stock and information on the limited market.
Shareholders  should  be  aware  that,  according  to  Securities  and  Exchange
Commission  Release No.  34-29093,  the market for penny  stocks has suffered in
recent years from patterns of fraud and abuse. Such patterns include (i) control
of the market for the  security  by one or a few  broker-dealers  that are often
related  to  the  promoter  or  issuer;  (ii)  manipulation  of  prices  through
prearranged  matching  of  purchases  and sales and false and  misleading  press
releases;  (iii) "boiler room"  practices  involving high pressure sales tactics
and unrealistic price projections by inexperienced sales persons; (iv) excessive
and undisclosed bid ask differential and markups by selling broker-dealers;  and
(v) the wholesale dumping of the same securities by promoters and broker dealers
after prices have been manipulated to a desired level,  along with the resulting
inevitable  collapse of those prices and with consequent  investor  losses.  The
Company's  management is aware of the abuses that have occurred  historically in
the penny stock market. Although the Company does not expect to be in a position
to dictate the behavior of the market or of  broker-dealers  who  participate in
the market,  management will strive within the confines of practical limitations
to prevent the  described  patterns from being  established  with respect to the
Company's securities.

There  May  Be  A  Scarcity  of  and/or  Significant  Competition  For  Business
Opportunities and/or Combinations
---------------------------------
The  Company is and will  continue  to be an  insignificant  participant  in the
business of seeking mergers with and acquisitions of business entities.  A large
number of established  and well financed  entities,  including  venture  capital
firms,  are active in mergers and  acquisitions of companies which may be merger
or acquisition target candidates for the Company.  Nearly all such entities have
significantly  greater financial  resources,  technical expertise and managerial
capabilities  than the  Company  and,  consequently,  the  Company  will be at a
competitive  disadvantage in identifying  possible  business  opportunities  and
successfully completing a business combination.  Moreover, the Company will also



                                                                              11
<PAGE>

compete in seeking  merger or  acquisition  candidates  with other  public shell
companies, some of which may also have funds available for use by an acquisition
candidate.

Reporting Requirements May Delay or Preclude Acquisition
--------------------------------------------------------
Pursuant to the  requirements  of Section 13 of the Exchange Act, the Company is
required to provide certain information about significant acquisitions including
audited financial  statements of the acquired  company.  These audited financial
statements  must be furnished  within 4 days  following the effective  date of a
business  combination.  Obtaining audited financial  statements are the economic
responsibility of the target company.  The additional time and costs that may be
incurred by some potential target companies to prepare such financial statements
may  significantly  delay or essentially  preclude  consummation of an otherwise
desirable acquisition by the Company.  Acquisition prospects that do not have or
are unable to obtain the required audited  statements may not be appropriate for
acquisition  so long  as the  reporting  requirements  of the  Exchange  Act are
applicable.  When a  non-reporting  company becomes the successor of a reporting
company by merger,  consolidation,  exchange of securities,  and  acquisition of
assets or otherwise,  the successor  company is required to provide in a Current
Report  on Form  8-K the  same  kind  of  information  that  would  appear  in a
Registration Statement or an Annual Report on Form 10-KSB, including audited and
pro forma financial statements.  The Commission treats these Form 8-K filings in
the same way it treats the  Registration  Statements on Form 10-SB filings.  The
Commission  subjects  them  to  its  standards  of  review  selection,  and  the
Commission may issue substantive  comments on the sufficiency of the disclosures
represented.   If  the  Company  enters  into  a  business  combination  with  a
non-reporting  company,  such  non-reporting  company will not receive reporting
status  until the  Commission  has  determined  that it will not  review the 8-K
filing or all of the comments have been cleared by the Commission.

Lack of Market Research or Marketing Organization
-------------------------------------------------
The Company has neither conducted,  nor have others made available to it, market
research indicating that demand exists for the transactions  contemplated by the
Company.  In the event demand exists for a transaction of the type  contemplated
by the  Company,  there  is no  assurance  the  Company  will be  successful  in
completing any such business combination.

Probable Change in Control of The Company and/or Management
-----------------------------------------------------------
In conjunction with completion of a business acquisition, it is anticipated that
the Company will issue an amount of the Company's authorized but unissued common
stock that represents the greater majority of the voting power and equity of the
Company,  which will,  in all  likelihood,  result in  shareholders  of a target
company obtaining a controlling  interest in the Company.  As a condition of the
business combination agreement, the current shareholder of the Company may agree
to sell or transfer all or a portion of the Company's common stock he owns so to
provide the target company with all or majority control. The resulting change in
control of the Company will likely result in removal of the present  officer and
director of the Company and a  corresponding  reduction in or elimination of his
participation in the future affairs of the Company.

Possible Dilution of Value of Shares Upon Business Combination
--------------------------------------------------------------

A business  combination  normally  will  involve the  issuance of a  significant
number of additional shares.  Depending upon the value of the assets acquired in
such business combination, the per share value of the Company's common stock may
increase or decrease, perhaps significantly.

Limited or No Public Market Exists
----------------------------------

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

Registration of Shares is Required
----------------------------------
It is the SEC's position that  securities  issued by a "shell" company cannot be
sold under the  exemption  from  registration  provided by Rule 144  promulgated
under the Securities Act of 1933 (the "Act"),  but must be registered  under the
Securities  Act of 1933.  Any  other  securities  issued to  individuals  in the
capacity of management,  affiliates,  control persons and promoters will also be
registered  with the SEC prior to resale  and shall be issued  with  appropriate



                                       12
                                                                          <PAGE>

restricted  legend to reflect the  registration  requirements.  The Company will
make  appropriate  provisions  under the  Securities Act of 1933 to register the
Company's shares for resale."

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

Additional Risks Doing Business in a Foreign Country
----------------------------------------------------
The Company may  effectuate a business  combination  with a merger  target whose
business operations or even headquarters, place of formation or primary place of
business are located  outside the United States of America.  In such event,  the
Company may face the significant additional risks associated with doing business
in that country. In addition to the language barriers,  different  presentations
of financial  information,  different  business  practices,  and other  cultural
differences  and barriers  that may make it difficult to evaluate  such a merger
target,   ongoing  business  risks  result  from  the  international   political
situation,  uncertain legal systems and applications of law,  prejudice  against
foreigners,   corrupt  practices,  uncertain  economic  policies  and  potential
political and economic  instability  that may be exacerbated in various  foreign
countries.

Taxation
--------
Federal  and  state  tax  consequences   will,  in  all  likelihood,   be  major
considerations  in any  business  combination  that the Company  may  undertake.
Currently,  such  transactions  may be  structured  so as to result in  tax-free
treatment  to  both  companies,  pursuant  to  various  federal  and  state  tax
provisions.  The Company intends to structure any business  combination so as to
minimize  the  federal  and state tax  consequences  to both the Company and the
target entity; however, there can be no assurance that such business combination
will meet the statutory  requirements of a tax-free  reorganization  or that the
parties will obtain the intended tax-free  treatment upon a transfer of stock or
assets. A non-qualifying  reorganization  could result in the imposition of both
federal and state taxes, which may have an adverse effect on both parties to the
transaction.


Item 2 - Description of Property

The Company currently maintains a mailing address at 12890 Hilltop Road, Argyle,
TX 76226.  The Company's  telephone  number there is (972) 233-0300.  Other than
this mailing address,  the Company does not currently  maintain any other office
facilities,  and does not anticipate the need for maintaining  office facilities
at any time in the  foreseeable  future.  The Company pays no rent or other fees
for the use of the mailing address as these offices are used virtually full-time
by other businesses of the Company's President.

It is  likely  that  the  Company  will not  establish  an  office  until it has
completed a business acquisition transaction,  but it is not possible to predict
what   arrangements  will  actually  be  made  with  respect  to  future  office
facilities.


Item 3 - Legal Proceedings

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


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

The Company has not conducted any meetings of shareholders  during the preceding
quarter or periods subsequent thereto.



                                                                              13
<PAGE>


                                     PART II

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

Market for Trading

The  Company's  equity  securities  are  currently  quoted  on the  Pink  Sheets
over-the-counter   market  under  the  symbol  "NVSC"  and  have  irregular  and
infrequent trading volumes and pricing.

The table below sets forth the high and low bid prices for the Company's  common
stock as obtained from the  "historical  quotes"  section of  www.bigcharts.com.
Bids  represent  inter-dealer  prices,  without  retail  mark-up,   markdown  or
commissions, and may not represent actual transactions.

The following table sets forth the high and low closing bid prices for the
periods indicated:


Year ended June 30, 2005                               High             Low
------------------------                               ----             ---
   1st Quarter                                        $0.30            $0.30
   2nd Quarter                                         0.30             0.30
   3rd Quarter                                         0.30             0.30
   4th Quarter                                         0.30             0.30

Year ended June 30, 2006
------------------------
   1st Quarter                                        $6.01            $0.30
   2nd Quarter                                         4.50             1.50
   3rd Quarter                                         7.55             1.50
   4th Quarter                                         7.55             7.51

Year ended June 30, 2007
------------------------
   1st Quarter                                        $7.51            $7.51
   2nd Quarter                                         7.51             0.15
   3rd Quarter                                         0.15             0.15
   4th Quarter                                         0.15             0.15

These  quotations are  inter-dealer  prices  without retail markup,  markdown or
commissions, and may not necessarily represent actual transactions.

As of September 12, 2007, there were approximately 671 shareholders of record of
the Company's common stock

Transfer Agent

Our  independent  stock  transfer  agent is Transfer  Online,  Inc.,  located in
Portland,  Oregon.  Their mailing address and telephone  number is: 317 SW Alder
Street,  2nd Floor,  Portland,  Oregon  97204;  (503)  227-2950  (voice);  (503)
227-6874 (fax).

Reports to Stockholders

The Company  plans to furnish its  stockholders  with an annual  report for each
fiscal  year  ending  June 30  containing  financial  statements  audited by its
independent certified public accountants. In the event the Company enters into a
business  combination  with  another  Company,  it is the present  intention  of
management to continue furnishing annual reports to stockholders.  Additionally,
the Company  may, in its sole  discretion,  issue  unaudited  quarterly or other
interim  reports to its  stockholders  when it deems  appropriate.  The  Company
intends to maintain  compliance with the periodic reporting  requirements of the
Securities Exchange Act of 1934.

Dividend Policy

No dividends  have been paid to date and the Company's  Board of Directors  does
not anticipate  paying  dividends in the foreseeable  future.  It is the current
policy of the Company's  Board of Directors to retain all  earnings,  if any, to
support future growth and expansion.



                                                                              14
<PAGE>

Recent Issuances of Unregistered Securities

On October 11,  2005,  the Company  sold  250,000  post-reverse  split shares of
restricted   common  stock  for  gross  proceeds  of  $75,000,   pursuant  to  a
subscription agreement, to Halter Financial Investments, L. P., (a Texas Limited
Partnership)  (HFI), an entity  controlled by Timothy P. Halter,  who became the
Company's current Chief Executive Officer.  The Company relied upon Section 4(2)
of The Securities Act of 1933, as amended, for an exemption from registration of
these shares and no  underwriter  was used in this  transaction.  As a result of
this  transaction,  HFI became the  Company's  controlling  stockholder,  owning
approximately  59.60%  of the  419,436  issued  and  outstanding  shares  of the
Company's common stock.

The $75,000 in proceeds was used to satisfy the pre-petition debt payable to the
Nevada Gaming Commission,  retire certain trade accounts payable and pay certain
operating  expenses of the Company to maintain  compliance with the requirements
of the Securities Exchange Act of 1934, as amended

On November  17,  2006,  the Company  sold to HFI 723,641  shares of  restricted
common stock for approximately  $217,000 or $0.30 per share. The transaction was
effected pursuant to the terms of a Stock Purchase Agreement entered into by the
Company and HFI on October 11,  2005.  The  purchase  transaction  was  effected
without  registration  in reliance  upon Section 4(2) of the  Securities  Act of
1933.  The form and terms of the purchase  agreement were agreed upon as part of
the October 2005 change in control  transaction  as  disclosed in the  Company's
Current  Report on Form 8-K filed  with the SEC on  October  12,  2005.  As this
selling   price  was   substantially   below  the  "fair  value"  of  comparable
transactions,  the Company  recognized  a charge to  operations  for  consulting
expense of  approximately  $1,736,700  equivalent to the difference  between the
established "fair value" of $2.70 per share (as determined by the quoted closing
price of the  Company's  common  stock on the date of the  transaction)  and the
selling price of $0.30 per share.

On November  17,  2006,  the Company  satisfied  the terms and  conditions  of a
Settlement and Stock  Issuance  Agreement  with W/F  Investment  Corp.  (W/F), a
shareholder  of the Company,  with the payment of $100,000 cash and the issuance
of  107,000  shares of  restricted  common  stock to settle the  Company's  debt
obligation to W/F of approximately $501,945. The form and terms of the agreement
were agreed upon as part of the October  2005 change in control  transaction  as
disclosed  in the  Company's  Current  Report on Form 8-K filed  with the SEC on
October 12, 2005.


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

Results of Operations

The  Company  had no revenue  for the  respective  years ended June 30, 2007 and
2006, respectively.

During each of the years ended June 30,  2007 and 2006,  the Company  recognized
general operating expenses of approximately  $10,600 and $39,700,  respectively,
which  were  directly  related to the  Company's  compliance  with the  periodic
reporting  requirements  of the  Securities  Exchange  Act of 1934,  as amended.
Further,  during the  quarter  ended June 30,  2007,  the Company  recognized  a
one-time gain on forgiveness  of debt or  approximately  $44,600  related to the
settlement  and payment in full of the  pre-petition  tax liability  owed to the
Nevada Department of Taxation..

The Company accrued  interest  expense on  pre-petition  tax liabilities and the
Line of Credit notes payable to two separate  shareholders totaled approximately
$28,600  and  $40,900  for  each of the  years  ended  June 30,  2007 and  2006,
respectively.  During the year ended June 30,  2007,  the  Company  settled  the
outstanding  obligations to the Nevada Department of Taxation and W/F Investment
Corp.  on April 9,  2007 and  November  17,  2006,  respectively.  There  are no
continuing obligation on the part of the Company for either of these items.

The  Company  does not  expect  to  generate  any  meaningful  revenue  or incur
operating  expenses for purposes  other than  fulfilling  the  obligations  of a
reporting  company  under The  Securities  Exchange Act of 1934 unless and until
such time that the Company's operating subsidiary begins meaningful operations.

At June 30, 2007 and 2006,  the Company  had  working  capital of  approximately
$(37,900) and $(654,800), respectively.

It is the belief of management  and  significant  stockholders  that  sufficient
working capital necessary to support and preserve the integrity of the corporate
entity  will be  present.  However,  there is no  legal  obligation  for  either
management or significant  stockholders  to provide  additional  future funding.
Should this pledge fail to provide financing, the Company has not identified any
alternative  sources.  Consequently,   there  is  substantial  doubt  about  the
Company's ability to continue as a going concern.



                                                                              15
<PAGE>

The Company's need for working  capital may change  dramatically  as a result of
any business acquisition or combination  transaction.  There can be no assurance
that the Company will identify any such business, product, technology or company
suitable for acquisition in the future.  Further, there can be no assurance that
the Company would be successful in  consummating  any  acquisition  on favorable
terms  or that it will be able  to  profitably  manage  the  business,  product,
technology or company it acquires.

Plan of Business

General

The  Company  intends to locate and  combine  with an  existing,  privately-held
company which is profitable  or, in  management's  view,  has growth  potential,
irrespective of the industry in which it is engaged.  However,  the Company does
not  intend  to  combine  with a  private  company  which may be deemed to be an
investment  company subject to the Investment Company Act of 1940. A combination
may be structured as a merger,  consolidation,  exchange of the Company's common
stock for stock or assets or any other form which  will  result in the  combined
enterprise's becoming a publicly-held corporation.

Pending  negotiation and consummation of a combination,  the Company anticipates
that it will have, aside from carrying on its search for a combination  partner,
no business  activities,  and, thus, will have no source of revenue.  Should the
Company incur any significant  liabilities prior to a combination with a private
company, it may not be able to satisfy such liabilities as are incurred.

If the Company's management pursues one or more combination opportunities beyond
the  preliminary  negotiations  stage and those  negotiations  are  subsequently
terminated,  it is  foreseeable  that such efforts  will  exhaust the  Company's
ability to continue to seek such combination opportunities before any successful
combination can be consummated.  In that event,  the Company's common stock will
become  worthless  and  holders of the  Company's  common  stock will  receive a
nominal distribution, if any, upon the Company's liquidation and dissolution.

Combination Suitability Standards

In its pursuit for a combination  partner,  the Company's  management intends to
consider only  combination  candidates  which are profitable or, in management's
view, have growth potential.  The Company's management does not intend to pursue
any  combination  proposal  beyond the  preliminary  negotiation  stage with any
combination  candidate which does not furnish the Company with audited financial
statements  for at least its most  recent  fiscal year and  unaudited  financial
statements for interim periods  subsequent to the date of such audited financial
statements, or is in a position to provide such financial statements in a timely
manner.  The Company will, if necessary  funds are available,  engage  attorneys
and/or accountants in its efforts to investigate a combination  candidate and to
consummate a business  combination.  The Company may require  payment of fees by
such combination  candidate to fund the investigation of such candidate.  In the
event such a combination candidate is engaged in a high technology business, the
Company may also obtain  reports from  independent  organizations  of recognized
standing  covering the technology  being developed and/or used by the candidate.
The  Company's  limited  financial  resources may make the  acquisition  of such
reports  difficult  or even  impossible  to obtain  and,  thus,  there can be no
assurance  that the Company  will have  sufficient  funds to obtain such reports
when considering combination proposals or candidates.  To the extent the Company
is  unable to  obtain  the  advice or  reports  from  experts,  the risks of any
combined enterprise's being unsuccessful will be enhanced.  Furthermore,  to the
knowledge of the Company's officers and directors, neither the candidate nor any
of  its  directors,   executive  officers,  principal  shareholders  or  general
partners:

     1)   will not have been  convicted of  securities  fraud,  mail fraud,  tax
          fraud, embezzlement,  bribery, or a similar criminal offense involving
          misappropriation  or theft of funds,  or be the  subject  of a pending
          investigation or indictment involving any of those offenses;

     2)   will not have been subject to a temporary or permanent  injunction  or
          restraining  order arising from unlawful  transactions  in securities,
          whether as issuer, underwriter, broker, dealer, or investment advisor,
          may be the subject of any pending  investigation  or a defendant  in a
          pending  lawsuit  arising from or based upon  allegations  of unlawful
          transactions in securities; or

     3)   will not have been a defendant in a civil  action which  resulted in a
          final judgement against it or him awarding damages or rescission based
          upon unlawful practices or sales of securities.

The Company's  officers and directors will make these  determinations  by asking
pertinent  questions of the  management of prospective  combination  candidates.
Such persons will also ask pertinent  questions of others who may be involved in
the combination proceedings.  However, the officers and directors of the Company



                                       16
<PAGE>

will not generally take other steps to verify independently information obtained
in this manner which is favorable.  Unless  something  comes to their  attention
which  puts  them on  notice  of a  possible  disqualification  which  is  being
concealed  from them,  such persons will rely on  information  received from the
management of the prospective  combination  candidate and from others who may be
involved in the combination proceedings.

Liquidity and Capital Resources

It is the belief of management  and  significant  stockholders  that  sufficient
working capital necessary to support and preserve the integrity of the corporate
entity  will be  present.  However,  there is no  legal  obligation  for  either
management or significant  stockholders  to provide  additional  future funding.
Should this pledge fail to provide financing, the Company has not identified any
alternative  sources.  Consequently,   there  is  substantial  doubt  about  the
Company's ability to continue as a going concern.

The Company and Halter Financial Investments,  LP (HFI), an entity controlled by
the Company's  President and Chief Executive  Officer,  have  acknowledged  that
outside funds are necessary to support the corporate  entity and comply with the
periodic  reporting  requirements  of the  Securities  Exchange Act of 1934,  as
amended.  To this end,  HFI has agreed to lend the Company up to $50,000  with a
maturity  period not to exceed two (2) years from the initial funding date at an
interest  rate of 6.0% per  annum.  Through  June  30,  2007,  HFI has  advanced
approximately  $45,700 under this agreement,  with an initial scheduled maturity
date in May 2008.

The Company has no current plans, proposals, arrangements or understandings with
respect to the sale or issuance of additional  securities  prior to the location
of a merger or  acquisition  candidate.  Accordingly,  there can be no assurance
that sufficient  funds will be available to the Company to allow it to cover the
expenses related to such activities.

The Company does not currently contemplate making a Regulation S offering.

Regardless of whether the  Company's  cash assets prove to be inadequate to meet
the Company's  operational needs, the Company might seek to compensate providers
of services by issuances  of stock in lieu of cash.  For  information  as to the
Company's  policy in regard to payment  for  consulting  services,  see  Certain
Relationships and Transactions.


Item 7 - Index to Financial Statements

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


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

None.

Item 8A - Controls and Procedures

(a)  Evaluation of Disclosure Controls and Procedures

     Under  the  supervision  and  with  the  participation  of our  management,
     including our principal  executive officer and principal financial officer,
     we conducted an evaluation of our disclosure  controls and  procedures,  as
     such term is defined under Rule 13a-15(e)  promulgated under the Securities
     Exchange Act of 1934, as amended (Exchange Act), as of June 30, 2007. Based
     on this evaluation, our principal executive officer and principal financial
     officer concluded that our disclosure controls and procedures are effective
     in alerting them on a timely basis to material  information relating to our
     Company required to be included in our reports filed or submitted under the
     Exchange Act.

(b)  Changes in Internal Controls

     There were no significant changes (including corrective actions with regard
     to  significant  deficiencies  or  material  weaknesses)  in  our  internal
     controls over financial  reporting  that occurred  during the quarter ended
     June 30, 2007 that has  materially  affected,  or is  reasonably  likely to
     materially affect, our internal control over financial reporting.



                                                                              17
<PAGE>

                                    PART III

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

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

          Name            Age                  Position Held and Tenure
          ----            ---                  ------------------------
     Timothy P. Halter    41              President, Chief Executive Officer
                                              Chief Financial Officer and
                                              Director

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

The directors and officers will devote their time to the Company's affairs on an
as needed  basis,  which,  depending  on the  circumstances,  could amount to as
little as two hours per month, or more than forty hours per month, but more than
likely encompass less than four (4) hours per month.  There are no agreements or
understandings  for any  officer or director to resign at the request of another
person,  and none of the officers or directors  are acting on behalf of, or will
act at the direction of, any other person.

Biographical Information

Timothy P. Halter - Since 1995,  Mr.  Halter has been the president and the sole
stockholder of Halter  Financial Group,  Inc., a Dallas,  Texas based consulting
firm specializing in the area of mergers, acquisitions and corporate finance. In
September 2005, Mr. Halter and other minority  partners formed HFI. HFI conducts
no  business  operations.  Mr.  Halter  currently  serves as a  director  of DXP
Enterprises,  Inc., a public corporation  (Nasdaq:  DXPE), and is an officer and
director of Nevstar  Corporation,  a Nevada corporation,  Marketing  Acquisition
Corp., a Nevada corporation,  Energroup  Technologies Corp., a Utah corporation,
BTHC VIII,  Inc.  and BTHC X, Inc.,  each a  Delaware  corporation.  Each of the
afore-referenced  companies is current in the filing of their  periodic  reports
with the SEC. Except for DXP Enterprises, each of the afore-referenced companies
for which  Mr.  Halter  acts as an  officer  and  director  may be deemed  shell
corporations. Mr. Halter will devote as much of his time to our business affairs
as may be necessary to implement our business plan.

Mr. Halter has  significant  experience  acting in the capacity of the principal
stockholder,  a director and an executive officer of blank check companies.  The
following  table  identifies  those  companies  with  which Mr.  Halter has been
affiliated that operated as a blank check company at some point in their history
and whose  securities  are  registered  under the  Exchange  Act. The table also
details Mr. Halter's prior and present  involvement with each referenced company
and the current  status of each  company's  business  operations.  The  business
descriptions  provided below are derived from the respective  entities' periodic
reports as filed with the SEC. Except for Nevstar Corporation,  BTHC VIII, Inc.,
BTHC X, Inc., Marketing Acquisition Corp., and Energroup  Technologies Corp., we
have made no independent verification of the accuracy of the disclosure found in
such  reports  or  whether  the  entities  are  current  in the  filing of their
respective periodic reports with the SEC.

As noted in the table below,  Mr.  Halter is  currently a director,  officer and
principal  shareholder of Nevstar Corporation,  a Nevada corporation,  Marketing
Acquisition Corp., a Nevada  corporation,  Energroup  Technologies Corp., a Utah
corporation,  BTHC VII,  Inc.,  BTHC VIII,  Inc. and BTHC X, Inc., and BTHC XIV,
Inc., each a Delaware  corporation..  Regarding the other registrants  listed in
the table,  Mr. Halter was not affiliated  with any of the operating  businesses
prior to the  consummation of the reverse merger  transaction and resigned as an
officer and director  upon  consummation  of the  transaction.  After the merger
transaction,  Mr.  Halter did not  participate  in the  management of any of the
registrants  and  ceased  being a  principal  shareholder.  Other  than  being a
minority shareholder of certain of the registrants, Mr. Halter is not affiliated
with, and does not control, any of the registrants.




                                                                              18
<PAGE>
<TABLE>
<CAPTION>


---------------------- ------------------------------- ----------------------------------- -----------------------------
Name of Registrant     Date of Registration/SEC File   Nature of Interest                  Current Status of Registrant
                       Number
---------------------- ------------------------------- ----------------------------------- -----------------------------
<S>                    <C>                             <C>                                 <C>

Athersys, Inc.         Form 10 filed on July 6,        Mr. Halter remains a minority       The company is in the
(formerly BTHC VI,     2006; SEC File Number           stockholder of the company.  Mr.    business of developing
Inc.)                  000-52108                       Halter resigned as an officer and   therapeutic product
                                                       director of the company as a        candidates.
                                                       result of a change in control
                                                       transaction completed on June 8,
                                                       2007.
---------------------- ------------------------------- ----------------------------------- -----------------------------
Avatar Systems, Inc.   Form 10 filed on June 25,       Mr. Halter remains a minority       The company is in the
                       2001; SEC File Number           stockholder of the company.  Mr.    business of providing
                       000-32925                       Halter resigned as an officer and   petroleum industry
                                                       director of the company as a        solutions for accounting
                                                       result of a change in control       and financial management.
                                                       transaction completed on November
                                                       14, 2000.
---------------------- ------------------------------- ----------------------------------- -----------------------------
Bitech Pharma, Inc.    Form 10 filed on December       Mr. Halter remains a minority       The company is in the
                       16, 2005; SEC File Number       stockholder of the company.  Mr.    business of developing and
                       000-51684                       Halter resigned as an officer and   producing therapeutic
                                                       director of the company as a        protein products.
                                                       result of a change in control
                                                       transaction completed on June 30,
                                                       2005.
---------------------- ------------------------------- ----------------------------------- -----------------------------
BTHC VII, Inc.         Form 10 filed on July 10,       Mr. Halter remains a minority       The company is engaged in
                       2006; SEC File Number           stockholder of the company.  Mr.    the retail jewelry business.
                       000-52123                       Halter resigned as an officer and
                                                       director of the company as a
                                                       result of a change in control
                                                       transaction completed in July
                                                       2007.
  ---------------------- ------------------------------- ----------------------------------- -----------------------------
BTHC VIII, Inc.        Form 10-SB filed on September   Mr. Halter acquired control on      The company is a shell
                       21, 2006; SEC File Number       August 7, 2006 and currently        company.
                       0-52232                         serves as its sole officer and
                                                       director.
---------------------- ------------------------------- ----------------------------------- -----------------------------
BTHC X, Inc.           Form 10 filed on September      Mr. Halter acquired control on      The company is a shell
                       22, 2006; SEC File Number       August 16, 2006 and currently       company.
                       0-52237                         serves as its sole officer and
                                                       director.
---------------------- ------------------------------- ----------------------------------- -----------------------------
BTHC XIV, Inc.         Form 10-SB filed on July 9,     Mr. Halter acquired control on      The company is a shell
                       2007; SEC File Number           August 16, 2006 and currently       company.
                       000-52722                       serves as its sole officer and
                                                       director.
---------------------- ------------------------------- ----------------------------------- -----------------------------
China Agritech, Inc.   Form 10 filed on February 2,    Mr. Halter acquired a controlling   The company is currently
                       2002; Current SEC File Number   interest in the company on May      engaged in the business of
                       0-49608                         25, 2004, and acted as its sole     producing organic liquid
                                                       officer and director until his      compound fertilizers.
                                                       resignation as a result of a
                                                       change in control transaction
                                                       completed on February 3, 2005.
                                                       Mr. Halter remains a minority
                                                       stockholder of the company.
---------------------- ------------------------------- ----------------------------------- -----------------------------
China BAK Battery,     The company originally filed    Mr. Halter acquired a controlling   The company is a
Inc.                   a registration statement on     interest in the company on June     manufacturer of lithium-ion
                       Form S-1 on June 10, 2000 and   14, 2004, and acted as its sole     batteries and related
                       a Form 8-A12G on March 29,      officer and director until his      products.
                       2002; SEC File Number           resignation as a result of a
                       000-49712                       change in control transaction
                                                       completed on January 20, 2005.
                                                       Mr. Halter remains a minority
                                                       stockholder of the company
---------------------- ------------------------------- ----------------------------------- -----------------------------
China Digital          The company originally became   Mr. Halter acquired a controlling   The company is a provider
Wireless, Inc.         obligated to file reports       interest in the company on          of value added information
                       with the SEC in 1983 with the   February 23, 2004, and acted as     services to mobile phone
                       filing of a Registration        its sole officer and director       subscribers in China.
                       Statement on Form S-18(File     until his resignation as a result
                       Number 2-84351); Current SEC    of a change in control
                       File Number 0-12536.            transaction completed on June 23,
                                                       2004. Mr. Halter remains
                                                       a minority stockholder of
                                                       the company.
---------------------- ------------------------------- ----------------------------------- -----------------------------
China Pharma          Form 10 filed on February 15,   Mr. Halter acquired a controlling   The company's primary
Holdings, Inc.        2000; SEC File Number 000-29523 interest in the company on May 11,  business is research,
                                                      2005, and acted as its sole         development, manufacturing
                                                      officer and director until the      and sale of
                                                      completion of a change in control   bio-pharmaceutical products.
                                                      transaction on October 20, 2005.
                                                      Mr. Halter remains a minority
                                                      stockholder of the company.
------------------------------------------------------------------------------------------------------------------------
 China Ritar Power    Form 10-SB filed on April 29,   Mr. Halter remains a minority       The company is a
Corp. (formerly       1999; SEC File Number 000-25901 stockholder of the company.  Mr.    manufacturer of lead acid
Concept Ventures                                      Halter resigned as an officer and   batteries.
Corp.)                                                director of the company as a
                                                      result of a change in control
                                                      transaction completed on February
                                                      16, 2007.
------------------------------------------------------------------------------------------------------------------------




                                                                              19
<PAGE>



------------------------------------------------------------------------------------------------------------------------
Games, Inc            Form 10 filed on November 15,   Mr. Halter remains a minority       The company is a technology
                      2001; SEC File Number 000-33345 stockholder of the company.  Mr.    company operating in the
                                                      Halter resigned as an officer and   area of interactive
                                                      director of the company as a        entertainment.
                                                      result of a change in control
                                                      transaction completed on September
                                                      30, 2001.
------------------------------------------------------------------------------------------------------------------------
International Stem    Form 10 filed on April 4,       Mr. Halter remains a minority       The company is engaged in
Cell Corp. (formerly  2006; SEC File Number 000-51891 stockholder of the company.  Mr.    the business of developing
BTHC III, Inc.)                                       Halter resigned as an officer and   theraeutic products.
                                                      director of the company as
                                                      a result of a change in
                                                      control transaction
                                                      completed on December 28,
                                                      2006.
------------------------------------------------------------------------------------------------------------------------
KMG Chemicals, Inc.   Form 10 filed on December 6,    Mr. Halter is not a current         The company is a seller of
                      1996; SEC File Number 000-29278 stockholder of the company.  Mr.    industrial wood preserving
                                                      Halter resigned as an officer and   chemicals in the United
                                                      director of the company as a        States.
                                                      result of a change in control
                                                      transaction completed on October
                                                      15, 1996.
------------------------------------------------------------------------------------------------------------------------
MGCC Investment       The company became public via   Mr. Halter remains a minority       The company is a
Strategies, Inc.      the filing of a SB-2            stockholder of the company.  Mr.    manufacturer of auto parts.
                      registration statement filed    Halter resigned as an officer and
                      in October 2001, SEC File       director of the company as a
                      Number 000-50883                result of the change in control
                                                      transaction completed on June 22,
                                                      2006.
------------------------------------------------------------------------------------------------------------------------
Millennium Quest,     The company became public via   Mr. Halter remains a minority       The company is a shell
Inc.                  the filing of a Form 10         stockholder of the company.  Mr.    company.
                      registration statement filed    Halter resigned as an officer and
                      in September 2000, SEC File     director of the company as a
                      Number 000-31619                result of the change in control
                                                      transaction completed on May3,
                                                      2007.
------------------------------------------------------------------------------------------------------------------------
Microwave             Form 10 filed on March 31,      Mr. Halter is not a current         The company is currently
Transmission          2000; SEC File Number 000-30722 stockholder of the company.  Mr.    engaged in the business of
Systems, Inc.                                         Halter resigned as an officer and   constructing and maintaining
                                                      director of the company on as a     wireless communications
                                                      result of a change in control       transmitting and recovering
                                                      transaction completed on August 6,  facilities.
                                                      1999.
------------------------------------------------------------------------------------------------------------------------
Nevstar Corporation    The Company filed a             Mr. Halter acquired control of      The company is a shell
                       registration statement on       the company on October 11, 2005     company.
                       Form S-1 on September 24,       and currently serves as its sole
                       1997; SEC File Number           officer and director.
                       000-21071
---------------------- ------------------------------- ----------------------------------- -----------------------------
Playlogic             The company filed with the SEC  Mr. Halter acquired a controlling   The company is presently
Entertainment, Inc.   a registration statement on     interest in the company on          engaged in the business of
                      Form SB-2 on August 30, 2001 December 15, 2004, and acted
                      as developing gaming software. and a Form 8-A12G on
                      February its sole officer and director 28, 2002; SEC File
                      Number until the completion of a change 000-49649 in
                      control transaction on June 3,
                                                      2005. Mr. Halter remains a
                                                      minority stockholder of
                                                      the company.
------------------------------------------------------------------------------------------------------------------------
Polymedix, Inc.       Form 10 filed on April 5,       Mr. Halter resigned as an officer   The company is a
                      2006; SEC File Number 000-51895 and director on October 6, 2005.    bio-technology company
                                                      Mr. Halter remains a
                                                      minority focusing on
                                                      research of stockholder of
                                                      the company. infectious
                                                      diseases.
------------------------------------------------------------------------------------------------------------------------
Point Acquisition     The company became public via   Mr. Halter remains a minority       The company is engaged in
Corp.                 the filing of a Form 10         stockholder of the company.  Mr.    the business of
                      registration statement filed    Halter resigned as an officer and   manufacturing monolithic
                      in September 2005, SEC File     director of the company as a        refractory products.
                      Number 000-51527                result of the change in control
                                                      transaction completed on April 25,
                                                      2007
------------------------------------------------------------------------------------------------------------------------
Redpoint Bio Corp.    The company became public via   Mr. Halter remains a minority       The company is presently
(formerly Robcor      the filing of a SB-2            stockholder of the company.  Mr.    engaged in the development
Properties, Inc.)     registration statement filed    Halter resigned as an officer and   of biotech products.
                      on May 19, 2005; SEC File       director of the company as a
                      Number 000-51708                result of a change in control
                                                      transaction completed on March 12,
                                                      2007.
------------------------------------------------------------------------------------------------------------------------




                                                                              20
<PAGE>


------------------------------------------------------------------------------------------------------------------------
RTO Holdings, Inc.    The Company originally became   Mr. Halter acquired control of the  The company is presently
                      public in 1986 pursuant to the  company on June 21, 2006 and        engaged in the development
                      filing of a registration        served as its sole officer and      and operation of ethanol
                      statement under the Securities  director until August 29, 2006      manufacturing facilities.
                      Act of 1933; SEC File Number    when a change in control
                      000-15579                       transaction was consummated. Mr.
                                                      Halter remains a minority
                                                      stockholder of the
                                                      company.
------------------------------------------------------------------------------------------------------------------------
Segmentz, Inc.        Form 10 filed on January 30,    Mr. Halter remains a minority       The company is currently
                      2002; SEC File Number 000-49606 stockholder of the company.  Mr.    engaged in the business of
                                                      Halter resigned as officer and      providing transportation
                                                      director of the company as a        services to clients in the
                                                      result of a change in control       U.S. and Canada.
                                                      transaction completed on January
                                                      31, 2001.
------------------------------------------------------------------------------------------------------------------------
Shelron Group, Inc.   Form 10 filed on October 11,    Mr. Halter is not a current         The company is currently
                      2000; SEC File Number 000-31176 stockholder of the company.  Mr.    engaged in the business of
                                                      Halter resigned as an
                                                      officer and developing
                                                      business director of the
                                                      company as a intelligence
                                                      software and result of a
                                                      change in control
                                                      comparative shopping
                                                      transaction completed on
                                                      April 26, software
                                                      programs. 2000.
------------------------------------------------------------------------------------------------------------------------
Sutor Technology,     The company originally became   Mr. Halter remains a minority       The company is engaged in
Inc.                  obligated to file reports with  stockholder of the company.  Mr.    the business of
                      the SEC as the result of its    Halter resigned as an officer and   manufacturing and selling
                      1989 filing of a registration   director of the company as a        steel fabrication products.
                      statement on Form SB-2; SEC     result of a change in control
                      File Number 333-83351.          transaction completed on February
                                                      1, 2007.
------------------------------------------------------------------------------------------------------------------------

Tiens Biotech Group,   Form 10 filed on March 7,       Mr. Halter remains a minority       The Company primarily
Inc.                   2002; SEC File Number           stockholder of the company.  Mr.    engages in the development,
                       000-49666                       Halter resigned as an officer and   manufacturing, and
                                                       director of the company as a        marketing of nutrition
                                                       result of a change in control       supplement products.
                                                       transaction completed on February
                                                       11, 2002.
---------------------- ------------------------------- ----------------------------------- -----------------------------
Winner Medical        The company originally became   Mr. Halter acquired a controlling   The company is involved in
Group, Inc.           obligated to file reports with  interest in the company on          the development,
                      the SEC as the result of its    November 4, 2005, and acted as its  manufacturing and marketing
                      1989 filing of a registration   sole officer and director until     of medical dressings and
                      statement on Form S-18; SEC     the completion of a change in       medical disposables.
                      File Number 000-16547.          control transaction on December
                                                      16, 2005.  Mr. Halter remains a
                                                      minority stockholder of the
                                                      company.
------------------------------------------------------------------------------------------------------------------------
Zeolite Exploration    The company originally became   Mr. Halter acquired a controlling   The company owns and
Company                public with the filing of a     interest in the company on          operates a nano
                       Registration Statement on       November 30, 2005, and acted as     precipitated calcium
                       Form SB-2 on October 23,        its sole officer and director       carbonate manufacturing
                       2002; SEC File Number           until the completion of a change    company in China.
                       333-74670                       in control transaction on March
                                                       31, 2006.  Mr. Halter remains a
                                                       minority stockholder of the
                                                       company.
---------------------- ------------------------------- ----------------------------------- -----------------------------
</TABLE>

In addition to the companies listed above,  Mr. Halter is an officer,  director,
and shareholder of several private companies.

It is  specifically  noted  that the  relative  success or failure of any of the
entities  referenced above subsequent to Mr. Halter's  affiliation should not be
deemed an  indication  of the  possibility  of our  success or failure  upon the
completion of our current plan of operations.

Compliance with Section 16(a) of the Exchange Act
-------------------------------------------------

Section  16(a) of the Exchange Act requires the Company's  directors,  executive
officers and persons who own more than ten percent of a registered  class of the
Company's equity  securities  ("10%  holders"),  to file with the Securities and
Exchange Commission (SEC) initial reports of ownership and reports of changes in
ownership of Common stock and other equity securities of the Company.

Directors,  officers and 10% holders are required by SEC  regulation  to furnish
the Company with copies of all of the Section  16(a)  reports  they file.  Based
solely on a review of reports furnished to he Company or written representations
from the Company's directors and executive officers during the fiscal year ended
June 30, 2007 and/or 2006 no Section 16(a) filing requirements applicable to its
directors, officers and 10% holders for such year were complied with.



                                                                              21
<PAGE>

Conflicts of Interest

None of the  officers  of the Company  will devote more than a small  portion of
their  respective  time to the affairs of the  Company.  There will be occasions
when the time  requirements of the Company's  business conflict with the demands
of the officers'  other business and investment  activities.  Such conflicts may
require that the Company  attempt to employ  additional  personnel.  There is no
assurance  that the  services of such persons will be available or that they can
be obtained upon terms favorable to the Company.

The officers,  directors and principal  shareholders of the Company may actively
negotiate for the purchase of a portion of their common stock as a condition to,
or in  connection  with, a proposed  merger or  acquisition  transaction.  It is
anticipated  that  a  substantial  premium  may be  paid  by  the  purchaser  in
conjunction  with any sale of shares by the  Company's  officers,  directors and
principal shareholders made as a condition to, or in connection with, a proposed
merger or acquisition  transaction.  The fact that a substantial  premium may be
paid to members of Company management to acquire their shares creates a conflict
of interest for them and may compromise  their state law fiduciary duties to the
Company's  other  shareholders.  In making  any such  sale,  members  of Company
management  may consider  their own personal  pecuniary  benefit rather than the
best  interests of the Company and the  Company's  other  shareholders,  and the
other shareholders are not expected to be afforded the opportunity to approve or
consent to any particular buy-out  transaction  involving shares held by members
of Company management.

The Company has adopted a policy under which any  consulting or finders fee that
may be paid to a third party for  consulting  services to assist  management  in
evaluating a prospective business opportunity would be paid in stock rather than
in  cash.  Any  such  issuance  of  stock  would  be  made  on an ad hoc  basis.
Accordingly,  the Company is unable to predict whether,  or in what amount, such
stock issuance might be made.

It is not currently anticipated that any salary,  consulting fee, or finders fee
shall be paid to any of the Company's directors or executive officers, or to any
other affiliate of the Company except as described under Executive  Compensation
above.

Although  management  has no current  plans to cause the Company to do so, it is
possible  that the  Company  may enter  into an  agreement  with an  acquisition
candidate requiring the sale of all or a portion of the Common Stock held by the
Company's  current  stockholders  to the  acquisition  candidate  or  principals
thereof,  or to other individuals or business entities,  or requiring some other
form of payment to the Company's current  stockholders,  or requiring the future
employment  of specified  officers  and payment of salaries to them.  It is more
likely  than  not  that  any  sale  of  securities  by  the  Company's   current
stockholders  to an  acquisition  candidate  would  be at a price  substantially
higher than that  originally paid by such  stockholders.  Any payment to current
stockholders  in the context of an  acquisition  involving  the Company would be
determined  entirely by the largely  unforeseeable  terms of a future  agreement
with an unidentified business entity.


Item 10 - Executive Compensation

Since the change in control in October 2005,  management of the Company requires
less than four (4)  hours per  calendar  quarter.  Accordingly,  no  officer  or
director  has  received any  compensation  from the  Company.  Until the Company
acquires  additional capital, it is not anticipated that any officer or director
will  receive  compensation  from  the  Company  other  than  reimbursement  for
out-of-pocket   expenses  incurred  on  behalf  of  the  Company.   See  Certain
Relationships and Related Transactions.

Prior to the October  2005 change in control,  no  compensation  of any type was
paid to any Company officer or director.

The Company has no stock option, retirement, pension, or profit-sharing programs
for the  benefit of  directors,  officers or other  employees,  but the Board of
Directors may recommend adoption of one or more such programs in the future.




                (Remainder of this page left blank intentionally)




                                                                              22
<PAGE>



Item 11 - Security Ownership of Certain Beneficial Owners and Management

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

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

Halter Financial Investments, L. P.          973,641             77.89%
12890 Hilltop Road
Argyle TX 76226

W/F Investment Corp.                         107,000              8.56%
1900 Avenue of the Stars, Suite 2410,
Los Angeles CA  90067

Executive Officers and Directors as          973,641             77.89%
a group (three persons)

Halter Financial Investments, L. P. is controlled by the Company's sole director
and officer, Timothy P. Halter.

Item 12 - Certain Relationships and Related Transactions

The Company currently maintains a mailing address at 12890 Hilltop Road, Argyle,
Texas 76226. The Company's telephone number there is (972) 233-0300.  Other than
this mailing address,  the Company does not currently  maintain any other office
facilities,  and does not anticipate the need for maintaining  office facilities
at any time in the  foreseeable  future.  The Company pays no rent or other fees
for the use of the mailing address as these offices are used virtually full-time
by other businesses of the Company's President.

Item 13 - Exhibits and Reports on Form 8-K

Exhibits
--------

31.1    Certification pursuant to Section 302 of Sarbanes-Oxley Act of 2002

32.1    Certification pursuant to Section 906 of Sarbanes-Oxley Act of 2002.

Reports on Form 8-K
-------------------
   None


Item 14 - Principal Accountant Fees and Services

                                   Year ended        Year ended
                                 June 30, 2007     June 30, 2006
                                 -------------     -------------

1.            Audit fees           $16,000           $17,500
2.            Audit-related fees      --                --
3.            Tax fees                --                --
4.            All other fees          --                --
                                   -------           -------

     Totals                        $16,000           $17,500
                                   =======           =======

The Company has not designated a formal audit committee.  However, as defined in
Sarbanes-Oxley  Act of 2002,  the  entire  Board of  Directors  (Board),  in the
absence of a formally  appointed  committee,  is, by  definition,  the Company's
audit committee.

In discharging its oversight responsibility as to the audit process,  commencing
with the  engagement  of Rose,  Snyder &  Jacobs,  the Board  obtained  from the
independent  auditors a formal written  statement  describing all  relationships
between  the  auditors  and  the  Company  that  might  bear  on  the  auditors'
independence  as  required  by  Independence  Standards  Board  Standard  No. 1,
"Independence  Discussions with Audit  Committees." The Board discussed with the



                                                                              23
<PAGE>

auditors any  relationships  that may impact their objectivity and independence,
including fees for non-audit services,  and satisfied itself as to the auditors'
independence.

The Board  discussed  and  reviewed  with the  independent  auditors all matters
required to be discussed by auditing standards  generally accepted in the United
States of America,  including those described in Statement on Auditing Standards
No. 61, as amended, "Communication with Audit Committees".

The Board reviewed the audited financial statements of the Company as of and for
the years  ended  June 30,  2007 and 2006 with  management  and the  independent
auditors. Management has the sole ultimate responsibility for the preparation of
the  Company's  financial  statements  and the  independent  auditors  have  the
responsibility for their examination of those statements.

Based  on the  above-mentioned  review  and  discussions  with  the  independent
auditors and management,  the Board of Directors  approved the Company's audited
financial  statements and recommended that they be included in its Annual Report
on Form  10-KSB  for the year  ended  June 30,  2007 for  filing  with the U. S.
Securities and Exchange Commission.

The Company's  principal  accountant,  Rose,  Snyder & Jacobs did not engage any
other  persons  or  firms  other  than  the  principal  accountant's  full-time,
permanent employees.



                (Remainder of this page left blank intentionally)



              (Financial statements follow, beginning on Page F-1)










                                                                              24
<PAGE>

                                                 Nevstar Corporation
                                            (a development stage company)

                                                      Contents


                                                                            Page

Report of Independent Registered Certified Public Accounting Firm            F-2

Financial Statements

   Balance Sheets
     as of June 30, 2007 and 2006                                            F-3

   Statements of Operations and Comprehensive Loss
     for the years ended June 30, 2007 and 2006 and
     for the period from November 22, 2002
       (date of bankruptcy settlement) through June 30, 2007                 F-4

   Statements of Changes in Stockholders' Equity
     for the period from November 22, 2002
       (date of bankruptcy settlement) through June 30, 2007                 F-5

   Statements of Cash Flows
     for the years ended June 30, 2007 and 2006 and
     for the period from November 22, 2002
       (date of bankruptcy settlement) through June 30, 2007                 F-6

   Notes to Financial Statements                                             F-7











                                                                             F-1
<PAGE>

                       LETTERHEAD OF ROSE, SNYDER & JACOBS
                  A CORPORATION OF CERTIFIED PUBLIC ACCOUNTANTS



        REPORT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM



Board of Directors and Stockholders
Nevstar Corporation

We have audited the  accompanying  balance  sheets of Nevstar  Corporation  (the
Company) (a Nevada  corporation  and  development  stage company) as of June 30,
2007 and 2006 and the related statements of operations, changes in shareholders'
deficit and cash flows for the years  ended June 30, 2007 and 2006,  and for the
period from November 22, 2002 (date of bankruptcy  settlement)  through June 30,
2007.  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 the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements  are free of  material  misstatement.  The  Company is not
required  to have,  nor were we engaged  to  perform,  an audit of its  internal
control over financial reporting.  Our audits included consideration of internal
control over financial  reporting as a basis for designing audit procedures that
are appropriate in the  circumstances,  but not for the purpose of expressing an
opinion on the  effectiveness  of the Company's  internal control over financial
reporting.  Accordingly,  we express  no such  opinion.  An audit also  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial   statements,   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 Nevstar Corporation as of June
30, 2007 and 2006,  and the results of its operations and its cash flows for the
years ended June 30, 2007 and 2006,  and for the period from  November  22, 2002
through  June 30, 2007,  in  conformity  with  accounting  principles  generally
accepted in the United States of America.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue  as a  going  concern.  As  discussed  in  Note C to the
financial statements,  the Company did not generate revenue and is not operating
which raises substantial doubt about its ability to continue as a going concern.
Management's  plans in  regard to these  matters  are  described  in Note C. The
financial  statements do not include any adjustments  that might result from the
outcome of this uncertainty.


/s/ Rose, Snyder & Jacobs
Rose, Snyder & Jacobs
A Corporation of Certified Public Accountants

Encino, California
August 22, 2007






                                                                             F-2
<PAGE>
<TABLE>
<CAPTION>

                               Nevstar Corporation
                        (a development stage enterprise)
                                 Balance Sheets
                             June 30, 2007 and 2006


                                                              June 30, 2007     June 30, 2006
                                                               -----------       -----------
<S>                                                            <C>               <C>
                                     Assets
Assets
   Cash on hand and in bank                                    $     9,342       $     2,146
                                                               -----------       -----------

Total Assets                                                   $     9,342       $     2,146
                                                               ===========       ===========


                      Liabilities and Stockholders' Deficit

Current Liabilities
   Current portion of long-term pre-petition tax liabilities   $      --         $   113,638
   Accounts payable - trade                                            275            52,797
   Accrued interest payable                                          1,233            99,927
   Line of credit payable to shareholder                            45,753           390,625
                                                               -----------       -----------
                                                                    47,261           656,987
                                                               -----------       -----------

Long-Term Liabilities
   Line of credit payable to shareholder                              --               7,500
                                                               -----------       -----------

   Total Liabilities                                                47,261           664,487
                                                               -----------       -----------


Commitments and contingencies


Stockholders' Deficit Preferred stock - $0.01 par value.
     10,000,000 shares authorized
     None issued and outstanding                                      --                --
   Common stock - $0.01 par value.
     150,000,000 shares authorized.
     1,250,090 and 419,449 shares
       issued and outstanding, respectively                         12,501             4,194
   Additional paid-in capital                                    2,925,425           577,956
   Accumulated deficit prior to development stage               (1,001,679)       (1,001,679)
   Deficit accumulated during development stage                 (1,974,166)         (242,812)
                                                               -----------       -----------

     Total Stockholders' Deficit                                   (37,919)         (662,341)
                                                               -----------       -----------

Total Liabilities and Stockholders' Deficit                    $     9,342       $     2,146
                                                               ===========       ===========

</TABLE>


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




                                                                             F-3
<PAGE>
<TABLE>
<CAPTION>



                               Nevstar Corporation
                        (a development stage enterprise)
                 Statements of Operations and Comprehensive Loss
                     Years ended June 30, 2007 and 2006 and
          Period from November 22, 2002 (date of bankruptcy settlement)
                             through June 30, 2007



                                                                                              Period from
                                                                                           November 22, 2002
                                                                                          (date of bankruptcy
                                                  Year ended            Year ended        settlement) through
                                                 June 30, 2006         June 30, 2007         June 30, 2007
                                                  -----------           -----------           -----------
<S>                                               <C>                   <C>                   <C>

Revenues                                          $      --             $      --             $      --

Operating Expenses
   General and administrative expenses                 10,627                39,706               163,551
   Consulting expense related to issuance
     of common stock at less than "fair value"      1,736,738                  --               1,736,738
                                                  -----------           -----------           -----------
   Total Operating Expenses                         1,747,365                39,706             1,900,289
                                                  -----------           -----------           -----------

Loss from Operations                               (1,747,365)              (39,706)           (1,900,289)

Other Expense
   Other income                                          --                    --                  20 000
   Gain on settlement of liabilities                   44,581                 9,985                54,566
   Interest expense                                   (28,570)              (40,854)             (148,443)
                                                  -----------           -----------           -----------

Loss before Provision for Income Taxes             (1,731,354)              (70,575)           (1,974,166)

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

Net Loss                                           (1,731,354)              (70,575)           (1,974,166)

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

Comprehensive Loss                                $(1,731,354)          $   (70,575)          $(1,974,166)
                                                  ===========           ===========           ===========

Loss per weighted-average share of common stock
   outstanding, computed on Net Loss -
   basic and fully diluted                        $     (1.86)          $     (0.20)
                                                  ===========           ===========

Weighted-average number of shares
   of common stock outstanding                        933,764               349,586
                                                  ===========           ===========

</TABLE>

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



                                                                             F-4
<PAGE>
<TABLE>
<CAPTION>

                               Nevstar Corporation
                        (a development stage enterprise)
                      Statement of Changes in Stockholders'
            Deficit Period from November 22, 2002 (date of bankruptcy
                        settlement) through June 30, 2007




                                                                                  Accumulated      Deficit
                                                                                   deficit       accumulated
                                             Common Stock            Additional    prior to      during the
                                             ------------             paid-in     development    development
                                         Shares        Amount         capital       stage           stage          Total
                                      -----------    -----------    -----------   -----------    -----------    -----------
<S>                                   <C>            <C>            <C>           <C>            <C>            <C>

Stock issued pursuant
   to Plan of Reorganization
   at Settlement Date on
   November 22, 2002                   50,715,008    $   507,150    $      --     $(1,001,679)   $      --      $  (494,529)
 Effect of January 12, 2006
   1 for 300 reverse stock split      (50,545,559)      (505,456)       505,456          --             --             --
                                      -----------    -----------    -----------   -----------    -----------    -----------



As restated                               169,449          1,694        505,456    (1,001,679)          --         (494,529)

Net loss for the period                      --             --             --            --          (36,007)       (36,007)
                                      -----------    -----------    -----------   -----------    -----------    -----------



Balances at
   June 30, 2003                          169,449          1,694        505,456    (1,001,679)       (36,007)      (530,536)


Net loss for the year                        --             --             --            --          (78,612)       (78,612)
                                      -----------    -----------    -----------   -----------    -----------    -----------



Balances at
   June 30, 2004                          169,449          1,694        505,456    (1,001,679)      (114,619)      (609,148)


Net loss for the year                        --             --             --            --          (57,618)       (36,007)
                                      -----------    -----------    -----------   -----------    -----------    -----------



Balances at
   June 30, 2005                          169,449          1,694        505,456    (1,001,679)      (172,237)      (666,766)


Private placement sale
   of common stock                        250,000          2,500         72,500          --             --           75,000

Net loss for the year                        --             --             --            --          (70,575)       (70,575)
                                      -----------    -----------    -----------   -----------    -----------    -----------



Balances at
   June 30, 2006                          419,449          4,194        577,956    (1,001,679)      (242,812)      (662,341)


Issuance of common stock
   for private placement for cash         723,641          7,237        209,856          --             --          217,093
   for retirement of debt and
     accrued interest                     107,000          1,070        400,875          --             --          401,945
     Consulting expense for
     value of common stock
     sold at less than "fair value"          --             --        1,736,738          --             --        1,736,738

Net loss for the year                        --             --             --            --       (1,731,354)    (1,731,354)
                                      -----------    -----------    -----------   -----------    -----------    -----------



Balances at
   June 30, 2007                        1,250,090    $    12,501    $ 2,925,425   $(1,001,679)   $(1,974,166)   $   (37,919)
                                      ===========    ===========    ===========   ===========    ===========    ===========

</TABLE>

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



                                                                             F-5
<PAGE>
<TABLE>
<CAPTION>

                               Nevstar Corporation
                        (a development stage enterprise)
                            Statements of Cash Flows
                     Years ended June 30, 2007 and 2006 and
          Period from November 22, 2002 (date of bankruptcy settlement)
                             through June 30, 2007



                                                                                                Period from
                                                                                             November 22, 2002
                                                                                            (date of bankruptcy
                                                     Year ended            Year ended       settlement) through
                                                    June 30, 2007         June 30, 2006       June 30, 2007
                                                     -----------          -----------          -----------
<S>                                                  <C>                  <C>                  <C>

Cash Flows from Operating Activities
   Net Loss                                          $(1,731,354)         $   (70,575)         $(1,974,166)
   Adjustments to reconcile net income to net cash
     provided by operating activities
       Depreciation                                         --                   --                   --
       Consulting expense related to issuance
         of common stock at less than "fair value"     1,736,738                 --              1,736,738
       Gain on negotiated debt reduction in
         pre-petition tax liabilities                    (44,581)              (9,985)             (54,566)
       Increase (Decrease) in
         Accounts payable - trade                        (52,522)                 250              (77,771)
         Pre-petition tax liabilities                    (85,000)             (47,234)            (132,234)
         Accrued interest payable                         28,570               36,869              127,076
                                                     -----------          -----------          -----------
Net cash used in operating activities                   (148,149)             (90,675)            (374,923)
                                                     -----------          -----------          -----------


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


Cash Flows from Financing Activities
   Proceeds from sale of common stock                    217,092               75,000              292,092
   Proceeds from loans payable to stockholders            38,253               17,821              213,753
   Cash paid on loans payable to stockholders           (100,000)                --               (121,580)
                                                     -----------          -----------          -----------
Net cash provided by financing activities                155,345               92,821              384,265
                                                     -----------          -----------          -----------


Increase in Cash and Cash Equivalents                      7,196                2,146                9,342

Cash and cash equivalents at beginning of period           2,146                 --                   --
                                                     -----------          -----------          -----------

Cash and cash equivalents at end of period           $     9,342          $     2,146          $     9,342
                                                     ===========          ===========          ===========

Supplemental Disclosures of
   Interest and Income Taxes Paid
   Interest paid during the period                   $      --            $     3,985          $    19,985
                                                     ===========          ===========          ===========
   Income taxes paid (refunded)                      $      --            $      --            $      --
                                                     ===========          ===========          ===========

Supplemental Disclosures of
   Non-Cash Investing and Financing Activities
   Conversion of note payable and accrued interest
     to stockholder into common stock                $   401,946          $      --            $   301,946
                                                     ===========          ===========          ===========

</TABLE>

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


                                                                             F-6
<PAGE>


                               Nevstar Corporation
                        (a development stage enterprise)
                          Notes to Financial Statements
                             June 30, 2007 and 2006



Note A - Organization and Description of Business

Nevstar  Corporation  (Company) was incorporated  under the laws of the State of
Nevada on December  2, 1993 as Mesquite  Gaming  Corp.  On October 3, 1995,  the
Company  changed its name to NevStar  Gaming  Corporation  and on September  18,
1997, changed its name to NevStar Gaming & Entertainment Corporation.

The  Company  was  formed  to  acquire,  develop,   construct,  own  and  manage
hotel/casino  projects. The Company's strategy was to concentrate its efforts on
"niche" markets, such as "local" or "neighborhood" casinos. The Company obtained
its license and related  approvals from the Nevada Gaming  Commission to conduct
gaming at its initial hotel/casino, Mesquite Star Hotel and Casino (The Mesquite
Star) in Mesquite,  Nevada,  pursuant to an Order of Registration dated June 23,
1998. On July 1, 1998,  the Mesquite  Star,  opened for business and the Company
began receiving  revenues from  operations.  The Mesquite Star was located on an
approximately 25-acre property in Mesquite, Nevada.

On December 1, 1999,  the Company  filed a voluntary  petition  for relief under
Chapter 11 (the First Chapter 11  Proceeding)  in the United  States  Bankruptcy
Court, District of Nevada (Bankruptcy Court), Case No. 99-19566RCJ.  The Company
acted as debtor in possession during the First Chapter 11 Proceeding. In part as
a result of the objections of certain of the Company's secured creditors and the
Bankruptcy Court's belief that the Company could not be successfully reorganized
in view of such objections,  the Bankruptcy Court dismissed the First Chapter 11
Proceeding on or about March 2, 2000.

On March 3, 2000,  Randy Black  (Black) was  appointed by the District  Court of
Clark  County,  Nevada as receiver for the  Company.  On or about March 8, 2000,
Black caused the casino to cease all  meaningful  operations  and the casino was
closed.  The Company has not  engaged in  business  operations  since that date.
Subsequently,  Black  acquired  the first trust deed on the casino from the bank
and he began foreclosure proceedings against the casino.

On July 10, 2000, the Company again filed a voluntary  petition for relief under
Chapter 11 (the Second Chapter 11 Proceeding) in the Bankruptcy  Court, Case No.
BK-S-00-15075-LBR. During the Second Chapter 11 Proceeding, the Company acted as
debtor in possession. During the course of the Second Chapter 11 Proceeding, the
Bankruptcy  Court permitted Black to foreclose on the casino,  which occurred on
November 13, 2000. In April,  2001, the Company and W/F Investment  Corp.  (W/F)
submitted to the Bankruptcy  Court a plan of  reorganization,  which was amended
from  time to time (the Plan of  Reorganization).  On  February  20,  2002,  the
Bankruptcy  Court  issued an order  confirming  the Plan of  Reorganization.  On
November 22, 2002,  the Plan of  Reorganization  became  effective.  The Company
issued 15,141,674 shares of common stock to holders of unsecured claims; 156,428
shares of common stock to certain  administrative  claimants and to a previously
secured  claim  holder,  and  27,807,219  shares  of  common  stock  to the Plan
Proponents.   The  7,583,687   shares  of  Common  Stock  that  were  previously
outstanding  were retained by the holders of those shares.  There are a total of
50,715,008 shares of common Stock outstanding after the issuance of shares under
the Plan of  Reorganization.  The Plan of  Reorganization  authorized  a reverse
split of the Common Stock, which occurred on January 12, 2006. The effect of the
reverse stock split is reflected in the accompanying  financial statements as of
the first day of the first period presented.

On September 6, 2005, the United States  Bankruptcy  Court,  District of Nevada,
issued a final  decree in the  Chapter  11  proceeding,  formally  removing  the
Company from the  oversight of the  Bankruptcy  Court and ending all  bankruptcy
proceedings.

On October 11 2005,  the Company  entered into a Stock  Purchase  Agreement with
Halter Financial  Investments,  L.P., a Texas limited partnership (HFI) pursuant
to which the Company sold 250,000 newly issued,  restricted  post-reverse  split
shares  (75,000,000  pre-reverse  split  shares)  of its  common  stock  to HFI,
constituting a change of control of the Company.



                                                                             F-7
<PAGE>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                             June 30, 2007 and 2006



Note A - Organization and Description of Business - Continued

The Company's emergence from Chapter 11 of Title 11 of the United States Code on
November 22, 2002 created the combination of a change in majority  ownership and
voting control - that is, loss of control by the then-existing  stockholders,  a
court-approved reorganization, and a reliable measure of the entity's fair value
- resulting in a fresh start,  creating,  in substance,  a new reporting entity.
Accordingly,   the  Company,   post  bankruptcy,   has  no  significant  assets,
liabilities or operating activities.  Therefore, the Company, as a new reporting
entity, qualifies as a "development stage enterprise" as defined in Statement of
Financial Accounting Standard No. 7, as amended.

The  Company's  post-bankruptcy  business  plan is to locate and combine with an
existing,  privately-held  company which is profitable or, in management's view,
has growth  potential,  irrespective  of the  industry  in which it is  engaged.
However, the Company does not intend to combine with a private company which may
be deemed to be an investment  company subject to the Investment  Company Act of
1940. A combination  may be structured as a merger,  consolidation,  exchange of
the  Company's  common  stock for stock or assets or any other  form  which will
result in the combined enterprise's becoming a publicly-held corporation.

As of the date of the accompanying  financial statements and subsequent thereto,
the Company does not have any operations.


Note B - Preparation of Financial Statements

The  Company  follows  the  accrual  basis  of  accounting  in  accordance  with
accounting principles generally accepted in the United States of America and has
a year-end of June 30.

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

Management further acknowledges that it is solely responsible for adopting sound
accounting  practices,   establishing  and  maintaining  a  system  of  internal
accounting  control and preventing and detecting  fraud. The Company's system of
internal  accounting  control is designed to assure,  among other items, that 1)
recorded  transactions  are valid; 2) valid  transactions  are recorded;  and 3)
transactions  are  recorded in the proper  period in a timely  manner to produce
financial  statements which present fairly the financial  condition,  results of
operations  and cash  flows of the  Company  for the  respective  periods  being
presented


Note C - Going Concern Uncertainty

The Company has no post-bankruptcy  operating history,  limited cash on hand, no
other  operating  assets and has a business plan with inherent risk.  Because of
these  factors,  the  Company's  auditors  have  issued an audit  opinion on the
Company's  financial  statements  for each of the years  ended June 30, 2007 and
2006,  respectively,  which includes a statement  describing the Company's going
concern status.  This means,  in the Company's  auditor's  opinion,  substantial
doubt exists about the  Company's  ability to continue as a going concern at the
date of their opinion.

The Company's majority stockholder maintains the corporate status of the Company
and has provided all nominal  working  capital  support on the Company's  behalf
since the bankruptcy  discharge date. Because of the Company's lack of operating
assets,  its  continuance  is fully  dependent  upon the majority  stockholder's
continuing support.  The majority stockholder intends to continue the funding of
nominal necessary expenses to sustain the corporate entity.




                                                                             F-8
<PAGE>


                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                             June 30, 2007 and 2006



Note C - Going Concern Uncertainty - Continued

The  Company's  continued  existence is  dependent  upon its ability to generate
sufficient cash flows from operations to support its daily operations as well as
provide sufficient resources to retire existing liabilities and obligations on a
timely basis.  Further, the Company faces considerable risk in its business plan
and a potential  shortfall of funding due to our  inability to raise  capital in
the equity  securities  market.  If no additional  operating capital is received
during the next twelve  months,  the Company  will be forced to rely on existing
cash in the bank and additional  funds loaned by management  and/or  significant
stockholders.  In the event,  the  Company is unable to  acquire  advances  from
management and/or  significant  stockholders,  the Company's ongoing  operations
would be negatively impacted.

The Company's  business plan is to seek an  acquisition or merger with a private
operating   company  which  offers  an  opportunity   for  growth  and  possible
appreciation of our stockholders'  investment in the then issued and outstanding
common stock.  However,  there is no assurance  that the Company will be able to
successfully  consummate  an  acquisition  or merger  with a  private  operating
company or, if  successful,  that any  acquisition  or merger will result in the
appreciation  of our  stockholders'  investment in the then  outstanding  common
stock.

The Company  remains  dependent upon additional  external  sources of financing;
including being dependent upon its management and/or significant stockholders to
provide   sufficient   working  capital  in  excess  of  the  Company's  initial
capitalization to preserve the integrity of the corporate entity.

The Company  anticipates  offering future sales of equity  securities.  However,
there is no assurance that the Company will be able to obtain additional funding
through the sales of additional  equity  securities  or, that such  funding,  if
available, will be obtained on terms favorable to or affordable by the Company.

It  is  the  intent  of  management  and  significant  stockholders  to  provide
sufficient  working  capital  necessary to support and preserve the integrity of
the corporate entity.  However, no formal commitments or arrangements to advance
or loan funds to the Company or repay any such advances or loans exist. There is
no legal obligation for either management or significant stockholders to provide
additional future funding.


Note D - Summary of Significant Accounting Policies

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

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

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

     The Company uses the asset and liability  method of  accounting  for income
     taxes. At June 30, 2006 and 2005, respectively,  the deferred tax asset and
     deferred tax liability accounts, as recorded when material to the financial
     statements,  are entirely the result of  temporary  differences.  Temporary
     differences   represent  differences  in  the  recognition  of  assets  and
     liabilities for tax and financial reporting purposes.

     As of June 30,  2007 and  2006,  the  deferred  tax  asset  related  to the
     Company's net operating loss  carryforward  is fully  reserved.  Due to the
     provisions of Internal  Revenue Code, the Company may have no net operating
     loss  carryforwards  available to offset financial  statement or tax return
     taxable  income  in  future  periods  as a result  of a change  in  control
     involving  50  percentage  points  or more of the  issued  and  outstanding
     securities of the Company.

3.   Earnings (loss) per share
     -------------------------

     Basic  earnings  (loss) per share is computed  by  dividing  the net income
     (loss) available to common shareholders by the  weighted-average  number of
     common shares  outstanding  during the respective  period  presented in our
     accompanying financial statements.



                                                                             F-9
<PAGE>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                             June 30, 2007 and 2006



Note D - Summary of Significant Accounting Policies - Continued

3.   Earnings (loss) per share - continued
     -------------------------------------

     Fully diluted earnings (loss) per share is computed similar to basic income
     (loss) per share  except that the  denominator  is increased to include the
     number of common  stock  equivalents  (primarily  outstanding  options  and
     warrants).

     Common  stock  equivalents  represent  the  dilutive  effect of the assumed
     exercise of the outstanding stock options and warrants,  using the treasury
     stock method, at either the beginning of the respective period presented or
     the date of  issuance,  whichever  is later,  and only if the common  stock
     equivalents  are  considered  dilutive  based upon the Company's net income
     (loss) position at the calculation date.

     At June 30,  2007 and 2006,  and  subsequent  thereto,  the  Company had no
     outstanding common stock equivalents.

     The  weighted-average  number of shares issued and outstanding as reflected
     in the accompanying  financial statements have been adjusted to give effect
     to the aforementioned 1-for-300 reverse stock split.

4.   Pending and/or New Accounting Pronouncements
     --------------------------------------------

     In July 2006,  the  Financial  Accounting  Standards  Board  (FASB)  issued
     Interpretation  No. 48,  "Accounting  for  Uncertainty in Income Taxes (FIN
     48).  This  interpretation  requires the  recognition  and  measurement  of
     uncertain income tax positions using a "more-likely-than-not" approach. The
     provisions  of  FIN 48 are  effective  for  fiscal  years  beginning  after
     December 15, 2006.  The Company  does not  anticipate  that the adoption of
     this accounting  pronouncement will have a material effect on its financial
     statements.

     The  Company  is also of the  opinion  that any  other  pending  accounting
     pronouncements,  either in the  adoption  phase or not yet  required  to be
     adopted,  will not have a  significant  impact on the  Company's  financial
     position or results of operations.


Note E - Fair Value of Financial Instruments

The carrying amount of cash,  accounts payable and notes payable, as applicable,
approximates  fair value due to the short term nature of these items  and/or the
current interest rates payable in relation to current market conditions.

Interest  rate risk is the risk  that the  Company's  earnings  are  subject  to
fluctuations  in interest  rates on either  investments  or on debt and is fully
dependent  upon  the  volatility  of  these  rates.  The  Company  does  not use
derivative instruments to moderate its exposure to interest rate risk, if any.

Financial  risk  is  the  risk  that  the  Company's  earnings  are  subject  to
fluctuations in interest rates or foreign exchange rates and are fully dependent
upon the  volatility  of  these  rates.  The  company  does  not use  derivative
instruments to moderate its exposure to financial risk, if any.


Note F - Pre-Petition Tax Liabilities

Certain  pre-petition tax liabilities to the Nevada  Department of Taxation were
agreed to be retired,  pursuant to the Bankruptcy Code and stipulations  entered
into  between the  parties and the  Company,  plus  interest at 5% in  quarterly
payments ending September,  2009. The Company settled this debt for $85,000 cash
on  April  9,  2007  and  recognized  an   approximate   $44,580  gain  on  debt
extinguishment.

During the quarter  ended  December 31, 2005,  the Company  reached a settlement
agreement with the Nevada Gaming Commission and paid approximately  $51,220 as a
"settlement in full" on the outstanding debt, resulting in an approximate $9,985
gain on debt extinguishment.



                                                                            F-10
<PAGE>
<TABLE>
<CAPTION>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                             June 30, 2007 and 2006



Note G - Line of Credit Notes Payable to Shareholders

W/F Investment Corp.
--------------------

The Company had a $250,000  revolving line of credit with W/F Investment Corp, a
company  shareholder and key participant of the Company's Plan of Reorganization
in the Second Chapter 11 Proceeding. As of June 30, 2007 and 2006, respectively,
this  Line of  Credit  has an  outstanding  balance  of  approximately  $-0- and
$390,625.

Proceeds  from this Line of Credit were used to pay the  Company's  obligations,
including the bankruptcy related allowed  administrative  expenses,  accounting,
legal and related  expenses.  The Line of Credit bore interest at prime plus 2%,
payable monthly.  The Line of Credit was due October 31, 2007.  Accrued interest
on the Line of Credit  totaled  approximately  $-0- and $88,219 at June 30, 2007
and 2006, respectively.

On November  17,  2006,  the Company  satisfied  the terms and  conditions  of a
Settlement and Stock  Issuance  Agreement  with W/F  Investment  Corp.  (W/F), a
shareholder  of the Company,  with the payment of $100,000 cash and the issuance
of 107,000 shares of restricted  common stock to settle the Company's  aggregate
approximately  $501,946  debt  obligation  to W/F.  The  form  and  terms of the
agreement  were  agreed  upon as part of the  October  2005  change  in  control
transaction as disclosed in the Company's  Current Report on Form 8-K filed with
the SEC on October 12, 2005.

Halter Financial Investments, LP
--------------------------------

The Company and Halter Financial Investments,  LP (HFI), an entity controlled by
the Company's  President and Chief Executive  Officer,  have  acknowledged  that
outside funds are necessary to support the corporate  entity and comply with the
periodic  reporting  requirements  of the  Securities  Exchange Act of 1934,  as
amended.  To this end,  HFI has agreed to lend the Company up  to$50,000  with a
maturity  period not to exceed two (2) years from the initial funding date at an
interest rate of 6.0% per annum.  Through June 30, 2007 and 2006,  respectively,
HFI has  advanced  approximately  $45,753 and $7,500,  respectively,  under this
agreement, with an initial scheduled maturity date in May 2008.


Note H - Income Taxes

The components of income tax (benefit)  expense for each of the years ended June
30, 2007 and 2006 and for the period from  November 22, 2002 (date of bankruptcy
settlement) through June 30, 2007 is as follows:

                                                                       Period from
                                                                    November 22, 2002
                                                                   (date of bankruptcy
                                 Year ended         Year ended     settlement) through
                                June 30, 2007     June 30, 2006       June 30, 2007
                                -------------     -------------       -------------
<S>                             <C>               <C>                 <C>

       Federal:
         Current                  $   --             $   --            $    --
         Deferred                     --                 --                 --
                                  -------             ------             ------
                                      --                 --                 --
                                  -------             ------             ------
       State:
         Current                      --                 --                 --
         Deferred                     --                 --                 --
                                  -------             ------             ------
                                      --                 --                 --
                                  -------             ------             ------
         Total                    $   --             $   --             $   --
                                  =======            =======            =======

</TABLE>




                                                                            F-11
<PAGE>
<TABLE>
<CAPTION>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                             June 30, 2007 and 2006



Note H - Income Taxes - Continued

As a result of a October  28,  2005  change in  control,  the  Company has a net
operating loss  carryforward of  approximately  $41,000 to offset future taxable
income.  The amount and availability of any net operating loss carryforwards may
be subject to limitations set forth by the Internal  Revenue Code.  Factors such
as the number of shares  ultimately issued within a three year look-back period;
whether  there is a deemed  more than 50  percent  change in  control  involving
holders of 5.0% or more of the issued and  outstanding  shares of common  stock;
the  applicable  long-term  tax  exempt  bond  rate;  continuity  of  historical
business;  and  subsequent  income  of the  Company  all enter  into the  annual
computation of allowable annual utilization of the carryforwards.

The Company's income tax expense  (benefit) for each of the years ended June 30,
2007 and 2006 and for the period  from  November  22,  2002 (date of  bankruptcy
settlement)  through June 30, 2007  respectively,  differed  from the  statutory
federal rate of 34 percent as follows:

                                                                                                    Period from
                                                                                                 November 22, 2002
                                                                                                (date of bankruptcy
                                                           Year ended          Year ended       settlement) through
                                                          June 30, 2007       June 30, 2006       June 30, 2007
                                                          -------------       -------------       -------------
<S>                                                       <C>                 <C>                 <C>


Statutory rate applied to income before income taxes        $(588,700)            $ (24,000)            $(671,300)
Increase (decrease) in income taxes resulting from:
     State income taxes                                          --                    --                    --
     Compensation expense related to common
     stock issuances at less than "fair value"                590,500                  --                 590,500
     Other, including reserve for deferred tax asset
       and application of net operating loss carryforward      (1,800)               24,000                80,800
                                                            ---------             ---------             ---------

     Income tax expense                                     $    --               $    --               $    --
                                                            =========             =========             =========

</TABLE>

The  Company's  available  net operating  loss  carryforward,  subsequent to the
October 28, 2005 change in control, is approximately $41,000 and gives rise to a
deferred tax asset of  approximately  $14,000 as of June 30, 2007. This deferred
tax asset is fully reserved due to the uncertainty of it's ultimate utilization,
if any, in future periods.


Note I - Common Stock Transactions

Authorized Shares and Reincorporation

On January 3, 2006,  the  Company  filed an  Amendment  and  Restatement  of its
Articles of  Incorporation  with the  Secretary of State of the State of Nevada.
This Amendment allows for the issuance of up to 150,000,000  shares,  consisting
of any combination of Common Stock, par value $0.01 and up to 10,000,000  shares
of Preferred Stock, par value $0.01 per share. Prior to this change, the Company
was authorized to issue up to 126,396,000 shares of $0.01 par value Common Stock
and up to 10,000,000  shares of $0.01 par value Preferred  Stock.  The effect of
this change is  reflected in the  accompanying  financial  statements  as of the
first day of the first period presented.

On January 12, 2006, the Company  effected a 1-for-300 share reverse stock split
of the then issued and outstanding common stock. The reverse stock split did not
change the number of  authorized  shares of common stock or the par value of the
Company's  common stock.  Except for any changes as a result of the treatment of
fractional  shares,  each stockholder  holds the same percentage of common stock
outstanding  immediately  following the reverse stock split as such  stockholder
did immediately prior to the reverse stock split.

This  action  caused  the  issued  and  outstanding   shares  to  decrease  from
125,715,008 to approximately  419,436. The effect of this action is reflected in
the  accompanying  financial  statements as of the first day of the first period
presented.



                                                                            F-12
<PAGE>

                               Nevstar Corporation
                        (a development stage enterprise)
                    Notes to Financial Statements - Continued
                             June 30, 2007 and 2006



Note I - Common Stock Transactions - Continued

Stock issuances

On October 11,  2005,  the Company  sold  250,000  post-reverse  split shares of
restricted   common  stock  for  gross  proceeds  of  $75,000,   pursuant  to  a
subscription agreement, to Halter Financial Investments, L. P., (a Texas Limited
Partnership),  an entity  controlled  by  Timothy  P.  Halter,  who  became  the
Company's current Chief Executive Officer.  The Company relied upon Section 4(2)
of The Securities Act of 1933, as amended, for an exemption from registration of
these shares and no underwriter was used in this transaction.

On November  17,  2006,  the Company  sold to HFI 723,641  shares of  restricted
common stock for approximately  $217,000 or $0.30 per share. The transaction was
effected pursuant to the terms of a Stock Purchase Agreement entered into by the
Company and HFI on October 11,  2005.  The  purchase  transaction  was  effected
without  registration  in reliance  upon Section 4(2) of the  Securities  Act of
1933.  The form and terms of the purchase  agreement were agreed upon as part of
the October 2005 change in control  transaction  as  disclosed in the  Company's
Current  Report on Form 8-K filed  with the SEC on  October  12,  2005.  As this
selling   price  was   substantially   below  the  "fair  value"  of  comparable
transactions,  the Company  recognized  a charge to  operations  for  consulting
expense of  approximately  $1,736,700  equivalent to the difference  between the
established "fair value" of $2.70 per share (as determined by the quoted closing
price of the  Company's  common  stock on the date of the  transaction)  and the
selling price of $0.30 per share.

On November  17,  2006,  the Company  satisfied  the terms and  conditions  of a
Settlement and Stock  Issuance  Agreement  with W/F  Investment  Corp.  (W/F), a
shareholder  of the Company,  with the payment of $100,000 cash and the issuance
of  107,000  shares of  restricted  common  stock to settle the  Company's  debt
obligation to W/F of approximately $501,945. The form and terms of the agreement
were agreed upon as part of the October  2005 change in control  transaction  as
disclosed  in the  Company's  Current  Report on Form 8-K filed  with the SEC on
October 12, 2005.





                (Remainder of this page left blank intentionally)


                        (Signatures follow on next page)











                                                                            F-13
<PAGE>


                                   SIGNATURES

In accord with Section 13 or 15(d) of the  Securities  Act of 1933,  as amended,
the Company  caused  this report to be signed on its behalf by the  undersigned,
thereto duly authorized.

                                                          Nevstar Corporation

Dated: September 12, 2007                          By:  /s/ Timothy P. Halter
       ------------------                               ------------------------
                                                            Timothy P. Halter
                                                     President, Sole Director
                                                  Chief Executive Officer and
                                                      Chief Financial Officer

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

                                                          Nevstar Corporation

Dated: September 12, 2007                          By:  /s/ Timothy P. Halter
       ------------------                               ------------------------
                                                            Timothy P. Halter
                                                     President, Sole Director
                                                  Chief Executive Officer and
                                                      Chief Financial Officer




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