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

                                   FORM 10-KSB

(Mark One)
[X]  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
     1934

     For the fiscal year ended December 31, 2002

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
     OF 1934

     For the transition period from ___________ to ___________

                        Commission File Number: 0-33023

                                 Shiprock, Inc.
                  --------------------------------------------
                 (Name of small business issuer in its charter)

           Nevada                                              86-0982792
-------------------------------                              --------------
(State or other jurisdiction of                              (IRS Employer
incorporation  or  organization)                             Identification
                                                             No.)

    1370 N. Monterey Dr., Apache Junction, AZ             85220
    -----------------------------------------         --------------
    (Address of principal executive offices)           (zip code)

             Issuers telephone number:   (480) 288-4220
                                         ----------------

Securities registered under Section 12(b) of the Exchange Act:

Title of each class registered: None       Name of each exchange on which
                                           registered:  None

Securities registered under Section 12(g) of the Exchange Act:

                          Common Stock, par value $.001
                          -----------------------------
                                (Title of class)

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

     Check if no disclosure of delinquent filers in response to Item 405
of Regulation S-B is 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.  $2,459.

     Based on the average if the closing bid and asked prices of the issuer's
common stock on December 31, 2002, the aggregate market value of the voting
stock held by non-affiliates of the registrant on that date was $725,000.

     As of December 31, 2002, the issuer had 1,580,000 shares of common
stock outstanding.

     Documents incorporated by reference:  See Item 13.  Exhibits and Reports
on Form 8-K in Part III.


     Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]


                                       1
<PAGE>



                           Forward-Looking Statements

This report contains forward-looking statements. The forward-looking statements
include all statements that are not statements of historical fact.  The
forward-looking  statements are often identifiable by their use of words such
as "may," "expect," "believe," "anticipate," "intend," "could," "estimate," or
"continue," "Plans" or the negative or other variations of those or comparable
terms.  Our actual results could differ materially from the anticipated results
described in the forward-looking statements.  Factors that could affect our
results include, but are not limited to, those discussed in Item 6,
"Management's Discussion and Analysis or Plan of Operation" and included
elsewhere in this report.







                                       2
<PAGE>




                                    CONTENTS

                                                                          PAGE
PART I

    Item 1.  Description of Business........................................4
    Item 2.  Description of Property.......................................14
    Item 3.  Legal Proceedings.............................................14
    Item 4.  Submission of Matters to a Vote of Security Holders...........14

PART II

    Item 5.  Market for Common Equity and Related Stockholder Matters......15
    Item 6.  Management's Discussion and Analysis or Plan of Operation.....17
    Item 7.  Financial Statements..........................................18
    Item 8.  Changes in and Disagreements with Accountants on
                Accounting and Financial Disclosure........................20

PART III

    Item 9.  Directors, Executive Officers, Promoters and Control
                Persons; Compliance with Section 16(a) of the
                Exchange Act...............................................21
    Item 10. Executive Compensation........................................22
    Item 11. Security Ownership of Certain Beneficial Owners and
                Management.................................................23
    Item 12. Certain Relationships and Related Transactions................24
    Item 13. Exhibits and Reports on Form 8-K..............................25
    ITEM 14  Control and Procedures....................................... 26

SIGNATURES   ..............................................................27




                                       3

<PAGE>



                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS.

A.  Business Development, Organization and Acquisition Activities

Shiprock, Inc., a developmental stage company, hereinafter referred to as
"the Company", was organized by the filing of Articles of Incorporation with
the Secretary of State of the State of Nevada on November 2, 1999.  The
original articles of the Company authorized the issuance of twenty million
(20,000,000) shares of Common Stock at par value of $0.001 per share and
five million (5,000,000) shares of Preferred Stock at par value of $0.001.
On November 2, 2000, the Company issued one million (1,000,000) shares of
its $0.001 par value Common Stock for cash of $1,000, held by two (2)
shareholders of record.

On August 25, 2000, the Company initiated a public offering of shares of
common stock of the Company pursuant to Regulation D, Rule 504 of the
Securities Act of 1933, as amended, which resulted in the sale of an
additional 580,000 shares of its $0.001 par value common stock to
approximately 64 shareholders.  As of December 31, 2002, therefore, the
number of common shares issued and outstanding is one million, five-hundred
and eighty thousand (1,580,000).

Shiprock, Inc. is developmental stage company, which plans to provide
installation of landscaping for new homes in the metropolitan area of
Phoenix, Arizona, with a primary emphasis on irrigation systems.  This
includes renovation, sprinkler installation and repair on later model
homes.

The Company anticipates that the proceeds from the sale of the Common
Shares offered in the 504 Offering referred to above were sufficient to
provide the capital requirements to implement the Company's initial plans
over the next twelve months.  Management believes the Company's continued
expansion is dependent upon the achievement of profitable operations in the
future, of which there are no guarantees.  The Company could be required to
secure additional financing to fully implement its entire business plan.
There is no guarantee that such financing will be available to the Company,
or if available, will be on terms and conditions satisfactory to management.


1)  Principal Products, Services and Principal Markets.

Shiprock, Inc. was incorporated to set up a landscaping business, initially
in the greater metropolitan area of Phoenix, Arizona.  Its primary focus will
be the installation of irrigation systems for new homes, as well as the
repair of previously installed sprinkler systems.  Shiprock is an outgrowth
of a landscaping business that has been doing business by the Company's
current management as The Flying Circus, a licensed Limited Liability
Company operated in the Phoenix, Arizona area for the past ten years


                                     4

<PAGE>


Shiprock, Inc. has set out to develop its expertise in the area of
irrigation, this would include both the installation  of new systems and
to repair systems that are fifteen to twenty years old.  Management has
observed that many customers are unwilling to replace a broken irrigation
systems, but look for service to repair them.  One of the factors that led
management to realize that a separate business specializing in irrigation
systems could be viable was the fact that a substantial number of other
contractors would regularly call them, via their Flying Circus landscaping
operations to sub-contract out the irrigation jobs.

Prospective customers and marketing targets for Shiprock include both new
homebuyers and longer term homeowners.  Plans to advertise in the Yellow
Pages and newspapers in the Phoenix area are being supplemented by the use
of value-pack advertising and flyer runs on new home developments in targeted
neighborhoods.  Furthermore, and most importantly, through their
sub-contracting experience with Flying Circus, the management of Shiprock,
Inc. are known by many homeowners and residents through whom they have
developed a network of contacts and customers by word-of-mouth endorsements.

Word-of-mouth is of no advantage unless those customers who deliver
it, have positive things to say, and in this regard.  Their can be no
assurances that word-of-mouth recommendations would by sufficient to keep
Shiprock as a Going Concern.  The auditors of the Company have issued a
going concern opinion in Note 6 of the Notes to Financial Statements,
The Company may not be able to generate enough revenues or have significant
cash or other material assets, to cover its operating costs and to allow it
to continue as a going concern.  It would therefore be the intent of the
Company to seek to raise additional capital via a private placement offering
pursuant to Regulation "D" Rule 505 or 506.

Shiprock, Inc. is one of the few landscaping services, in the Phoenix metro
area that offers 24-hour emergency service.  This emergency service would
include a faulty sprinkler system springs with a leak at 10:00 p.m.  They
offer homeowners has an emergency solution to a sprinkler problem.  Moreover,
the Company hopes to develop a reputation of quick turnaround time from a
customer's initial call to the beginning of work on a repair or new
installation.  Management believes that typical of service from most of
the area contractors is a 72-hour lag from first contact to the return of
an estimate, and then another week until the work is completed.
It is Shiprock's commitment is to call the customer back within an hour
with an estimate and then to begin the work itself within a 24-hour period.
The Company has access to three trucks that are fully stocked with
everything needed to diagnose a problem and make the repair.

The revenues generated by complete home landscaping installation can be
approximately $2,000 to $6,000 per job.  A four-man crew consisting of
1 foreman and 3 workers can complete three to five installations a week
depending on the difficulty and magnitude of the job.  The cost to
complete a home landscaping installation with parts and labor can amount
to approximately $1,500 to $5,000.

                                   5
<PAGE>

One sprinkler repair technician can complete 3-5 repairs per day,
averaging $100 a job.  With a sales manager who can meet with potential
clients and walk finished jobs to ensure customer satisfaction, and an
office manager who will take all incoming calls assigning technicians to
repairs while transferring the potential clients over to the sales manager,
the behind the scenes labor costs can be extensive.

The Company has initiated plans to identify prospective customers for
the landscaping of residential homes with special emphasis on the
installation and repair of irrigation systems, both new and old.  Shiprock
now sub-contracts sprinkler repair jobs within the limits allowed by Arizona
regulatory practice.  The Company has therefore begun to generate some income
as it continues to build its customer base.


                                     6
<PAGE>


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

a)  LIMITED OPERATING HISTORY MAKES POTENTIAL DIFFICULT TO ASSESS.  The
Company was incorporated in the State of Nevada on November 2, 1999 (file
number:  28250-1999)  As of the date of this document, the Company has
developed a business plan, established administrative offices and an
operating facility at Apache Junction, AZ, and begun the process of
identifying prospective customers for the landscaping of residential homes
in the Phoenix metropolitan area.

The Company has limited operating history and must be considered to be
only a step away from the status of a developmental stage company.
Prospective investors should be aware of the difficulties encountered by
such new enterprises, as the Company faces all of the risks inherent in any
new business and especially with a developmental stage company.  These risks
include, but are not limited to, competition, the absence of an operating
history, the need for additional working capital, and the possible inability
to adapt to various economic changes inherent in a market economy.  The
likelihood of success of the Company must be considered in light of these
problems, expenses that are frequently incurred in the operation of a new
business and the competitive environment in which the Company will operate.

b)  EVENTUAL NEED FOR ADDITIONAL CAPITAL.  In September, 2000, the
Company completed a 504 Offering and was able to generate enough
working capital to implement plans for the first year of its
operations.  However, the Company will eventually need a good deal
of additional capital in order to expand its operations.  Especially
when it begins to expand beyond the Phoenix area, the Company will
need a large reserve of capital from which to draw in order to fund
additional operations, get the required licenses, identify customer
bases, and so on.  This need for additional funds will be derived
somewhat from internal revenues and earnings, but the vast
majority will be received from future stock offerings.  These future
offerings could significantly dilute the value of any previous
investor's investment value.

c)  OPERATING LOSSES, NEGATIVE CASH FLOW FROM OPERATIONS LIKELY FOR
FORESEEABLE FUTURE.  There is no guarantee that the Company will ever be
able to operate profitably or derive any significant revenues from its
operation.  The Company could be required to raise additional financing
through a Regulation D, 505 or 506 Offering to fully implement its entire
business plan.

As stated above, the Company has begun some revenue generation in
relation to its repair services.  It is, however, important to note
that the Company anticipates that it will incur losses and negative
cash flow over the next twelve (12) to eighteen (18) months.  There is
no guarantee that the Company will ever operate profitably or even
receive positive cash flows from full operations.


                                     7
<PAGE>


d)  STRONG COMPETITION COULD CUT INTO COMPANY'S MARKET.  Competition for
small landscaping companies is relatively limited due to the number of new
homes and renovations being done in the metropolitan Phoenix area, and as
stated above, the Company is in a relatively new position to capture this
business from its competitors.  There is no guarantee that Shiprock will be
able to build on these accomplishments, or that the public will support
Shiprock in the future.  Other companies, with greater financial resources,
could enter the Phoenix area, or current competitors could find ways to out
perform Shiprock, at the Company's expense.

A common problem with most small landscaping companies is that they are not
able to do the larger jobs due to lack of sufficient capital.  It is possible
that the Company could face this problem, especially if a well-financed
competitor should enter the market or emerge from the current field.

Furthermore, the Company's desire to expand could expose it to competition
both from large companies who share the desire to operate in a national
arena and from the established companies in various regions and areas of the
country who would be fighting for the same customers as those of Shiprock
or its affiliates and associated entities.

e)  COMPANY MAY FAIL TO CONVINCE ENOUGH CUSTOMERS TO USE ITS SERVICES.  The
Company's plans to establish a landscaping business with a primary emphasis
on irrigation systems are obviously dependent on its ability to convince the
homeowners of the Phoenix area that it is the best option to provide the
service they need.  Despite the good reputation and strong referral base of
the Company's management and its strong belief that Shiprock will do very
well, if it cannot establish itself as an effective business in its home
market it will not be able to fulfill any of the more ambitious aspects of
its business plan.  There can be no assurances that this market acceptance
will be forthcoming.

f)  DEPENDENCE ON KEY PERSONNEL COULD LEAD TO PROBLEMS.  The Company
currently relies heavily upon the services and expertise of Tommy Gropp and
Michael D. Artis.  Should the Company be deprived of the services of either
or both of these men for any reason during this period of initial and
expansion, the results would be devastating to the Company and could lead
to its dissolution.

g)  POSSIBLE INABILITY TO FIND SUITABLE EMPLOYEES COULD LIMIT SHIPROCK'S
PROSPECTS.  In order to implement the aggressive business plan of the
Company, management recognizes that additional staff will be required.  The
Company's two Officers are the only personnel at the outset.  The Company
will require the hiring of an office assistant and laborers.

No assurances can be given that the Company will be able to find suitable
employees that can support the above needs of the Company or that these
employees can be hired on terms favorable to the Company.



                                     8
<PAGE>

h)  POSSIBLE REGULATORY OBSTACLES CREATED BY CHANGES IN WATER SUPPLY.  In
the Southwest United States there are major political storms as well as
troubling environmental issues that relate to the issue of the water supply.
The use of water from the area's major rivers are at the center of
continuing disputes between the states of those regions.  As a company
primarily concerned with irrigation systems and the watering of client's
lawns, shrubbery and gardens, Shiprock's fortunes are intimately bound up
with all issues of public policy that have to do with these critical issues
of water use.  It is entirely possible that controversies and regulations
that relate to these issues could have an adverse effect on the Company's
business, both in Arizona and in the larger Southwest region that it intends
to serve.

i)  DROUGHT CONDITIONS COULD LEAD TO PROHIBITIONS ON WATERING.  The State
of Arizona and parts of the Southwest have been subjected to drought with
some regularity in the past decades.  It is well known that the first kind of
water use that local and state governments curtail when faced with a short-
age of that critical element is that relating to the watering of private
lawns and gardens.  In some jurisdictions, such usage is prohibited by severe
fines.  Should such a situation come into being in the future, the Company
would stand to lose a substantial amount of revenues, and, if severe enough,
could even cause the Company's business to fail.

j)  CHANGING ENVIRONMENTAL ATTITUDES COULD CUT THE AVAILABLE MARKET.  As
the availability of water becomes a bigger issue and many people are in
the process of changing their attitudes toward appropriate water use,
advocates are emerging for so-called indigenous plant landscaping that
relies on flora that grow naturally in the dry desert climate of the
Southwest.  Whatever might be said on either side of this issue, the fact
remains that to the extent that consumers turn away from green grasses and
plants, the Company's lawn-sprinkler systems will have a smaller available
market.

k)  PLANS FOR EXPANSION MAY BE UNREALISTIC.  The management of Shiprock,
Inc. has confidence in its vision for the Company and believes that the
time is ripe for a firm to develop and expand its irrigation business.
However the fact that none exists to this point is indicative of the strong
possibility that the difficulties and challenges in creating such a company
are too great to be overcome.  Other Companies, pursing this market have had
such a vision and have been unsuccessful in their attempts to realize it.
Customers often gravitate to local firms; the realities of the business in
the Northeast, for example, where winterizing systems with a compressed air
blowout to prevent the destruction of pipes by freezing residual water are
far different from those in the desert-like conditions near the Company's
home base and obviously any national company needs to find its ways to deal
with these differences.  Potential investors should carefully consider the
possibility that the Company's plans to expand may not be realistic and could
ultimately prove to be unworkable.




                                     9
<PAGE>



l)  GOVERNMENT REGULATION COULD UNDERMINE THE COMPANY'S PROFITABILITY.
Though the Company plans on obtaining all required federal and state
permits, licenses, and bonds to operate its facilities, there can be no
assurance that the Company's operation and profitability will not be subject
to more restrictive regulation or increased taxation by federal, state, or
local agencies.  Especially in relation to the Irrigation industry, there are
many different kinds of regulatory bodies and diverse problems that arise in
different geographical and climactic regions that can affect in all manner
of ways Shiprock's ambitious expansion plans.  One small example: two
confusing laws relating lawn sprinkler systems to the plumbing industry in
Illinois resulted in a Supreme Court case in that state in which a lawsuit
was brought against a landscaping concern for installing an irrigation
system without a plumber's license.  Multiplied by multiple states' worth of
regulations, this kind of incidence could place enormous obstacles in the
way of the Company's expansion plans.

m)  LACK OF CASH DIVIDENDS.  The Company has not paid any cash dividends
on the Common Shares to date, and there can be no guarantee that the Company
will be able to pay a cash dividends on the Common Shares in the foreseeable
future. Initial earnings that the Company may realize, if any, will be
retained to finance the growth of the Company.  Any future dividends, of
which there can be no guarantee, will be directly dependent upon earnings of
the Company, its financial requirements and other factors that are not
determined.  (See "CAPITALIZATION")

n)  POSSIBLE LIABILITY FOR SERVICE PROVIDED.  There is no guarantee that
the level of coverage secured by the Company will be adequate to protect the
Company from risks associated with claims that exceed the level of coverage
maintained.  As a result of the Company's limited operations to date, no
threatened or actual claims have been made upon the Company for service
liability.

o)  SHARES SUBJECT TO RULE 144.  On April 14, 2000, the Company had
1,000,000 Common Shares issued and outstanding that have not been
registered with the Commission or any State securities agency and which
are currently restricted pursuant to Rule 144 promulgated by the Commission
under the 1933 Act.  Rule 144 provides, in essence, that a person holding
restricted securities for two years from the date the securities were
purchased from the issuer, or an affiliate of the issuer, and fully paid,
may sell limited quantities of the securities to the public without
registration, provided there shall be certain public information with
respect to the issuer.  Pursuant to Rule 144, securities held by
non-affiliates for more than three years may generally be sold without
reference to the current public information or broker transaction
requirements, or the volume limitations.  None of the current outstanding
restricted shares are available for resale pursuant to Rule 144.  The sale of
some or all of the currently restricted Common Shares could have a material
negative impact upon the market price of the Common Shares if a market for
the Common Shares should develop in the future.  (See "PRINCIPAL STOCKHOLDERS")




                                     10
<PAGE>


p)  POTENTIAL FLUCTUATION IN OPERATING RESULTS; QUARTERLY FLUCTUATIONS

The Company's operating results may fluctuate significantly in the
future as a result of a variety of factors, many of which are outside
the Company's control.  As a strategic response to changes in the
competitive environment, the Company may from time to time make certain
pricing, marketing decisions or acquisitions that could have a material
short-term or long-term adverse effect on the Company's business,
results of operations and financial condition.


q)  RISKS ASSOCIATED WITH NEW CAMPAIGNS AND ATTEMPTS TO EXPAND

There can be no assurance that the Company will be able to expand its
operations in a cost-effective or timely manner or that any such
efforts will maintain or increase overall market acceptance.
Furthermore, any concerted but unsuccessful attempts by the Company to
find new pay telephone sites or to expand its base beyond Houston
could damage the Company's reputation and diminish the value of its
name. Expansion of the Company's operations in this manner would also
require significant additional expenses and development, that could strain
the Company's management, financial and operational resources.
The lack of market acceptance of the Company's services could result
in the Company's inability to generate satisfactory revenues and its
inability to offset their costs could have a material adverse effect
on the Company's business, results of operations and financial
condition.



                                     11
<PAGE>



2)  Customers

The Company intends to serve homeowners both new and established by the
installation, maintenance and repair of irrigation systems both new and
previously installed.  Initially the Company will operate in Arizona in the
greater Phoenix area but intends to expand its field of operations to
regional and then national markets with the creation of a network of
connected businesses.  The focus, however, will remain on the servicing
of the home market.


3)  Patents, Trademarks, Licenses, Franchises, Concessions, Royalty
    Agreements, or Labor Contracts

The Company regards substantial elements of its future and underlying
infrastructure and technology as proprietary and attempts to protect them
by relying on trademark, service mark, copyright and trade secret laws and
restrictions on disclosure and transferring title and other methods.  The
Company plans to enter into confidentiality agreements with its future
Employees and any future consultants and in connection with its license
agreements with third parties and generally seeks to control access to its
irrigation business and other proprietary information.  Despite these
precautions, it may be possible for a third party to copy or otherwise
obtain and use the Company's proprietary information without authorization
or to develop similar technology independently.  Legal standards relating
to the validity, enforceability and scope of protection of certain
proprietary rights in irrigation businesses may be uncertain, and no
assurance can be given as to the future viability or value of any of the
Company's proprietary rights.  This can be no assurance that the steps
taken by the Company will prevent misappropriation or infringement of its
proprietary information, which could have a material adverse effect on the
Company's business, results of operations and financial condition.


4)  Effect of Existing or Probable Government Regulations

The Company is fully bonded and licensed and careful in its adherence to
all regulations.  Beyond these, however, the irrigation industry is subject
to many different kinds of regulatory authority, not only in Arizona but in
the country as a whole; and these regulations differ in relation to climate,
local water supplies, and numerous other factors that vary from state to
state or even municipality to municipality.  Shiprock plans to stay abreast
of all federal, state, regional and local regulations that are relevant to
its business and maintain careful compliance with them wherever necessary.

5)  Impact of Environmental Laws

As a licensed contractor, the Company must adhere to all federal, state or
local environmental laws which would effect is operations.


                                  12

<PAGE>


6)  Employees

The Company currently has three (3) employees, one (1) President and
Chief Executive Officer, and one (1) Secretary and currently sub-contracts
its manual laborer requirements.  In order to further implement its business
plan, management recognizes that additional staff will be required.  This
would include an office assistant, foreman, sprinkler techs and laborers
as required to complete the work.

(i) The Company's performance is substantially dependent on the performance
of its President, Tommy Gropp and its Corporate Secretary, Michael Artis.  In
particular, the Company's success depend on their ability to build the
business for the Company.

(ii) The Company does not carry key person life insurance on any of its
personnel. The loss of the services of any of its executive officers or other
key employees could have a material adverse effect on the business, results of
operations and financial condition of the Company.  The Company's future
success also depends on its ability to retain and attract highly qualified
technical and managerial personnel.

(iii)  There can be no assurance that the Company will be able to retain its
key managerial and technical personnel or that it will be able to attract and
retain additional highly qualified technical and managerial personnel in the
future.   The inability to attract and retain the technical and managerial
personnel necessary to support the growth of the Company's business, due to,
among other things, a large increase in the wages demanded by such personnel,
could have a material adverse effect upon the Company's business, results of
operations and financial condition.


7)  Recent Events

On October 14, 2002, the Company announced that it has executed an agreement
to acquire all of the issued and outstanding shares of Arbios Technologies,
Inc., a private biomedical company based in Los Angeles, CA., Shiprock will
acquire Arbios' shares through a merger in which Shiprock will issue
approximately 10,670,000 shares of its unregistered common stock to the
shareholders of Arbios.

Arbios Technologies, Inc. is a biomedical company engaged in the discovery,
acquisition and development of proprietary liver assist devices and new
technologies useful in the diagnosis and treatment of acute liver failure, a
debilitating and fatal disease. Liver failure affects all age groups and may
be caused by viruses, alcohol, ingestion of common medications, extensive liver
removal for trauma or cancer and other etiologies.  At the present time, no
direct treatment for liver failure is available and such patients must receive
a liver transplant or endure prolonged hospitalization with significant
mortality rate.  While liver transplants increase the chances of survival for
patients with liver failure, only a small percentage of such patients receive
a transplant due to a shortage of donor livers, or suffer from conditions such
as alcohol or drug abuse, infection, cancer or cardiovascular disease that make
transplants impossible.

                                       13

<PAGE>


The closing of this acquisition is subject to certain customary closing
conditions as well as the concurrent completion of a private placement financing
by Shiprock of at least $1,500,000 that has not yet been effected.  If the
financing and merger are completed, the current stockholders of Shiprock will
own approximately 8% of the then outstanding common stock.  If the monies are
not raised through this private placement, both parties have agreed that the
acquisition will not take place.  As such, as of the date of this Form 10KSB,
the private placement the $1,500,000 has not been raised and the acquisition
has not taken place.


ITEM 2.  DESCRIPTION OF PROPERTY.

A.  Description of Property

The Company's corporate headquarters are located at:  1370 N. Monterey Dr.,
Apache Junction, AZ  85220.  Telephone number:  (480) 288-4220.  The space
is provide to Shiprock by one of its directors at no cost to the business.

B.  Investment Policies

The Company does not currently own and the Company has not made any
investments in real estate, including real estate mortgages, and the
Company does not intend to make such investments in the near future.


ITEM 3.  LEGAL PROCEEDINGS.

As of the date hereof, Shiprock, Inc. is not a party to any material
legal proceedings, and none are known to be contemplated against Shiprock,
Inc.

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

No matters were submitted to a vote of security holders during the fiscal
year ended December 31, 2002.


                                   14
<PAGE>



                                PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

(i) Market Information
----------------------

On February 25, 2002, the Company's common stock was cleared for trading on
the OTC Bulletin Board system, under the trading symbol: SRKI.  Since the
Company was approved for trading, a very limited market exists for the
trading of the Company's common stock.

The table below sets forth the high and low bid prices of our common stock for
each quarter shown, as provided by the NASD Trading and Market Services
Research Unit.  Quotations reflect inter-dealer prices, without retail mark-up,
mark-down or commission and may not represent actual transactions.

<TABLE>
<CAPTION>

FISCAL 2002                                  HIGH              LOW
--------------------------------             ----              ----
<S>                                          <C>               <C>
Quarter ended March 31, 2002                 $0.00             $0.00
Quarter ended June 30, 2002                  $0.00             $0.00
Quarter ended September 30, 2002             $0.00             $0.00
Quarter ended December 31, 2002              $1.50             $0.00
</TABLE>

(a) There is currently no Common Stock which is subject to outstanding
options or warrants to purchase, or securities convertible into, the
Company's common stock.

(b)  There is currently no common stock of the Company which could be sold
under Rule 144 under the Securities Act of 1933 as amended or that the
registrant has agreed to register for sale by security holders.

(ii) Holders
------------

The approximate number of holders of record of common stock as of December 31,
2001 was approximately sixty-six (66).

(iii) Dividends
---------------

Holders of common stock are entitled to receive such dividends as the board of
directors may from time to time declare out of funds legally  available for the
payment of dividends. No dividends have been paid on our common stock, and we
do not anticipate paying any dividends on our common stock in the foreseeable
future.

(iv)  Liquidity and Capital Resources
-------------------------------------

On November 2, 1999, the Company issued one million (1,000,000) shares of
its $0.001 par value Common Stock for cash of $1,000, held by two (2)
shareholders of record.

On August 25, 2000, Shiprock was issued a permit to sell securities by the
State of Nevada, pursuant to our application for registration by qualification
of our offering of Common Stock in that state (See Exhibit 99 "Notice of
Effectiveness").  The application for registration by qualification was filed
pursuant to the provisions of NRS 90.490, which requires the public filing and
delivery to investors of a substantive disclosure document before sale.  On
September 30, 2000, Shiprock completed a public offering of shares of our
common stock pursuant to Regulation D, Rule 504 of the Securities Act of 1933,
as amended, and the registration by qualification of said offering in the


                                     15
<PAGE>


State of Nevada, whereby Shiprock sold 580,000 shares of Common Stock to
approximately 64 unaffiliated shareholders of record, none of whom were or are
officers, directors or affiliates of the Company.  The entire offering was
conducted exclusively in the State of Nevada, pursuant to the permit issued by
the State of Nevada.  As of December 31, 2002, therefore, the number of common
shares issued and outstanding is one million, five-hundred and eighty thousand
(1,580,000).

In addition, this offering was made on a best efforts basis and was not
underwritten.  In regards to the August-September, 2000 offering, listed
below are the requirements set forth under Regulation D, Rule 504 and the
facts which support the availability of Rule 504 to the August-September,
2000 offering:

As of December 31, 2002, the Company has 1,580,000 shares of common stock
issued and outstanding held by approximately 66 shareholders of record.

The Company has no material commitments for capital expenditures nor does it
foresee the need for such expenditures over the next year.

The Company has limited financial resources available, which has had an
adverse impact on the Company's liquidity, activities and operations. These
limitations have adversely affected the Company's ability to obtain certain
projects and pursue additional business. There is no assurance that the
proceeds of the Company will be able to raise sufficient funding to enhance
the Company's financial resources sufficiently to generate volume for the
Company.


                                      16
<PAGE>




ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

((a) Results of Operations
--------------------------

As a developmental stage Company, the Company had revenues of $2,459 for
calendar year ending 2002 versus $4,775 in revenues for the same period last
year.  The Company does not expect to generate any significant revenues over
the next approximately to twelve (12) months.  During calendar year, 2002,
the Company experienced net losses $(3,197) versus net losses of $(3,328)
for the same period last year.  The bulk of these expenses, $2,184 were for
general and administrative costs, and the remaining expenses, $1,836 was for
depreciation.  The net (loss) per share- basic and fully diluted for 2002 was
$(0.00) versus $(0.00) for the same period last year.  Since the Company's
inception on November 2, 1999 through December 31, 2002 it has lost $(24,440).
The Company does not have any material commitments for capital expenditures.

(b) Plan of Operation
---------------------

(i)  The Company does not have significant cash or other material assets,
nor does it have an established source of revenues sufficient to cover its
operating costs and to allow it to continue as a going concern.  The ability
of the Company to continue as a going concern is dependent upon its ability
to raise additional capital  from the sale of common stock and, ultimately,
the achievement of significant operating revenues.

The Company does not have any preliminary agreements or understandings
between the company and its stockholders/officers and directors with
respect to loans or financing to operate the company.  The Company
currently has no arrangements or commitments for accounts and accounts
receivable financing.  There can be no assurance that any such financing
can be obtained or, if obtained, that it will be on reasonable terms.

Unless the Company can start generating additional revenues, it is
questionable that it can remain a Going Concern.  In order for the Company
to remain a Going Concern it will need to find additional capital.
Additional working capital may be sought through additional debt or
equity private placements, additional notes payable to banks or related
parties (officers, directors or stockholders), or from other available
funding sources at market rates of interest, or a combination of these.
The ability to raise necessary financing will depend on many factors,
including the nature and prospects of any business to be acquired and
the economic and market conditions prevailing at the time financing is
sought.  No assurances can be given that any necessary financing can
be obtained on terms favorable to the Company, or at all.

(ii)  No engineering, management or similar report has been prepared or
provided for external use by the Company in connection with the offer of
its securities to the public.

(iii) Management believes that the Company's future growth and success will
be largely dependent on its ability to identify customers who are in need
of lawn irrigation systems.

(iv) The Company is not anticipating any significant changes in the number
of employees.


                                       17

<PAGE>

ITEM 7.  FINANCIAL STATEMENTS.




                                SHIPROCK, INC.
                         (A DEVELOPMENT STAGE COMPANY)

                             FINANCIAL STATEMENTS

                          DECEMBER 31, 2002 AND 2001



                                      18
<PAGE>


                                SHIPROCK, INC.
                         (A Development Stage Company)

                             FINANCIAL STATEMENTS


                                   CONTENTS
                                   --------



<TABLE>
<CAPTION>

CONTENTS


                                                  PAGE
<S>                                               <C>
INDEPENDENT AUDITORS' REPORT                      1
BALANCE SHEETS                                    2
STATEMENTS OF OPERATIONS                          3
STATEMENT OF STOCKHOLDER'S DEFICIT                4
STATEMENTS OF CASH FLOWS                          5
NOTES TO FINANCIAL STATEMENTS                     6-9
</TABLE>

                                     19
<PAGE>
                MERDINGER, FRUCHTER, ROSEN & COMPANY, P.C.
                      CERTIFIED PUBLIC ACCOUNTANTS
                           888 SEVENTH AVENUE
                           NEW YORK, NY 10106
                                  ------
                          TEL: (212) 757-8400
                          FAX: (212) 757-6124


                         INDEPENDENT AUDITORS' REPORT


To the Board of Directors of Shiprock, Inc.:

We have audited the accompanying balance sheet of Shiprock, Inc. (A
Development Stage Company) as of December 31, 2002 and 2001, and the related
statements of operations, stockholders' equity and cash flows for the years
then ended.  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 audit.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America.  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 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 Shiprock, Inc. as of December
31, 2002 and 2001, and the results of its operations and its cash flows for
the years then ended in conformity with accounting principles generally
accepted in the United States of America.

The accompanying financial statements have been prepared assuming the Company
will continue as  a  going concern.  As discussed in Note 2 to the financial
statements, the Company has had limited operations and has not commenced
planned principal operations.  This raises substantial doubt about its ability
to continue as a going concern.  Management's plans in regard to these matters
are also described in Note 2.  The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.


                          /s/ Merdinger Fruchter Rosen & Company PC
                          MERDINGER, FRUCHTER ROSEN & COMPANY, P.C.
                          Certified Public Accountants

New York, New York
January 21, 2003

                                     F-1
<PAGE>

                                SHIPROCK, INC.
                         (A Development Stage Company)
                                 BALANCE SHEET


<TABLE>
<CAPTION>

BALANCE SHEET


                                                             December 31,
                                                        ----------------------

                                                           2002        2001
                                                        ----------  ----------
<S>                                                     <C>         <C>


ASSETS
   Cash and cash equivalents                            $       11  $      344
   Inventory                                                   478       1,506
                                                        ----------  ----------
     Total current assets                                      489       1,850
Fixed assets, net of accumulated depreciation of $4,114
 and $2,278 at December 31, 2002 and 2001, respectively      5,071       6,907
                                                        ----------  ----------
TOTAL ASSETS                                            $    5,560  $    8,757
                                                        ==========  ==========


LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities                                     $        -  $        -
                                                        ----------  ----------


STOCKHOLDERS' EQUITY
  Preferred stock, $0.001 par value;
    5,000,000 shares authorized,
    no shares issued and outstanding                    $        -  $        -
  Common stock, $0.001 par value;
    20,000,000 shares authorized,
  1,580,000 shares issued and outstanding
    as of December 31, 2001 and 2000                         1,580       1,580

  Additional paid-in capital                                28,420      28,420
 Deficit accumulated during the development stage          (24,440)    (21,243)
                                                        ----------  ----------
     Total stockholders' equity                              5,560       8,757
                                                        ----------  ----------
   Total liabilities and stockholders' equity           $    5,560  $    8,757
                                                        ==========  ==========
</TABLE>


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

                                      F-2
<PAGE>

                                SHIPROCK, INC.
                         (A Development Stage Company)
                           STATEMENTS OF OPERATIONS


<TABLE>
<CAPTION>

STATEMENTS OF OPERATIONS


                                                                  November 2,
                                                                     1999
                                             December 31,       (Inception) to
                                        ----------------------   December 31,
                                           2001        2000          2002
                                        ----------  ----------  --------------
<S>                                     <C>         <C>         <C>
Revenue                                 $    2,459  $    4,775  $       10,734
Cost of revenue                              1,636       3,371           7,478
                                        ----------  ----------  --------------
Gross profit                                   823       1,404           3,256

Operating expenses:
  General and administrative                 2,184       2,895          23,582
  Depreciation                               1,836       1,837           4,114
                                        ----------  ----------  --------------
Total operating expenses                     4,020       4,732          27,696

Loss from operations before provisions
  for income taxes                          (3,197)     (3,328)        (24,440)

Provision for income taxes                       -           -               -
                                        ----------  ----------  --------------

Net loss                                $   (3,197) $   (3,328) $      (24,440)
                                        ==========  ==========  ==============

Net loss per share                      $    (0.00) $    (0.00) $        (0.02)
                                        ==========  ==========  ==============

Weighted average number of
  common shares outstanding              1,580,000   1,580,000       1,413,784
                                        ==========  ==========  ==============
</TABLE>


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

                                     F-3
<PAGE>

                                SHIPROCK, INC.
                         (A Development Stage Company)
                      STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>

STATEMENT OF STOCKHOLDERS' EQUITY

                                                         Deficit
                                                       Accumulated
                 Common Stock               Additional  During the    Total
                 ------------- Subscriptions  Paid-in  Development Stockholders'
                 Shares  Amount Receivable    Capital     Stage       Equity
                 ------- ------ ------------ --------- ----------- ------------
<S>            <C>       <C>    <C>          <C>       <C>         <C>
Balance,
Nov 2,1999             - $    - $          - $       - $        -  $          -

Founder shares
issued for
subscription
receivable     1,000,000  1,000      (1,000)         -          -             -
Net loss               -      -           -          -          -             -
                 ------- ------ ------------ --------- ----------- ------------
Balance,
Dec 31,
1999           1,000,000  1,000      (1,000)         -          -             -
Cash received
 for subscription
 receivable
 March, 2000           -      -        1,000         -          -         1,000

Rule 504
offering
issued for
cash
September 2000   580,000    580            -    28,420          -        29,000

Net loss               -      -            -         -    (17,915)      (17,915)
               --------- ------ ------------ --------- ----------- -------------
Balance,
Dec 31,
2000           1,580,000  1,580            -    28,420    (17,915)       12,085

Net loss               -      -            -         -    ( 3,328)       (3,328)
               --------- ------ ------------ --------- ----------- -------------
Balance,
Dec 31,
2001           1,580,000  1,580            -    28,420     (21,243)       8,757

Net loss               -      -            -         -      (3,197)      (3,197)
                 ------- ------ ------------ --------- ----------- -------------
Balance,
December 31,
2002           1,580,000 $1,580 $          - $  28,420 $   (24,440)$      5,560
               ========= ====== ============ ========= =========== =============
</TABLE>

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

                                      F-4

<PAGE>

                                SHIPROCK, INC.
                         (A Development Stage Company)
                            STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>

STATEMENT OF CASH FLOWS

                                                                  November 2,
                                                                     1999
                                             December 31,       (Inception) to
                                        ----------------------   December 31,
                                           2001        2000          2002
                                        ----------  ----------  --------------
<S>                                     <C>         <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                $   (3,197) $   (3,328) $      (24,440)
Adjustments to reconcile net loss to net cash
  Used by operating activities
     Depreciation                            1,836       1,837           4,114
     Decrease (increase) in inventory        1,028         366            (478)
                                        ----------  ----------  --------------
NET CASH USED IN OPERATING ACTIVITIES         (333)     (1,125)        (20,804)

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of fixed assets                       -           -          (9,185)
                                        ----------  ----------  --------------
                                                             -

CASH FLOWS FROM FINANCING ACTIVITIES
  Sale of common stock                           -           -          30,000
  Decrease in subscriptions receivable           -           -               -
                                        ----------  ----------  --------------
NET CASH PROVIDED BY FINANCING ACTIVITIES        -           -          30,000

(DECREASE) INCREASE IN
 CASH AND CASH EQUIVALENTS                    (333)     (1,125)             11

CASH AND CASH EQUIVALENTS-beginning
  of period                                    344       1,469               -
                                        ----------  ----------  --------------
CASH AND CASH EQUIVALENTS-end of period $       11  $      344  $           11
                                        ==========  ==========  ==============

SUPPLEMENTAL DISCLOSURES
  Interest paid                         $        -  $        -  $            -
                                        ==========  ==========  ==============
  Income taxes paid                     $        -  $        -  $            -
                                        ==========  ==========  ==============
</TABLE>

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

                                      F-5
<PAGE>

                                SHIPROCK, INC.
                         (A Development Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                          DECEMBER 31, 2002 AND 2001



 NOTE 1 -   DESCRIPTION  OF  BUSINESS  AND  SUMMARY  OF SIGNIFICANT ACCOUNTING
            POLICIES

            Nature of Operations
            --------------------

            Shiprock,  Inc.  (the "Company") is currently  a  development-stage
            company under the  provisions of the Financial Accounting Standards
            Board ("FASB") Statement of Financial Accounting Standards ("SFAS")
            No. 7.  The Company was incorporated under the laws of the State of
            Nevada on November 2, 1999.

            Use of Estimates
            ----------------

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

            Cash and Cash Equivalents
            -------------------------

            The Company considers all highly liquid investments purchased with
            original  maturities  of  three  months   or   less   to  be  cash
            equivalents.

            Inventory
            ---------

            Inventory consists of finished goods, which are valued at the lower
            of cost or market on a first-in, first-out basis.

            Long-lived Assets
            -----------------

            SFAS  No. 121, "Accounting for the Impairment of Long-lived  Assets
            and for  Long-lived  Assets  to be Disposed of" requires that long-
            lived assets be reviewed for impairment  whenever events or changes
            in circumstances indicate that the related  carrying amount may not
            be recoverable.  Recovery of assets to be held and used is measured
            by a comparison of the carrying amount of the  assets to the future
            net  cash  flows  expected to be generated by the asset.   If  such
            assets  are  considered  to  be  impaired,  the  impairment  to  be
            recognized is  measured  by the amount by which the carrying amount
            of the assets exceeds the  fair  value of the assets.  Assets to be
            disposed of are reported at the lower  of  the  carrying  amount or
            fair value less the cost to sell.

            Income Taxes
            ------------

            Income  taxes  are  provided for based on the liability method  of
            accounting  pursuant to  SFAS  No.  109,  "Accounting  for  Income
            Taxes."  Deferred  income  taxes,  if any, are recorded to reflect
            the tax consequences on future years  of  differences  between the
            tax bases of assets and liabilities and their financial  reporting
            amounts at each year-end.

                                      F-6
<PAGE>

                                SHIPROCK, INC.
                         (A Development Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                          DECEMBER 31, 2002 AND 2001


 NOTE 1 -   DESCRIPTION  OF  BUSINESS  AND  SUMMARY  OF SIGNIFICANT ACCOUNTING
            POLICIES (Continued)

            Earnings Per Share
            ------------------


            The Company calculates earnings per share  in accordance with SFAS
            No.  128,  "Earnings  Per Share," which requires  presentation  of
            basic earnings per share  ("BEPS")  and diluted earnings per share
            ("DEPS").  The computation of BEPS is  computed by dividing income
            available to common stockholders by the weighted average number of
            outstanding common shares during the period.  DEPS gives effect to
            all  dilutive  potential  common  shares  outstanding  during  the
            period.   The  computation  of  DEPS  does not assume  conversion,
            exercise or contingent exercise of securities  that  would have an
            antidilutive  effect  on  earnings.   As of October 31, 2002,  the
            Company had no securities that would effect loss per share if they
            were to be dilutive.

            Comprehensive Income
            --------------------

            SFAS  No.  130,  "Reporting  Comprehensive   Income,"  establishes
            standards  for  the reporting and display of comprehensive  income
            and its components  in  the financial statements.  The Company had
            no items of other comprehensive  income  and,  therefore,  has not
            presented a statement of comprehensive income.

  NOTE 2 -  GOING CONCERN

            These  financial statements have been prepared in accordance  with
            accounting  principles  generally accepted in the United States of
            America  applicable  to a going  concern  which  contemplates  the
            realization of assets  and  the  satisfaction  of  liabilities and
            commitments in the normal course of business.  As of  December 31,
            2002,  the  Company has realized nominal revenue to date  and  has
            accumulated  operating   losses  of  approximately  $24,000  since
            inception.  The Company's  ability  to continue as a going concern
            is  contingent  upon  the  successful  completion   of  additional
            financing  arrangements  and  its ability to achieve and  maintain
            profitable operations.  Management  plans  to raise equity capital
            to finance the operating and capital requirements  of the Company.
            Amounts  raised  will  be  used  to  further  development  of  the
            Company's   products,  to  provide  financing  for  marketing  and
            promotion, to  secure  additional  property and equipment, and for
            other working capital purposes.  While  the  Company  is expending
            its best efforts to achieve the above plans, there is no assurance
            that any such activity will generate funds that will be  available
            for operations.

            These  conditions  raise  substantial  doubt  about  the Company's
            ability   to   continue  as  a  going  concern.   These  financial
            statements do not  include  any  adjustments that might arise from
            this uncertainty.

                                     F-7
<PAGE>

                                SHIPROCK, INC.
                         (A Development Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                          DECEMBER 31, 2002 AND 2001



  NOTE 3 -  INCOME TAXES

            The components of the provision for income taxes for the year ended
            December 31, 2002 are as follows:

             Current Tax Expense
               U.S. Federal                           $           -
               State and Local                                    -
                                                      -------------

             Total Current                                        -
                                                      -------------


             Deferred Tax Expense
               U.S. Federal                                       -
               State and Local                                    -
                                                      -------------

             Total Deferred                                       -
                                                      -------------


             Total Tax Provision (Benefit) from
              Continuing Operations                   $           -
                                                      =============


            The reconciliation of the effective  income tax rate to the Federal
            statutory rate is as follows:

            Federal Income Tax Rate                        34.0%
            Effect of Valuation Allowance                 (34.0)%
                                                           ----
            Effective Income Tax Rate                       0.0%

                                                           ====


            At December 31, 2002, the Company had  net  carryforward  losses of
            $24,440.   Because  of  the  current  uncertainty  of realizing the
            benefits  of the tax carryforward, a valuation allowance  equal  to
            the tax benefits for deferred taxes has been established.  The full
            realization  of  the  tax  benefit associated with the carryforward
            depends  predominantly  upon  the  Company's  ability  to  generate
            taxable income during the carryforward period.

            Deferred tax assets and liabilities  reflect  the net tax effect of
            temporary  differences between the carrying amount  of  assets  and
            liabilities  for  financial reporting purposes and amounts used for
            income  tax purposes.   Significant  components  of  the  Company's
            deferred  tax assets and liabilities as of December 31, 2002 are as
            follows:

            Deferred Tax Assets
             Loss Carryforwards                             $    8,310

             Less:  Valuation Allowance                         (8,310)
                                                          ------------

             Net Deferred Tax Assets                      $          -
                                                          ============


            Net operating loss carryforwards expire in 2022.

                                     F-8
<PAGE>

                                SHIPROCK, INC.
                         (A Development Stage Company)
                         NOTES TO FINANCIAL STATEMENTS
                          DECEMBER 31, 2002 AND 2001


NOTE 4 -    COMMON STOCK

            On November  3,  1999,  the  Company issued 1,000,000 shares of its
            $0.001 par value common stock for cash of $1,000.

            On September 29, 2000, the Company issued 580,000 shares of its
            $0.001 pare value common stock for cash of $29,000, pursuant to
            Regulation D, Rule 504.

NOTE 5 -    RELATED PARTY TRANSACTIONS

            The Company neither owns nor leases  any real or personal property.
            The  officers/directors of the Company  provide  office  and  other
            services  without  charge.  These individuals are involved in other
            business activities  and  may,  in  the  future, become involved in
            other business opportunities.

NOTE 6 -    RECENT EVENT

            On October 14, 2002, the Company announced  that it has executed an
            agreement  to acquire all of the issued and outstanding  shares  of
            Arbios Technologies,  Inc.,  a  private biomedical company based in
            Los  Angeles, California.  Shiprock  will  acquire  Arbios'  shares
            through  a  merger  in  which  Shiprock  will  issue  approximately
            10,670,000   shares   of  its  unregistered  common  stock  to  the
            shareholders of Arbios.  The closing of this acquisition is subject
            to certain customary closing  conditions, as well as the concurrent
            completion of a private placement financing by Shiprock of at least
            $1,500,000 that has not yet been  effected.   If the monies are not
            raised  through  this private placement, both parties  have  agreed
            that the acquisition will not take place.


                                     F-9
<PAGE>
ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE.

The Company filed a Current Report dated March 18, 2002 on Form 8-K
containing information pursuant to Item 4 ("Changes in Accountants")
entitled "Changes in Registrant's Certifying Account."

There were no disagreements between the Company and its former CPA, G. Brad
Beckstead on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which, if not resolved
to the satisfaction of G. Brad Beckstead, would have caused them to make
reference to the subject matter of the disagreement in connection with its
report.

On March 18, 2002 the Registrant engaged Merdinger, Fruchter, Rosen &
Company, P.C. as its principal accountant to audit the Registrant's financial
statements as successor to G. Brad Beckstead.  During the Registrant's two
most recent fiscal years or subsequent interim period, the Registrant has
not consulted Merdinger, Fruchter, Rosen & Company, P.C. regarding the
application of accounting principles to a specific transaction, either
completed or proposed, or the type of audit opinion that might be rendered on
the Registrant's financial statements, nor did Merdinger, Fruchter, Rosen &
Company, P.C. provide advice to the Registrant, either written or oral, that
was an important factor considered by the Registrant in reaching a decision
as to the accounting, auditing or financial reporting issue.  Further, during
the Registrant's two most recent fiscal years or subsequent interim period,
the Registrant has not consulted Merdinger, Fruchter, Rosen & Company, P.C.
on any matter that was the subject of a disagreement or a reportable event.



                                       20
<PAGE>


                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

The names, ages and positions of the Company's directors and executive officers
are as follows:

<TABLE>
<CAPTION>

Name                  Age                Position                 Appointed
------------          ---      ------------------------------     ---------
<S>                   <C>      <C>                                <C>
Tommy Gropp           42       Chairman of the Board              11/02/99
                               President, CEO, CFO
Michael Artis         27       Director, Corporate Secretary      11/02/99

</TABLE>

Family relationships
--------------------

Mr. Gropp is married to the mother of Mr. Artis.  Mr. Artis is the step-son
of Mr. Gropp.

Work Experience
---------------

Tommy Gropp, Director, President and CEO/CFO
--------------------------------------------

Tommy Gropp, for the past year has been working as a partner of the Flying
Circus LLC, a landscaping company doing business in the Phoenix metro area as
a subcontractor.  For the last 10 years, he has been a subcontractor in the
landscaping field working for licensed contractors.  Controlling all aspects
in jobs to include yard maintenance, sprinkler repair and full landscaping
installation.  During these years he has acquired a vast knowledge of the
landscaping business.  He currently holds a Certificate of Completion in
Management from Mesa Community College, class of 1992.B.S. in Performing
Music, MacMurray College, class of 1978.   He plans to devote 15-20 hours
per week to the operations of Shiprock.

Michael Artis, Director and Corporate Secretary
-----------------------------------------------

Michael Artis, for the past year has been working as a partner in the Flying
Circus LLC, a landscaping company in the Phoenix metro area as a subcontractor.
He has spent the last 7 years in the US Navy responsible for the training and
maintenance of shipboard fire-fighting equipment.  For the last 2 years, he
was stationed at the Phoenix Naval Reserve Center as the Facilities Manager
in charge of all contracts and building maintenance.  He plans to devote
15-20 hours per week to the operations of Shiprock.


                                     21
<PAGE>

Directors are elected in accordance with our bylaws to serve until the next
stockholders meeting.  Shiprock, Inc. does not currently pay compensation
to directors for services in that capacity.

Officers are elected by the board of directors and hold office until their
successors are chosen and qualified, until their death or until they resign or
have been removed from office.  All corporate officers serve at the discretion
of the board of directors.  There are no family relationships between any
director or executive officer and any other director or executive officer of
Shiprock, Inc.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires our directors and
executive officers, and persons who beneficially own more than ten percent of a
registered class of our equity securities (referred to as "reporting persons"),
to file with the Securities and Exchange Commission initial reports of
ownership and reports of changes in ownership of common stock and other
Shiprock, Inc. equity securities.  Reporting persons are required by Commission
regulations to furnish us with copies of all Section 16(a) forms they file.

ITEM 10.  EXECUTIVE COMPENSATION.

As a result of our the Company's current limited available cash, no officer
or director received compensation during the fiscal year ended December 31,
2001.  Shiprock, Inc. intends to pay salaries when cash flow permits.  No
officer or director received stock options or other non-cash compensation
during the fiscal year ended December 31, 2002.  The Company does have
employment agreements in place with each of its officer.

<TABLE>
<CAPTION>

Compensation of Executive Officer

Name              Title           Salary         Bonus    Common Stock
----------------------------------------------------------------------
<S>               <C>             <C>             <C>      <C>
Tommy J. Gropp    President/CEO   None            None     None
Michael Artis     Sec/Director    None            None     None

All Executive Officers as a Group (2 persons)

</TABLE>

The Company currently does not have employment agreements with its
executive officers.  The executive officers will not draw any salary from
the Company, and the Company - in order to prudently manage its limited
financial resources - does not plan on compensating its executive officers
for their present services rendered to the Company for the foreseeable
future while Shiprock is in its early stages.  Both Mr. Gropp and Mr. Artis
are currently involved in the hands-on management of their related
landscaping business, Flying Circus, from which each derives their income

                                   22
<PAGE>

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

A.  Security Ownership

The following table sets forth certain information concerning the beneficial
ownership of our outstanding common stock as of December 31, 2002, by each
person known by Shiprock, Inc. to own beneficially more than 5% of the
outstanding common stock, by each of our directors and officer and by all of
our directors and officers as a group.  Unless otherwise indicated below, to
our knowledge all persons listed below have sole voting and investment
power with  respect to their  shares of common  stock  except to the extent
that authority is shared by spouses under applicable law.

<TABLE>
<CAPTION>
                                            Amount
Title    Name and Address                   of shares              Percent
of       of Beneficial                      held by    Date        of
Class    Owner of Shares    Position        Owner      Acquired    Class
----------------------------------------------------------------------------
<S>      <C>                <C>             <C>        <C>         <C>

Common   Tommy Gropp        Pres./CEO/CFO   500,000    11/02/99    32.00%
Common   Michael Artis      Corp. Sec'y     500,000    11/02/99    32.00%
----------------------------------------------------------------------------

</TABLE>

(1) c/o Shiprock, Inc., 1370 N. Monterey Dr., Apache Junction, AZ 85220

B.  Persons Sharing Ownership of Control of Shares

    Tommy Gropp and Michael D. Artis own and share the power to vote ten
    percent (10%) or more of the Company's securities.

C.  Non-voting Securities and Principal Holders Thereof

    The Company has not issued any non-voting securities.

D.  Options, Warrants and Rights

    There are no options, warrants or rights to purchase securities of the
    Company.

E.  Parents of the Issuer

    Under the definition of parent, as including any person or business
    entity who controls substantially all (more than 80%) of the issuers of
    common stock, the Company has no parents.


                                     23
<PAGE>




ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

By Board Resolution, the Company hired the professional services of Merdinger,
Fruchter, Rosen & Company, P.C., Certified Public Accountants, to perform
audited financials for the Company.  The members of the firm of Merdinger,
Fruchter, Rosen & Company, P.C. own no stock in the Company.

The officers and directors of the Company are involved in other business
activities and may, in the future, become involved in other business
opportunities.  If a specific business opportunity becomes available, such
persons may face a conflict in selecting between the Company and their
other business interests.  The Company has not formulated a policy for the
resolution of such conflicts.


                                    24
<PAGE>


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

(a)  EXHIBITS.

     99     Certification Pursuant to 18 U.S.C. Section 1350, As Adopted
           Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
           (Chief Executive Officer and Chief Financial Officer).

(b)  REPORTS ON FORM 8-K

The Company filed a Current Report dated March 18, 2002 on Form 8-K
containing information pursuant to Item 4 ("Changes in Accountants")
entitled "Changes in Registrant's Certifying Account."  (See Item 8 above,
entitled, "Changes in and Disagreements with Accountants on Accounting")

                                       25
<PAGE>

ITEM 14 - CONTROL AND PROCEDURES

As required by Rule 13a-15 under the Exchange Act, within the 90 days prior to
the filing date of this report, the Company  carried out an evaluation of the
effectiveness of the design and operation of the Company's  disclosure controls
and procedures.  This evaluation was carried out under the supervision and with
the participation of the Company's management, including the Company's
President, Chief Executive Officer and Chief Financial Officer.  Based upon that
evaluation, the Company's President, Chief Executive Officer and Chief Financial
Officer concluded that the Company's disclosure controls and procedures are
effective.  There have been no  significant changes in the Company's internal
controls or in other factors, which could significantly affect internal controls
subsequent to the date the Company carried out its evaluation.

Disclosure controls and procedures are controls and other procedures that are
designed to ensure that information  required to be disclosed in Company reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported, within the time  periods  specified in the Securities and Exchange
Commission's rules and forms.  Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed in Company reports filed under the Exchange Act is
accumulated and communicated to management, including the Company's Chief
Executive Officer and Chief Financial Officer as appropriate, to allow timely
decisions regarding required disclosure.

                                   SIGNATURES


In accordance with the  requirements  of  Section  13 or 15(d) of the
Securities Exchange Act of 1934, the registrant, caused this report to be
signed on its  behalf by the  undersigned  based  upon the best  information
available pursuant to Section 12b-25, thereunto duly authorized.

                                                    Shiprock, Inc.
                                           -----------------------------
                                                    (Registrant)

Dated:  March 6, 2003                  By:  /s/ Tommy Gropp
                                           ---------------------------
                                           Tommy Gropp,
                                           Chairman of the Board
                                           President
                                           Chief Executive Officer
                                           Chief Financial Officer


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

By:  /s/ Tommy Gropp                       March 6, 2003
--------------------------------
Tommy Gropp
President, CEO and CFO

By:  /s/ Michael Artis                     March 6, 2003
---------------------------------
Michael Artis
Director and Corporate Secretary


                                       26

<PAGE>


                                   SHIPROCK, INC.

Certification of Procedures Followed in Connection with Sarbanes-Oxley Act
Certification

     The undersigned, Chief Executive Officer and Chief Financial Officer of
Shiprock, Inc., a Nevada Corporation (the "Company") hereby certifies, for
purposes of documenting the steps followed by the officer in connection with
the execution and delivery to the Securities and Exchange Commission of the
attached certification, as follows:

         (1) I reviewed in detail the Annual Report on Form 10-KSB for the
period ending December 31, 2002, (the "Report") shortly before the
certification was provided.

         (2) I discussed the substance of the Report with each of the Company's
outside auditors and acting controller.  These discussions took place at
various times and covered principally the financial statement portions of the
reports (including the notes which are an integral part of the financial
statements) and related financial disclosures.  These discussions included my
verifying that the financial  statements included in the report are accurate
and complete, and are properly  prepared and consolidated.  I confirmed that
each of the  outside auditors and acting controller were satisfied that the
notes to the financial statements  read  clearly  and that  the notes fairly
explain the company's significant accounting principles and significant
estimates, as well as disclose all material contingencies and "off balance
sheet" transactions and commitments known to them. In addition, my discussions
with outside  auditors  included a discussion of any material issues that came
up in their review of the financial statements and the resolution of those
issues.  I also verified with the outside auditors and acting controller that
internal controls are in place and operating to warrant reliance upon the
financial and business  information  provided to me by management.

         (3) I confirmed that the consolidated  financial statements included
in the Report are accurate and complete in all material respects, reflect all
transactions of the Company  during and for the statement period following
accounting principles consistent with those applied in prior periods, and that
all period end adjustments have been made in a manner consistent with the
accounting  principles in prior periods (other than usual and customary year
end adjustments in the case of interim statements).

         (4) I informed the heads of the Company's primary business units and
divisions, as well as any officers of those business units or divisions who
have the primary  financial  reporting  responsibility, that I would be
providing a certification  regarding the accuracy of the Report and confirmed
orally and in writing with each such head and financial officer that insofar
as they knew, the Report did not include any untrue  statement of a material
fact or omit to state a material fact.

         (5) As a result of the foregoing procedures, I concluded that, to the
best of my knowledge, I was able to provide the certification without exception.

         In witness whereof, I have executed this certification as of the 6th
day of March, 2003.

/s/ Tommy Gropp
-----------------------
Name:  Tommy Gropp
Chief Executive Officer
Chief Financial Officer