SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB
                Annual Report Pursuant to Section 13 or 15(d) of
               the Securities Exchange Act of 1934 (Fee Required)

For the Fiscal Year Ended June 30, 1996      Commission file number   0-18224
                                                                     ---------

                              NUOASIS GAMING, INC.

                                    Delaware
                  (State of other jurisdiction of incorporation
                                or organization)


                                   95-4176781
                      (I.R.S. Employer Identification No.)

                2 Park Plaza, Suite 470, Irvine, California 92614
                    (Address of Principal Executive Offices)


       Registrant's telephone number, including area code: (714) 833-5382
                                  ------------
           Securities registered pursuant to Section 12(b) of the Act:
                                      None

           Securities registered pursuant to Section 12(g) of the Act:
                          Common Stock, $.01 Par Value

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                         Yes  X         No 
                             ---           ---

         Indicate by check mark if disclosure of delinquent  filers  pursuant to
Item 405 of Regulation  S-K, is not contained  herein and will not be contained,
to the best of  Registrant's  knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB.

                                                                               o

         As of September  30,  1996,  the  aggregate  market value of the voting
stock   (based   upon  the  average   closing  bid  and  asked   prices  in  the
over-the-counter market as quoted on NASD-OTC Bulletin Board as of September 30,
1996) held by non-affiliates was approximately $5,781,380.

                                      Class
                          -----------------------------
                          Common Stock , $.01 par value

                       Outstanding at September 30, 1996
                       ---------------------------------
                               30,000,000 shares


                      Documents Incorporated by Reference:
                                      None

                                       Total Number of Pages Including Cover: 64

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<PAGE>



                                TABLE OF CONTENTS

                                                                         Page

                                     PART I

Item 1. Business ..........................................................1

Item 2. Properties ........................................................6

Item 3. Legal Proceedings .................................................6

Item 4. Submission of Matters to a Vote of Security-Holders ...............9

                                     PART II

Item 5.  Market  for  the  Registrant's   Securities  and  
          Related Stockholder Matters .....................................10

Item 6. Management's  Discussion and Analysis of Financial
          Condition and Results of Operations .............................11

Item 7. Financial Statements 13

Item 8.  Changes  in  and  Disagreements  with  Accountants
          on  Accounting  and Financial Disclosures .......................13

                                    PART III

Item 9. Directors and Executive Officers of the Registrant ................15

Item 10. Executive Compensation ...........................................18

Item 11. Security Ownership of Certain Beneficial Owners and
          Management ......................................................23

Item 12. Certain Relationships and Related Transactions ...................26

                                     PART IV

Item 13. Exhibits and Reports on Form 8-K .................................29

                                                    {NUOGAM\10K\96\96KSB.CLN}-22

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                                     PART I


ITEM 1.       BUSINESS.

(a)    BUSINESS DEVELOPMENT

    GENERAL

    NuOasis Gaming,  Inc. (the "Company",  or the "Registrant") was incorporated
in the State of Delaware  in 1987.  As of the date of filing  this  Report,  the
Registrant  has had no current  ongoing  business.  The  Registrant is presently
evaluating  business  opportunities for possible  acquisition  within the gaming
industry.

    In September 1992, prior management redirected the Registrant's focus to the
legalized  gaming  business.  In this  connection,  on December  15,  1992,  the
Registrant  established a gaming  subsidiary in Louisiana  named Phillips Gaming
International,  Inc.,  a Louisiana  corporation.  On December 8, 1993,  Phillips
Gaming  International,   Inc.  changed  its  corporate  name  to  Ba-Mak  Gaming
International,  Inc. ("Ba- Mak"). On April 8, 1993, Ba-Mak obtained a license to
distribute  and conduct route  operations of electronic  video bingo machines to
licensed charitable gaming locations in the state of Louisiana. Ba-Mak filed for
protection  under  Chapter  11 of the  U.S.  Bankruptcy  Code in  October  1995.
Operations  of Ba- Mak  continued  through  April 20, 1995, at which time Ba-Mak
converted its Chapter 11 bankruptcy proceeding into a proceeding under Chapter 7
of the  Bankruptcy  Code  (the  Ba-Mak  Bankruptcy).  As a  result,  all  gaming
operations  at  Ba-Mak  ceased  and the  Chapter 7 Trustee  took  possession  of
Ba-Mak's  assets  and  liquidated  such  assets  for  the  benefit  of  Ba-Mak's
bankruptcy  estate.  Gaming  revenues from Ba-Mak will not recur in future years
due to the bankruptcy and liquidation of Ba-Mak.

    Since 1992,  substantially  all of the  Registrant's  efforts were  directed
toward  acquiring  or merging with another  company (or  companies),  preserving
remaining  capital,  raising  additional  capital and  creating a new  operating
entity,  in addition to settling certain pending lawsuits and other  obligations
of the Registrant.

    On January 13,  1994,  the  Registrant  entered  into a Stock  Purchase  and
Business  Combination  Agreement  (the  "Stock  Purchase  Agreement")  with Nona
Morelli's  II,  Inc.  ("Nona")  and  Nona's  wholly-owned   subsidiary,   Casino
Management of America,  Inc. ("CMA"),  whereby the Registrant agreed to purchase
all of the  outstanding  capital  stock of CMA  from  Nona in  exchange  for the
Registrant  issuing  to Nona a)  2,000,000  shares of common  stock;  b) 250,000
shares of Series B Convertible  Preferred Stock; c) 6,000,000 New Class D common
stock  purchase  warrants;  and d) an option  to  purchase  up to an  additional
6,000,000  shares of common  stock.  A Closing  occurred on March 30, 1994,  the
"Closing Date", whereby CMA became a wholly-owned  subsidiary of the Registrant.
The former Board of Directors,  with the exception of Gary L. Blum, resigned and
elected replacement Directors nominated by Nona.

     At the Closing,  the  Registrant  issued to Nona,  2,000,000  shares of the
Registrants  common  stock,  250,000  shares of a new  class of the  Registrants
convertible  preferred  stock (the "Series B Preferred"),  6,000,000 New Class D
warrants common stock (the "New Class D Warrants"), and an option to purchase up
to an additional  6,160,000 shares of the Registrants common stock,  exercisable
under certain  conditions  (the "Nona Option").  A Certificate of  Designations,
Preferences and Rights, a Warrant  Certificate and an Option  Agreement  setting
forth  the terms  and  conditions  of the  Series B  Preferred,  the New Class D
Warrants and the Nona Option,  respectively,  were  prepared and approved by the
Registrant  prior to the  Closing  Date and were filed as  Exhibits to a Current
Report on Form 8-K dated March 31, 1994 and filed on April 11, 1994.

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<PAGE>



    As a result of the Stock  Purchase  Agreement  with Nona, a change in voting
control of the Registrant  occurred in March 1994. The new Board of Directors of
the Registrant  effected the corporate name change to "NuOasis Gaming,  Inc." on
September 23, 1994. Based on 30,000,000 shares of common stock outstanding as of
June 30, 1996,  Nona can vote 40.2% of the  Registrant's  voting  securities  by
virtue of its ownership of 491,847  shares of common stock and 250,000 shares of
Series B  Preferred  Stock,  and the  Registrant  may  become  a  majority-owned
subsidiary of Nona, a publicly-held  company whose shares are traded on NASD-OTC
Bulletin  Board, if Nona converts the Series B Preferred Stock into common stock
or exercises the warrants granted to it in the Stock Purchase Agreement. Nona is
considered  an  affiliate  of  Registrant  given  Nona's  voting  control of the
Registrant.

    Since the change in control of the Registrant,  new management has sought to
divide its business  segments,  both  development  stage and  operational,  into
separate  subsidiaries.  This  restructuring  commenced  following the change in
control  on March  30,  1994.  The  restructuring  was  undertaken  to allow the
Registrant  to redefine its business  segments,  concentrate  its  financial and
human resources in each of its present areas of operation, and focus performance
incentives based upon separate  segment,  or  project-specific  businesses.  The
restructuring  entailed  a  change  in  Board  of  Directors,  upper  and  local
management and a segregation of the Registrant's  then operational  segment from
its developmental stage segments in separate subsidiaries.

    Following the Ba-Mak  bankruptcy,  the Registrant began evaluating  business
opportunities  for  possible  acquisition.  In  particular,  the  Registrant  is
evaluating the possible  acquisition of a developmental stage California company
formed in 1992 to facilitate participation in group play in the California State
Lottery, and the lotteries of other states,  through the sale of a prepaid debit
card called the  HIT-LOTTO  value card.  If management is successful in locating
and  acquiring a business  opportunity  on terms which can be  satisfied  by the
Registrant given its present negative  working capital  position,  it intends to
make  such  acquisition  and  thereafter  manage  such  acquisition   through  a
parent-subsidiary  relationship  where the Registrant  will operate as a holding
company and  supervise  and  provide  administrative  and other  services to its
subsidiary business.

     As used  herein,  the term  "Company"  or  "Registrant"  refers to  NuOasis
Gaming,  Inc. and its wholly- owned subsidiaries:  Ba-Mak Gaming  International,
Inc.  ("Ba-Mak") and Casino Management of America,  Inc.  ("CMA").  CMA owns two
subsidiaries: NuOasis Laughlin, Inc. ("NuOasis Laughlin") and NuOasis Las Vegas,
Inc.  ("NuOasis Las Vegas").  The Registrant  currently  maintains its executive
offices at 2 Park Plaza,  Suite 470,  Irvine,  California  92614.  The telephone
number is (714) 833-5382.

    SUBSIDIARIES

    BA-MAK GAMING INTERNATIONAL, INC.

     On September 30, 1994,  Ba-Mak had agreements with five  charitable  gaming
establishments  in New Orleans at which 140 video bingo machines were operating.
Ba-Mak  recognized as gaming  revenues the gross funds  deposited in video bingo
machines.  Ba-Mak  realized  gross  profits,  or "net win" as represented by the
difference  between  gross funds  deposited  into the  machines  and payments to
customers. Ba-Mak realized net operating profits by way of the percentage of the
net win after payments to the charitable organizations,  the location owners and
the State of Louisiana for gaming taxes.  On October 28, 1994,  Ba-Mak filed for
protection under Chapter 11 of the U.S.  Bankruptcy Code in the Eastern District
of Louisiana.

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                                        2

<PAGE>



    Commencing October 28, 1994, Ba-Mak, as a Debtor-in-Possession, continued to
operate as a  charitable  bingo  route  operator  in  Louisiana.  In April 1995,
operations  ceased when the bankruptcy  proceeding was converted to a proceeding
under Chapter 7. Since April 1995, the Chapter 7 Trustee has liquidated Ba-Mak's
assets for the benefit of Ba-Mak's  bankruptcy  estate.  All but 35 of the video
bingo  machines  were  returned to the  machine  vendor in  satisfaction  of its
secured claim. The remaining 35 machines and Ba-Mak's office equipment were sold
by the Trustee.  The  Registrant  has filed a Proof of Claim with the Bankruptcy
Court  for the  intercompany  advances  made to  Ba-Mak.  As of the date of this
Report, the Trustee's administration of the bankruptcy estate is ongoing. Due to
the amount of other  creditor  claims  filed in  Ba-Mak's  estate and the amount
received by the Trustee,  the Registrant does not anticipate  receiving any sums
on its Claim. (As discussed in Item 3(c).)

    CASINO MANAGEMENT OF AMERICA, INC.

    CMA did not have any operations  during fiscal 1996 and 1995.  However,  CMA
intends to pursue gaming investments and, as of the date of this Report, CMA has
no potential acquisition candidates.

    NUOASIS LAS VEGAS, INC. AND NUOASIS LAUGHLIN, INC.

     Neither  NuOasis  Las  Vegas,  Inc.  nor  NuOasis  Laughlin,  Inc.  had any
operations during fiscal year 1996 and 1995.  NuOasis Las Vegas, Inc. was formed
for the purpose of acquiring gaming assets in the metropolitan Las Vegas, Nevada
area.  NuOasis  Laughlin,  Inc. was formed for the purpose of  acquiring  gaming
assets in the Laughlin,  Nevada area. Negotiations by each of these subsidiaries
of CMA to acquire  certain  gaming  assets have reached an impasse.  Each of the
subsidiaries  of CMA intend to pursue  other gaming  assets in their  respective
geographical segments.

    CHANGE IN FISCAL YEAR

    During the nine  months  ended  June 30,  1996  ("fiscal  year  1996"),  the
Registrant elected to change its fiscal year end from September 30 to June 30 to
facilitate  and coincide with Nona's fiscal year end of June 30. The election of
change  in fiscal  year was  reported  on a Current  Report on Form 8-K filed on
November 10, 1995.

    OPTION AGREEMENT

    On June  13,  1996,  Nona  entered  into an  Option  Agreement  with  Joseph
Monterosso,  President of National  Pools  Corporation  ("NPC"),  an  individual
previously  unrelated to the Registrant or Nona, and granted such  individual an
option to purchase the 250,000 Series B Preferred Shares of the Registrant owned
by Nona at a purchase price of $13.00 per share, or a total of $3,250,000,  with
a minimum purchase of 110,000 shares.

    The exercise of the option is  conditioned  upon  shareholder  approval of a
proposal  to increase  the  authorized  number of shares of common  stock of the
Registrant  by at least  twenty  million  (20,000,000)  shares.  The  option  is
assignable   and  shall  expire  90  days  after  the  next  Annual  Meeting  of
Shareholders of the Registrant.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                        3

<PAGE>



    SUBSEQUENT EVENT - ACQUISITION

    On November  21, 1996,  the  Registrant's  board of  directors  approved the
acquisition  of NPC. The  acquisition is expected to be financed by the issuance
of securities,  however, a definitive  agreement has not been signed.  Moreover,
the  acquisition is contingent  upon the occurrence of certain events  including
but not limited to: (a) NPC shareholder  approval;  (b) exercise of that certain
option agreement between Monterosso and Nona; (c) Monterosso  securing financing
that would  allow the  exercise of the option by  Monterosso  and/or one or more
qualified  private  investors;  (d)  reaching an  agreement to sell CMA; and (e)
shareholder  approval of a proposal to increase the number of authorized  shares
of common stock of the Registrant by at least 20,000,000 shares.

(b)    PATENTS, TRADEMARKS AND LICENSES

    The  Registrant's  domestic  gaming  activities,   which  consisted  of  the
activities of Ba-Mak, in the past have not relied on any patents and trademarks,
but are  subject  to gaming  licenses,  food and  beverages  licenses  and other
permits  which are  regulated,  issued and  controlled by the  respective  state
regulatory  agencies.  The Registrant  continues to analyze  prospective  casino
properties  and projects  with the goal of achieving the highest and best use of
its working  capital.  Ba-Mak was  licensed to operate  charitable  bingo gaming
operations in the State of Louisiana.

(c)    CUSTOMER DEPENDENCE

       Ba-Mak was dependent on machine play by the general public in Louisiana.

(d)    BACKLOG OF ORDERS

    The Registrant's  domestic gaming  subsidiaries were not subject to the type
of business activities which would give rise to "orders".

(e)    COMPETITION

    The Registrant  competes with other gaming  companies for  opportunities  to
acquire legal gaming sites in emerging gaming  jurisdictions,  and opportunities
to manage Indian gaming  facilities.  The Registrant expects many competitors to
enter  new  jurisdictions  that  authorize  gaming,  some of whom may have  more
personnel and greater financial and other resources than the Registrant.

(f)    GOVERNMENT REGULATION

    (1)    GENERAL

           Distribution  and route  operations  of gaming  machines  in both the
    non-profit  and  commercial  gaming  sectors  are subject to  extensive  and
    complex governmental  regulation and control under federal, state, and local
    law.

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                                        4

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    (2)    LOUISIANA

           To the extent applicable to Ba-Mak's operations during the year ended
    September 30, 1995 ("fiscal year 1995"),  the majority of the laws governing
    manufacturers,  distributors,  gaming locations and non-profit organizations
    using  electronic  video bingo gaming machines as a fund raising service are
    found in Title 33  ("Charitable  Raffles,  Bingo and Keno  Licensing  Law"),
    Title 40 and Title 55 of the  Louisiana  Revised  Statutes  (the  "Louisiana
    Act")  and  the  regulations  (the  "Louisiana   Regulations")   promulgated
    thereunder  by  the  Department  of  Public  Safety  and   Corrections   and
    administered and enforced by the Division of Charitable  Gaming Control (the
    "Gaming Division") of the Office of State Police.

    (3)    NON-LOUISIANA

           With respect to the Registrant's  domestic gaming activities,  casino
    gaming in the United  States is highly  regulated.  Owners and  operators of
    casinos must be licensed by the various  state gaming  commissions  and must
    provide  detailed  financial and other  reports.  Additionally,  some of the
    states which have just recently legalized gaming have experienced unexpected
    internal changes and modification of the rules and regulations, all of which
    has  served to delay and impede  gaming  applications  filed by  prospective
    gaming  operators.  Changes in laws and  regulations  may limit or otherwise
    materially  affect  types of  gaming  that  may be  conducted  in these  new
    jurisdictions.  Any  such  changes  might  have  an  adverse  affect  on the
    activities and proposed activities of the Registrant. To the extent that the
    Registrant  utilizes  certain  of its  assets to make  investments  in other
    gaming   companies,   one  or  all  companies  may  be  required  to  submit
    applications,  since any holder of more than ten percent (10%) of the common
    stock of a gaming entity must be found suitable.

    (4)    BANKRUPTCY COURT

           Additionally,  with respect to the activities of Ba-Mak during fiscal
    year 1995, gaming  operations were subject to the supervision,  approval and
    compliance  with the rules and  regulations  of the Bankruptcy  Court,  U.S.
    Trustee's office, and U.S. Bankruptcy Code.

(g)    EMPLOYEES

    During  fiscal  year 1995,  Ba-Mak  employed 4  full-time  employees  and 10
part-time  employees.  All employees  were located in Louisiana.  Since Ba-Mak's
bankruptcy case was converted to a Chapter 7 proceeding,  the Registrant  ceased
employing  personnel at Ba-Mak.  Neither CMA,  NuOasis  Laughlin nor NuOasis Las
Vegas have any  employees.  The  officers of the  Registrant  rendered  services
pursuant to either  Consulting  Agreements  or  Employment  Agreements  with the
Registrant during fiscal year 1996 as follows:

               Office                        Name
               ----------------------        ---------------------------------
              President                      Fred G. Luke (Employee)
              Chief Financial Officer        Steven H. Dong (Consultant)
              Corporate Secretary            John D. Desbrow (Consultant)

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                        5

<PAGE>



ITEM 2.       PROPERTIES.

    In April 1993, Ba-Mak entered into a non-cancelable  lease agreement for its
office and warehouse in  Louisiana.  The lease expired May 31, 1996 and provided
for monthly rental  payments  starting at $1,750 with annual  increases of $125.
The lease has been included in Ba-Mak's  bankruptcy  proceedings under Chapter 7
of the Bankruptcy Code.

    On September 30, 1994, the Registrant,  through Ba-Mak, provided video bingo
gaming devices to five (5) charitable bingo halls in southern Louisiana.  Ba-Mak
leased  approximately  1,000 square feet of  industrial/office  space in the New
Orleans area from where it supervised the related gaming activities and where it
maintained the gaming devices. As of June 30, 1996, all of Ba-Mak's property was
subject to its Chapter 7 bankruptcy proceedings.

ITEM 3.       LEGAL PROCEEDINGS.

    The  following  legal   proceedings   against  the  Registrant   and/or  its
subsidiaries , CMA or Ba-Mak, are pending as of the date of this report:

(a)  CASINO MANAGEMENT OF AMERICA,  INC. VS. MARK BACHIK AND BACHIK ENTERPRISES,
     INC.; TEXAS DISTRICT COURT, DALLAS COUNTY; CASE #CV-94-4479

     In April 1993, FTF Management Company, Inc., a Colorado corporation ("FTF")
entered into an agreement  with Bachik  Enterprises,  Inc., a Texas  corporation
("Bachik"),  to purchase a 50% interest in the Star  Casino.  At the time of the
Agreement,  FTF was  controlled  by then current and former  officers and former
directors of Nona.  Under the agreement,  FTF and Bachik orally agreed to form a
joint venture to own and operate the Star Casino with each party acquiring a 50%
interest in the venture.  Subsequent to the agreement, a $400,000 receivable due
Nona was allegedly  diverted by Nona's former  President to agents of Bachik for
the  purpose  of  applying  the  funds to the  acquisition  of the Star  Casino.
Concurrently  with the  diversion of Nona's funds,  Nona's former  President was
identified by local  newspaper  articles as the owner of Nona's  interest in the
Casino.  Subsequently,  based on documentation  received by the Registrant,  the
interest in the Star Casino attributable to Nona's funds was held in the name of
FTF. Nona subsequently assigned its rights to the $400,000 receivable to CMA. On
May 9, 1994,  Texas  counsel for CMA filed suit against  Bachik to recover CMA's
funds  improperly   diverted  to  Bachik.   Counsel  for  Mark  Bachik,   Bachik
Enterprises, Inc., and East Bennett Limited Liability Company has withdrawn from
their  representation.  Texas Counsel for CMA has  negotiated a settlement  with
Bachik. Counsel for CMA and Counsel for Defendant Bruce West have entered into a
letter  agreement  for  settlement  with Bruce West  calling  for the deposit of
$25,000 into an attorney's escrow until certain conditions are satisfied. A jury
trial  which was set to  commence  in October  1996 has been taken off  calendar
pending receipt of documentation to effect a dismissal of the action.

(b)  CASINO MANAGEMENT OF AMERICA,  INC. VS. STAR CASINOS  INTERNATIONAL,  INC.,
     AND CRIPPLE CREEK PROPERTIES, INC.; TELLER COUNTY, COLORADO DISTRICT COURT;
     CASE NO. 94-CV-144

     In a further effort to recover the $400,000  receivable related to the Star
Casino,  CMA,  in  November  1994 filed a suit in the  District  Court of Teller
County, Colorado against Star Casinos International, Inc. ("Star International")
and Cripple Creek Properties,  Inc.  ("Cripple  Creek") seeking  imposition of a
resulting trust, constructive seal, constructive trust, and an accounting of all
money  received and expended in connection  with a gaming  facility known as the
Star Casino.  The Defendants  answered and  counterclaimed  for slander of title
given that CMA filed a lis pendens  against the real  property on which the Star
Casino  is  located  in  Cripple  Creek,  Colorado.  CMA has  asserted  that the
counterclaim for slander of title is substantially  frivolous and groundless due
to existing  Colorado  case law.  Star  International  and Cripple Creek filed a
counterclaim  naming  Richard M. Greene  ("Greene")  as a third party  defendant
alleging  breach of contract,  promissory  estoppel,  and fraud causes of action
asserting  that Greene  received  $100,000 from them under an agreement  between
Greene,  FTF and Star  International,  that the funds would be paid to CMA.  The
funds were never paid to CMA  resulting  in CMA filing  suit.  After  taking the
depositions of all of the principal players,  everyone has acknowledged that the
original  $400,000  used to purchase the Star Casino in 1993 came from Nona.  On
May 3, 1996 Star Casinos International,  Inc., (the "debtor") filed a bankruptcy
petition under Chapter 11 of the Bankruptcy  Code. The schedules  filed with the
bankruptcy  court  do not  list  the  Casino  real  property  as an asset of the
bankruptcy estate. Prior to October 9, 1996 the Casino real property was held by
Cripple Creek  Properties,  Inc.,  one of the defendants and a subsidiary of the
debtor, the stock of which is listed as one of the debtor's assets. In July 1996
the first  trust deed holder on the casino real  property  instituted  a quasi -
judicial  foreclosure  proceeding in Teller County,  Colorado  District Court. A
foreclosure  sale occurred on October 9, 1996. The bid price by the  foreclosing
party was $782,320.72.  Since the first trust deed holder foreclosed the ability
of the  defendants to establish any damages as a result on the filing of the lis
pendens  has been  substantially  impaired.  Additionally,  under  Colorado  law
subject to redemption  rights the foreclosure  sale  effectively  eliminates all
junior  liens  including  CMA's lis  pendens.  A trial  date set for the week of
November 4, 1996 has been vacated and indefinitely stayed, pending resolution of
the bankruptcy case.  Another creditor of the debtor unrelated to the Registrant
has filed a motion to dismiss  the  Chapter  11  bankruptcy  and that  motion is
currently  pending.  The Registrant has filed a Proof of Claim in the bankruptcy
proceeding for the $400,000 plus accrued interest.

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<PAGE>



(c)  BA-MAK GAMING  INTERNATIONAL INC., CHAPTER 11 BANKRUPTCY,  EASTERN DISTRICT
     OF LOUISIANA, CASE NO. 94-1366

     On October 28,  1994,  Ba-Mak  filed a Chapter 11 Petition  with the United
States  District  Court  (Bankruptcy  Division)  for  the  Eastern  District  of
Louisiana,  Bankruptcy Case #94-13661.  On April 20, 1995, the Bankruptcy  Court
granted  the  motion of the  United  States  Trustee  to  convert  the case to a
proceeding  under Chapter 7. A Trustee was appointed to liquidate the bankruptcy
estate of Ba-Mak,  and the  liquidation of its assets has been  occurring  since
July 1995. The Registrant's  remaining obligation in connection with Ba-Mak is a
claim,  in the approximate  amount of $47,000,  against NuOasis Gaming for legal
fees incurred  during the bankruptcy if the bankruptcy  estate does not pay such
legal fees in full. The Trustee in the bankruptcy estate has been ordered to pay
such fees.  As of the date of this  Report,  the  Trustee has not yet closed the
bankruptcy estate; however, due to the claims of other creditors, the Registrant
does not  expect to  recover  any  amount on the Proof of Claim it has filed for
funds lent or advanced to Ba-Mak.

(d)  CHARLES  ARNOLD VS. NONA MORELLI'S II, INC.,  CASINO  MANAGEMENT OF AMERICA
     AND MDM GAMING PARTNERS,  L.P.;  DENVER,  COLORADO DISTRICT COURT; CASE NO.
     95-CV-104

     In January 1995,  Charles Arnold  ("Arnold"),  a consultant to Nona's prior
management,  initiated a lawsuit  against  Nona,  CMA and MDM alleging  that the
defendants  have denied him a 1% equitable  interest in MDM, which was allegedly
verbally  promised to Arnold by Frank J. Morelli,  III and Frank J. Morelli,  II
for alleged professional services rendered to MDM. Arnold is alleging damages in
an  amount  of  $90,000  in  connection  with  this  claim.  Nona and the  other
defendants have filed a third-party  complaint against FTF, Theodore E. DeTello,
Frank J. Morelli,  II and Frank J. Morelli,  III,  seeking full  indemnification
from them for any damages to which Arnold may be entitled in  accordance  with a
certain  Termination  Agreement  dated  December  17, 1993  between the parties.
Counsel for the Morelli's  has recently  indicated  that the Morelli's  would be
taking the Fifth Amendment  against  testifying in connection with this lawsuit.
Since Arnold may not have  witnesses  to prove the alleged  existence of an oral
promise,   the  likelihood  of  any  recovery   against  CMA,  the  Registrant's
subsidiary,  appears to be remote.  Counsel for the parties have  stipulated  to
binding arbitration to be held in 1997.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                        7

<PAGE>



(e)  RUBEN  KITAY ET AL. VS. NONA  MORELLI'S  II,  INC.  ET AL.;  UNITED  STATES
     DISTRICT COURT FOR THE CENTRAL DISTRICT OF CALIFORNIA; CASE NO. 95-4375 RMT
     (SHX)

     On October  10,  1995,  a Second  Amended  Complaint  was filed in the U.S.
District  Court  for  the  Central   District  of  California  which  named  the
Registrant,  Fred G. Luke, John D. Desbrow,  Kenneth R. O'Neal,  O'Neal & White,
P.C., a Texas  professional  corporation,  New World Capital,  Inc., Rocci Howe,
Euro-  Belge  (NA)  N.V.,  Structure  America,   Inc.,   International   Banking
Corporation  Caribbean  (IBCC),  and the Luke Family Trust as  defendants  in an
alleged shareholder  derivative action (the "Derivative Action") filed on behalf
of certain shareholders of the Registrant.  The Derivative Action arose from the
Stock  Purchase  and  Business  Combination  Agreement,  pursuant  to which Nona
Morelli's II, Inc. acquired voting control of E.N.  Phillips Company,  Inc. (now
NuOasis Gaming, Inc.) and the events surrounding the bankruptcy of Ba-Mak Gaming
International,  Inc. The Plaintiffs sought damages according to proof, interest,
rescission,  attorneys'  fees and  exemplary  damages.  Outside  counsel for the
Registrant in the Derivative  Action,  and the management of both the Registrant
and Nona believe,  among other things,  that the Plaintiffs do not have standing
to file such litigation, have failed to state a proper claim, and do not qualify
as  representatives  in a shareholder  action.  In response to the  Registrant's
filing a Motion to Dismiss  the  Derivative  Action,  the  Action was  dismissed
without prejudice pursuant to stipulation.

(f)  GUSTAVO  FARIAS ET AL. VS. NONA  MORELLI'S  II, INC. ET AL.;  UNITED STATES
     DISTRICT  COURT  FOR  THE  CENTRAL   DISTRICT  OF   CALIFORNIA;   CASE  NO.
     CV-96-2617-RMT (SHX)

     A Second  Amended  Complaint  entitled Ruben Kitay et al vs. Nona Morelli's
II,  Inc.,  et al;  United  States  District  Court for the Central  District of
California:  Case No. 95-4375  RMT(SHx),  filed on October 10, 1995, in the U.S.
District Court for the Central District of California and subsequently dismissed
pursuant to  stipulation,  was refiled by the Plaintiffs on April 12, 1996, by a
complaint entitled Gustavo Farias, et al v. Nona Morelli's II Inc., et al, filed
in the United States District Court for the Central District of California, Case
No. CV-96-2617-RMT (SHx). The new complaint named the Registrant,  its officers,
the  Registrant's  accounting  firm and other third  parties as defendants in an
alleged  shareholder  derivative action (the "Refiled Action") refiled on behalf
of certain shareholders of NuOasis Gaming. The Refiled Action alleges securities
fraud and RICO  violations  in connection  with the Stock  Purchase and Business
Combination  Agreement pursuant to which the Registrant  acquired voting control
of ENP (now  NuOasis  Gaming),  and the events  surrounding  the  bankruptcy  of
Ba-Mak.  The plaintiffs seek damages in an amount not yet ascertained  according
to proof, interest, rescission,  imposition of constructive trust, diminution of
share  value  for the  individual  defendants,  attorneys'  fees  and  exemplary
damages.  Outside  counsel for the  Registrant  in the Refiled  Action,  and the
management of both NuOasis Gaming and the Registrant believe among other things,
that the action was initiated by Mike Savage,  a former  consultant  and current
shareholder,  and  persons  affiliated  with him,  as part of an attempt to take
control of NuOasis Gaming; that the Plaintiffs do not have standing to file such
litigation;  that the  Plaintiffs  have no competent  and  credible  evidence to
support their  allegations;  that they have failed to state a proper claim;  and
that they do not  qualify as proper  representatives  in a  shareholder  action.
After the filing of the  Registrant's  Motion to Dismiss in the original action,
the original action was voluntarily dismissed by the Plaintiffs.  The Registrant
has filed a Motion to Dismiss the Refiled Action. As of the date of this Report,
all but three of the Plaintiffs have dropped out of the Litigation.  In response
to the Registrant's Motion to Dismiss, the remaining Plaintiffs have voluntarily
dismissed most of the other  Defendants and have dismissed the RICO claims.  The
Registrant's  accounting firm and chief financial officer have been dismissed as
Defendants. The Motion to Dismiss the remaining claims is currently pending.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                        8

<PAGE>



(g)    INVESTIGATION

    Since November 1991, the U.S. Securities and Exchange Commission (the "SEC")
has been conducting an  investigation  into trading in the  Registrant's  common
stock. The investigation appeared to focus on trading in the Registrant's common
stock during 1990 and 1991 by individuals who are no longer  associated with the
Registrant in any managerial or employment capacity, as the SEC has alleged that
a broker hired by Douglas J.  Phillips and Hal B.  Phillips  (collectively,  the
"Phillips")  manipulated  the trading volume of the stock in order to enable the
Phillips' to sell more of the stock which they held  personally.  The Registrant
has  fully  cooperated  with  the SEC in  this  investigation.  Counsel  for the
Registrant  submitted a brief to the SEC arguing that proceedings  should not be
instituted  against  the  Registrant,  since the  Registrant  itself (i) did not
benefit in any way, and (ii) has now  completely  disassociated  itself from the
persons who were allegedly  involved in the scheme and benefited from it (except
for their prior status as minority shareholders).  The SEC has indicated that it
is not seeking financial compensation or damages from the Registrant, but it has
not  indicated  whether  it will  bring  any  charges  in  connection  with this
investigation.  However,  after consultation with counsel,  management  believes
that,  ultimately,  any  action  brought  by the SEC will not have any  material
adverse effect on the Registrant's  future operations or consolidated  financial
statements.  Additionally, there was no activity under this investigation during
fiscal year 1996. In July 1996, the Phillips,  along with certain brokers,  were
charged with stock manipulation in an indictment.  No charges were filed against
the Registrant or its present management.


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

    None.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                        9

<PAGE>



                                     PART II

ITEM 5.       MARKET FOR THE REGISTRANT'S SECURITIES AND RELATED
              STOCKHOLDER MATTERS.

    Following the completion of the  Registrant's  public offering in July 1988,
the Registrant's common shares have been traded in the  over-the-counter  market
and were quoted in the NASDAQ System under the symbol ENPQ  commencing  March 1,
1990. On May 12, 1992,  the  Registrant was delisted from the NASDAQ System and,
on the same day,  was listed on the NASD-OTC  Bulletin  Board where it currently
trades under the symbol  "NUOG".  The  Registrant's  securities are not publicly
traded on any other market.  Set forth below are the high and low bid prices for
the Common Stock of the Registrant for each quarterly period commencing  October
1, 1994:

                                               Bid Price of Common Stock
                                             -----------------------------

          Fiscal 1996                        Low                      High
          ----------------------             ----                     ----
          Quarter ended 12/31/95             $.01                     $.24
          Quarter ended 03/31/96             $.01                     $.22
          Quarter ended 06/30/96             $.01                     $.62


          Fiscal 1995                        Low                      High
          ----------------------             ----                     ----
          Quarter ended 12/31/94             $.01                     $.20
          Quarter ended 03/31/95             $.01                     $.19
          Quarter ended 06/30/95             $.01                     $.25
          Quarter ended 09/30/95             $.01                     $.24

    Such  quotations  reflect  inter-dealer  prices,   without  retail  mark-up,
mark-down or commissions and may not necessarily represent actual transactions.

    As of August 30, 1996, the Registrant had 3,927  shareholders  of record and
in excess of 2,000 persons who were beneficial shareholders of its common stock.

    The  Registrant  has never paid cash  dividends on its common stock.  At the
present time, the Registrant's anticipated capital requirements are such that it
intends to follow a policy of  retaining  earnings,  if any, in order to finance
the  development  of its  business.  Dividends  on common  stock may not be paid
unless provision has been made for payment of preferred dividends.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       10

<PAGE>



ITEM 6.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
           AND RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES

    The  Registrant  has  incurred  net  losses  and  negative  cash  flows from
operating  activities  since its inception in 1988.  The Registrant had cash and
cash equivalents of approximately $84 and $866 as of June 30, 1996 and September
30, 1995, respectively, and negative working capital of $769,012 and $580,123 as
of June 30, 1996 and September 30, 1995,  respectively.  The increase in working
capital  deficiency  is a direct  result of the  Registrant  having no operating
revenues  during  the  nine  months  ended  June  30,  1996 to  cover  fees  for
professional services and other overhead that the Registrant has incurred. As of
the date of this Report, the Registrant has no material  commitments for capital
expenditures.

    As a result of the Registrant  having no revenue producing  activities,  the
Registrant had limited cash and cash  equivalents  remaining as of June 30, 1996
to finance future operations. The Registrant has received financial support from
Nona of  approximately  $155,000  during fiscal 1996, and is dependent upon Nona
for future working capital.  The Registrant's plan is to continue  searching for
additional   sources  of  equity  and   working   capital   and  new   operating
opportunities.  In the interim,  the  Registrant's  existence is dependent  upon
continuing  financial  support from Nona which is estimated to be  approximately
$1.1 million for the next fiscal year based upon  agreements and obligations the
Registrant has at June 30, 1996. Such conditions raise  substantial  doubt about
the  Registrant's  ability  to  continue  as  a  going  concern.  As  such,  the
Registrant's  independent  accountants  have modified their report to include an
explanatory paragraph with respect to such uncertainty.

    As of the  date of  filing  this  Report,  Ba-Mak's  operations  had  ceased
following  the  bankruptcy  court's  conversion  in April 1995 of its Chapter 11
proceeding into a proceeding under Chapter 7 of the Bankruptcy Code. The Chapter
7  Trustee  took  possession  of  Ba-Mak's  assets  and  is in  the  process  of
liquidating such assets for the benefit of Ba-Mak's  bankruptcy estate. As such,
all gaming operations at Ba-Mak ceased and accordingly, Ba-Mak was accounted for
as a disposition of an investment  during fiscal year 1995.  Gaming  revenues in
the amount of $884,077 for the year ended September 30, 1995 from Ba-Mak are not
expected  to  recur  in  future  years  due to the  Chapter  7  bankruptcy.  The
Registrant  is  also  pursuing  other  joint  venture,   merger  or  acquisition
opportunities which may provide additional capital resources during fiscal 1997.

SUBSEQUENT EVENT - ACQUISITION

    On June  13,  1996,  Nona  entered  into an  Option  Agreement  with  Joseph
Monterosso,  President of National  Pools  Corporation  ("NPC"),  an  individual
previously  unrelated to the Registrant or Nona, and granted such  individual an
option to purchase the 250,000 Series B Preferred Shares of the Registrant owned
by Nona at a purchase price of $13.00 per share, or a total of $3,250,000,  with
a minimum purchase of 110,000 shares.

    The exercise of the option is  conditioned  upon  shareholder  approval of a
proposal  to increase  the  authorized  number of shares of common  stock of the
Registrant  by at least  twenty  million  (20,000,000)  shares.  The  option  is
assignable   and  shall  expire  90  days  after  the  next  Annual  Meeting  of
Shareholders of the Registrant.

     On November  21, 1996,  the  Registrant's  board of directors  approved the
acquisition  of NPC. The  acquisition is expected to be financed by the issuance
of securities,  however, a definitive  agreement has not been signed.  Moreover,
the  acquisition is contingent  upon the occurrence of certain events  including
but not limited to: (a) NPC shareholder  approval;  (b) exercise of that certain
option agreement between Monterosso and Nona; (c) Monterosso  securing financing
that would  allow the  exercise of the option by  Monterosso  and/or one or more
qualified  private  investors;  (d)  reaching an  agreement to sell CMA; and (e)
shareholder  approval of a proposal to increase the number of authorized  shares
of common stock of the Registrant by at least  20,000,000  shares.  There are no
assurances  that  such   transaction   will  occur,   and  because  of  on-going
negotiations and uncertainties  surrounding the realization of such transaction,
the  Registrant  cannot  determine  the  ultimate  effect  on  the  Registrant's
financial position at this time.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       11

<PAGE>



CASH FLOWS

<TABLE>
<CAPTION>

                                                        Nine Months             Year Ended
                                                      Ended June 30,           September 30,
                                                           1996                    1995
                                                  ---------------------    ---------------------
<S>                                               <C>                      <C>

Cash used in operating activities                 $             (26,282)   $            (196,963)
Cash provided by financing activities             $              25,500    $              35,500
Net decrease in cash                              $                (782)   $            (161,463)

</TABLE>

    Cash used in operating  activities  decreased to $26,282 for the nine months
ended June 30, 1996 from $196,963 for the year ended  September 30, 1995,  which
was  primarily  attributable  to the  Chapter 7  bankruptcy  proceedings  of the
Registrant's operating subsidiary which commenced April 20, 1995.

    Cash  provided by financing  activities of $25,500 for the nine months ended
June  30,  1996  and  $35,500  for  the  year  ended  September  30,  1995,  was
attributable  to proceeds  received  from the  President of the  Registrant  for
options exercised.

    During  fiscal  1996,  868,824  common  shares were issued upon  exercise of
options by the President of the  Registrant  in the amount of $104,258,  or $.12
per share.  The Registrant  received a note  receivable in the amount of $78,758
and a cash payment of $25,500 as consideration for the exercise of options.  The
note receivable has been classified as Stockholder Receivable at June 30, 1996.

    RESULTS OF OPERATIONS

     NINE MONTHS ENDED JUNE 30, 1996  COMPARED TO THE YEAR ENDED  SEPTEMBER  30,
1995

    Gaming  revenues  totaled  $884,077 during the twelve months ended September
30, 1995, and were derived from gaming operations. There were no gaming revenues
during the nine months ended June 30, 1996 due to the cessation of operations by
Ba-Mak.  During the twelve months ended  September 30, 1995,  the Chapter 11 and
Chapter 7 bankruptcy proceedings significantly hindered operations which finally
ceased April 20, 1995.

    Gaming operating  expenses totaled $776,827 for the year ended September 30,
1995, the major  components of which were location and  charitable  organization
split  costs,  license  and permit  fees,  legal  fees,  salaries,  payroll  and
applicable  taxes and  depreciation.  There  were no gaming  operation  expenses
during fiscal year 1996 due to the cessation of operations by Ba-Mak.

     General and  administrative  expenses  totaled $164,414 for the nine months
ended June 30,  1996,  representing  a decrease of $127,219  from the year ended
September 30, 1995.  Professional  services totaled $401,236 for the nine months
ended June 30,  1996,  representing  a decrease of $205,932  from the year ended
September 30, 1995.  Decreases in both general and  administrative  expenses and
professional services were primarily attributable to comparing a shorter year of
nine  months  ended  June  30,  1996 to a longer  year of  twelve  months  ended
September 30, 1995.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       12

<PAGE>



    Gain on disposal  of  investments  in the amount of $38,510  during the nine
months ended June 30, 1996 resulted from the sale of marketable  securities that
the Registrant had previously fully reserved in prior fiscal years.

    Loss on disposal of  investments  during the year ended  September 30, 1995,
resulted trom the cessation of all gaming  operations at Ba-Mak and accordingly,
Ba-Mak was accounted for as a  disposition  of an investment  during fiscal 1995
which resulted in (a) the write-off of $1,056,978 and $1,415,050 of total assets
and liabilities,  respectively;  and (b) a net loss on disposal of investment of
approximately $140,949.

    As a result of Ba-Mak's bankruptcy proceedings, and due to a shorter current
fiscal year, the  Registrant's  net loss from  operations  decreased to $797,140
during the nine months  ended June 30, 1996 as  compared  to  $1,096,705  during
fiscal year 1995.

    On June 30, 1996 and September 30, 1995,  the  Registrant  had net operating
loss  carryforwards  of approximately  $7,300,000 and $6,900,000,  respectively,
available  for federal  income tax purposes  that expire  through  2009.  If the
holder of the Series B Preferred  shares converts the Series B Preferred  shares
into shares of common  stock,  there  would be a greater  than 50% change in the
ownership of the Registrant's common stock and Internal Revenue Code Section 382
would place certain restrictions on the amount of the net operating loss ("NOL")
that could be utilized in future years. Internal Revenue Code Section 382 limits
the use of NOL's to the extent of an amount  equal to the fair  market  value of
the Registrant  just prior to the 50% or greater change in ownership  multiplied
by the Federal Long Term  Discount  Rate. A valuation  allowance was recorded in
the financial statements to offset the tax benefit resulting from utilization of
the NOL carryforward due to the uncertainty  surrounding the realization of such
tax asset.


ITEM 7.  FINANCIAL STATEMENTS

    Financial  Statements  are referred to in Item 14(a) and listed in the Index
to Financial Statements filed as part of this Annual Report on Form 10-KSB.


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

    There were no changes in or  disagreements  with  accountants  during fiscal
year 1996.

    A Current  Report on Form 8-K dated  November  8, 1995 was filed on November
16, 1995,  reporting  under Item 4 a change of  accountants  on November 8, 1995
from C. Williams & Associates,  P.C. to Raimondo, Pettit & Glassman and a change
in fiscal year end from September 30 to June 30.

    A Current  Report on Form 8-K dated  December 23, 1994 was filed on December
27, 1994 and amended on December  19, 1995,  reporting  under Item 4 a change of
accountants on December 12, 1994 from J.H. Cohn & Company ("JHC") to C. Williams
& Associates, P.C.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       13

<PAGE>



    The report of Raimondo,  Pettit & Glassman with respect to the 1995 and 1996
fiscal year financial statements included an explanatory  paragraph with respect
to the  substantial  doubt  existing  about the  ability  of the  Registrant  to
continue as a going concern due to its recurring net losses, negative cash flows
from  operating  activities  since  its  inception,  limited  liquid  resources,
negative  working  capital  and its  primary  operating  subsidiary  filing  for
protection under Chapter 7 of the Bankruptcy Code.

    The report of C. Williams & Associates, P.C. with respect to the 1994 fiscal
year financial statements included an explanatory  paragraph with respect to the
substantial  doubt existing about the ability of the Registrant to continue as a
going  concern  due to its  recurring  net  losses,  negative  cash  flows  from
operating  activities since its inception,  limited liquid  resources,  negative
working capital and its primary operating subsidiary filing for protection under
Chapter 11 of the U.S.  Bankruptcy  Code.  On January 29, 1996,  the Texas State
Board of Public  Accountancy made a determination that the firm of C. Williams &
Associates,  P.C. was not properly  licensed to practice  public  accounting  in
Texas, retroactive back to March 2, 1995.

    The firm of C.  Williams  &  Associates,  P.C.  performed  the  audit of the
Registrant's  financial  statements  for the year ended  September  30, 1994 and
issued  its  report on that audit on  February  5,  1995,  which is prior to the
revocation of Mr. Williams' license on March 2, 1995.

    Article 2 of Regulation S-X provides that,  after March 2, 1995, the firm of
C.  Williams  &  Associates,  P.C.  is not  qualified  to  practice  before  the
Commission.  Shareholders  of the Registrant  continue to retain legal rights to
sue and recover  damages  from C.  Williams &  Associates,  P.C.,  for  material
misstatements or omissions, if any, in the financial statements.

    Should C. Williams & Associates,  P.C. dissolve under the laws of Texas, its
state of incorporation,  the rights of the Registrant's  shareholders to sue and
recover damages from C. Williams & Associates, P.C. and its directors,  officers
and shareholders would be determined by the laws of the State of Texas governing
the  dissolution  of  Texas   professional   corporations  or  possibly  federal
securities laws or the laws of the state in which the Registrant's  shareholders
reside.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       14

<PAGE>



                                    PART III

ITEM 9.     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

(a)      IDENTIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS

    The  Registrant,  pursuant to its bylaws,  maintains a Board of Directors of
between one and twenty  five  directors  and  officers,  composed of  President,
Secretary and Chief Financial Officer.  Any two or more officer positions may be
held by the same person.  The directors and officers during fiscal year 1996 are
as follows:

<TABLE>
<CAPTION>


                         Position Held
Name                     with the Registrant      Age       Dates of Service
-----------------        --------------------     ---       ----------------------------------- 
<S>                      <C>                      <C>       <C>

Fred G. Luke             Chairman of the          49
                         Board and President;               March 30, 1994 to Present
                         Chief Financial                    March 30, 1994 to October 24, 1994
                         Officer
John D. Desbrow          Secretary                41        March 30, 1994 to July 20, 1994 and
                                                            November 8, 1994 to Present
                         Director                           March 30, 1994 to July 20, 1994

Steven H. Dong           Chief Financial                    30 July 16, 1995 to Present
                         Officer

</TABLE>

    All directors of the Registrant hold office until the next annual meeting of
shareholders and until their  successors have been elected and qualified.  As of
the date of filing this Report,  there has been one Director since Mr.  O'Neal's
resignation as a Director on July 15, 1995.  Vacancies in the Board of Directors
are filled by the remaining  members of the Board until the next annual  meeting
of shareholders.  The three nominees,  as of August 25, 1996 for election at the
Registrant's  next  annual  meeting are Fred G. Luke,  Jonathan  Small and Royce
Warren.  The officers of the Registrant are elected by the Board of Directors at
its first meeting after each annual meeting of the Registrant's shareholders and
serve at the  discretion  of the  Board of  Directors  or  until  their  earlier
resignation or death.

(b)      BUSINESS EXPERIENCE

    The following is a brief account of the business experience for at least the
past five years of each director,  director nominee and executive officer of the
Registrant,  including principal  occupations and employment during that period,
and the name and principal  business of any corporation or other organization in
which such occupation and employment were carried on.

    All of the directors are elected at the annual  meeting of  shareholders  to
serve for one year or until their  successors  are  elected and have  qualified.
Officers serve at the discretion of the Board of Directors.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       15

<PAGE>



     FRED G. LUKE.  Mr. Luke has been Chairman of the Board and President of the
Registrant  since March 30,  1994.  Mr. Luke has over  twenty-six  (26) years of
experience  in  domestic  and  international  financing  and the  management  of
privately  and  publicly  held  companies.  Since 1982,  Mr.  Luke has  provided
consulting  services and has served,  for brief periods lasting usually not more
than six months,  as Chief  Executive  Officer  and/or  Chairman of the Board of
various  publicly held and privately  held  companies in  conjunction  with such
financial and corporate restructuring services. In addition to his position with
the  Registrant,  Mr.  Luke  currently  serves as Chairman  and Chief  Executive
Officer of the  Registrant's  parent  company,  Nona,  as well as  Chairman  and
President  of NuVen  Advisors,  Inc.,  ("NuVen  Advisors")  formerly  New  World
Capital,  Inc.  ("New  World"),  President and Director of The Toen Group,  Inc.
("Toen"),  President  of  Hart  Industries,  Inc.  ("Hart"),  and  Chairman  and
President of  Diversified  Land &  Exploration  Co.  ("DL&E").  DL&E is a former
publicly traded  independent  natural  resource  development  company engaged in
domestic oil and gas  exploration,  development and  production.  Prior to 1995,
DL&E was a 90% owned subsidiary of Basic Natural Resources,  Inc. ("BNR").  From
1991 through  1994,  Mr. Luke served as the President and a Director of BNR. BNR
is presently inactive. Hart and DL&E were formerly in the environmental services
and natural gas processing business, respectively. Both Hart and Toen are public
companies  which  were  formerly  traded on NASDAQ  or the OTC  Bulletin  Board.
Neither Hart nor Toen have ongoing  operations.  Nona is a publicly traded (OTC:
Bulletin  Board)  diversified  holding company with overseas gaming and domestic
pasta  production  subsidiaries,  in addition to the Registrant.  NuVen Advisors
provides  managerial,  acquisition  and  administrative  services  to public and
private companies including the Registrant, Nona, Hart and Toen. NuVen Advisors,
which is controlled by Fred G. Luke, as Trustee of the Luke Family Trust,  is an
affiliate of both Nona and the  Registrant.  NuVen  Advisors is a stockholder of
Hart,  DL&E and  Nona,  and  provides  management,  general  and  administrative
services, and merger and acquisition services to Hart, DL&E and Nona pursuant to
independent Advisory and Management  Agreements.  Mr. Luke also served from 1973
through 1985 as President of American Energy  Corporation,  a privately held oil
and gas company  involved in the  operation of domestic oil and gas  properties.
From 1970  through  1985 Mr. Luke served as an officer and  Director of Eurasia,
Inc., a private equipment  leasing company  specializing in oil and gas industry
equipment.  Mr.  Luke  received a Bachelor of Arts  Degree in  Mathematics  from
California State University, San Jose in 1969.

     JOHN D. DESBROW.  Mr. Desbrow has been  Secretary of the  Registrant  since
November 8, 1994 and was the Secretary from March 30, 1994 to July 20, 1994. Mr.
Desbrow is also the Secretary of the  Registrant's  parent  company,  Nona.  Mr.
Desbrow is a member in good standing of the State Bar of California and has been
since 1980.  Prior to joining  the  Registrant,  Mr.  Desbrow was in the private
practice of law. Mr. Desbrow received his Bachelor of Science degree in Business
Administration  from the  University of Southern  California in 1977,  his Juris
Doctorate from the University of Southern California Law Center in 1980, and his
Master of Business  Taxation  degree from the University of Southern  California
Graduate  School of Accounting in 1982.  Mr.  Desbrow has also been serving as a
Director and Secretary of Hart Industries, Inc. since July 31, 1993. Mr. Desbrow
has been a director of The Toen Group Inc. since September 28, 1994.

     JONATHAN L. SMALL. Mr. Jonathan L. Small, as an independent consultant, has
been a Director of Nona since March 17, 1994. Mr. Small is currently a member in
good standing of the State Bar of California  and has been since 1980. Mr. Small
is in the private  practice of law.  Mr.  Small's law  practice  consists of the
regulation, due diligence, planning tax opinions for private placement offerings
in oil and gas, real estate, banking, alternative energy, investment and venture
capital programs;  financial business and individual planning;  civil litigation
and general  business  matters.  Prior to forming his private law practice,  Mr.
Small was a tax  accountant  with Arthur  Young & Company in 1981 and 1982.  Mr.
Small  served as  Director,  General  Counsel and  Assistant  Secretary of Basic
Natural  Resources,  Inc. from June 1992 to September 1994. Mr. Small has served
as Secretary and General  Counsel for  Diversified  Land and  Exploration  since
March 1988. Mr. Small resigned as a Director of Nona in January 1996.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       16

<PAGE>



     ROYCE  WARREN.  Mr.  Royce Warren is Director of  Operations  of the Indian
Springs  Casino in Indian  Springs,  Nevada.  Mr.  Warren has more than 25 years
experience in gaming personnel recruitment.

     STEVEN  H.  DONG.  Mr.  Dong,  a  Certified  Public  Accountant,  and as an
independent Consultant serves as Chief Financial Officer of the Registrant.  Mr.
Dong replaced Kenneth R. O'Neal who resigned as the Registrants' Chief Financial
Officer  and as a  Director  effective  July  16,  1995.  Prior to  joining  the
Registrant,  Mr. Dong worked with the international accounting firm of Coopers &
Lybrand since 1988. As an Assurance  Manager with Coopers & Lybrand,  Mr. Dong's
experience  consisted of providing financial  accounting and consulting services
to privately and publicly held  companies.  In addition to his position with the
Registrant,  Mr. Dong currently serves as Chief Financial  Officer of Nona, Hart
and Toen.  Mr. Dong received his Bachelor of Science  degree in Accounting  from
Babson  College  in 1988 and is a member in good  standing  with the  California
Society of Certified  Public  Accountants  and  American  Institute of Certified
Public Accountants.

    (c)  COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT

    Section  16(a) of the  Securities  Exchange  Act of 1934,  as  amended  (the
"Exchange Act") requires the  Registrant's  officers and directors,  and persons
who own more than ten percent of a registered class of the  Registrant's  equity
securities,  to file  reports of  ownership  and changes in  ownership  with the
Securities  and  Exchange  Commission.  Officers,  directors,  and greater  than
ten-percent  shareholders  are required by  Securities  and Exchange  Commission
regulations  to furnish the  Registrant  with copies of all Section  16(a) forms
they file.

    Based  solely  on  review  of the  copies  of such  forms  furnished  to the
Registrant,  or  representations  that no Forms 5 were  required  or filed,  the
Registrant  believes  that during the periods  from October 1, 1995 through June
30, 1996,  all Section  16(a) filing  requirements  applicable  to its officers,
directors,  and greater than  ten-percent  beneficial  owners were complied with
except  Fred G. Luke in March  1996  filed a late Form 4 for the month of August
1995 reporting the acquisition in August 1995 of option rights to purchase up to
3,000,000 shares of the Registrant's  common stock. In November 1996 Steven Dong
filed Form 5 for the fiscal year ending June 30, 1996  reporting his  acceptance
of the office of Chief  Financial  Officer in July 1995 and his  acquisition  in
July 1995 of an option to purchase  275,000  shares of the  Registrant's  common
stock.  In November 1996,  John D. Desbrow filed an amended Form 4 for the month
of April 1996  reporting the  acquisition in April 1996 of an option to purchase
275,000 shares of the Registrant's common stock.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       17

<PAGE>



ITEM 10.  EXECUTIVE COMPENSATION.

(a)      SUMMARY COMPENSATION TABLE

    The  following  summary  compensation  table sets forth in summary  form the
compensation  received  during  each of the  Registrant's  last three  completed
fiscal  years by the  Registrant's  President  and four most highly  compensated
executive officers other than the President.

<TABLE>
<CAPTION>

                                                                                            LONG TERM COMPENSATION
                                                                                ------------------------------------
                                           ANNUAL COMPENSATION                            AWARDS             PAYOUTS
                              -----------------------------------------------   ----------------------       -------
                                                                 Other Annual   Restricted                   LTIP      All Other
Name and Principal            Fiscal                   Bonus     Compensation   Stock          Options       Payouts   Compensation
Position                      Year      Salary ($)     ($)       ($)            Award(s)       (#)           ($)       ($)         
--------------------------    ------    ----------     -----     ------------   ----------     -------       -------   ------------
<S>                           <C>       <C>            <C>       <C>            <C>            <C>           <C>       <C>

Fred G. Luke                  1994      $27,000(1)     -         -              -              -             -         -
 President and
 Director                     1995      $59,000(1)     -         -              -              3,000,000     -         -
 (3-30-94 to Present)
                              1996                     -         $25,000(4)     -              -             -         -
                                        $40,500(3)
-----------------------------------------------------------------------------------------------------------------------------------
John Desbrow                  1994      $18,000(2)     -         -              -              -             -         -
 Secretary  (4-94 to 7-94
 and 11-94 to present) and    1995      $43,000(2)     -         -              -              -             -         -
 Director (4-94 to 7-94)      1996      $43,750(3)     -         -              -              275,000       -         -
-----------------------------------------------------------------------------------------------------------------------------------
Steven H. Dong                1994         -           -         -              -              -             -         -
 CFO (7/95 to Present)        1995      $5,000         -         -              -              275,000       -         -
                              1996      $15,000(3)     -         -              -              -             -         -

</TABLE>

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       18

<PAGE>



(1)  Total  compensation  of $86,000 was accrued and  expensed for Fred G. Luke;
     however,  no cash  payments  have been made.  Approximately  $27,000 of the
     $86,000  compensation  represents  amount of compensation  retroactive from
     April 1, 1994 to  September  30,  1994,  which is included in the table for
     fiscal year 1994.  Mr.  Luke's salary for fiscal year 1996 has been accrued
     and the Registrant owes Mr. Luke $126,500 as of June 30, 1996.

(2)  Based on amounts  billed to the  Registrant  by Mr.  Desbrow.  Mr.  Desbrow
     billed  $18,000 or $3,000 per month for the six months ended  September 30,
     1994 for his services as  Secretary  and $4,000 or $1,000 per month for his
     services as Director  from April 1994 to July 1994.  Mr.  Desbrow  received
     337,500  shares in January 1995, of which the proceeds from 225,000  shares
     were applied to amounts due for the 1994 fiscal year.  Mr.  Desbrow  billed
     $18,000  or $3,000  per month for the first six  months of fiscal  1995 and
     $25,000 or $4,167 per month for the second six months of fiscal  1995.  The
     proceeds  from  112,500 of the shares  issued in January  1995 and  112,500
     shares  issued in March 1995 were  applied to amounts  due for fiscal  year
     1995.  In June  1995 Mr.  Desbrow  received  600,000  shares  of which  the
     proceeds  from  225,000  shares were  applied to the amounts due for fiscal
     year 1995. The remaining  375,000 shares have been applied towards services
     performed in fiscal year 1996. No shares were issued during fiscal 1996.

(3)  Amounts for fiscal year 1996 represent the nine months ended June 30, 1996,
     whereas  amounts for fiscal years 1995 and 1994  represent  the years ended
     September 30, 1995 and 1994.

(4)  Other  Annual  Compensation  of $25,000  represents  payments  in excess of
     reimbursable expenses pursuant to Mr. Lukes Employment Agreement.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       19

<PAGE>



(b)  OPTION AND LONG-TERM COMPENSATION

     The  following  table  sets  forth in summary  form the  aggregate  options
granted  during the fiscal  year 1995 and fiscal  year 1996 by the  Registrant's
President and four most highly  compensated  executive  officers  other than the
President.

<TABLE>
<CAPTION>

                                        Number of           Percent of Total
                                        Shares              Options/
                              Fiscal    Under               SAR's Granted       Exercise or
                              Year      Options/SAR's       to employees        Base Price     Expiration
            Name              Granted   Granted             in Fiscal Years     ($/Sh)         Date
-----------------------       -------   -------------       ---------------     -----------    ----------
<S>                           <C>       <C>                 <C>                 <C>            <C>

Fred G. Luke, President
 and Director                 1995      3,000,000(1)        53%                 $.12           7/00
NuVen Advisors, Inc.(2)       1995      2,000,000           35.4%               $.10           3/97
Steven H. Dong, CFO           1995      275,000             4.8%                $.12           7/00
John D.  Desbrow              1996      275,000             100%                $.12           7/00

</TABLE>


     The  following  table  sets  forth in summary  form the  aggregate  options
exercised  during fiscal year 1996,  and the June 30, 1996 value of  unexercised
options  for  the  Registrant's  President  and  four  most  highly  compensated
executive officers other than the President.

<TABLE>
<CAPTION>
                                                                                                         Value of Unexercised
                                                                      Number of Unexercised              In-the-Money
                                                                      Option/SAR's at Fiscal             Options/SAR's at Fiscal
                                                                      Year-End (#)                       Year-End ($)
                         Shares                                       --------------------------------   -----------------------
                         Acquired                                     Exercisable/                       Exercisable/
            Name         on Exercise (#)     Value realized ($)       Unexercisable (d)                  Unexercisable
-----------------------  ---------------     ------------------       --------------------------------   -----------------------
<S>                      <C>                 <C>                      <C>                                <C>

Fred G. Luke, President                                                 481,176 Exercisable              $173,205  Exercisable
and Director (1)         868,824             $104,258                 1,650,000 Unexercisable            $594,000  Unexercisable

NuVen Advisors, Inc.(2)  _                   _                        2,000,000 Exercisable              $760,000  Exercisable

Steven H. Dong, CFO      _                   _                          275,000 Exercisable              $ 99,000  Exercisable

John D.  Desbrow,        _                   _                          275,000 Exercisable              $ 99,000  Exercisable
Secretary

</TABLE>

(1)  Options  vest at a rate of 50,000  per month  over a five year term  ending
     March 31, 1999.

(2)  The Luke  Family  Trust  (the  "Luke  Trust")  owns 93% of NuVen  Advisors,
     formerly  New  World.  Fred  G.  Luke,  as  Co-Trustee  of the  Luke  Trust
     determines  the voting of such shares  and,  as a result,  may be deemed to
     control the Luke Trust.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       20

<PAGE>



    There were no awards under long-term  incentive plans, such as phantom stock
grants and restricted  stock grants that vest upon  satisfaction  of performance
goals.

(c) PENSION PLANS AND OTHER BENEFIT OR ACTUARIAL PLANS

    The  Registrant has no annuity,  pension or retirement  plans or other plans
for which benefits are based on actuarial computations.

(d) EMPLOYMENT AND CONSULTING CONTRACTS

    In August 1995,  the  Registrant  entered into an Employment  Agreement with
Fred G. Luke, the Registrant's Chairman and President. Mr. Luke has been serving
as the Registrant's  Chairman and President since  approximately March 31, 1994.
The terms of the Employment Agreement call for Mr. Luke to receive approximately
$4,500 per  month,  retroactive  to April 1, 1994,  for five (5) years as a base
salary;  granted him an option to purchase  3,000,000 shares of the Registrant's
common stock at an exercise price of $.12 per share; provides him with an annual
bonus  based upon a number of factors  related  to the  Registrant's  growth and
performance which include (a) serving on the Registrant's Board of Directors and
as its President; (b) providing advice concerning mergers and acquisitions;  (c)
corporate  finance;  (d) day to day  management;  (e)  guidance  with respect to
general business decisions; (f) other duties commonly performed by the President
of a  publicly-held  company;  and  requires  the  Registrant  to purchase  life
insurance  coverage,  reimburse  vehicle  expenses,  and  provide  other  fringe
benefits.  Between March 31, 1994 and  September 30, 1994,  Mr. Luke received no
cash  payments  for his  services.  In August  1995,  the  Registrant  agreed to
retroactively compensate Mr. Luke for past services in the amount of $27,000 for
the  period  April 1, 1994 to  September  30,  1994 and  $59,000  for the period
October 1, 1994 to September 30, 1995. No bonuses have been accrued, paid or are
owed as of the date of this Report. The Registrant  expensed $40,500 and $86,000
during fiscal 1996 and 1995,  respectively,  and had $126,500 due to Mr. Luke as
of June 30, 1996.

    Effective April 1, 1994, the Registrant entered into a Consulting  Agreement
with John D. Desbrow for the engagement of Mr. Desbrow to perform legal services
and to hold the office of Secretary, on behalf of the Registrant, for the period
from April 1, 1994 to March 31, 1995.  Between  April 1, 1994 and  September 30,
1994,  Mr.  Desbrow did not  receive any funds or shares of common  stock in the
Registrant but in fiscal 1995, he did bill and eventually received from the sale
of shares $3,000 per month for services rendered as Secretary from April 1, 1994
to  September  30,  1994  all  of  which  was  expensed  in  fiscal  year  1994.
Additionally,  the  Registrant  expensed  $4,000 for  services  rendered  by Mr.
Desbrow as a Director from April 1994 to July 1994.

     Effective  April 1,  1995,  the  Registrant  and Mr.  Desbrow  renewed  the
Consulting  Agreement  through  March 31,  1996.  Under the  renewed  Consulting
Agreement the Registrant  contracted to pay Mr. Desbrow  $50,000 for the renewal
term payable in the Registrant's common stock.  1,050,000 shares were registered
for  issuance on Forms S-8 filed with the  Securities  and  Exchange  Commission
during the 1995 fiscal year for payment of sums earned  during fiscal years 1994
and 1995. Under the terms of the Consulting Agreement,  Mr. Desbrow invoices the
Registrant  and applies the net proceeds  received from the sale of stock to the
invoiced amounts. For purposes of any "profit" computation under Section 16 (b),
Mr.  Desbrow  and the  Registrant  have  agreed the price paid for the shares is
deemed to be $50,000.  As of September 30, 1995, Mr. Desbrow held 600,000 shares
which were to be utilized for current and future  services  incurred.  Effective
April 1, 1996, the Consulting Agreement was renewed through March 31, 1997 at an
annual rate of $75,000 and granted him an option to purchase  275,000  shares of
the  Registrant's  Common  Stock  at an  exercise  price of .12 per  share.  The
Registrant   expensed  $43,750  and  $43,000,   during  fiscal  1996  and  1995,
respectively, and had $8,252 due from Mr. Desbrow as of June 30, 1996.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       21

<PAGE>



    In July 1995,  the Registrant  entered into a Consulting  Agreement with Mr.
Dong,  pursuant to which Mr. Dong is to perform accounting  services and to hold
the office of Chief  Financial  Officer  through June 30, 1996.  Pursuant to the
agreement the Registrant  agreed to pay Mr. Dong $20,000 per annum in cash or in
the Registrant's  common stock,  payable monthly in arrears,  and granted him an
option  to  purchase  275,000  shares  of the  Registrant's  common  stock at an
exercise price of $.12 per share.  Cash payments of $5,000 were made to Mr. Dong
by the  Registrant  during fiscal 1995. No shares were issued to Mr. Dong during
fiscal 1995 or 1996.  During fiscal 1996, the  Consulting  Agreement was renewed
for fiscal  1997 for an amount of $39,000  per annum.  The  Registrant  expensed
$15,000 and $5,000  during fiscal 1996 and 1995,  respectively,  and had $15,000
due to Mr. Dong as of June 30, 1996.

    ADVISORY AGREEMENTS WITH AFFILIATE

     The Luke  Trust and Lawver  Corporation  own 93% and 7%,  respectively,  of
NuVen  Advisors.  Fred G. Luke, as trustee of The Luke Trust,  controls the Luke
Trust,  and Mr. Lawver is the majority  shareholder  of Lawver Corp. and thereby
controls Lawver Corp. Mr. Lawver is President of Fantastic Foods  International,
Inc., a wholly owned subsidiary of Nona.

    Effective  April 1,  1994,  the  Registrant  entered  into an  Advisory  and
Management Agreement with NuVen Advisors for the engagement of NuVen Advisors to
perform   administrative,   human  resource  and   merger/acquisition   services
consisting  of (a)  management  of the  use,  purchase  and  disposition  of the
Registrant's  assets  including,  by  way of  illustration,  the  evaluation  of
economic,  statistical,   financial  and  other  data,  and  formulation  and/or
implementation  of the  Registrant's  business  plan;  and (b) management of the
Registrant's  operations  including,  by way of illustration,  the furnishing of
routine  supervisory,   and  administrative  services  and  the  supervision  of
administrative   personnel  including,   by  way  of  illustration,   consultant
recruiting and screening; and (c) preparation of the usual and customary reports
required of a publicly-held company subject to the reporting requirements of the
Securities Exchange Act of 1934; and (d) furnishing of office space,  facilities
and  equipment  for the  Registrant's  non-exclusive  use.  The  Registrant  has
significantly  reduced or eliminated  completely  its human resource and payroll
obligations  and  requirements,  but the  Registrant  continues  to require  the
administrative,   audit  and  consultant   screenings,   and  merger/acquisition
services. The Registrant anticipates continued reliance on the services provided
under the  Advisory  and  Management  Agreement  until such time it has,  or its
subsidiaries  have, the need and sufficient cash flow to justify performing such
services  in-house.  Pursuant to such  Agreement,  the Registrant  agreed to pay
NuVen  Advisors  $180,000  annually,  payable  monthly in $15,000  increments in
arrears,  and granted NuVen Advisors an option to purchase  2,000,000  shares of
the Registrant's  common stock exercisable at a price of $.10 per share.  During
fiscal year 1996,  the Advisory and Management  Agreement was renewed  effective
October 1, 1995,  for $120,000  annually.  The Registrant  expensed  $90,000 and
$180,000, during fiscal years 1996 and 1995, respectively,  and had $118,000 due
to NuVen Advisors as of June 30, 1996.

     Effective  April 1, 1994,  CMA  entered  into an  Advisory  and  Management
Agreement  with NuVen  Advisors for the  engagement of NuVen Advisors to perform
administrative, human resource and merger/acquisition services consisting of (a)
management of the use,  purchase and disposition of CMA's assets  including,  by
way of  illustration,  the  evaluation of economic,  statistical,  financial and
other data, and formulation  and/or  implementation  of CMA's business plan; and
(b)  management  of CMA's  operations  including,  by way of  illustration,  the
furnishing  of  routine   supervisory  and   administrative   services  and  the
supervision  of  administrative  personnel  including,  by way of  illustration,
consultant  recruiting  and  screening;  and (c)  furnishing  of  office  space,
facilities  and equipment  for CMA's  non-exclusive  use. CMA has  significantly
reduced or eliminated  completely its human resource and payroll obligations and
requirements,  but CMA  continues  to  require  the  administrative,  audit  and
consultant  screenings,   and   merger/acquisition   services.  CMA  anticipates
continued  reliance on the services  provided  under the Advisory and Management
Agreement  until  such  time it has,  or its  subsidiaries  have,  the  need and
sufficient cash flow to justify performing such services  in-house.  Pursuant to
such  Agreement  CMA agreed to pay NuVen  Advisors  $120,000  annually,  payable
monthly in $10,000  increments in arrears,  and granted NuVen Advisors an option
to purchase up to five percent (5%) of CMA's  common  stock  outstanding  at the
time of  exercise,  exercisable  at a price per share  equal to one  hundred ten
percent  (110%) of the book value of such shares.  During fiscal year 1996,  the
Advisory and Management Agreement was renewed for fiscal year 1997. CMA expensed
$120,000 and $90,000  during fiscal years 1996 and 1995,  respectively,  and had
$159,000 due to NuVen  Advisors as of June 30,  1996.  The option given to NuVen
Advisors by CMA, if exercised, will (a) result in an infusion of working capital
into CMA;  and,  (b) reduce the  Registrant's  ownership  of CMA by five percent
(5%), which management believes will not have any material adverse effect on the
Registrant's financial condition or investment in CMA.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       22

<PAGE>



(e) DIRECTOR COMPENSATION

    The  Registrant  has no standard  arrangements  by which its  directors  are
compensated.

(f) INTERLOCKING RELATIONSHIPS OF DIRECTORS

    The Directors of the  Registrant are also Directors of Nona as of the filing
date of this Report.


ITEM  11.      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
               MANAGEMENT.

    The following  table set forth,  as of October 31, 1996, the stock ownership
of each  person  known  by the  Registrant  to be the  beneficial  owner of five
percent  or  more  of the  Registrant's  voting  securities  and  each  officer,
director,  director nominees, and all officer's and directors as a group. Unless
otherwise indicated, each person has beneficial voting and investment power with
respect to the shares owned.

                             Shares of
                             Common Stock            Number And Percent of
Name and Address of          Beneficially            Class if Additional Common
Beneficial Owners(1)         Owned(2)                Shares are Authorized(3)
----------------------       ---------------------   --------------------------
                             Number     Percentage   Number         Percentage
                             ------     ----------   -------------  -----------
Nona Morellis II, Inc.       0          -            31,500,000(4)  51.22%

Fred G.  Luke                0          -               681,176      2.22%

Steven H.  Dong              0          -               275,000       .91%


John D.  Desbrow             96,250     .32%            371,250      1.22%
                             ------                  ----------

All directors and            96,250     .32%         32,827,426     53.72%
executive officers as        ======                  ==========
a group

Joseph Monterosso            0          -            19,500,000(5)  39.39%
550 15th Street
San Francisco, CA 94103

Structure America, Inc.      0          -             2,000,000(6)   6.25%
550 N.  Jefferson
Loveland, CO  80537

Nuven Advisors, Inc.         0          -             2,000,000(7)   6.25%
2 Park Plaza
Irvine, CA  92614

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       23

<PAGE>



    The  following  table sets  forth,  as of  October  31,  1996,  the Series B
Preferred  Stock and 14% Preferred  Stock  ownership of all holders of more than
five  percent of the Series B  Preferred  Stock and 14%  Preferred  Stock of the
Registrant.  No officers or  directors  own any shares of either the Series B or
the 14% Preferred Stock.

<TABLE>
<CAPTION>


                                            Shares of Series                    Number and Percent of Class if
Name and Address of                         B Preferred Stock                   Proposal No.
Beneficial Owner(1)                         Beneficially Owned                  1 or 2 is approved(3)
--------------------                        ---------------------               ------------------------------
<S>                                         <C>        <C>                      <C>        <C>

                                            Number     Percentage               Number         Percentage
                                            -------    ----------               -------    -------------------
Nona Morelli's II, Inc.                     250,000        100%                 250,000             100%

Joseph Monterosso(5)                        250,000        100%                 250,000             100%
550 15th Street
San Francisco, CA 94103

Raymond C. Kitely                           30,000          17.6%               30,000              17.6%
 20079 Glen Arbor
  Court
 Saratoga, CA  95070

Eli Moshe                                   10,000          5.9%                10,000              5.9%
 110 S. Sweetzer,
 No. 301
 Los Angeles, CA
  90048

Walter K. Theis,                            20,000          11.8%               20,000              11.8%
 M.D.
 1200 Corsica Drive
 Pacific Palisades,
  CA  90272

David Seror,
 Chapter 7 Trustee
 for the Estate of
 David A. Paletz                            77,500          45.6%               77,500              45.6%
 221 N. Figueroa
  St., Room 800
 Los Angeles, CA
  90012

Neil Miller                                 15,000          8.8%                15,000              8.8%
 2790 Forrester
  Drive
 Los Angeles, CA
  90064

David Sheetrit                              10,000          5.9%                10,000              5.9%
 c/o Moshe Shram
 929 East Fourteenth
  Street
 Los Angeles, CA
  90021

</TABLE>

<PAGE>



(1)  The address of Nona  Morelli's  II,  Inc.  and each  executive  officer and
     Director is c/o NuOasis  Gaming,  Inc. 2 Park Plaza,  Suite 470 Irvine,  Ca
     92614. With the exception of Joseph Monterosso,  each stockholder listed in
     these tables possesses sole voting and investment power with respect to the
     shares listed opposite the holder's name.

(2)  Excludes  common  shares  underlying  convertible  securities,  options  or
     warrants that are presently held but not currently  exercisable because the
     Company's authorized capital is insufficient.

(3)  Percentage  ownership  amounts  under the If  Additional  Common Shares are
     Authorized  column are computed for each holder  assuming that  convertible
     securities,  options and warrants held by such holder that are  exercisable
     within 60 days are  exercised.  The effect of options and warrants of other
     holders are excluded from each holder's percentage computation.



                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       24

<PAGE>



(4)  Assumes  conversion of Series B Preferred shares into 19,500,000  shares of
     Common Stock and  12,000,000  shares of Common stock which may be issued to
     Nona on exercise of New Class D Warrants.

(5)  Nona has granted Joseph  Monterosso an option to acquire the 250,000 shares
     of Series B Preferred  Stock. The table presents the effect of the exercise
     of such options by Mr.  Monterosso.  The table  presents  both Nona and Mr.
     Monterosso  as  beneficial  owners of the same  250,000  shares of Series B
     Preferred stock.

(6)  On  February  29,  1996,   Structure  America,   Inc.  received  contingent
     contractual  rights for 1,000,000 shares for services to be rendered and an
     option to purchase 1,000,000 shares at $.12 per share. Under Rule 13d-3 (d)
     (1)(c) Structure America,  Inc. is deemed the beneficial owner of 2,000,000
     shares even though the shares are not outstanding.

(7)  The Luke  Family  Trust  (the  "Luke  Trust")  owns 93% of NuVen  Advisors,
     formerly  New  World.  Fred  G.  Luke,  as  Co-Trustee  of the  Luke  Trust
     determines  the voting of such shares  and,  as a result,  may be deemed to
     control the Luke Trust.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       25

<PAGE>



ITEM 12.      CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     There were no  related  transactions  during the last two fiscal  years for
which the amount of the transaction or series of similar  transactions  exceeded
$60,000 other than the following:

a)   ISSUANCE OF STOCK OPTIONS AND WARRANTS ON BUSINESS COMBINATION

     On January 13,  1994,  the  Registrant  entered  into a Stock  Purchase and
Business  Combination  Agreement  (the  "Stock  Purchase  Agreement")  with Nona
Morelli's  II,  Inc.  ("Nona")  and  Nona's  wholly-owned   subsidiary,   Casino
Management of America,  Inc. ("CMA"),  whereby the Registrant agreed to purchase
all of the  outstanding  capital  stock of CMA  from  Nona in  exchange  for the
Registrant  issuing  to Nona a)  2,000,000  shares of common  stock;  b) 250,000
shares of Series B Convertible  Preferred Stock; c) 6,000,000 New Class D common
stock  purchase  warrants;  and d) an option  to  purchase  up to an  additional
6,000,000  shares of common  stock.  A Closing  occurred on March 30, 1994,  the
"Closing Date", whereby CMA became a wholly-owned  subsidiary of the Registrant.
The former Board of Directors  with the exception of Gary L. Blum,  resigned and
elected replacement Directors nominated by Nona.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       26

<PAGE>



     SERIES B PREFERRED STOCK

     The 250,000  shares of Series B Preferred  are  convertible  at the rate of
seventy-eight  (78) shares of common stock for each share of Series B Preferred,
or a total of 19,500,000 shares of common stock if all of the shares of Series B
are converted.  The Series B Preferred Stock has no redemption rights and is not
entitled  to any  dividends.  It has a  liquidation  value  of $2 per  share  in
preference to any payment on common stock, subject only to rights of the holders
of the 14% Preferred Stock.  Each share is entitled to seventy-eight  (78) votes
and shall be convertible into  seventy-eight  (78) fully paid and non-assessable
shares of common stock.

     NONA OPTION

     This  Option was  granted  to Nona to enable  Nona to  purchase  any of the
shares  underlying  the New Class A, B and C Warrants  that are not exercised by
the Warrant holders.  The Nona Option for the purchase of up to 6,160,000 shares
of common stock is nontransferable  and exercisable at $.01 per share. The total
number of shares that can be purchased  upon  exercise of the option is equal to
the number of shares of common stock subject to New Class A, New Class B and New
Class  C  Warrants   outstanding  on  March  30,  1994  that  eventually  expire
unexercised.  Nona  does  not  presently  hold  any of the New  Class  A, B or C
Warrants, nor is it currently entitled to exercise its option.

     NEW CLASS D WARRANTS

     Each New Class D Warrant is exercisable at $1.00 per share and will entitle
the holder to receive upon exercise two (2) shares of common  stock,  or a total
of 12,000,000  shares if all of the New Class D Warrants are exercised.  To date
none of the New  Class D  Warrants  have  been  exercised  and Nona has been the
holder  of the New  Class D  Warrants  since  March  30,  1994.  The New Class D
Warrants and warrant shares  purchasable upon exercise of the Warrants shall not
be subject to dilution or reduction by any reverse split.

     COMMON SHARES ISSUED TO NONA

     As set forth above, the Registrant  issued 2,000,000 common shares to Nona.
On September 23, 1994, Nona distributed 1,508,153 of the 2,000,000 common shares
to Nona  shareholders.  The  remaining  491,847  shares of  common  stock in the
Registrant were held by Nona as of June 30, 1996.

b)   ADVISORY AGREEMENTS WITH AFFILIATES

     Effective  April 1, 1994,  the  Registrant  entered  into an  Advisory  and
Management Agreement with NuVen Advisors for the engagement of NuVen Advisors to
perform   administrative,   human  resource  and   merger/acquisition   services
consisting  of (a)  management  of the  use,  purchase  and  disposition  of the
Registrant's  assets  including,  by  way of  illustration,  the  evaluation  of
economic,  statistical,   financial  and  other  data,  and  formulation  and/or
implementation  of the  Registrant's  business  plan;  and (b) management of the
Registrant's  operations  including,  by way of illustration,  the furnishing of
routine  supervisory,   and  administrative  services  and  the  supervision  of
administrative   personnel  including,   by  way  of  illustration,   consultant
recruiting and screening; and (c) preparation of the usual and customary reports
required of a publicly-held company subject to the reporting requirements of the
Securities Exchange Act of 1934; and (d) furnishing of office space,  facilities
and  equipment  for the  Registrant's  non-exclusive  use.  The  Registrant  has
significantly  reduced or eliminated  completely  its human resource and payroll
obligations  and  requirements,   but  the  company  continues  to  require  the
administrative,   audit  and  consultant   screenings,   and  merger/acquisition
services. The Registrant anticipates continued reliance on the services provided
under the  Advisory  and  Management  Agreements  until such time it has, or its
subsidiaries  have, the need and sufficient cash flow to justify performing such
services  in-house.  Pursuant to such  Agreement,  the Registrant  agreed to pay
NuVen  Advisors  $180,000  annually,  payable  monthly in $15,000  increments in
arrears,  and granted NuVen Advisors an option to purchase  2,000,000  shares of
the Registrant's  common stock exercisable at a price of $.10 per share.  During
fiscal year 1996, the Consulting Agreement was renewed effective October 1, 1995
for $120,000 annually.  The Registrant  expensed $90,000,  and $180,000,  during
fiscal year 1996 and 1995, respectively,  and had $118,000 due to NuVen Advisors
as of June 30, 1996.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       27

<PAGE>



     Effective  April 1, 1994,  CMA  entered  into an  Advisory  and  Management
Agreement  with NuVen  Advisors for the  engagement of NuVen Advisors to perform
administrative, human resource and merger/acquisition services consisting of (a)
management of the use,  purchase and disposition of CMA's assets  including,  by
way of  illustration,  the  evaluation of economic,  statistical,  financial and
other data, and formulation  and/or  implementation  of CMA's business plan; and
(b)  management  of CMA's  operations  including,  by way of  illustration,  the
furnishing  of  routine   supervisory  and   administrative   services  and  the
supervision  of  administrative  personnel  including,  by way of  illustration,
consultant  recruiting  and  screening;  and (c)  furnishing  of  office  space,
facilities  and equipment  for CMA's  non-exclusive  use. CMA has  significantly
reduced or eliminated  completely its human resource and payroll obligations and
requirements,  but CMA  continues  to  require  the  administrative,  audit  and
consultant  screenings,   and   merger/acquisition   services.  CMA  anticipates
continued  reliance on the services  provided  under the Advisory and Management
Agreement  until  such  time it has,  or its  subsidiaries  have,  the  need and
sufficient cash flow to justify performing such services  in-house.  Pursuant to
such  Agreement,  CMA agreed to pay NuVen Advisors  $120,000  annually,  payable
monthly in $10,000  increments in arrears,  and granted NuVen Advisors an option
to purchase up to five percent (5%) of CMA's  common  stock  outstanding  at the
time of  exercise,  exercisable  at a price per share  equal to one  hundred ten
percent  (110%)  of the book  value of such  shares.  During  fiscal  1996,  the
Consulting Agreement was renewedeffective  October 1, 1995. CMA expensed $90,000
and $120,000 during fiscal years 1996 and 1995,  respectively,  and had $159,000
due to NuVen Advisors as of June 30, 1996. The option given to NuVen Advisors by
CMA, if exercised,  will (a) result in an infusion of working  capital into CMA;
and, (b) reduce the  Registrant's  ownership of CMA by five percent (5%),  which
management   believes  will  not  have  any  material   adverse  effect  on  the
Registrant's financial condition or investment in CMA.

     During  fiscal year 1994,  the  Registrant  entered into an agreement  with
Structure  America,  Inc.  ("SAI")  to issue  1,000,000  shares  for  consulting
services.  Such services were  rendered  during fiscal 1995.  During fiscal year
1996,  the  Registrant  entered  into  another  agreement  with  SAI to  perform
consulting services.  Pursuant to such agreement, the Registrant agreed to issue
1,000,000  common  shares of the  Registrant to SAI and granted SAI an option to
purchase  1,000,000  common shares of the  Registrant,  exercisable  at $.12 per
share. The agreement is fully contingent upon the final execution and closing of
the purchase of National Pools Corporation.  The Registrant expensed $75,000 and
$54,000 during fiscal years 1996 and 1995,  respectively  and had  approximately
$40,000 due to SAI as of June 30, 1996.

c)   ADVANCES FROM AFFILIATE

     The Registrant has received  financial  support from Nona of  approximately
$155,000  during  fiscal  1996,  and is dependent  upon Nona for future  working
capital.  As of June 30,  1996,  the  Registrant  had  $238,118  due to Nona and
classified as Due to Affiliates.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       28

<PAGE>



                                     PART IV

ITEM 13.      EXHIBITS AND REPORTS ON FORM 8-K.

(a)  1.   FINANCIAL STATEMENTS

     The  financial  statements  listed in the  accompanying  index to financial
statements and financial statement schedules are filed as part of this report.

     2.   FINANCIAL STATEMENT SCHEDULES

     There were no financial statement schedules required to be filed as part of
this Annual Report.

     3.  EXHIBITS

     Unless otherwise noted, Exhibits are filed herewith.

    Exhibit
    Number     Description
    ---------------------------------------------------------------------------
    3.1        Restated Certificate of Incorporation(1)

    3.2        By-Laws (filed as Exhibit 3.2 of the Registrant's Registration
                Statement on Form S-18, File No. 33-19883-NY, and incorporated
                herein by reference thereto).

    3.3        Certificate of Amendment of Certificate of Incorporation. (12)

    4.5        Certificate of Designations, Preferences and Rights of 14%
                Cumulative Convertible $.01 par value Preferred Stock.(1)

    4.6        Letter Extending Exercise Period of Class A Warrants and Class B
                Warrants.(3)

    4.7        Letters Reducing Exercise Price of Class A Warrants, Class B
                Warrants and Class C Warrants.(4)

    4.8        Warrant Agreement dated September 13, 1994 with Douglas J.
                Phillips.(7)

    4.9        Certificate of Designations, Preferences and Rights of Series B
                Convertible Preferred Stock of E.N. Phillips Company (10)

    4.10       New Class D Warrant Agreement to Purchase Common Stock(10)

    4.11       Option Agreement(10)

    9.1        Form of Irrevocable Proxy Coupled with Right of First Refusal.(4)

    10.1       Amended 1989 Non-Qualified Stock Option Plan.(1)

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       29

<PAGE>



    Exhibit
    Number     Description
    ---------------------------------------------------------------------------
    10.2       1989 Incentive Stock Option Plan.(1)

    10.3       1991  Non-Qualified  Stock Option Plan (incorporated by reference
                herein from Proxy  Statement for February 14, 1992 Annual
                Meeting filed on February 5, 1992).

    10.4       Employment Agreement between Phillips Gaming International, Inc.
                and James R. Martin (incorporated by reference herein from
                amendment on Form 8 filed February 4, 1993 to Form 8-K dated
                November 23, 1992).

    10.5       1993  Incentive  Stock Option Plan and 1993  Non-Qualified  Stock
               Option  Plan   (incorporated   by  reference  herein  from  Proxy
               Statement  for March 4, 1993 Annual  Meeting filed on February 5,
               1993).

    10.6       Employment  Agreement of December 7, 1993  between E.N.  Phillips
               Company and Douglas J. Phillips  (incorporated  by reference from
               10-KSB for fiscal  year ended  September  30,  1993,  filed on or
               about March 28, 1994.)

    10.7       Stock Purchase and Business Combination  Agreement of January 13,
               1994  between Nona  Morellis's  II, Inc.,  Casino  Management  of
               America,   Inc.  and  E.N.  Phillips  Company   (incorporated  by
               reference  from 10-KSB for fiscal year ended  September 30, 1993,
               filed on or about March 28, 1994.)

    10.9       Settlement Agreement dated September 13, 1994 between E.N.
                Phillips Company and Douglas J. Phillips.(7)

    10.10      Settlement Agreement and Mutual Release between Douglas J.
                Phillips, Hal B. Phillips and E.N. Phillips Company and
                Stephen A. Weiner.(7)

    10.11      Advisory and Management Agreement dated February 1, 1995 between
                NuOasis Gaming, Inc. and NuVen Advisors, Inc.(11)

    10.12      Advisory and Management Agreement dated July 1, 1994 between
                Casino Management of America, Inc. and NuVen Advisors, Inc.(11)

    10.13      Employment Agreement dated August 30, 1995 between NuOasis
                Gaming, Inc. and Fred G. Luke.(11)

    10.14      Consulting Agreement dated July 1995 between NuOasis Gaming,
                Inc. and Steven Dong.(11)

    10.15      Consulting Agreement dated October 15, 1994 between E.N.
                Phillips Company and Kenneth R. O'Neal.(8)

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       30

<PAGE>



    Exhibit
    Number     Description
    ---------------------------------------------------------------------------
    10.16      Engagement Letter and Fee Agreement dated November 29, 1995
                between NuOasis Gaming, Inc. and J.L. Lawver Corp.(8)

    10.17      Engagement Letter and Fee Agreement dated October 4, 1994
                between NuOasis Gaming, Inc. and John Ris.(8)

    10.18      Engagement Letter and Fee Agreement dated November 15, 1994
                between NuOasis Gaming, Inc. And Geoffrey G. Riggs.(8)

    10.19      Engagement Letter and Fee Agreement dated September 13, 1994
                between E.N. Phillips Company and Structure America, Inc.(8)

    10.20      Engagement Letter and Fee Agreement dated October 18, 1994
                between NuOasis Gaming, Inc. and OTC Communications.(8)

    10.21      Engagement Letter and Fee Agreement dated November 1, 1994
                between NuOasis Gaming, Inc. and Citigate, Inc.(8)

    10.22      Consulting Agreement dated April 1, 1994, between NuOasis
                Gaming, Inc. and John D. Desbrow.(8)

    10.23      Engagement Letter and Fee Agreement dated March 7, 1994 between
                NuOasis Gaming, Inc. and John Ris.(9)

    10.24      Consulting Agreement dated April 21, 1995 between NuOasis
                Gaming, Inc. and Sandra V. Alsina.(9)

    10.25      Fee Agreement dated April 12, 1995 between NuOasis Gaming, Inc.
                and Richard O. Weed.(9)

    10.26      First Addendum to Consulting Agreement dated November 22, 1994
                between NuOasis Gaming, Inc. and John D. Desbrow.(9)

    10.27      Consulting Agreement dated January 1995 between NuOasis Gaming,
                Inc. and Edward S. Luke.(9)

    10.28      Engagement Letter and Fee Agreement for Services with Structure
                America, Inc.

    10.29      Second Addendum to Consulting Agreement between NuOasis Gaming,
                Inc.  and John D. Desbrow.

    10.30      Second Addendum to Consulting Agreement between NuOasis Gaming,
                Inc.  and Steven H. Dong.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       31

<PAGE>



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

    24.1       Schedule of Subsidiaries.(5)

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

(1)  Previously filed by the Registrant in Post-Effective Amendment No. 2 to the
     Registrant's  Registration  Statement  on Form S-18 filed  October 23, 1989
     (File No. 33-19883-NY) and incorporated herein by reference.

(2)  Previously filed by the Registrant in Post-Effective Amendment No. 3 to the
     Registrant's  Registration  Statement  on Form S-18 filed  January 26, 1990
     (File No. 33-19883-NY) and incorporated herein by reference.

(3)  Previously filed by the Registrant in Post-Effective Amendment No. 5 to the
     Registrant's Registration Statement on Form S-18 filed March 28, 1990 (File
     No. 33-19883-NY) and incorporated herein by reference.

(4)  Previously filed by the Registrant in Post-Effective Amendment No. 6 to the
     Registrant's  Registration Statement on Form S-18 filed June 25, 1990 (File
     No. 33-19883-NY) and incorporated herein by reference.

(5)  Previously filed by the Registrant in Pre-Effective  Amendment No. 1 to the
     Registrant's Registration Statement on Form S-1 filed December 19, 1995 and
     incorporated herein by reference.

(6)  Previously filed by the Registrant in the Form 10-K filed February 14, 1995
     and incorporated herein by reference.

(7)  Previously  filed by the  Registrant in the Form 10-KSB filed June 29, 1995
     and incorporated herein by reference.

(8)  Previously filed by the Registrant in a Registration  Statement on Form S-8
     filed December 7, 1994, File No. 33-87102.

(9)  Previously filed by the Registrant in a Registration  Statement on Form S-8
     filed May 3, 1995, File No. 33-91862.

(10) Previously  filed by the  Registrant in a Current  Report on Form 8-K dated
     March 31, 1994, filed April 11, 1994.

(11) Previously filed by the Registrant on January 18, 1996 in its Annual Report
     on Form 10KSB for the fiscal year ended September 30, 1995.

(12) Previously  filed by the  Registrant on April 2, 1996 in its amended Annual
     Report on Form 10KSB/A for the fiscal year ended September 30, 1995.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       32

<PAGE>



(b)          REPORTS ON FORM 8-K

     (1)  On November 10, 1995,  the  Registrant  filed a Current Report on Form
          8-K dated  November 8, 1995,  reporting  a change in auditors  from C.
          Williams & Associates  to Raimondo,  Pettit & Glassman and reporting a
          change in fiscal year end from September 30 to June 30.

     (2)  On December 19, 1995, the Registrant  filed an Amended  Current Report
          on Form 8-K/A dated March 31, 1994, reporting revised proforma numbers
          on the  E.N.  Phillips-Nona  Morelli's  Stock  Purchase  and  Business
          Combination Agreement.

     (3)  On December 19, 1995, the Registrant  filed an Amended  Current Report
          on Form 8-K/A  dated  March 31,  1994,  reporting a change in auditors
          from J.H. Cohn & Company to C. Williams & Associates.

     No  reports on Form 8-K were  filed  during the last  quarter of the fiscal
year ended June 30, 1996.

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       33

<PAGE>



                                   SIGNATURES

     In accordance  with Section 13 or 15 (d) of the Securities  Exchange Act of
1934,  the  Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

                              NUOASIS GAMING, INC.



Date:    November 22, 1996    By:/s/    Fred G. Luke
                              ------------------------------------------------
                                        Fred G. Luke,
                                        President and Chairman of the Board
                                        and sole Director



Date:    November 22, 1996    By:/s/    Steven H. Dong
                              -------------------------------------------------
                                        Steven H. Dong, Chief Financial Officer


Date:    November 22, 1996    By:/s/    John D. Desbrow
                              -------------------------------------------------
                                        John D. Desbrow, Secretaru

                                                    [NUOGAM\10K\96\96KSB.CLN]-22

                                       35

<PAGE>



                              NUOASIS GAMING, INC.

                          Index to Financial Statements

                                                                          Page

(1)  FINANCIAL STATEMENTS:

     Independent Auditors' Report .........................................F-2

     Consolidated Balance Sheet at June 30, 1996 ..........................F-3

     Consolidated Statements of Operations for the Nine Months Ended
     June 30, 1996 and Year Ended September 30, 1995 ......................F-4

     Consolidated Statements of Stockholders' Equity (Deficiency)
      for the Nine Months Ended June 30, 1996 and Year Ended September
      30, 1995 ............................................................F-5

     Consolidated Statements of Cash Flows for the Nine Months Ended
     June 30, 1996 and Year Ended September 30, 1995 ......................F-6

     Notes to Consolidated Financial Statements ...........................F-7

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F36

<PAGE>



                           RAIMONDO, PETTIT & GLASSMAN
               A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS
                          CERTIFIED PUBLIC ACCOUNTANTS
                          UNION BANK TOWER, SUITE 1250
                            21515 HAWTHORNE BOULEVARD
                           TORRANCE, CALIFORNIA 90503
                 TELEPHONE: (310) 540-5990 FAX: (310) 543-3066

                          INDEPENDENT AUDITORS' REPORT

Board or Directors
NuOasis Gaming, Inc.

We have audited the accompanying  consolidated  balance sheet of NuOasis Gaming,
Inc. and  subsidiaries  (the  "Company")  as of June 30,  1996,  and the related
consolidated  statements of operations,  stockholders'  equity  (deficiency) and
cash  flows  for the nine  months  ended  June 30,  1996 and for the year  ended
September 30, 1995.  These financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

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

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material  respects,  the financial  position of the Company as of
June 30, 1996,  and its results of operations and cash flows for the nine months
then  ended and for the year  ended  September  30,  1995,  in  conformity  with
generally accepted accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
consolidated financial statements, the Company has incurred recurring net losses
and negative cash flows from operating activities, has limited liquid resources,
has negative  working  capital and its primary  operating  subsidiary  is in the
process of being  liquidated  under Chapter 7 of the U.S.  Bankruptcy Code. Such
matters raise  substantial  doubt about the  Company's  ability to continue as a
going concern.  Management's plans regarding those matters are described in Note
1. The  consolidated  financial  statements do not include any adjustments  that
might result from the outcome of this uncertainty.

                              /s/  RAIMONDO, PETTIT & GLASSMAN
                              ------------------------------------------------
                                   Raimondo, Pettit & Glassman

Torrance, California
October 31, 1996

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F37

<PAGE>

<TABLE>
<CAPTION>

                              NUOASIS GAMING, INC.
                           Consolidated Balance Sheet
                               As of June 30, 1996



                                                                                                As of
                                                                                            June 30, 1996
                                                                                        ---------------------
<S>                                                                                     <C>

ASSETS

Current Assets:
Cash and cash equivalents                                                               $                  84
                                                                                        ---------------------
   Total Current Assets                                                                                    84
                                                                                        ---------------------

TOTAL ASSETS                                                                            $                  84
                                                                                        =====================
LIABILITIES AND STOCKHOLDERS'
 DEFICIENCY
Current Liabilities:
 Accounts payable and accrued expenses                                                  $             103,725
 Due to affiliates                                                                                    665,371
                                                                                        ---------------------
   Total Current Liabilities                                                                          769,096
Commitments and Contingencies (Note 7)
Stockholders' Deficiency:
 Preferred stock - par value $.01;  authorized  1,000,000 shares; 14% cumulative
  convertible; issued and outstanding
  170,000 shares (aggregate liquidation of $304,425)                                                     1,700
 Preferred Stock Series B - par value $2.00;  authorized,
  issued and outstanding 250,000 shares (aggregate liquidation
  of $500,000)                                                                                        500,000
 Common stock - par value $.01;  authorized 30,000,000 shares;
  30,000,000 shares issued and outstanding                                                            300,000
 Stockholder receivable                                                                            (1,447,080)
 Additional paid-in capital                                                                        12,376,196
 Accumulated deficit                                                                              (12,499,828)
                                                                                        ---------------------
   Total Stockholders' Deficiency                                                                    (769,012)
                                                                                        ----------------------
TOTAL LIABILITIES AND STOCKHOLDERS'                                                     $                  84
DEFICIENCY                                                                              =====================

</TABLE>


          See accompanying notes to consolidated financial statements.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F38

<PAGE>

<TABLE>
<CAPTION>

                              NUOASIS GAMING, INC.
                      Consolidated Statements of Operations
    For the Nine Months Ended June 30, 1996 and Year Ended September 30, 1995



                                                            For the Nine Months          For the Year Ended
                                                            Ended June 30, 1996          September 30, 1995
                                                            ---------------------------  -------------------------
<S>                                                         <C>                          <C>

Revenues:

Gaming                                                      $                         -  $                 884,077
                                                            ---------------------------  -------------------------
    Totals                                                                            -                    884,077
                                                            ---------------------------- -------------------------
Costs and Expenses:
Gaming, prizes and revenue sharing                                                    -                    776,827
General and administrative                                                      164,414                    291,633
Depreciation and amortization                                                   270,000                    156,376
Loss (gain) on disposal of investments                                          (38,510)                   140,949
Professional Services                                                           401,236                    607,168
Interest Expense                                                                      -                      7,829
                                                            ---------------------------- -------------------------
    Totals                                                                      797,140                  1,980,782
                                                            ---------------------------- -------------------------
Loss before income taxes                                                       (797,140)                (1,096,705)
Provision for income taxes                                                            -                          -
                                                            ---------------------------- -------------------------
Net loss                                                    $                  (797,140) $              (1,096,705)
                                                            ============================ ==========================

Net loss applicable to common stock                         $                  (814,990) $              (1,120,505)
                                                            ============================ ==========================
Net loss per common share                                   $                      (.$3)                      (.05)
                                                            ---------------------------- --------------------------
Weighted average common shares outstanding                                   29,057,660                 23,785,550
                                                            ---------------------------- -------------------------

</TABLE>

          See accompanying notes to consolidated financial statements.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F39

<PAGE>

<TABLE>
<CAPTION>


                              NUOASIS GAMING, INC.
          Consolidated Statements of Stockholders' Equity (Deficiency)
                     For Nine Months Ended June 30, 1996 and
                        the Year Ended September 30, 1995


                                        Preferred            Preferred Stock               Common                                  
                                          Stock                 Series B                     Stock                
                                ------------------------------------------------------------------------------   Stockholder
                                       Shares     Amount      Shares     Amount       Shares        Amount        Receivable       
                                ------------------------------------------------------------------------------  -------------------
<S>                                    <C>        <C>         <C>        <C>          <C>           <C>         <C>

Balances, September 30, 1994           170,000    $1,700      250,000   $500,000      20,643,676    $ 206,437   $     (1,000,000)  
Issuance of stock for cash                                                               887,500        8,875                      
Issuance of stock for consulting
  services(1)                                                                          4,600,000       46,000                     
Change in Stockholder
  Receivable                                                                                                            (473,773)
   Net loss                                                                                                                        
                                -------------------------------------------------------------------------------------------------
Balances, September 30, 1995           170,000    $1,700      250,000   $500,000      26,131,176    $ 261,312   $     (1,473,773)  
Conversion of loan for stock                                                           3,000,000       30,000                     
Exercise of stock options                                                                868,824        8,688                     
Change in Stockholder                                                                                                              
  Receivable                                                                                                              26,693
Net loss                                                                                                                           
                                -------------------------------------------------------------------------------------------------
Balances, June 30, 1996                170,000    $1,700      250,000   $500,000      30,000,000    $ 300,000   $     (1,447,080)
                                ------------------------------------------------------------------------------=------------------

</TABLE>

<TABLE>
<CAPTION>



                                   Additional          Retained Earnings   Total
                                   Paid-In             (Accumulated        Stockholders'
                                   Capital             (Deficit)           Equity (Deficiency)
                                --------------------------------------------------------------
<S>                                <C>                 <C>                 <C>

Balances, September 30, 1994       $    11,850,673     $    (10,605,983)   $        952,827
Issuance of stock for cash                  26,625                                   35,500
Issuance of stock for consulting
  services(1)                              233,328                                  279,328
Change in Stockholder
  Receivable                                                                       (473,773)
Net loss                                                     (1,096,705)         (1,096,705)
                                   -----------------------------------------------------------
Balances, September 30, 1995       $    12,110,626     $    (11,702,688)   $       (302,823)
Conversion of loan for stock               170,000                                  200,000
Exercise of stock options                   95,570                                  104,258
Change in Stockholder
  Receivable                                                                         26,693
Net loss                                                       (797,140)            (797,140)
                                   -----------------------------------------------------------
Balances, June 30, 1996            $    12,376,196     $    (12,499,828)   $        (769,012)
                                   ===========================================================

</TABLE>


(1)  Includes 1,237,500 shares issued to affiliates

           See accompanying notes to consolidated financial statements

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F40

<PAGE>



                              NUOASIS GAMING, INC.
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>

                                                                           For the Nine             For the Year
                                                                           Months Ended                 Ended
                                                                           June 30, 1996         September 30, 1995
                                                                      ---------------------    --------------------------
<S>                                                                   <C>                      <C>

Operating activities:              
  Net loss                                                            $            (797,140)   $               (1,096,705)
 Adjustments to reconcile net loss to net
    cash used in operating activities:
      Effect of common shares issued for payment of services                              -                       263,125
      Depreciation and amortization                                                 270,000                       156,376
      Loss (gain) on disposal of investments and property                           (38,510)                      140,949
   Increase (decrease) from changes in:
         Accounts Receivable                                                              -                       184,767
         Other current assets                                                         50,566                      (38,421)
         Stockholder receivable                                                      143,962                     (473,773)
         Other assets                                                                  7,300                      100,205
         Accounts payable and accrued expenses                                        34,505                      141,113
         Due to affiliates                                                           416,871                      111,565
         Other current liabilities and accrued expenses                            (113,836)                      313,836
                                                                      ----------------------   --------------------------
             Net cash used in operating activities                                  (26,282)                    (196,963)
                                                                      ----------------------   --------------------------
Financing activities:
  Proceeds from issuances of equity securities                                       25,500                        35,500
            Net cash provided by financing activities                                25,500                        35,500
Net decrease in cash and cash equivalents                                              (782)                     (161,463)
Cash and cash equivalents, beginning of year                                            866                       162,329
Cash and cash equivalents, end of year                                $                  84    $                      866
Supplemental disclosures of cash flow data: Cash paid during the period for:
      Interest                                                        $                   -    $                        -
      Income taxes                                                    $               1,600    $                        -
Non-cash financing activities:
      Common stock issued for stockholder note receivable             $              78,758    $                        -
      Loan converted to common stock                                  $             200,000    $                        -

</TABLE>

          See accompanying notes to consolidated financial statements.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F41

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



Note 1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITIES

DESCRIPTION OF BUSINESS

     NuOasis Gaming,  Inc. and its subsidiaries  (the "Company"),  operates as a
holding  company for  leisure  and  entertainment  related  businesses.  NuOasis
Gaming,  Inc. was incorporated in the State of Delaware in 1987. During the nine
months ended June 30, 1996 and fiscal year ended September 30, 1995, the Company
had two  wholly-owned  subsidiaries  engaged  in casino  gaming  and  investment
development activities.

     The  activities of the Company's  subsidiaries  have been  primarily in the
United States.

PRINCIPLES OF CONSOLIDATION

     The accompanying  consolidated financial statements include the accounts of
NuOasis Gaming,  Inc.  ("NuOasis")  and its  wholly-owned  subsidiaries,  Ba-Mak
Gaming International,  Inc. ("Ba-Mak"),  formerly Phillips Gaming International,
Inc.,  and Casino  Management  of America,  Inc.  ("CMA");  the  accounts of CMA
include its wholly-owned  subsidiaries,  NuOasis Las Vegas,  Inc.  ("NuOasis Las
Vegas"), and NuOasis Laughlin,  Inc. ("NuOasis  Laughlin"),  and as used herein,
are  collectively  referred to as the  "Company"  unless the  context  indicates
otherwise.  All  material  intercompany  accounts  and  transactions  have  been
eliminated in consolidation.

MANAGEMENT ESTIMATES

     The  preparation  of financial  statements  in  conformity  with  generally
accepted  accounting  principles  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.

CHANGE IN FISCAL YEAR

     During the nine  months  ended June 30,  1996  ("fiscal  year  1996"),  the
Company  elected to change its fiscal year end from  September  30 to June 30 to
facilitate and coincide with Nona Morelli's II, Inc., the Company's  controlling
parent  ("Nona")  fiscal  year end of June 30. The  election of change in fiscal
year was reported on Form 8-K filed on November 10, 1995.

BANKRUPTCY FILING OF BA-MAK GAMING INTERNATIONAL, INC.

     Ba-Mak was  incorporated  in  Louisiana on December 15, 1992 to conduct the
Company's gaming operations, including gaming machine route operations and sales
of  gaming  equipment.  On April 8,  1993,  Ba-Mak  received  approval  from the
Louisiana  Gaming  Regulatory  Division  to become a licensed  distributor/route
operator for electronic video bingo machines.

     In October 1994,  Ba-Mak filed for protection  under Chapter 11 of the U.S.
Bankruptcy Code in the Eastern District of Louisiana. While under the protection
of Chapter 11, Ba-Mak  continued to operate as a charitable bingo route operator
in  Louisiana  as   Debtor-in-Possession.   It  was  management's  objective  to
reorganize  Ba- Mak's  debt  under  Chapter  11 and fully  continue  its  gaming
operations.  Accordingly,  Ba-Mak was  accounted  for as a continuing  operation
during fiscal 1995.

     On April 20, 1995,  upon motion from the United  States  Trustee,  an order
converting  the case to  Chapter  7 was  issued  and a  Chapter  7  Trustee  was
appointed.  The trustee took possession of Ba-Mak's assets and is in the process
of liquidating  such assets for the benefit of Ba-Mak's  bankruptcy  estate.  As
such, all gaming  operations at Ba-Mak ceased and,  accordingly,  were accounted
for as a disposition  of an investment  during fiscal 1995 which resulted in (a)
the write off of  $1,056,978  and  $1,415,050  of total assets and  liabilities,
respectively;  and (b) a net loss on  disposal  of  investment  in the amount of
approximately  $140,949.  Gaming  revenues  with  respect to Ba-Mak  were $0 and
$884,077 during fiscal years 1996 and 1995, respectively,  and will not recur in
future years.

GOING CONCERN

     The Company  has  experienced  recurring  net  losses,  has limited  liquid
resources,  negative  working capital and its primary  operating  subsidiary was
liquidated  during the  fiscal  year 1995.  Management's  intent is to  continue
searching for additional sources of capital and new operating opportunities.  In
the interim,  the Company will continue  operating with minimal overhead and key
administrative functions will be provided by an affiliate,  NuVen Advisors (Note
5). The  Company  has  received  financial  support  from Nona of  approximately
$155,000  during the nine months ended June 30, 1996, and  management  estimates
that Nona will need to contribute approximately $1.1 million in future financial
support  for the  Company  to fund its  operations  through  fiscal  year  1997.
Accordingly,  the  accompanying  consolidated  financial  statements  have  been
presented under the assumption the Company will continue as a going concern.

CASH EQUIVALENTS

     Cash  equivalents  are highly liquid  investments  with a maturity of three
months or less when acquired.

ISSUANCE OF STOCK FOR SERVICES

     Shares of the  Company's  common  stock issued for services are recorded in
accordance  with APB16 at the fair market  value of the stock issued or the fair
market  value of the  services  provided,  whichever  value is the more  clearly
evident.  The value of the  services are  typically  stipulated  by  contractual
agreements.

LOSS PER COMMON SHARE

     Loss per common share is computed based on the net loss for each period, as
adjusted for dividends  required on preferred stock ($17,850 for the nine months
ended June 30, 1996, and $23,800 for the year ended  September 30, 1995) and the
weighted average number of common shares  outstanding.  Common stock equivalents
were not considered in the loss per share calculations, as the effect would have
been anti-dilutive.

INCOME TAXES

     The Company  accounts for income taxes using the liability  method.  Income
taxes are provided on all revenue and expense items, regardless of the period in
which  such  items are  recognized  for tax  purposes,  except  for those  items
representing  a  permanent  difference  between  pre-tax  accounting  income and
taxable  income.  A valuation  allowance is recorded when it is more likely than
not that benefits resulting from deferred tax assets will not be realized.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F42

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



REVENUE RECOGNITION

     Gaming revenues were recognized based upon the gross funds deposited in the
gaming machines.  Net revenues are referred to in the industry as "Net Win", the
difference  between gross funds  deposited into the gaming machines and payments
to customers.  Operating  expenses  were paid from the "Net Win".  There were no
gaming revenues during the nine months ended June 30, 1996.

RECLASSIFICATION OF PRIOR YEAR AMOUNTS

     To enhance  comparability,  the  fiscal  year 1995  consolidated  financial
statements  have been  reclassified,  where  appropriate,  to  conform  with the
financial statement presentation used in fiscal year 1996.

RECENT ACCOUNTING DEVELOPMENT

     In October  1995,  the FASB  adopted  Statement  No. 123,  "Accounting  for
Stock-Based  Compensation."  This Statement  encourages entities to adopt a fair
value method of accounting for  stock-based  compensation  plans including stock
options and warrants  issued to employees.  For entities which do not adopt this
method,  the Statement  requires  disclosure  of the effect that the  fair-value
method  would have on net income  and  earnings  per  share.  The  Statement  is
effective  for  transactions  entered  into in fiscal  years  that  begin  after
December 15, 1995.  The Company has not  determined the effect of this Statement
nor has it decided when it will adopt the provisions of this Statement.

Note 2.  STOCKHOLDER RECEIVABLE

     Components of Stockholder Receivable are as follows:

                                                  June 30,
                                                  1996
                                                  -----------
Receivable from Nona                              $ 1,368,322
Receivable from Officer                                78,758
                                                  -----------
                                                  $ 1,447,080

     Receivable  from Nona relates  primarily to the  acquisition of CMA and has
been  reclassified  to equity  because the repayment of the receivable is at the
discretion  of Nona and the  Company.  The  Company is  dependent  upon Nona for
continued  financial  support  (Note 1),  and Nona  historically  and  currently
provides  financial  support to the Company.  The Company believes that Nona has
the ability  and intent to repay the  receivable  or will offset the  receivable
against any amounts due to Nona by the Company.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F43

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     Receivable  from Officer  relates to options  exercised by Mr. Fred G. Luke
during fiscal year 1996 (Note 4).

Note 3.  OTHER ASSETS

The following is a summary of other assets:

                              June 30, 1996
                              -------------
     Prepaid Media            $     360,000
     Fine Art                             -
                              -------------
                                    360,000
     Valuation Allowance:
     Prepaid Media                 (360,000)

     Net Book Value           $           -
                              ==============

     Prepaid  Media  represents  prepaid  print  and  broadcast  advertising.  A
valuation  allowance was set up given the  uncertainty  of utilizing such media.
The Company  recognized  $270,000 and $90,000 in expense  during fiscal 1996 and
1995, respectively.

     The Fine Art represents paintings originally appraised at $2,000,000, which
was  recorded  in  fiscal  1995 at the $0 basis of the  assets  for which it was
exchanged.

Note 4.  STOCKHOLDERS' EQUITY

SECURITIES ISSUED TO NONA

     NuOasis  entered into a Stock Purchase and Business  Combination  Agreement
(the  "Stock  Purchase  Agreement")  with  Nona  and  Nona's  then  wholly-owned
subsidiary,  CMA,  whereby  NuOasis  agreed to purchase  all of the  outstanding
capital  stock of CMA from  Nona in  exchange  for  NuOasis  issuing  to Nona a)
2,000,000  shares of common  stock;  b) 250,000  shares of Series B  Convertible
Preferred  Stock ("Series B  Preferred");  c) 6,000,000 New Class D common stock
purchase  warrants ("New Class D Warrants");  and d) an option to purchase up to
an additional 6,160,000 shares of common stock, (the "Nona Option"). The Closing
occurred on March 30, 1994, the "Closing  Date",  pursuant to which CMA became a
wholly-owned  subsidiary  of  NuOasis.  Based upon an  opinion of the  Company's
former legal counsel,  the Company  consummated the Stock Purchase Agreement and
legally  issued  convertible  securities,  options and warrants  when there were
insufficient  authorized  shares to provide for  conversion  of the  convertible
securities,  and exercise of the options and warrants,  due to an undertaking by
the former  directors of the Company to enact the necessary  corporate action to
provide the Company with sufficient authorized shares to satisfy all outstanding
rights for unissued  shares.  A total of  30,000,000  shares of common stock are
currently  authorized for issuance by the Company,  all of which are outstanding
at June 30, 1996.  The  Company's  Board of Directors has approved a proposal to
amend the  Company's  Certificate  of  Incorporation  to increase  the number of
common shares the Company is authorized to issue to 100,000,000.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F44

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


COMMON SHARES RESERVED FOR ISSUANCE

     At June 30, 1996, shares of common stock were reserved for the exercise and
conversion of the following:

Preferred stock:
   14% Preferred Stock issued and outstanding             170,000
   Series B Preferred Stock issued to Nona             19,500,000
Redeemable common stock purchase warrants:
   New Class A (exercisable at $.50 per share)          1,530,000
   New Class B (exercisable at $.75 per share)          3,080,000
   New Class C (exercisable at $1.00 per share)         1,510,000
   New Class D                                         12,000,000
Phillips' Warrants                                      1,325,193
   1993 incentive and non-qualified stock
      options - available for grant                     1,200,000
1989 Incentive Stock Options:
   Grants outstanding                                      50,000
   Available for grant                                    450,000
1989 Non-qualified Stock Options:
   Grants outstanding                                     200,000
   Available for grant                                    300,000
1991 Non-qualified Stock Options:
    Grants outstanding                                    150,000
    Available for grant                                   450,000
Other Stock Options:
    Grants outstanding                                  5,006,176

        Total                                          46,921,369


     As of the date of this report,  the 46,921,369 shares reserved for issuance
exceed the available  number of shares  authorized for issuance in the Company's
Certificate of Incorporation. The proceeds from the sale of the New Class A, New
Class B and New Class C warrants were reflected in the consolidated statement of
cash flows for the fiscal year ended September 30, 1993. However,  since none of
the warrants have been exercised, no shares have been issued or reflected in the
stockholders' equity section of the balance sheet.

PREFERRED STOCK

     During 1989, stockholders authorized the issuance of up to 1,000,000 shares
of preferred stock with a par value of $.01 per share.

     During 1989, the Company sold 750,000 shares of preferred stock  designated
as 14% cumulative  convertible  preferred stock (the "14% Preferred Stock"). The
14%  Preferred  Stock is  redeemable,  in whole or in part, at the option of the
Company  at a  redemption  price of $100 per  share  plus any  unpaid  dividends
thereon to the redemption date. The 14% Preferred Stock has a liquidation  value
of $1.00 per share, ranks, as to dividends and liquidation,  prior to the common
stock and is  convertible  at the option of the holder  upon 30 days notice into
one share of common stock,  subject to adjustments in certain events. Each share
is entitled to one vote and an annual dividend of $.14 per share.  Dividends are
cumulative  and payable  quarterly.  Dividends  on common  stock may not be paid
unless provision has been made for payment of preferred dividends.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F45

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     No 14% Preferred Stock was converted during fiscal years 1996 and 1995.

     No dividends were paid on the 14% Preferred  Stock during fiscal years 1996
and 1995. Dividends in arrears aggregated $134,425 at June 30, 1996.

     The 14% Preferred Stock shall have a liquidation preference of the original
purchase  price ($1.00 per share) plus unpaid  dividends on each share  thereof.
The balance of proceeds of a  liquidation,  if any, are to be paid to the common
stockholders of the Company.  A merger or reorganization or other transaction in
which control is transferred will be treated similar to a liquidation.

     Subject to anti-dilution adjustments,  each share of 14% Preferred Stock is
convertible at any time into one share of the Company's common stock. Each share
of the 14% Preferred Stock votes on a 1:1 converted-to-  common stock basis, and
the holders of 14%  Preferred  Stock and the holders of common  stock shall vote
together  as one  class  on all  matters  submitted  to a vote of the  Company's
stockholders.  The conversion  ratio of the 14% Preferred  Stock to common stock
will be  proportionally  adjusted in the event of  dilution,  i.e.  proportional
adjustments for stock splits and stock dividends will be made.

     Pursuant to the Stock  Purchase  Agreement  with Nona and CMA,  the Company
issued  250,000  shares  of  Series B  Preferred  Stock to  Nona.  The  Series B
Preferred  Stock has no redemption  rights and is not entitled to any dividends.
It has a  liquidation  value of $2 per share in  preference  to any  payment  on
common stock,  subject only to rights of the holders of the 14% Preferred Stock.
Each share is entitled to seventy-eight (78) votes and shall be convertible into
seventy-eight  (78) fully paid and  nonassessable  shares of common stock,  or a
total of  19,500,000  shares  of common  stock if all of the  shares of Series B
Preferred Stock are converted.

PRIVATE SALE OF COMMON STOCK AND NEW WARRANTS

     During June 1993, the Company undertook a private placement of 25 units for
an aggregate  sales price of $250,000  ("Private  Placement  I"), with each unit
consisting  of 40,000  shares of common  stock,  40,000  New Class A  redeemable
common stock  purchase  warrants ("New Class A Warrants") and 40,000 New Class B
redeemable  common stock purchase  warrants  ("New Class B Warrants").  Each New
Class A Warrant entitles the holder to purchase one share of common stock at the
price of $.50 per share for the period from August 1, 1993 to the effective date
of a registration  statement  registering  the common stock and the common stock
underlying  the New Class A Warrants  offered  and  issuable  under the  related
private  placement  memorandum.  Each New Class B Warrant entitles the holder to
purchase one share of common stock at the price of $.75 per share for the period
from  August  1,  1993  to  the  effective  date  of  a  registration  statement
registering  the common  stock and the common stock  underlying  the New Class B
Warrants offered and issuable under the related private placement memorandum.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F46

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     During  July  1993,  the  Company  undertook  a  private  placement  of  an
additional 25 units for an aggregate sales price of $250,000 ("Private Placement
II"),  with each unit  consisting of 40,000  shares of common stock,  40,000 New
Class A Warrants, and 40,000 New Class B Warrants.

     During August 1993, the Company  undertook a private place of an additional
20 units for an aggregate  sales price of $200,000  ("Private  Placement  III"),
with each unit  consisting of 40,000 shares of common stock,  40,000 New Class A
Warrants, and 40,000 New Class B Warrants.

     In connection with Private  Placements I, II and III, the Company  received
proceeds of $559,000 (net of sales agent and other direct costs which aggregated
$141,000) from the sale of 70 units and issued 2,800,000 shares of common stock,
2,800,000 New Class A Warrants and 2,800,000 New Class B Warrants  during fiscal
1993.

     In September 1993, in an effort to encourage  early  exercise,  the Company
offered one New Class C redeemable  common stock purchase  warrant ("New Class C
Warrants")  for each New Class A Warrant  exercised on or before  September  30,
1993.  In  connection  with  that  offer  1,550,000  New Class A  Warrants  were
exercised resulting in the issuance of an additional  1,550,000 shares of common
stock for $775,000 and 1,550,000 New Class C Warrants.  Each New Class C Warrant
entitles  the holder to purchase one share of common stock at the price of $1.00
per share.

     The Company  received  $50,000,  $300,000 and $1,090,000 from other private
sales of 300,000,  1,371,500  and 1,090,000  shares of  restricted  common stock
during  1993,  1992 and 1991,  respectively.  The 1993  private  sales  included
100,000 New Class A Warrants  and 100,000 New Class B Warrants.  No amounts were
recorded on the balance  sheet for the  issuance or valuation of the warrants as
all  proceeds  were  recorded  in common  stock and  additional  paid-in-capital
accounts. All New Class A, B and C Warrants are exercisable up to one year after
the effective date of the  registration of the underlying  stock. As of the date
of this report,  the registration of the underlying stock has not been finalized
and therefore is not yet effective.

     Pursuant to the Stock  Purchase  Agreement  with Nona and CMA,  the Company
issued  6,000,000  New Class D  Warrants  to Nona.  Each New Class D Warrant  is
exercisable  at $1.00 per share and will  entitle  the  holder to  receive  upon
exercise two (2) shares of common stock, or a total of 12,000,000  shares if all
of the New Class D Warrants are  exercised.  The new Class D Warrants  expire on
March  30,  2004,  and to  date,  none of the new  class D  Warrants  have  been
exercised.

PHILLIPS' WARRANTS

     In September  1994,  the Company  entered into a Settlement  Agreement with
Douglas J. Phillips, the Company's former President,  whereby shares held by Mr.
Phillips were sold for the benefit of the Company to pay creditor  claims due to
Mr.  Phillips'  prior  misrepresentations  of the cash account of the Company at
March 30, 1994.  Under the Settlement  Agreement,  Mr. Phillips placed 1,325,193
shares  of the  Company's  common  stock  in the  name  of the  Phillips  Family
Investment  Limited  Partnership  into  escrow  with a third  party  trustee for
liquidation  with  payment of the net  proceeds to the  Company for  application
towards  certain  debts  including  payables to trade  creditors.  Mr.  Phillips
received a grant of  non-transferable  Warrants to purchase  1,325,193 shares of
the Company's  common stock at an exercise  price of $.21875 per share  expiring
September 13, 1996.  No Warrants have been  exercised and have all expired as of
the date of this Report.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F47

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1993 INCENTIVE AND NON-QUALIFIED STOCK OPTION PLANS

     Under stock option plans adopted on January 22, 1993,  the Company's  Board
of  Directors  may grant  "incentive  stock  options" and  "non-qualified  stock
options"  whereby option  holders may purchase up to 1,200,000  shares of common
stock prior to the termination of the plan on January 22, 2003.  Incentive stock
options may only be granted to officers and other employees; non-qualified stock
options may be granted to employees,  advisors,  consultants  and members of the
Board of Directors of the Company. Incentive stock options may not be granted at
a price less than 100% of fair market  value as of the date of grant to officers
and employees  who own less than 10% of the  Company's  common stock and 110% of
fair  market  value to those  officers  and  employees  who own more  than  10%.
Non-qualified  stock  options may be granted at a price to be  determined by the
compensation  committee of the Board of Directors on the date such non-qualified
stock options are granted.  Options are  exercisable  from the date of grant and
expire no later  than ten years from the date of grant or such  earlier  date as
determined by the compensation committee at the date of grant. However, the term
of an incentive  stock option granted to an officer or other employee who at the
time of grant owns at least 10% of the Company's common stock,  shall not exceed
five  years.  No  options  have  been  granted  under  the  1993  incentive  and
non-qualified stock options plans.

1989 INCENTIVE STOCK OPTIONS

     Under a stock option plan adopted on July 30, 1989, the Company's  Board of
Directors may grant "incentive stock options" whereby  employees may purchase up
to 500,000  shares of common stock prior to the  termination of the plan on July
30,  1999.  Options  may not be granted at a price less than 100% of fair market
value as of the date of grant to officers and employees who own less than 10% of
the Company's  common stock and 110% of fair market value to those  officers and
employees who won more than 10%. Options are exercisable from the date of grant,
and  expire no later than five  years  from the date of grant.  No options  were
issued,  canceled or exercised during fiscal years 1996 or 1995. Prior to fiscal
year 1995, 50,000 options were granted of which 450,000 options remain available
for grant. The 50,000 granted options expire November 15, 1996.

1989 NON-QUALIFIED STOCK OPTIONS

     Under a stock option plan adopted on July 30, 1989, the Company's  Board of
Directors may grant "non-qualified stock options" whereby employees may purchase
up to 500,000  shares of common  stock prior to the  termination  of the plan on
July 30, 1999.  Options must be granted at no less than 85% of fair market value
as of the date of  grant.  Options  are  exercisable  from the date of grant and
expire no later than five years from the date of grant.  No options were issued,
cancelled or exercised  during  fiscal years 1996 or 1995.  Prior to fiscal year
1995, 200,000 options were granted of which 300,000 options remain available for
grant. The 200,000 granted options expire November 15, 1996.

1991 NON-QUALIFIED STOCK OPTIONS

     Under a stock option plan adopted on February 1, 1991, the Company's  Board
of Directors  may grant  "non-qualified  stock  options"  whereby  employees may
purchase up to 600,000  shares of common stock prior to the  termination  of the
plan on  February 1, 2001.  Options  must be granted at no less than 85% of fair
market value as of the date of grant.  Options are exercisable  from the date of
grant and expire no later  than five  years  from the date of grant.  No options
were issued,  cancelled or exercised  during fiscal years 1996 or 1995. Prior to
fiscal year 1996, 150,000 options were granted of which 450,000 remain available
for grant. The 150,000 granted options expire November 15, 1996.


                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F48

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



THE NONA OPTION

     Pursuant to the Stock Purchase  Agreement with Nona and CMA, the option for
the purchase of up to 6,160,000  shares of common stock is  nontransferable  and
exercisable at $.01 per share.  The total number of shares that can be purchased
upon  exercise  of the option is equal to the  number of shares of common  stock
subject to New Class A, New Class B and New Class C warrants  outstanding at the
Closing Date that eventually expire  unexercised.  The Warrant Agreements extend
the expiration dates of the respective  Warrants to one year after the effective
date of a  registration  statement,  at which time Nona may  exercise its option
provided  all the New Class A, B and C Warrants  have not been  exercised.  Nona
does not  hold any of the New  Class  A, B or C  Warrants,  nor is it  currently
entitled to exercise its Option.

OTHER STOCK OPTIONS

     A summary of all other stock option  transactions for the nine months ended
June 30, 1996 and the year ended September 30, 1995 is as follows:

                                        Nine Months         Year
                                        Ended               Ended
                                        June 30, 1996       September 30, 1995
                                        -------------       ------------------

Outstanding at beginning of year        5,875,000           -
--------------------------------

    Granted (Note 5)                    1,275,000           5,975,000
--------------------

    Exercised                           (868,824)           -
-------------

    Cancelled                           -                   (100,000)
-------------

    Issued

Outstanding at end of year              6,281,176           5,875,000
--------------------------              =============       ==================

Range of option exercise prices
 granted                                $ .12               $.10 - $.80
-------------------------------         ----------------    ------------------

Stock Options Granted

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F49

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     During  the  year  ended  September  30,  1995,  the  Company  granted  and
subsequently  cancelled an option to purchase  100,000  shares of the  Company's
common   shares  to  the  former  Chief   Financial   officer  of  the  Company.
Additionally,  during year ended  September  30,  1995,  the Company  granted an
option to purchase 600,000 shares of the Company's common shares to an unrelated
third party  consultant.  The remaining options granted in fiscal years 1995 and
1996 were granted to related parties as described in Note 5.

STOCK OPTIONS EXERCISED

     During  fiscal 1996,  868,824  common  shares were issued upon  exercise of
options by the  President of the Company in the amount of $104,258,  or $.12 per
share.  The Company  received a note  receivable  in the amount of $78,758 and a
cash payment of $25,500 as consideration for the exercise of these options.  The
note receivable has been  classified as Stockholder  Receivable at June 30, 1996
and was collected after year end.

SHARES ISSUED TO ADVISORS

     During the year ended  September  30, 1995,  the Company  issued  4,600,000
shares to certain  advisors and consultants  for services.  There were no shares
issued to advisors and  consultants  for  services  during the nine months ended
June 30, 1996.

Note 5.  OTHER RELATED PARTY TRANSACTIONS

     In August 1995, the Company entered into an Employment  Agreement with Fred
G. Luke, the Company's Chairman and President.  Mr. Luke has been serving as the
Company's Chairman and President since  approximately  March 31, 1994. The terms
of the Employment  Agreement call for Mr. Luke to receive  approximately  $4,500
per month,  retroactive  to April 1, 1994,  for five (5) years as a base salary;
granted him an option to purchase 3,000,000 shares of the Company's common stock
at an exercise price of $.12 per share;  provides him with an annual bonus based
upon a number of factors related to the Company's  growth and performance  which
include (a) serving on the Company's  Board of Directors  and as its  President;
(b) providing advice concerning mergers and acquisitions; (c) corporate finance;
(d) day to day  management;  (e)  guidance  with  respect  to  general  business
decisions;   (f)  other  duties  commonly   performed  by  the  President  of  a
publicly-held  company;  and  requires  the Company to purchase  life  insurance
coverage, reimburse vehicle expenses, and provide other fringe benefits. Between
March 31, 1994 and  September  30, 1994,  Mr. Luke received no cash payments for
his services. In August 1995, the Company agreed to retroactively compensate Mr.
Luke for past  services in the amount of $27,000 for the period April 1, 1994 to
September  30, 1994 and $59,000 for the period  October 1, 1994 to September 30,
1995.  No  bonuses  have been  accrued,  paid or are owed as of the date of this
Report.  The Company  expensed  $40,500 and $86,000 during fiscal 1996 and 1995,
respectively, and had $126,500 due to Mr. Luke as of June 30, 1996.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F50

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     Effective  April 1, 1994, the Company  entered into a Consulting  Agreement
with John D. Desbrow for the engagement of Mr. Desbrow to perform legal services
and to hold the office of  Secretary,  on behalf of the Company,  for the period
from April 1, 1994 to March 31, 1995.  Between  April 1, 1994 and  September 30,
1994,  Mr.  Desbrow did not  receive any funds or shares of common  stock in the
Company but in fiscal 1995, he did bill and eventually received from the sale of
shares $3,000 per month for services rendered as Secretary from April 1, 1994 to
September 30, 1994 all of which was expensed in fiscal year 1994.  Additionally,
the Company  expensed $4,000 for services  rendered by Mr. Desbrow as a Director
from April 1994 to July 1994.

     Effective April 1, 1995, the Company and Mr. Desbrow renewed the Consulting
Agreement  through March 31, 1996.  Under the renewed  Consulting  Agreement the
Company  contracted to pay Mr.  Desbrow  $50,000 for the renewal term payable in
the Company's  common stock.  1,050,000  shares were  registered for issuance on
Forms S-8 filed with the  Securities  and  Exchange  Commission  during the 1995
fiscal year for payment of sums earned during fiscal years 1994 and 1995.  Under
the terms of the  Consulting  Agreement,  Mr.  Desbrow  invoices the Company and
applies  the net  proceeds  received  from the  sale of  stock  to the  invoiced
amounts.  For purposes of any  "profit"  computation  under  Section 16 (b), Mr.
Desbrow and the  Company  have agreed the price paid for the shares is deemed to
be $50,000. As of September 30, 1995, Mr. Desbrow held 600,000 shares which were
to be utilized  for current and future  services  incurred.  Effective  April 1,
1996, the Consulting  Agreement was renewed  through March 31, 1997 at an annual
rate of $75,000  and granted  him an option to  purchase  275,000  shares of the
Company's  Common  Stock at an  exercise  price of .12 per  share.  The  Company
expensed $43,750 and $43,000, during fiscal 1996 and 1995, respectively, and had
$8,252 due from Mr. Desbrow as of June 30, 1996.

     In July 1995,  the Company  entered  into a Consulting  Agreement  with Mr.
Dong,  pursuant to which Mr. Dong is to perform accounting  services and to hold
the office of Chief  Financial  Officer  through June 30, 1996.  Pursuant to the
agreement the Company agreed to pay Mr. Dong $20,000 per annum in cash or in the
Company's common stock, payable monthly in arrears, and granted him an option to
purchase  275,000  shares of the Company's  common stock at an exercise price of
$.12 per share.  Cash  payments  of $5,000  were made to Mr. Dong by the Company
during  fiscal  1995.  No shares were  issued to Mr. Dong during  fiscal 1995 or
1996.  During fiscal 1996,  the Consulting  Agreement was renewed  effective for
fiscal 1997 for an amount of $39,000 per annum. The Company expensed $15,000 and
$5,000  during  fiscal 1996 and 1995,  respectively,  and had $15,000 due to Mr.
Dong as of June 30, 1996.

     The Luke Family Trust and Lawver Corp.  owns 93% and 7%,  respectively,  of
NuVen  Advisors.  Fred G. Luke, as trustee of the Luke Trust,  controls the Luke
Trust and Mr.  Lawver is the majority  shareholder  of Lawver Corp.  and thereby
controls Lawver Corp.

     Effective  April  1,  1994,  the  Company  entered  into  an  Advisory  and
Management Agreement with NuVen Advisors for the engagement of NuVen Advisors to
perform  professional   services  for  calendar  year  1995.  Pursuant  to  such
Agreement,  the Company agreed to pay NuVen Advisors $180,000 annually,  payable
monthly in $15,000  increments in arrears,  and granted NuVen Advisors an option
to purchase  2,000,000  shares of the Company's  common stock  exercisable  at a
price of $.10 per  share.  During  fiscal  1996,  the  Advisory  and  Management
Agreement  was renewed  effective  October 1, 1995 for  $120,000  annually.  The
Company   expensed   $135,000  and  $180,000,   during  fiscal  1996  and  1995,
respectively, and had $118,000 due to NuVen Advisors as of June 30, 1996.


                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F51

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     Effective  April 1, 1994,  CMA  entered  into an  Advisory  and  Management
Agreement  with NuVen  Advisors for the  engagement of NuVen Advisors to perform
professional  services for calendar  year 1995.  Pursuant to such  Agreement CMA
agreed to pay NuVen  Advisors  $120,000  annually,  payable  monthly  in $10,000
increments in arrears,  and granted  NuVen  Advisors an option to purchase up to
five percent (5%) of CMA's  common  stock  outstanding  at the time of exercise,
exercisable  at a price per share equal to one hundred ten percent (110%) of the
book value of such  shares.  During  fiscal 1996,  the  Advisory and  Management
Agreement was renewed for fiscal 1997. CMA expensed  $90,000 and $120,000 during
fiscal 1996 and 1995 respectively,  and had $159,000 due to NuVen Advisors as of
June 30, 1996.

     During  fiscal  year 1994,  the  Company  entered  into an  agreement  with
Structure  America,  Inc.  ("SAI")  to issue  1,000,000  shares  for  consulting
services.  Such services were  rendered  during fiscal 1995.  During fiscal year
1996, the Company entered into another agreement with SAI to perform  consulting
services.  Pursuant to such  agreement,  the Company  agreed to issue  1,000,000
common  shares of the  Company  to SAI and  granted  SAI an  option to  purchase
1,000,000  common  shares of the  Company,  exercisable  at $.12 per share.  The
agreement  is fully  contingent  upon the final  execution  and  closing  of the
purchase of National Pools Corporation (Note 8). The Registrant expensed $75,000
and  $54,000   during  fiscal  years  1996  and  1995,   respectively   and  had
approximately $40,000 due to SAI as of June 30, 1996.

     The Company  has  received  financial  support  from Nona of  approximately
$155,000  during  fiscal  1996,  and is dependent  upon Nona for future  working
capital.  As of June  30,  1996,  the  Company  had  $238,118  due to  Nona  and
classified as Due to Affiliates.

Note 6.  FEDERAL INCOME TAXES

     The Company and its  subsidiaries,  CMA,  NuOasis  Laughlin and NuOasis Las
Vegas file  consolidated  federal and state tax returns.  Because of its losses,
the Company incurred no tax liability for the fiscal year ended June 30, 1996.

     The Company has recorded  deferred tax assets and liabilities  arising from
temporary differences as follows:

                                                   June 30, 1996

Deferred Tax Assets:
  Net Operating Loss Carry forward          $             2,795,940
----------------------------------          -----------------------
  Other                                                     154,224
-------                                     -----------------------
  Valuation Allowance                                   (2,950,164)
---------------------                       -----------------------
                                            $                    0
                                            ----------------------

     The  deferred  taxes  result  from  temporary  differences  relating to the
difference  in the  basis  of  assets  and  liabilities  for  financial  and tax
reporting purposes. The temporary difference relates mainly to the difference in
basis of and recognition of net operating loss carry forward benefit.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F52

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



     As a result of a change in ownership  that occurred in 1994,  the Company's
use of its NOL carry  forwards  may be limited by  section  382 of the  Internal
Revenue Code until such NOL's  expire.  Deferred  tax assets have been  computed
using the  maximum  expiration  terms of 13 to 5 years for federal and state tax
purposes, respectively.

     A deferred tax  valuation  allowance is used to offset most of the deferred
tax asset since it is more likely than not that the Company will not realize the
tax  benefits  of  its  net  operating  loss  carry  forwards  of  approximately
$7,278,086   and  $3,936,465  as  of  June  30,  1996  for  federal  and  state,
respectively. This net operating loss expires in various years through 2009.

Note 7.  COMMITMENTS AND CONTINGENCIES

OPERATING LEASES

     In April 1993, Ba-Mak entered into a noncancellable lease agreement for its
office  and  warehouse  in  Louisiana.  The lease  expires  on May 31,  1996 and
provides for monthly rent payments  starting at $1,750 with annual  increases of
$125. Rent expense  associated with the lease amounted to  approximately  $0 and
$11,000 for fiscal 1996 and 1995,  respectively.  The lease has been included in
the Chapter 7 bankruptcy proceedings.

OPTION AGREEMENT

     On June 13,  1996,  Nona  entered  into an  Option  Agreement  with  Joseph
Monterosso,  President of National  Pools  Corporation  ("NPC"),  an  individual
previously  unrelated  to the Company or Nona,  and granted such  individual  an
option to purchase the 250,000 Series B Preferred Shares of the Company owned by
Nona at a purchase price of $13.00 per share,  or a total of $3,250,000,  with a
minimum purchase of 110,000 shares.

     The exercise of the option is conditioned  upon  shareholder  approval of a
proposal  to increase  the  authorized  number of shares of common  stock of the
Company by at least twenty million (20,000,000) shares. The option is assignable
and shall expire 90 days after the next Annual  Meeting of  Shareholders  of the
Company.

     If the option is fully exercised by the holder of the option on the date of
exercise,  a change of control of the Company will occur by virtue of the voting
rights of the Series B Preferred  Shares,  and the  Company  would cease to be a
controlled subsidiary of Nona.

LEGAL PROCEEDINGS

     The   following   legal   proceedings   against  the  Company   and/or  its
subsidiaries, CMA or Ba-Mak, are pending as of the date of this Report:

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F53

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



(a)  Casino Management of America,  Inc. vs. Mark Bachik and Bachik Enterprises,
     Inc.; Texas District Court, Dallas County; Case #CV-94-4479

     In April 1993, FTF Management Company, Inc., a Colorado corporation ("FTF")
entered into an agreement  with Bachik  Enterprises,  Inc., a Texas  corporation
("Bachik"),  to purchase a 50% interest in the Star  Casino.  At the time of the
Agreement,  FTF was  controlled  by then current and former  officers and former
directors of Nona.  Under the agreement,  FTF and Bachik orally agreed to form a
joint venture to own and operate the Star Casino with each party acquiring a 50%
interest in the venture.  Subsequent to the agreement, a $400,000 receivable due
Nona was allegedly  diverted by Nona's former  President to agents of Bachik for
the  purpose  of  applying  the  funds to the  acquisition  of the Star  Casino.
Concurrently  with the  diversion of Nona's funds,  Nona's former  President was
identified by local  newspaper  articles as the owner of Nona's  interest in the
Casino.  Subsequently,  based on  documentation  received  by the  Company,  the
interest in the Star Casino attributable to Nona's funds was held in the name of
FTF. Nona subsequently assigned its rights to the $400,000 receivable to CMA. On
May 9, 1994,  Texas  counsel for CMA filed suit against  Bachik to recover CMA's
funds  improperly   diverted  to  Bachik.   Counsel  for  Mark  Bachik,   Bachik
Enterprises, Inc., and East Bennett Limited Liability Company has withdrawn from
their  representation.  Texas Counsel for CMA has  negotiated a settlement  with
Bachik. Counsel for CMA and Counsel for Defendant Bruce West have entered into a
letter  agreement  for  settlement  with Bruce West  calling  for the deposit of
$25,000 into an attorney's escrow until certain conditions are satisfied. A jury
trial  which was set to  commence  in October  1996 has been taken off  calendar
pending receipt of documentation to effect a dismissal of the action.

(b)  Casino Management of America,  Inc. vs. Star Casinos  International,  Inc.,
     and Cripple Creek Properties, Inc.; Teller County, Colorado District Court;
     Case No. 94-CV-144

     In a further effort to recover the $400,000  receivable related to the Star
Casino,  CMA,  in  November  1994 filed a suit in the  District  Court of Teller
County, Colorado against Star Casinos International, Inc. ("Star International")
and Cripple Creek Properties,  Inc.  ("Cripple  Creek") seeking  imposition of a
resulting trust, constructive seal, constructive trust, and an accounting of all
money  received and expended in connection  with a gaming  facility known as the
Star Casino.  The Defendants  answered and  counterclaimed  for slander of title
given that CMA filed a lis pendens  against the real  property on which the Star
Casino  is  located  in  Cripple  Creek,  Colorado.  CMA has  asserted  that the
counterclaim for slander of title is substantially  frivolous and groundless due
to existing  Colorado  case law.  Star  International  and Cripple Creek filed a
counterclaim  naming  Richard M. Greene  ("Greene")  as a third party  defendant
alleging  breach of contract,  promissory  estoppel,  and fraud causes of action
asserting  that Greene  received  $100,000 from them under an agreement  between
Greene,  FTF and Star  International,  that the funds would be paid to CMA.  The
funds were never paid to CMA  resulting  in CMA filing  suit.  After  taking the
depositions of all of the principal players,  everyone has acknowledged that the
original  $400,000  used to purchase the Star Casino in 1993 came from Nona.  On
May 3, 1996 Star Casinos International,  Inc., (the "debtor") filed a bankruptcy
petition under Chapter 11 of the Bankruptcy  Code. The schedules  filed with the
bankruptcy  court  do not  list  the  Casino  real  property  as an asset of the
bankruptcy estate. Prior to October 9, 1996 the Casino real property was held by
Cripple Creek  Properties,  Inc.,  one of the defendants and a subsidiary of the
debtor, the stock of which is listed as one of the debtor's assets. In July 1996
the first  trust deed holder on the casino real  property  instituted  a quasi -
judicial  foreclosure  proceeding in Teller County,  Colorado  District Court. A
foreclosure  sale occurred on October 9, 1996. The bid price by the  foreclosing
party was $782,320.72.  Since the first trust deed holder foreclosed the ability
of the  defendants to establish any damages as a result on the filing of the lis
pendens  has been  substantially  impaired.  Additionally,  under  Colorado  law
subject to redemption  rights the foreclosure  sale  effectively  eliminates all
junior  liens  including  CMA's lis  pendens.  A trial  date set for the week of
November 4, 1996 has been vacated and indefinitely stayed, pending resolution of
the bankruptcy case. Another creditor of the debtor unrelated to the Company has
filed a motion to dismiss the Chapter 11 bankruptcy and that motion is currently
pending. The Company has filed a Proof of Claim in the bankruptcy proceeding for
the $400,000 plus accrued interest.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F54

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



(c)  Ba-Mak Gaming  International Inc., Chapter 11 Bankruptcy,  Eastern District
     of Louisiana, Case No. 94-1366

     On October 28,  1994,  Ba-Mak  filed a Chapter 11 Petition  with the United
States  District  Court  (Bankruptcy  Division)  for  the  Eastern  District  of
Louisiana,  Bankruptcy Case #94-13661.  On April 20, 1995, the Bankruptcy  Court
granted  the  motion of the  United  States  Trustee  to  convert  the case to a
proceeding  under Chapter 7. A Trustee was appointed to liquidate the bankruptcy
estate of Ba-Mak,  and the  liquidation of its assets has been  occurring  since
July 1995.  The Company's  remaining  obligation in connection  with Ba-Mak is a
claim,  in the approximate  amount of $47,000,  against NuOasis Gaming for legal
fees incurred  during the bankruptcy if the bankruptcy  estate does not pay such
legal fees in full. The Trustee in the bankruptcy estate has been ordered to pay
such fees.  As of the date of this  Report,  the  Trustee has not yet closed the
bankruptcy estate;  however,  due to the claims of other creditors,  the Company
does not  expect to  recover  any  amount on the Proof of Claim it has filed for
funds lent or advanced to Ba-Mak.

(d)  Charles  Arnold vs. Nona Morelli's II, Inc.,  Casino  Management of America
     and MDM Gaming Partners,  L.P.;  Denver,  Colorado District Court; Case No.
     95-CV-104

     In January 1995,  Charles Arnold  ("Arnold"),  a consultant to Nona's prior
management,  initiated a lawsuit  against  Nona,  CMA and MDM alleging  that the
defendants  have denied him a 1% equitable  interest in MDM, which was allegedly
verbally  promised to Arnold by Frank J. Morelli,  III and Frank J. Morelli,  II
for alleged professional services rendered to MDM. Arnold is alleging damages in
an  amount  of  $90,000  in  connection  with  this  claim.  Nona and the  other
defendants have filed a third-party  complaint against FTF, Theodore E. DeTello,
Frank J. Morelli,  II and Frank J. Morelli,  III,  seeking full  indemnification
from them for any damages to which Arnold may be entitled in  accordance  with a
certain  Termination  Agreement  dated  December  17, 1993  between the parties.
Counsel for the Morelli's  has recently  indicated  that the Morelli's  would be
taking the Fifth Amendment  against  testifying in connection with this lawsuit.
Since Arnold may not have  witnesses  to prove the alleged  existence of an oral
promise,  the likelihood of any recovery against CMA, the Company's  subsidiary,
appears  to be  remote.  Counsel  for the  parties  have  stipulated  to binding
arbitration to be held in 1997.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F55

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(e)  Ruben  Kitay et al. vs. Nona  Morelli's  II,  Inc.  et al.;  United  States
     District Court for the Central District of California; Case No. 95-4375 RMT
     (SHx)

     On October  10,  1995,  a Second  Amended  Complaint  was filed in the U.S.
District Court for the Central  District of California  which named the Company,
Fred G. Luke, John D. Desbrow,  Kenneth R. O'Neal, O'Neal & White, P.C., a Texas
professional  corporation,  New World Capital, Inc., Rocci Howe, Euro-Belge (NA)
N.V.,  Structure America,  Inc.,  International  Banking  Corporation  Caribbean
(IBCC),  and the Luke  Family  Trust as  defendants  in an  alleged  shareholder
derivative  action  (the  "Derivative   Action")  filed  on  behalf  of  certain
shareholders of the Company. The Derivative Action arose from the Stock Purchase
and Business  Combination  Agreement,  pursuant to which Nona Morelli's II, Inc.
acquired  voting control of E.N.  Phillips  Company,  Inc. (now NuOasis  Gaming,
Inc.) and the events surrounding the bankruptcy of Ba-Mak Gaming  International,
Inc. The Plaintiffs  sought damages  according to proof,  interest,  rescission,
attorneys'  fees and exemplary  damages.  Outside counsel for the Company in the
Derivative  Action,  and the  management  of both the Company and Nona  believe,
among  other  things,  that the  Plaintiffs  do not have  standing  to file such
litigation,  have  failed  to  state  a  proper  claim,  and do not  qualify  as
representatives  in a shareholder  action. In response to the Company's filing a
Motion to Dismiss  the  Derivative  Action,  the Action  was  dismissed  without
prejudice pursuant to stipulation.

(f)  Gustavo  Farias et al. vs. Nona  Morelli's  II, Inc. et al.;  United States
     District  Court  for  the  Central   District  of   California;   Case  No.
     CV-96-2617-RMT (SHx)

     A Second  Amended  Complaint  entitled Ruben Kitay et al vs. Nona Morelli's
II,  Inc.,  et al;  United  States  District  Court for the Central  District of
California:  Case No. 95-4375  RMT(SHx),  filed on October 10, 1995, in the U.S.
District Court for the Central District of California and subsequently dismissed
pursuant to  stipulation,  was refiled by the Plaintiffs on April 12, 1996, by a
complaint entitled Gustavo Farias, et al v. Nona Morelli's II Inc., et al, filed
in the United States District Court for the Central District of California, Case
No. CV-96-2617-RMT (SHx). The new complaint named the Company, its officers, the
Company's  accounting  firm and other third  parties as defendants in an alleged
shareholder  derivative  action  (the  "Refiled  Action")  refiled  on behalf of
certain  shareholders of NuOasis Gaming.  The Refiled Action alleges  securities
fraud and RICO  violations  in connection  with the Stock  Purchase and Business
Combination  Agreement  pursuant to which the Company acquired voting control of
ENP (now NuOasis Gaming),  and the events  surrounding the bankruptcy of Ba-Mak.
The plaintiffs seek damages in an amount not yet ascertained according to proof,
interest,  rescission,  imposition of  constructive  trust,  diminution of share
value for the  individual  defendants,  attorneys'  fees and exemplary  damages.
Outside  counsel for the Company in the Refiled  Action,  and the  management of
both NuOasis Gaming and the Company believe among other things,  that the action
was initiated by Mike Savage,  a former  consultant and current  shareholder and
persons  affiliated  with him, as part of an attempt to take  control of NuOasis
Gaming;  that the Plaintiffs do not have standing to file such litigation;  that
the  Plaintiffs  have no  competent  and  credible  evidence  to  support  their
allegations; that they have failed to state a proper claim; and that they do not
qualify as proper  representatives in a shareholder action.  After the filing of
the Company's Motion to Dismiss in the original action,  the original action was
voluntarily  dismissed  by the  Plaintiffs.  The  Company  has filed a Motion to
Dismiss the Refiled Action. As of the date of this Report,  all but three of the
Plaintiffs  have  dropped out of the  Litigation.  In response to the  Company's
Motion to Dismiss, the remaining  Plaintiffs have voluntarily  dismissed most of
the  other  Defendants  and  have  dismissed  the  RICO  claims.  The  Company's
accounting firm and chief  financial  officer have been dismissed as Defendants.
The Motion to Dismiss the remaining claims is currently pending.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F56

<PAGE>



                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




(g)  INVESTIGATION

     Since  November  1991, the U.S.  Securities  and Exchange  Commission  (the
"SEC") has been conducting an investigation into trading in the Company's common
stock.  The  investigation  appeared to focus on trading in the Company's common
stock during 1990 and 1991 by individuals who are no longer  associated with the
Company in any managerial or employment capacity,  as the SEC has alleged that a
broker  hired by Douglas J.  Phillips  and Hal B.  Phillips  (collectively,  the
"Phillips")  manipulated  the trading volume of the stock in order to enable the
Phillips' to sell more of the stock which they held personally.  The Company has
fully  cooperated  with the SEC in this  investigation.  Counsel for the Company
submitted a brief to the SEC arguing that  proceedings  should not be instituted
against the  Company,  since the Company  itself (i) did not benefit in any way,
and (ii) has now  completely  disassociated  itself  from the  persons  who were
allegedly  involved in the scheme and benefited  from it (except for their prior
status as minority  shareholders).  The SEC has indicated that it is not seeking
financial  compensation  or damages from the Company,  but it has not  indicated
whether  it will  bring any  charges  in  connection  with  this  investigation.
However, after consultation with counsel,  management believes that, ultimately,
any action  brought by the SEC will not have any material  adverse effect on the
Company's future operations or consolidated financial statements.  Additionally,
there was no activity under this investigation  during fiscal year 1996. In July
1996,  the  Phillips,  along  with  certain  brokers,  were  charged  with stock
manipulation in an indictment.  No charges were filed against the Company or its
present management.

     Counsel for the Company do not believe  that any existing  litigation  will
result in an adverse judgment which would have a negative material impact on the
Company's financial  condition.  Accordingly,  no provision has been made in the
accompanying  financial  statements  for such  contingencies  and no  additional
liabilities have been estimated or accrued.

Note 8.  SUBSEQUENT EVENTS

PROXY FILING AND COMMENT LETTER

     In February  1995,  the Company filed its Schedule 14A - Preliminary  Proxy
Material to hold a  shareholders  meeting.  Since February 1995, the Company has
received  five comment  letters  from the  Division of Corporate  Finance of the
Securities and Exchange  Commission ("SEC") regarding reports filed with the SEC
for fiscal  years 1994 and 1995 and has  responded  to all but the last  comment
letter. On October 2, 1996, the Company received its latest comment letter, with
respect to the Company's Form 10-KSB/A for fiscal year ended  September 30, 1995
and its Amended Schedule 14A - Preliminary Proxy Material.

     The Company is in the process of  answering  the SEC  comments and does not
believe the changes  that will be made in response to the  comments  will have a
material effect on the accompanying  financial statements.  However, the SEC may
have further  comments  upon receipt of the  Company's  response and there is no
assurance as to when all comments will be cleared.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F57

<PAGE>


                              NUOASIS GAMING, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


ACQUISITION (UNAUDITED)

     On November  21,  1996,  the  Company's  board of  directors  approved  the
acquisition  of National Pools  Corporation  ("NPC"),  a California  Development
Stage Company,  formed in 1992 to facilitate  participation in group play in the
California  State  Lottery.  The  acquisition  is expected to be financed by the
issuance of  securities,  however,  a definitive  agreement has not been signed.
Moreover,  the  acquisition is contingent  upon the occurrence of certain events
including but not limited to: (a) NPC shareholder approval; (b) exercise of that
certain  option  agreement  between  Monterosso  and  Nona  (see  Note  7);  (c)
Monterosso  securing  financing  that would allow the  exercise of the option by
Monterosso  and/or one or more  qualified  private  investors;  (d)  reaching an
agreement  to sell CMA; and (e)  shareholder  approval of a proposal to increase
the  number of  authorized  shares of common  stock of the  Company  by at least
20,000,000 shares. There are no assurances that such transaction will occur, and
because of on-going  negotiations and uncertainties  surrounding the realization
of such  transaction,  the Company cannot  determine the ultimate  effect on the
Company's financial position at this time.

                                                 [NUOGAM\10K\96:96KSBFIN.CLN]-22

                                       F58

<PAGE>