SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-KSB

                Annual Report Pursuant to Section 13 or 15(d) of
                       The Securities Exchange Act of 1934

For the fiscal year ended:  June 30, 1994

Commission File number:  0-114244

                          WHITE CLOUD EXPLORATION, INC.
              ---------------------------------------------------
             (Exact name of registrant as specified in its charter)

Utah                                                 84-0959153
--------------------------------                     ---------------------
State or Other Jurisdiction                          (I.R.S. Employer
of incorporation or organization)                    Identification Number)

1430 Larimer #209, Denver, CO                         80202
---------------------------------------              --------
(Address of principal Executive Offices              Zip Code)

Registrant's telephone number, including area code: None

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

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

                     Common Stock, $.001 Par Value per Share
                     ---------------------------------------
                                (Title of Class)

     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 ( )  No (X)


Check if disclosure of delinquent  filers pursuant to Item 405 of Regulation S-B
is not contained in this form, and no disclosure will be contained,  to the best
of  Registrant's  knowledge,  in  definitive  proxy  or  information  statements
incorporated  by reference  in Part III of this Form 10-KSB or any  amendment to
this Form 10-KSB. [ ]

State issuer's revenues for its most recent fiscal year. $0


<PAGE>




Transitional Small Business Disclosure Format:

                                Yes       X     No
                          -----         -----

As of June 30,  1994,  9,825,000  shares of common stock were  outstanding.  The
aggregate market value of the Stock held by non-affiliates  was none at June 30,
1994.

     Documents incorporated by reference: None


<PAGE>



                                     Part I

Item 1. Business.

General
-------

     Since its inception in July of 1983, White Cloud Exploration,  Inc. ("White
Cloud"  or the  Company")  has  been in the  developmental  stage,  while it has
attempted  to  identify   suitable  mergers,   asset  or  equity   acquisitions,
operations. See "Financial Statements".

     White  Cloud,  in March of 1991,  entered  into a Letter of Intent  whereby
White  Cloud was to  acquire  100% of the  Stock of  American  Technology,  Inc.
("ATI") in exchange for stock of White Cloud.  The merger was  cancelled  due to
accounting difficulties with American Technology, Inc.

     The  Company  has had no  further  activities  since  1991,  and  has  been
inactive.

     The Company has no full-time  employees.  Its officers and directors devote
as much of their time as is necessary to conduct the Company's business.

     The Company is presently in the  developmental  stage. The Company has been
unsuccessful  to date in achieving  any business  operations  due to  inadequate
capital.

Competition
-----------

The Company views itself as an insignificant  participant  among the other firms
which offer export consulting services.  Such competitive firms may have greater
financial and personnel resources and technical expertise than the Company.

Employees and Consultants
-------------------------

The Company presently has no paid employees, and its President, Steve Signer and
Secretary,  Dev Mahanti serve on an as needed basis.  These  officers  intend to
devote only such time as necessary to the business affairs of the Company.

Presently,  none of the officers receive salaries,  however, they are reimbursed
for their expenses incurred in their services as officers. There is no provision
for any additional bonuses or benefits. The Company anticipates that in the near
future it may enter  into  employment  agreements  with its  officers.  Although
Directors do not receive  compensation for their services they may be reimbursed
for expenses incurred in attending Board meetings.

Item 2. Properties.

The Company  maintains  its  corporate  office at 1430  Larimer,  #209,  Denver,
Colorado 80202 under an informal arrangement with the Company's President.  This
space is deemed adequate for the foreseeable future.


<PAGE>


Item 3. Legal Proceedings.

The Company is not a party to any pending legal proceedings.


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

No matters were submitted to a vote of security holders within thee year covered
by this report, through solicitation of proxies or otherwise.


                                     Part II

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

The outstanding  registered securities of White Cloud Exploration,  Inc. are not
now presently traded on any exchange.

                           Common Stock              Common Stock
1993                       Bid High                  Bid Low
--------------------------------------------------------------------------------

1st Quarter                no quote                  no quote
2nd Quarter                no quote                  no quote


                           Common Stock              Common Stock
1994                       Bid High                  Bid Low
--------------------------------------------------------------------------------

1st Quarter                no quote                  no quote
2nd Quarter                no quote                  no quote


The Company  anticipates its shares will trade over the counter by market makers
who have not as yet quoted a specific  bid or ask  price.  Quotations,  if made,
represent  only  prices  between  dealers  and do not  include  retail  markups,
markdowns or commissions and accordingly, may not represent actual transactions.
The Company  estimates  that as of June 30, 1994,  there are  approximately  198
stockholders of the Company's shares.

No dividends have been declared or paid by the Company and presently  intends to
retain all future earnings,  if any, to finance the expansion and development of
its business.




<PAGE>



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

Financial Condition
-------------------

During fiscal year 1994, the Company  continued to be a development stage entity
and posted no sales or revenues.

Financial Condition and Changes in Financial Condition
------------------------------------------------------

No business  operations  were  conducted and no revenues  were  generated in the
fiscal year 1994 or 1993.  The Company at year end had $0 in cash  compared with
$0 in cash at June 30, 1993,  and no other  significant  assets.  The Company at
year end would have needed cash infusions from  shareholders to provide capital,
or loans from any sources, for any significant business venture.

Liquidity and Capital Assets.
-----------------------------

The Company's  primary source of liquidity  since  inception has been from funds
raised during its initial  capitalization and shareholder advances.  The company
had no cash at current year end, and had none at previous year end.

Results of Operations 1994 Compared to 1993
-------------------------------------------

     No  Revenues  were  generated  in 1994 or 1993.  In 1994 and 1993  expenses
consisted  of $0. As of June 30, 1994,  the Company had no material  commitments
for capital expenditures.

     During the fiscal  year ended June 30,  1994,  the  Company  incurred $0 in
general and  administrative  expenses for a total net  operating  loss of $0. In
1993,  the Company  incurred $0 in general and  administrative  expenses,  for a
total net operating loss of $0.

     At present,  the Company  has no  business  income or business  operations.
Accordingly,  the reported financial information herein may not be indicative of
future operating results.

Results of Operations - Prior Years
-----------------------------------

     The Company's  operations through June 30, 1994, did not generate revenues,
and the Company has not been actively  engaged in any operations  since June 30,
1991.  Consequently,  the Company has not generated  any revenues,  and does not
anticipate  generating  revenues or becoming  actively engaged in any operations
until such time as it  completes an  acquisition,  in which case it may commence
active operations and generate revenues,  depending on the nature and activities
after the merger.



<PAGE>



Item 7. Financial Statements and Supplemental Data.

Attached  hereto  and  filed  as part  of this  Form  10-KSB  are the  financial
statements required by Regulation SB. Please refer to pages F-1 through F-10.

Item 8. Changes in and Disagreements on Accounting and Financial Disclosure.

     In  connection  with audits of two most recent fiscal years and any interim
period preceding resignation,  no disagreements exist with any former accountant
on any  matter  of  accounting  principles  or  practices,  financial  statement
disclosure, or auditing scope of procedure,  which disagreements if not resolved
to the  satisfaction  of the former  accountant  would  have  caused him to make
reference  in  connection   with  his  report  to  the  subject  matter  of  the
disagreement(s).

     The principal  accountant's  report on the financial  statements for any of
the past two years  contained no adverse  opinion or a disclaimer of opinion nor
was qualified as to uncertainty,  audit scope, or accounting  principles  except
for the "going concern" qualification.

     For Fiscal  Year 1992 and  thereafter  the  Company  engaged as its Auditor
Michael  B.  Johnson  & Co.  There  were no  disagreements  as to any  matter of
accounting practice or principles,  financial  statement  disclosure or auditing
scope or procedure.

                                    Part III

Item 9. Directors and Executive  Officers of the Registrant and Compliance  with
Section 16(a).

Identification of Directors and Executive Officers of the Company
-----------------------------------------------------------------

         The  directors  and  executive  officers  of the  Company,  their  age,
positions held in the Company,  and duration as such,  were as follows as of end
of the fiscal year:

    Name                   Age           Position                   Since
    ----                   ---           --------                   -----

Steven C. Signer            45            President                  10/9/89
Dev K. Mahanti              35            Secretary/Treasurer        10/9/89

Business Experience
-------------------

     The following is a brief account of the business experience during the past
five  years  of  the  current   officer/directors,   indicting  their  principal
occupation  and  employment  during  that  period,  and the name  and  principal
business  of the  organization  in which such  occupation  and  employment  were
carried out.

     Steven C. Signer.  Mr.  Signer is currently the President and a director of
White Cloud Exploration. From September 1, 1988 to June 19, 1991, Mr. Signer


<PAGE>


was president of Global Management  Corporation formally known as KLK Consulting
& Management  Corporation  of Nevada.  He was President of American  Technology,
Inc. until December 31, 1992. Mr. Signer served as Vice-president and a director
of National Securities Network, Inc., a Denver, Colorado investment banking firm
from May 1985 to August 1990.  Mr.  Signer is also  currently  the president and
director of two other Denver, Colorado corporations, American Capital Funding, a
privately-held financial consulting firm, of which Mr. Signer is the sole owner,
and Century Development,  a real estate investment firm, of which Mr. Signer and
his wife are the sole owners.  He has served in those  capacities  since January
1985 and January 1971,  respectively.  Mr. Signer  served as  vice-president  of
Neidiger, Tucker and Bruner, a Denver, Colorado broker-dealer, from January 1983
to May 1984. He served as  Vice-President  and as a director of Colorado  Tastee
Freez, a Colorado corporation, from 1971 through 1980, and as Vice-President and
a  director  of  International  Securities,  Inc.  ("ISI"),  a Denver,  Colorado
broker-dealer  from 1978 to 1982.  ISI, which operated as a securities  clearing
house, was ordered in 1982 to cease its securities trading business because of a
lack of capital.  ISI filed for protection of the U.S.  Bankruptcy  Laws in 1982
under Chapter 7 and was liquidated and discharged  from  bankruptcy in 1983. Mr.
Signer has been a member of the National Association of Securities Dealers, Inc.
since 1977 and served as a  securities  broker for B.J.  Leonard & Company  from
1982 to 1984.  Mr.  Signer  received  a degree  in  Economics  in 1971  from the
University of Colorado in Boulder, Colorado.

Dev Mahanti.  Mr. Mahanti is Director and Secretary of  Registrant.  From August
1988 to June 15, 1991, he was the Chief  Operations  officer and Director of KLK
Consulting & Management, Inc. which name was changed to Global Management Corp.,
a Nevada corporation. Mr. Mahanti was the Chief Financial Officer and a director
of First Centennial  Corporation,  a Colorado  insurance  holding  company,  and
served in those  capacities  October 1989 to 1992.  From  February  1988 to July
1988,  he was  employed  as an audit  manager by Hein &  Associates,  a regional
accounting  firm, at their Houston branch  office.  From October 1986 to January
1988, he was Vice-President of Finance of Interwest Communications  Corporation,
a Colorado  corporation  headquartered  in Denver,  Colorado  and engaged in the
business of sales and service of communications  equipment.  From September 1983
to September 1986, he was employed by Hein & Associates as an audit  supervisor.
From  July  1981 to  September  1983,  he was a  member  of the  audit  staff of
Arendale,  Young and Company,  a Houston,  Texas  accounting  firm.  In 1981, he
received a Bachelor  of Science  degree in  Accounting  from the  University  of
Detroit.

Directors  of the  Company  hold  office  until the next  annual  meeting of the
shareholders and until their successors have been elected and qualified.

Officers  of the  Company  are  elected by the Board of  Directors  at the first
meeting after each annual  meeting of the Company  shareholders  and hold office
until their death, or until they shall resign or have been removed from office.




<PAGE>



Section 16(a) Reporting Delinquencies
-------------------------------------

         Section 16(a) of the  Securities  Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's officers and directors,  and persons who
own more than 10% of a registered class of the Company's equity  securities,  to
file reports of ownership  and changes in ownership of equity  securities of the
Company  with the  Securities  and  Exchange  Commission  and NASDAQ.  Officers,
directors and  greater-than  10% shareholders are required by the Securities and
Exchange Commission regulation to furnish the Company with copies of all Section
16(a) filings.

     1. The  following  persons did not file reports  under Section 16(a) during
the most recent fiscal year:

         a.       Steven C. Signer          President and Director
         b.       Dev Mahanti               Secretary and Director


     2. For each person, listed by subparagraph letter above:

                              Number of                   
                            transactions not               
Number of late               reported on a                 Known failures
reports                      timely basis                   to file forms
-------                      ------------                   -------------

a.  1991 to 1994(5)              one                     i) Annual Form 5(x4)
                                                                      Form 3

b.  1991 to 1994(5)              one                     i) Annual Form 5(x4)
                                                                      Form 3

Item 10. Executive Compensation.

     The Company accrued a total of $0 compensation to the executive officers as
a group for services  contributed  to the Company in all  capacities  during the
1994 fiscal year.  No one  executive  officer  received,  or has accrued for his
benefit,  in excess of $60,000 for the year.No  cash  bonuses  were or are to be
paid to such persons.

     The Company does not have any employee incentive stock option plans.

     There are no plans pursuant to which cash or non-cash compensation was paid
or  distributed  during  the last  fiscal  year,  or is  proposed  to be paid or
distributed in the future,  to the executive  officers of the Company.  No other
compensation not described above was paid or distributed  during the last fiscal
year to the executive  officers of the Company.  There are no compensatory plans
or  arrangements,  with respect to any  executive  office of the Company,  which
result or will result from the resignation,  retirement or any other termination
of such individual's  employment with the Company or from a change in control of
the Company or a change in the individual's  responsibilities following a change
in control.

<PAGE>
<TABLE>
<CAPTION>
    

                                     SUMMARY COMPENSATION TABLE OF EXECUTIVES
                                     ----------------------------------------

                                            Annual Compensation                               Awards
==================================================================================================================================
Name and                  Year           Salary ($)         Bonus          Other Annual             Restricted         Securities
Principal                                                   ($)            Compensation ($)         Stock              Underlying
Position                                                                                            Award(s)           Options/
                                                                                                    ($)                SARs (#)
----------------------------------------------------------------------------------------------------------------------------------
<S>                       <C>            <C>                <C>            <C>                      <C>                <C>
Steven C. Signer,         1992           0                  0              0                        0                  0
President
                        ----------------------------------------------------------------------------------------------------------
                          1993           0                  0              0                        0                  0
                        ----------------------------------------------------------------------------------------------------------
                          1994           0                  0              0                        0                  0
==================================================================================================================================

Dev Mahanti,              1992           0                  0              0                        0                  0
Secretary
                        ----------------------------------------------------------------------------------------------------------
                          1993           0                  0              0                        0                  0
                        ----------------------------------------------------------------------------------------------------------
                          1994           0                  0              0                        0                  0
==================================================================================================================================

</TABLE>

     Option/SAR Grants Table (None)

     Aggregated  Option/SAR  Exercises in Last Fiscal Year an FY-End  Option/SAR
value (None)

     Long Term Incentive Plans - Awards in Last Fiscal Year (None)


                   DIRECTOR COMPENSATION FOR LAST FISCAL YEAR
                   ------------------------------------------

(Except for  compensation of Officers who are also Directors which  Compensation
is listed in Summary Compensation Table of Executives)
<TABLE>
<CAPTION>


                                Cash Compensation                           Security Grants
===================================================================================================================================
Name                                  Annual               Meeting           Consulting              Number           Number of
                                      Retainer             Fees ($)          Fees/Other              of               Securities
                                      Fees ($)                               Fees ($)                Shares           Underlying
                                                                                                     (#)              Options/SARs
                                                                                                                      (#)
-----------------------------------------------------------------------------------------------------------------------------------
<S>                                   <C>                  <C>               <C>                     <C>              <C>
Director Steven C. Signer             0                    0                 0                       0                0
-----------------------------------------------------------------------------------------------------------------------------------
Director Dev Mahanti                  0                    0                 0                       0                0
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>




<PAGE>



Item 11. Security Ownership of Management and Beneficial Owners.

The following table sets forth information,  as of Fiscal year end, with respect
to the  beneficial  ownership of the  Company's  $.001 par value common stock by
each person  known by the Company to be the  beneficial  owner of more than five
percent of the outstanding  common stock,  and by current officers and directors
of the Company.
<TABLE>
<CAPTION>


Stock Title          Name and Address                Amount of Beneficial          Percentage
of Class             of Beneficial Owner             Ownership                     of Class
--------             -------------------             ---------                     --------

<S>                  <C>                             <C>                           <C>   
Common               Kirk Family Trust
                     c/o CSI, Inc.                   4,722,000(1)                  48.0%
                     1430 Larimer, #209
                     Denver, CO 80202

Common               Dev K. Mahanti                  2,500                         .0025% (3)
                     1430 Larimer, #209
                     Denver, CO 80202

Common               Steven C. Signer                83,000                        1.3% (3)
                     1430 Larimer, #209              50,000 (2)
                     Denver, CO 80202

Common               Eric J. and Susan K.            522,064                       5.3%
                     Sundsvold                       380,000(4)                    3.8%
                     7133 S. Quebec Court
                     Englewood, CO  80112

                     All Officers and
                     Directors as a Group (3)        4,858,000                     49.325%
                     (2 Persons)
</TABLE>

(1)  CSI is  beneficially  owned by Messrs  Signer  and  Mahanti,  Officers  and
     Directors of the Company.

(2)  50,000 shares are solely owned by Reyna Culpepper, Mr. Signer's wife.

(3)  Mr. Signer and Mr. Mahanti are the principal  shareholders  and officers of
     CSI, Inc. (see Note 1)

(4)  Susan Sundsvold is a shareholder/beneficial owner of Bay Island Ltd., owner
     of 380,000 shares.


Item 12. Certain Relationships and Related Transactions.

     There were no transactions  or series of transactions  for the fiscal year,
to which the Company is a party,  in which the amount  exceeds  $60,000,  and in
which,  to the  knowledge  of the Company,  any  director,  executive  director,
nominee,  five percent  stockholder or any member of the immediate family of any
of the  foregoing  persons,  have or will  have a direct  or  indirect  material
interest.


<PAGE>

                                     Part IV

Item 13. Exhibits, Financial Statement Schedules and Reports on Form 8-K.

(a) The  following  exhibits  and  financial  statement  schedules  are filed as
exhibits to this Report:

1. Financial Statements of the Registrant are included under Item 8 hereof.

2. Financial Statement Schedules - None

3. Exhibits:

Exhibit #         Description                                 Location
---------         -----------                                 --------

3.1               Articles of Incorporation          Exhibit to Annual Report on
                                                     Form 10-K for Fiscal Year
                                                     ended June 30, 1986

3.2               Bylaws of Registrant               Exhibit to Annual Report on
                                                     Form 10-K for Fiscal Year
                                                     ended June 30, 1986

27.1              Financial Data Schedule            Attached


(b) Reports on Form 8-K.  There were no reports on Form 8-K for the twelve month
period ended June 30.

(c) Proxy  Statements.  There were no proxy statements or annual reports sent to
stockholders during the period covered herein.




<PAGE>


                                   Signatures

Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities  and
Exchange Act of 1934, the Registrant had duly caused this Report to be signed on
its behalf by the undersigned thereunto duly authorized,  in the city of Denver,
State of Colorado on this 8th day of July, 1997.


White Cloud Exploration, Inc.


By: /S/  STEVEN C. SIGNER
   ----------------------------
    Steven C. Signer, President

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

    Signature                          Title                         Date
    ---------                          -----                         ----

/S/  STEVEN C. SIGNER                 President                   July 8, 1997
----------------------                Director
Steven C. Signer                          


/S/  DEV MAHANTI                      Secretary                   July 8, 1997
----------------------                Director
Dev Mahanti                              


<PAGE>


                         Michael B. Johnson & Co., P.C.

                          (A Professional Corporation)

                          Certified Public Accountants
                        9175 East Kenyon Ave., Suite 100
                             Denver, Colorado 80237

Michael B. Johnson C.P.A.                                         (303) 796-0099
Member: A.I.C.P.A.
Colorado Society of C.P.A.'s

Board of Directors
White Cloud Exploration, Inc.


     We have examined the accompanying balance sheet of White Cloud Exploration,
Inc. (A Development Stage Company) as of March 31, 1997 and years ended June 30,
1992 through June 30,  1996,  and the related  statements  of  operations,  cash
flows,  and  changes  in  stockholders'  equity  for the  period  July 22,  1983
(inception),  through  March 31, 1997,  and the fiscal years ended  December 31,
1996 through 1992.  These  financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

     We conducted  our audits in accordance  with  generally  accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management, as well as evaluating the overall financial statements presentation.
We believe that our audits  provide a reasonable  basis for our opinion.  In our
opinion,  the  financial  statements  referred to above present  fairly,  in all
material respects,  the financial  position of White Cloud Exploration,  Inc. at
March 31, 1997 and June 30, 1992 through 1996, and the results of its operations
and its cash flows for the period July 22, 1983  (inception),  through March 31,
1997, and the fiscal years ended June 30, 1992 through 1996, in conformity  with
generally accepted accounting principles.

Denver, Colorado
May 24, 1997


<PAGE>
<TABLE>
<CAPTION>

                                        WHITE CLOUD EXPLORATION, INC.
                                        (A DEVELOPMENT STAGE COMPANY)
                                                BALANCE SHEET

                                                                                        June 30,
                                           March 31,     ----------------------------------------------------------------- 
                                             1997           1996         1995           1994         1993          1992
                                             ----           ----         ----           ----         ----          ----
                                             
<S>                                        <C>           <C>           <C>          <C>             <C>          <C>
Current Assets:
Cash                                       $     100     $     100     $     100     $     100     $     100     $     100
                                           ---------     ---------     ---------     ---------     ---------     ---------       
TOTAL ASSETS                               $     100     $     100     $     100     $     100     $     100     $     100
                                           =========     =========     =========     =========     =========     =========


LIABILITIES AND STOCKHOLDERS' EQUITY:

Liabilities:
Accounts Payable                           $  29,555     $  27,055     $  27,055     $  27,055     $  27,055     $  27,055
                                           ---------     ---------     ---------     ---------     ---------     ---------
                                           
TOTAL LIABILITIES                             29,555        27,055        27,055        27,055        27,055        27,055
                                           ---------     ---------     ---------     ---------     ----------    ---------
                                           

Stockholders' Equity:
Common stock, $.001 par value,
 50,000,000 shares authorized,
 9,825,000 shares
 issued and outstanding                        9,825         9,825         9,825         9,825         9,825         9,825
Additional paid-in capital                    65,707        65,707        65,707        65,707        65,707        65,707
Deficit accumulated during the
 development stage                          (104,987)     (102,487)     (102,487)     (102,487)     (102,487)     (102,487)
                                           ---------     ---------     ---------     ---------     ---------      -------- 
                                          
                                           
Total Stockholders' Equity                   (29,455)      (26,955)      (26,955)      (26,955)      (26,955)      (26,955)
                                           ---------     ---------     ---------     ---------     ---------       ------- 
                                               

TOTAL LIABILITIES AND
   STOCKHOLDERS' EQUITY                    $     100     $     100     $     100     $     100     $     100     $     100
                                           =========     =========     =========     =========     =========     =========



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

</TABLE>

<PAGE>
<TABLE>
<CAPTION>
                                                  WHITE CLOUD EXPLORATION, INC.
                                                  (A DEVELOPMENT STAGE COMPANY)
                                                     STATEMENT OF OPERATIONS


                              For the                                                                       July 22, 1983
                             Year Ended                      For the Year Ended June 30,                  (Inception) thru  
                              March 31,         ----------------------------------------------------------    March 31,
                                1997            1996          1995      1994        1993        1992            1997
                                ----            ----          ----      ----        ----        ----            ----

<S>                           <C>             <C>          <C>         <C>         <C>           <C>         <C>           
INCOME                        $       --      $     --     $    --     $     --     $      --    $     --    $        --   


OPERATING EXPENSES:
General & Administrative             2,500           --         --            --           --           --       102,503
                              ------------    ---------   --------     ---------    ----------   ---------   -----------  

Net Loss from Operations            (2,500)          --         --            --           --           --      (102,503)

Other Income & (Expense)              --             --         --            --           --           --        (2,484)
                              ------------    ---------   --------    ----------   ----------    ---------   -----------
Net Loss                      $     (2,500)   $      --   $     --    $       --   $       --    $      --   $  (104,987)
                              ============    =========   =========   ==========   ==========    =========   ===========

Weighted average number of
  shares outstanding             9,825,000    9,825,000   9,825,000    9,825,000   9,825,000     9,825,000    12,899,214

Net Loss Per Share            $    (*)       $   (*)     $   (*)      $    (*)    $   (*)       $   (*)      $    (*)

* Less than $0.01 per share





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


</TABLE>

<PAGE>
<TABLE>
<CAPTION>
                                         WHITE CLOUD EXPLORATION, INC.
                                         (A DEVELOPMENT STAGE COMPANY)
                                            STATEMENT OF CASH FLOWS
                                                INDIRECT METHOD

                                      For the                                                                         July 22, 1983
                                     Year Ended               For the Year Ended June 30,                           (Inception) thru
                                      March 31,  -------------------------------------------------------------------      March 31,
                                       1997          1996          1995          1994          1993          1992           1997
                                       ----          ----          ----          ----          ----          ----           ----
<S>                                <C>            <C>            <C>          <C>           <C>            <C>            <C>
Cash Flows From Operating
    Activities:
Net Profit (Loss)                  $    (2,500)  $       --     $      --     $      --     $      --     $      --       $(102,897)
Amortization of Organization
  Costs                                   --             --            --            --            --            --             200
Increase (Decrease) in
  Accounts Payables                      2,500           --            --            --            --            --          27,465
Common Stock issued for
  services                                --             --            --            --            --            --          33,000
Common Stock issued in
  exchange for cancellation
  of accrued expenses                     --             --            --            --            --            --          30,382
                                   -----------    -----------    ----------   -----------    ----------    ----------     ---------

Net Cash Provided (Used)
    by Operating Activities               --             --            --            --            --            --         (11,850)
                                   -----------    -----------    ----------   -----------    ----------    ----------     ---------

Cash Flows From Investing
    Activities:
Land and Equipment acquired               --             --            --            --            --            --       2,001,850
Distribution of property in
  redemption of common stock              --             --            --            --            --            --       2,001,850
                                   ----------     -----------    ----------   -----------    ----------     ---------    ----------

Net Cash Provided (Used)
    by Investing Activities               --             --            --            --            --            --            --
                                   ----------     -----------    ----------   -----------    ----------     ---------    ----------

Cash Flow From Financing
    Activities:
Expenses paid and cash
  contributed by a stockholder            --             --            --            --            --            --           2,600
Proceeds from sale of common
  stock                                   --             --            --            --            --            --          16,500
Deferred acquisition costs paid           --             --            --            --            --            --           6,600
Organization costs paid                   --             --            --            --            --            --            (550)
Common stock issued to
  acquire land and equipment              --             --            --            --            --            --       2,001,850
Redemption on common stock
  pursuant to distribution of
  property                                --             --            --            --            --            --       2,001,850
                                   -----------    -----------   -----------   -----------   -----------   -----------   -----------

Net Cash Provided (Used)
    in Financing Activities               --             --            --            --            --            --          11,950
                                   -----------    -----------   -----------   -----------   -----------   -----------   -----------

Increase (Decrease) in Cash               --             --            --            --            --            --             100

Cash and Cash Equivalents -
    Beginning of Period                    100            100           100           100           100           100          --
                                   -----------    -----------   -----------   -----------   -----------   -----------   -----------

Cash and Cash Equivalents -
    End of Period                  $       100    $       100   $       100   $       100   $       100   $       100   $       100

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


<PAGE>
<TABLE>
<CAPTION>
                                      WHITE CLOUD EXPLORATION, INC.
                                      (A DEVELOPMENT STAGE COMPANY)
                                    STATEMENT OF STOCKHOLDERS' EQUITY

                                                                                             Deficit
                                                                                            Accumulated
                                                                             Additional      During the
                                                                 Common        Paid-In       Development
                                                  Shares         Stock         Capital          Stage           Totals
                                                  ------         -----         -------          -----           ------
<S>                                           <C>             <C>             <C>              <C>              <C>   
Balance at
  July 22, 1983 (inception)                          --       $      --       $      --       $      --       $      --

Stock issued for cash to
  related parties in connection
  with business formation                         525,000             525             975            --             1,500

Stock issued for cash pursuant
  to public offering, net of
  offering costs of $6,600                      1,500,000           1,500           6,900            --             8,400

Stock issued for services                       3,300,000           3,300          29,700            --            33,000

Stock issued for cash pursuant
  to Plan of Reorganization with
  Public Oil                                   22,500,000          22,500       1,979,350            --         2,001,850

Net loss, period ended
  June 30, 1984                                      --              --              --           (42,015)        (42,015)
                                              -----------     -----------     -----------     -----------     -----------

Balance at
  June 30, 1984                                27,825,000          27,825       2,016,925         (42,015)      2,002,735

Net loss, year ended
  June 30, 1985                                      --              --              --           (25,476)        (25,476)
                                              -----------     -----------     -----------     -----------     -----------

Balance at
  June 30, 1985                                27,825,000          27,825       2,016,925         (67,491)      1,977,259

Stock issued for services and
  repayment of debt to a related
  party                                         4,000,000           4,000          26,032            --            30,032

Aquisition and retirement of
  treasury stock in connection
  with stock issued to Public
  Oil                                         (21,000,000)        (21,000)       (198,850)           --        (2,001,850)

Aquisition and retirement of
  treasury stock in connection
  with stock issued for services               (1,000,000)         (1,000)          1,000            --              --

Net loss, year ended
  June 30, 1986                                      --              --              --           (11,122)        (11,122)
                                              -----------     -----------     -----------     -----------     -----------

Balance at
  June 30, 1986                                 9,825,000           9,825          63,107         (78,613)         (5,681)

Net loss for year ended
  June 30, 1987                                      --              --              --            (4,269)         (4,269)
                                              -----------     -----------     -----------     -----------     -----------

Balance at
  June 30, 1987                                 9,825,000           9,825         (63,107)        (82,882)         (9,950)
                                              -----------     -----------     -----------     -----------     -----------     

Net loss for year ended
  June 30, 1988                                      --              --              --            (1,745)         (1,745)
                                              -----------     -----------     -----------     -----------     -----------

Balance at
  June 30, 1988                                 9,825,000           9,825          63,107         (84,627)        (11,695)
                                              -----------     -----------     -----------     -----------     -----------


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


</TABLE>


<PAGE>
<TABLE>
<CAPTION>
                                           WHITE CLOUD EXPLORATION, INC.
                                           (A DEVELOPMENT STAGE COMPANY)
                                         STATEMENT OF STOCKHOLDERS' EQUITY

                                                                                   Deficit
                                                                                  Accumulated
                                                                    Additional    During the
                                                        Common        Paid-In     Development
                                         Shares         Stock        Capital        Stage            Totals
                                         ------         -----        -------        -----            ------
<S>                                     <C>          <C>          <C>           <C>                <C>
Expenses paid and cash
  contributed by a shareholder              --            --           2,600          --               2,600

Net loss for year ended
  June 30, 1989                             --            --            --         (12,127)          (12,127)
                                      ----------    ----------    ----------    ----------         ---------

Balance at
  June 30, 1989                        9,825,000         9,825        65,707       (96,754)          (21,222)
                                      ----------    ----------    ----------    ----------         ---------

Net loss for year ended
  June 30, 1990                             --            --            --          (3,643)           (3,643)
                                      ----------    ----------    ----------    ----------         ---------

Balance at
  June 30, 1990                        9,825,000         9,825        65,707      (100,397)          (24,865)
                                      ----------    ----------    ----------    ----------         --------- 

Net loss for year ended
  June 30, 1991                             --            --            --          (2,090)           (2,090)
                                      ----------    ----------    ----------    ----------         ---------

Balance at
  June 30, 1991                       $9,825,000    $    9,825    $   65,707    ($ 102,487)        ($ 26,955)
                                      ==========    ==========    ==========    ==========         =========

Net loss for year ended
  June 30, 1992                             --            --            --            --                --
                                      ----------    ----------    ----------    ----------        ----------

Balance at
  June 30, 1992                       $9,825,000    $    9,825    $   65,707    ($ 102,487)       ($  26,955)
                                      ==========    ==========    ==========    ==========        ==========

Net loss for year ended
  June 30, 1993                             --            --            --            --                --
                                      ----------    ----------    ----------    ----------        ----------

Balance at
  June 30, 1993                       $9,825,000    $    9,825    $   65,707    ($ 102,487)       ($  26,955)
                                      ==========    ==========    ==========    ==========        ========== 

Net loss for year ended
  June 30, 1994                             --            --            --            --                --
                                      ----------    ----------    ----------    ----------        ----------

Balance at
  June 30, 1994                       $9,825,000    $    9,825    $   65,707    ($ 102,487)       ($  26,955)
                                      ==========    ==========    ==========    ==========        ==========

Net loss for year ended
  June 30, 1995                             --            --            --            --                --
                                      ----------    ----------    ----------    ----------        ----------

Balance at
  June 30, 1995                       $9,825,000    $    9,825    $   65,707    ($ 102,487)       ($  26,955)
                                      ==========    ==========    ==========    ==========        ==========

Net loss for year ended
  June 30, 1996                             --            --            --            --                --
                                      ----------    ----------    ----------    ----------        ----------

Balance at
  June 30, 1996                       $9,825,000    $    9,825    $   65,707    ($ 102,487)       ($  26,955)
                                      ==========    ==========    ==========    ==========        ==========

Net loss for the nine months
  ended March 31, 1997                      --            --            --          (2,500)           (2,500)
                                      ----------    ----------    ----------    ----------        ----------

Balance at
  March 31, 1997                      $9,825,000    $    9,825    $   65,707    ($ 104,987)       ($  29,455)
                                      ==========    ==========    ==========    ==========        ==========

                            The accompanying notes are an integral part of these financial statements.
</TABLE>

<PAGE>

                          WHITE CLOUD EXPLORATION, INC.
                        (A Development Stage Enterprise)

                          NOTES TO FINANCIAL STATEMENTS



1. Organization and Summary of Significant Accounting Policies:
   -----------------------------------------------------------

Organization -- White Cloud Exploration,  Inc. (the Company) was incorporated in
the State of Utah on July 22, 1983, for the purpose of obtaining capital to seek
potentially profitable business opportunities.  Since inception, the Company has
been engaged in organizational activities and is in the development stage.

Organization  Costs -- Amortization of organization costs was provided using the
straight-line  method over a five-year estimated life. They were fully amortized
by June 30, 1989.

Continuing  Operations  --  The  accompanying  financial  statements  have  been
prepared on a going concern basis,  which contemplates the realization of assets
and  satisfaction  of  liabilities  in  the  normal  course  of  business.   The
continuation  of the Company as a going concern is dependent  upon attaining and
maintaining  profitable  operations and the completion of a successful merger or
acquisition.


2. Stockholders' Deficiency:
   ------------------------

During  1984,  the Board of  Directors  resolved  that  3,300,000  shares of the
Company's common stock valued at $.01 per share, be issued to various parties in
connection with legal and other services  provided in connection with the Public
Oil and Gas Service  Company (a Colorado  corporation)  ("Public  Oil") plan and
agreement of reorganization plan and agreement of reorganization.

On  June  18,  1984,  the  Company  entered  into  the  plan  and  agreement  of
reorganization  with Public Oil. This agreement  provided for the acquisition of
Public  Oil's  assets,  which  consisted  primarily of  undeveloped  acreage and
certain  tangible  equipment,  for 22,500,000  shares of the Company's $.001 par
value  restricted  and legended  common  stock,  and the  assumption  of certain
liabilities.

In March 1986, the stockholders of Public Oil entered into an agreement with the
Company whereby the Company redeemed  21,000,000  shares of its common stock for
the  reconveyance  of all the  properties  and  equipment  that were  originally
transferred on June 18, 1984. The shares were retired in 1986.

On March 31,  1986,  the Board of  Directors  approved the issuance of 4,000,000
shares  of the  Company's  stock  to the  Company's  former  president  for past
services  and  repayment  of  advances  made to the  Company.  The  value of the
services and advances totaled $30,032.

During 1986, the Company  received  1,000,000 shares of its common stock from an
individual who had received the stock as compensation for services. The services
were not  adequately  performed  and the  individual  returned the shares to the
Company. The Company subsequently retired the shares.


<PAGE>

                          WHITE CLOUD EXPLORATION, INC.
                        (A Development Stage Enterprise)

                    NOTES TO FINANCIAL STATEMENTS (continued)



3.  Income Taxes:
    ------------

The Company has net operating loss carryforwards of approximately  $95,000 to be
used to offset future revenue.  The book and tax  carryforward  approximate each
other. The benefits will expire in the years from 1998 to 2006.


4.  Subsequent Events:
    -----------------

In April,  1997,  the Company issued  7,500,000  shares to the general public in
which the corporate attorney holds the proceeds of $7,500.