UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                        AMENDMENT NO. 1 ON FORM 10-KSB/A

[X]      Annual report under section 13 or 15(d) of the Securities  Exchange Act
         of 1934 for the fiscal year ended March 31, 2004

[        ]  Transition  report  under  section  13 or  15(d)  of the  Securities
         Exchange Act of 1934 for the transition period from to


                         Commission File Number 0-24372

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

                            Sundog Technologies, Inc.
                     (Former name of small business issuer)



        DELAWARE                                          33-0611746
----------------------------                   --------------------------------
(State or other jurisdiction                   (IRS Employer Identification No.)
    of incorporation
     or organization)

                           10542 South Jordan Gateway
                               South Jordan, Utah          84095
               ---------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                    Issuer's telephone number: (801) 501-7100


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

Name of exchange on which registered:                       N/A

Securities registered under to Section 12(g) of the Act:    Common Stock,
                                                            par value $.001

Name of exchange on which registered:                       OTC Bulletin Board



Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Securities  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 there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the  best  of  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. [ ]

       Issuer's revenues for its most recent fiscal year were $5,365,353.

The  aggregate  market value of the voting stock held by  non-affiliates  of the
registrant as of June 30, 2004 was $14,621,512. The number of shares outstanding
of the issuer's Common Stock, par value $.001 per share, as of June 30, 2004 was
31,631,823 shares, of which 22,494,634 were held by non-affiliates.

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      None

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


<PAGE>

         Arkona,  Inc. (the  "Company")  is filing this  Amendment No. 1 on Form
10-K/A (this "Amendment") to its Annual Report on Form 10-KSB for the year ended
March 31,  2004  filed  with the SEC on July 8, 2004 (the  "Form  10-K") for the
purpose of adding the  information  required by Part III, Items 9-12 and Item 14
of Form 10-K. The Company  intended to incorporate such information by reference
from  its  definitive  proxy  statement  but  does  not now  expect  to have its
definitive proxy statement completed and filed prior to the applicable deadline.
All  subsequent  references to "Form 10-K" shall refer to the initial Form 10-K,
as amended by this Amendment.


                                       1
<PAGE>

                                    PART III

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

Directors

         Certain  information  with  respect  to  each of the  directors  of the
Company is set forth below.
<TABLE>
<CAPTION>

              Name                        Age                       Position                       Director Since
----------------------------------     -----------    -------------------------------------     ---------------------
<S>                                        <C>        <C>                                       <C>
Alan Rudd                                  52         Chief Executive Officer, Chairman         January 2000
                                                      of the Board

Richard Holland                            43         President, Director                       November 2000

Bryan Allen                                37         Director                                  August 2000
</TABLE>

         The following  paragraphs sets forth certain  biographical  information
about each of the foregoing:

         ALAN RUDD joined the Company as Chairman and Chief Executive Officer on
January 1, 2000.  Rudd  brings  more than 20 years  experience  in the  computer
industry to the Company.  From March 1996 to November  1999,  Rudd was the Chief
Executive  Officer of Vinca  Corporation,  a Utah-based  company  that  provided
continuous  availability  software for Microsoft-,  Novell- and  IBM-distributed
network  platforms.  In recognition of his achievements at Vinca, Rudd was named
Utah's 1999  Entrepreneur of the Year. Vinca was acquired by Legato Systems Inc.
of Palo Alto, California (NASDAQ: LGTO) on July 31, 1999.

         In addition to building Vinca  Corporation  into a market leader,  Rudd
spent ten years in senior management  positions at Novell Inc.. His positions at
Novell  included  Legal  Counsel,  Regional  Manager,  Area  Director  and  Vice
President of OEM Operations.

         Rudd has a bachelor's degree in business administration and finance and
a juris doctorate from Brigham Young University.  Following law school, he spent
seven years as in-house legal counsel for several corporations,  including State
Farm  Insurance  and Prime  Computer,  before  joining  Novell and  moving  into
corporate management.

         RICHARD  HOLLAND joined the Company as a director and Vice President in
November 2000 and has been  President of the Company  since April 2001.  Holland
was formerly president and co-founder of Ensign Information Systems and has been
designing and developing cutting-edge technology systems for more than 23 years.
As co-founder of Ensign,  Holland was the chief system  architect of their fully
integrated business management software that has improved  communications within
organizations  to  improve  customer  relationships  and  profitability.  Before
starting   Ensign  in  1994,   Holland  was  the  national   sales  manager  for
Cars/Dyatron,  a specialist in General Motors dealership software,  from 1980 to
1994.  Under his  leadership,  sales  increased  more than 240% over a  two-year
period.  Prior to working at  Cars/Dyatron,  he was general  manager of Advanced
Computer  Systems (ACS), the first company to introduce IBM PC-based systems for
the automotive dealer industry.

         Holland has a bachelor of science  degree in tax accounting and finance
from the University of Utah. He is also a Certified IBM Professional.

                                       2
<PAGE>

         BRYAN  ALLEN is  outside  counsel  to the  Company  and has  served  as
director of the Company since August 2000. Allen is a partner at the law firm of
Stoel Rives LLP in Salt Lake City,  Utah, where he advises clients on corporate,
securities, acquisition and other business matters. Prior to joining Stoel Rives
LLP in October 2000,  Allen was a  shareholder  at the law firm of Parr Waddoups
Brown Gee & Loveless in Salt Lake City, Utah. Allen is presently the Chairman of
the Securities  Section of the Utah State Bar. Allen received bachelors degrees,
summa cum laude,  from the University of Utah in economics and Chinese  studies,
received a masters degree in religion, cum laude, from the Yale Divinity School,
and received his Juris Doctorate from Yale Law School.

Executive Officers and Key Employees

         In addition to Messrs.  Rudd and  Holland,  whose  biographies  are set
forth above, certain biographical information is furnished below with respect to
the  following  executive  officers  and key  employees  of the  Company and its
subsidiaries:
<TABLE>
<CAPTION>

              Name                        Age                       Position                       Officer Since
----------------------------------     -----------    -------------------------------------     ---------------------
<S>                                        <C>       <C>                                        <C>
Steve Russo                                46         Vice President of Operations, Chief       February 2000
                                                      Financial Officer

Jeffrey Swain                              46         Vice President of Sales                   February 2000

Blake Nielson                              44         Vice President - Client Services          November 2000

David Jenkins                              48         Vice President - Marketing                March 2000
</TABLE>


         STEPHEN L. RUSSO,  has been the Vice  President of  Operations  and the
Chief  Financial  Officer of the Company since  February 2000. He is a certified
public accountant, and his education and experience in accounting and operations
span more than 19 years and include  expertise  in financial  system  design and
implementation  with  significant  experience in SEC disclosure and  compliance.
From October 1992 to October 1999,  Russo served as vice president of operations
and chief financial officer of Vinca Corporation. From September 1989 to October
1992,  Russo  served as president of  Merisoft,  a high-tech  voice  recognition
company.  Russo  received  a bachelor  of  science  degree  from  Brigham  Young
University in accounting.

         JEFFREY L.  SWAIN,  has been Vice  President  of Sales for the  Company
since February 2000.  Swain brings more than fourteen years of sales  experience
in the network  computing  industry,  having served as director of channel sales
for Legato  Systems,  Inc.,  a leader in  enterprise  storage  management,  from
January 1998 to February 2000.  While at Legato,  Swain increased  channel sales
over 40% in less than six  months.  From April 1996 to December  1997,  he was a
Major Market Account Manager for Informix in the Southeastern  region.  Prior to
working at Informix,  Swain was the State and Local  Government  National  Sales
Manager  for  Novell  from July 1994 to April  1996.  He  started  his career at
WordPerfect  Corporation,  where he served in a variety of  positions  including
Sales Manager for the  Washington  D.C.  region.  Swain  attended  Brigham Young
University with an emphasis in Business Management and Psychology.

         BLAKE  NIELSON,  has been the Vice  President--Client  Services  of the
Company since November 2000. Nielson was a founder of Ensign Information Systems
and brings over 14 years of experience in client services with other  automotive
industry related companies.  Before becoming part of the Company, Nielson worked
as vice  president  of  operations  at Ensign  Information  Systems  for 1994 to

                                       3
<PAGE>

November 2000. Before founding Ensign in 1994, Nielson was the regional director
of client  services for Sunguard  Business  System  beginning in 1992.  Prior to
Sunguard,  Nielson was head of client services at Advanced Computer Systems from
1990 to 1992.

         Nielson has a Bachelor of Science degree from Brigham Young  University
in Financial Planning and an AS/400 Certified Specialist.  He also served on the
Internal Revenue Service Technology Committee for one term.

         DAVID D. JENKINS,  has been Vice  President of Marketing at the Company
since  March 2000.  Prior to joining Arkona,  Jenkins managed the  multi-million
dollar OEM sales  relationship with Novell at both Legato and Vinca Corporation.
He was instrumental in increasing revenue from Novell during his tenure. Jenkins
has also had experience  selling  software to many large worldwide  corporations
including  US  Air,  Northwest   Airlines,   Martin  Marietta,   Jet  Propulsion
Laboratories, Luxor Hotel and Casinos and 3Com Corporation.

         Jenkins has a bachelor of science degree from Utah State  University in
French and history and a masters of business  administration  from Brigham Young
University.

Meetings and Committees

         During the fiscal year ended  March 31,  2004,  our Board of  Directors
(the "Board") held 3 formal  meetings and met  informally on numerous  occasions
and then approved relevant matters by written consent.  All incumbent  directors
attended at least 75% of all board meetings and applicable committee meetings.

         The entire Board,  consisting of Alan Rudd,  Richard  Holland and Bryan
Allen, serves as the audit committee of the Company.  None of the members of the
audit  committee  satisfy  the  independence  requirements  applicable  to audit
committees of listed companies.  In addition,  the Board has determined that the
audit  committee  does  not  have a  member  qualifying  as an  audit  committee
financial  expert, as defined in Item 401(h) of Regulation S-B. In order to save
limited  capital  over the last  several  years,  the  Company has chosen not to
expand the size of its Board or offer cash  compensation  to its directors.  The
absence of cash  compensation  makes  recruiting  persons that are not otherwise
interested in the Company more  difficult.  For these reasons,  the Company does
not  have on its  Board a  person  that  would  qualify  as an  audit  committee
financial expert. Now that the Company has reported net income for a full fiscal
year and is preparing for the  possibility of applying for listing on the Nasdaq
SmallCap  Market or the American Stock  Exchange,  the Company expects to expand
its Board to  include  additional  independent  directors  and,  as part of that
process,  may recruit a person that  qualifies as an audit  committee  financial
expert.

         The Company does not presently have a standing nominating  committee or
compensation committee. The Company does not have a nominating committee charter
or a compensation committee charter.

Director Compensation.

         Directors  who are not  officers  of the  Company  do not  receive  any
regular compensation for their service on the board of directors,  and directors
who are officers of the Company  receive no  additional  compensation  for their
service  as a  director  of the  Company.  Directors  are  entitled  to  receive
compensation for services unrelated to their service as a director to the extent
that  they  provide  such  unrelated  services  to  the  Company.  See  "Certain
Relationships and Related Transactions."

                                       4
<PAGE>

         Directors  of  the  Company  and  its   subsidiaries  are  entitled  to
participate in the Company's stock incentive plan.  During the fiscal year ended
March 31, 2004,  the Company  granted  options to purchase  90,000 shares of its
Common Stock to Bryan Allen and options to purchase  1,200,000  shares of Common
Stock to Richard Holland.

Section 16(A) Beneficial Ownership Reporting Compliance

         Section  16(a) of the  Securities  Exchange  Act of 1934  requires  the
Company's executive officers and directors,  as well as persons who beneficially
own more than ten  percent  of the  Common  Stock,  to file  initial  reports of
ownership and reports of changes in ownership  with the  Securities and Exchange
Commission ("SEC"). Reporting persons are required by SEC regulations to furnish
the Company with copies of all Section 16(a) forms they file.  Based solely on a
review  of the  copies of such  forms  furnished  to the  Company,  the  Company
believes  that no forms other than the  following  were  delinquent  or were not
filed  during  the most  recent  fiscal  year or prior  years (to the extent not
previously disclosed):  Richard Holland,  President and director of the Company,
has exercised  100,000  options to purchase Common Stock at various times during
calendar 2004, and the Company believes Mr. Holland has resold the shares issues
upon exercise of such options.  Mr.  Holland has not filed a Form 4 with respect
to such transactions.

Code of Ethics

         The Company has  adopted the Arkona Code of Ethics and  Conduct,  which
constitutes  a code of ethics that applies to the principal  executive  officer,
principal  financial officer,  principal  accounting  officer or controller,  or
persons performing  similar functions,  as defined in Item 406 of Regulation S-K
under the Securities  Exchange Act of 1934. The Company intends to post the Code
of Ethics and Conduct and any  amendments  to or waivers from the Code Ethics on
our website at www.arkona.com.

Item 10.  Executive Compensation

Summary Compensation Table

         The following table summarizes the compensation  paid or accrued by the
Company to or on behalf of the Company's Chief Executive Officer, as well as the
four most highly  compensated  executive officers of the Company whose aggregate
compensation  for the  fiscal  year  ended  March  31,  2004  exceeded  $100,000
(collectively, the "Named Executive Officers").



                                       5
<PAGE>
<TABLE>
<CAPTION>

                                                                                      Long Term Compensation
                                                                              ------------------------------------
                                           Annual Compensation                Awards                       Payouts
                                           ---------------------------------  ------                       -------
                                                                    Other                    Securities
                                                                    Annual     Restricted    Underlying                  All Other
                                                                   Compen-       Stock        Options/        LTIP        Compen-
Name and                                     Salary      Bonus    sation(1)     Award(s)        SARs         Payouts       sation
Principal Position               Year         ($)         ($)        ($)          ($)            (#)           ($)          ($)
----------------------------- ------------ ----------- ---------- ----------- ------------- -------------- ------------ ------------
<S>                           <C>          <C>         <C>        <C>           <C>            <C>         <C>           <C>
Alan Rudd, Chief Executive    03/31/04        215,625         --          --            --        250,000           --         --
Officer and Chairman of the   03/31/03        195,750         --          --            --         70,000           --         --
Board                         03/31/02     221,250(1)         --  323,195(2)            --             --           --         --

Richard Holland, President    03/31/04        172,500         --          --            --      1,200,000           --         --
and Director                  03/31/03        171,250         --          --            --             --           --         --
                              03/31/02        170,000         --          --            --      1,200,000           --         --

Stephen L. Russo, Vice        03/31/04        137,750         --          --            --        100,000           --         --
President of Operations and   03/31/03        136,083         --          --            --         70,000           --         --
Chief Financial Officer       03/31/02        130,000         --          --            --        350,000           --         --

Jeffery Swain, Vice           03/31/04        151,041         --          --            --        100,000           --         --
President of Strategic        03/31/03        151,240         --          --            --         70,000           --         --
Relations                     03/31/02        147,500         --          --            --        275,000           --         --

Blake Nielson, Vice           03/31/04        123,333         --          --            --        250,000           --         --
President of Customer         03/31/03        115,000         --          --            --             --           --         --
Service                       03/31/02        125,249         --          --            --        250,000           --         --
</TABLE>
------------------------
(1)  Includes  $90,000 in salary that was  deferred due to a shortage in working
capital.

(2) Represents  the difference  between the purchase price paid by Mr. Rudd, and
the fair market value,  of shares of Common Stock purchased by Mr. Rudd from the
Company. Such shares were acquired upon the conversion of convertible notes. The
financing  underlying the convertible notes was provided at a time when no other
financing was available to meet short term capital needs of the Company.

                                       6
<PAGE>
Option Grants in Last Fiscal Year

         The following table sets forth-individual  grants of options to acquire
shares of Common  Stock  made by the  Company  to the Named  Executive  Officers
during the fiscal year ended March 31,  2004.  No SARs were granted to any Named
Executive Officer during the fiscal year ended March 31, 2004.
<TABLE>
<CAPTION>


                                      Number of         Percent of Total
                                     Securities        Options Granted to
                                 Underlying Options    Employees in Fiscal
         Name                         Granted                Year              Exercise Price           Expiration Date
------------------------------   ------------------    -------------------     --------------           ---------------
<S>                              <C>                   <C>                     <C>                      <C>
Alan Rudd, Chief Executive
Officer and Chairman of the            250,000                 8%                    $0.20                June 30, 2013
Board

Richard Holland, President and
Director                              1,200,000                41%                   $0.20                June 30, 2013

Stephen L. Russo, Vice
President of Operations and            100,000                 3%                    $0.20                June 30, 2013
Chief Financial Officer

Jeffery Swain, Vice President
of Strategic Relations                 100,000                 3%                    $0.20                June 30, 2013

Blake Nielson, Vice President
of Customer Service                    250,000                 8%                    $0.20                June 30, 2013
</TABLE>

(1)      Such options become exercisable 40% on 6/30/2004,  30% on 6/30/2005 and
         the remainder on 6/30/2006.

                                       7
<PAGE>
Aggregated Option Exercises and Fiscal Year-End Option Values

         The following table provides information  regarding options held by the
Named  Executive  Officers as of March 31, 2004 and  options  exercised  by them
during the year ended March 31, 2004:
<TABLE>
<CAPTION>
                                                         Number of Securities
                                                    Underlying Unexercised Options           Value of Unexercised
                                                                  at                       In-the-money Options at
                        Securities     Aggregate            March 31, 2004                    March 31, 2004(*)
  Name and Position    Acquired on       Value
                         Exercise      Realized       Exercisable   Unexercisable         Exercisable       Unexercisable
  Name and Position        (#)            ($)             (#)              (#)                ($)                ($)
---------------------- ------------- --------------  -------------- ----------------- -------------------- ----------------
<S>                    <C>           <C>              <C>              <C>                <C>                 <C>
Alan Rudd, Chief            -              -          (1)70,000        250,000            (1)25,200           115,000
Executive Officer
and Chairman of the
Board

Richard Holland,         100,000        34,331         320,000        1,380,000            115,200            614,800
President and                                        (1)420,000       (1)180,000         (1)151,200          (1)64,800
Director

Stephen L. Russo,           -              -           35,000          115,000             12,600             51,000
Vice President of                                    (1)520,000                          (1)187,200
Operations and Chief
Financial Officer

Jeffery Swain, Vice         -              -           227,500         197,500             81,900             81,100
President of                                         (1)145,000                           (1)52,200
Strategic Relations

Blake Nielson, Vice         -              -           175,000         325,000             63,000             127,000
President of
Customer Service
</TABLE>
* On March 31,  2004,  the closing sale price for a share of our Common Stock on
the OTC Bulletin Board was $0.66

(1)  Represent  options  to  purchase  outstanding  Common  Stock  held  by  key
shareholders  of the  Company.  The  Company  will not be  required to issue any
additional shares if such options are exercised.

Employment Agreements and Change of Control Arrangements

         In  connection  with the  purchase of the assets of Ensign  Information
Systems in November 2000, the Company entered into an employment  agreement with
Richard  Holland,  currently the President of the Company.  Under the employment
agreement,  Mr. Holland is entitled to receive base compensation of $150,000 per
year, a target bonus of $20,000 and such additional compensation as the Board of
Directors  may deem  appropriate.  The fixed term of the  agreement has expired;
however, parts of the agreement,  including the confidentiality,  noncompetition
and   invention-ownership   provisions,   continue   to  govern  Mr.   Holland's
relationship with the Company.

         In  connection  with the  purchase of the assets of Ensign  Information
Systems in November 2000, the Company entered into an employment  agreement with
Blake Nielson,  currently the Vice President of Customer Service of the Company.
Under the  employment  agreement,  Mr.  Nielson  is  entitled  to  receive  base
compensation of $120,000 per year, a target bonus of $20,000 and such additional
compensation as the Board of Directors may deem  appropriate.  The fixed term of


                                       8
<PAGE>
the  agreement  has expired;  however,  parts of the  agreement,  including  the
confidentiality,  noncompetition and invention-ownership provisions, continue to
govern Mr. Nielson's relationship with the Company.

Item 11.   Security Ownership of Certain Beneficial Owners and Management

Securities Authorized for Issuance Under Equity Compensation Plans

         Set forth below is certain information, as of March 31, 2004, about the
number of shares of Common Stock  subject to options,  warrants and other rights
granted,  or that  may be  granted,  under  compensation  plans  adopted  by the
Company.
<TABLE>
<CAPTION>
                                                                                      Number of securities
                                                                                    remaining available for
                              Number of securities to       Weighted-average         future issuance under
                              be issued upon exercise       exercise price of      equity compensation plans
                              of outstanding options,     outstanding options,       (excluding securities
       Plan category            warrants and rights        warrants and rights      reflected in column (a))
---------------------------  -------------------------  -------------------------  --------------------------
                                        (a)                        (b)                        (c)
<S>                                <C>                            <C>                     <C>
Equity compensation plans
  approved by security
  holders(1)(2)                    5,105,000(3)                   $0.30                   3,795,000(3)

Equity compensation plans
  not approved by security
  holders                               Nil                        Nil                        Nil

Total                              5,105,000(3)                   $0.30                   3,795,000(3)
</TABLE>
         (1) Other than options  with respect to 115,000  shares of Common Stock
granted  under the Company's  1992 stock option plan (which has been  terminated
other than with  respect to such  options),  all  options,  warrants  and rights
identified in this table  represent  options,  warrants and rights  granted,  or
available for grant under our 2001 Stock Incentive Plan, as amended.

         (2) Does not include secondary options with respect to 1,550,000 shares
of our  Common  Stock  granted  to our  officers,  directors  and  employees  by
shareholders  of the Company.  In 1999,  certain  founding  shareholders  of our
company entered into an agreement with Caldera Holding Company,  L.C., an entity
which is independent of Arkona, pursuant to which Caldera was given the right to
grant  secondary  options to third  parties with respect to 1,550,000  shares of
Common  Stock owned by the founders in order to encourage  the  development  and
increased  productivity of Arkona.  Under the agreement  between Caldera and the
founders,  the secondary  options are required to have an exercise price of $.30
per share and expire no later than December 31, 2006.  Because these options are
granted by shareholders of the Company with respect to outstanding  stock,  upon
the  exercise of these  options,  the Company  will not receive any proceeds and
will not issue any additional shares of Common Stock.

Security Ownership Of Certain Beneficial Owners And Management

         The table below sets forth information,  as of July 15, 2004 as to each
person who  beneficially  owns more than 5% of our  outstanding  Common Stock or
Series B Preferred  Stock,  and  information  as to the  ownership of our Common
Stock or Series B Preferred  Stock by each person serving as a director or Named
Executive  Officer  of  the  Company  as of  March  31,  2004  and by all of our
directors and executive  officers as a group.  Except as otherwise  indicated in
the  footnotes  to this table,  all shares are owned  directly,  and the persons
named in the table have sole voting and investment  power with respect to shares
shown as beneficially being owned by them.

                                       9
<PAGE>
<TABLE>
<CAPTION>

                                                                                 Beneficial Ownership of
                                   Beneficial Ownership of Common Stock          Series B Preferred Stock
                                   ------------------------------------    ---------------------------------
                                   Ownership Amount                        Ownership Amount
                                     and Nature of                           and Nature of
                                      Beneficial          Percentage          Beneficial        Percentage
           Name                      Ownership(1)        Ownership(2)        Ownership(1)      Ownership(2)
---------------------------------- ------------------    --------------    -----------------   -------------
      Name and Address of
Executive Officers and Directors
---------------------------------
<S>                                  <C>                   <C>             <C>                 <C>
Alan Rudd  (Chief Executive
Officer and Director)
10542 South Jordan Gateway
South Jordan, Utah   84095           8,170,190(4)          26%(4)              Nil               N/A

Richard Holland (President and
Director)
10542 South Jordan Gateway
South Jordan, Utah   84095           1,420,000(5)         4.5%(5)              Nil               N/A

Bryan Allen (Director)
201 South Main Street
Suite 1100
Salt Lake City, UT  84111              88,000(6)             *                 Nil               N/A

Blake Nielson (VP - Client
Services)
10542 South Jordan Gateway
South Jordan, Utah   84095            528,000(7)            1.6%               Nil               N/A

Stephen Russo ( VP-Operations
and CFO)
10542 South Jordan Gateway
South Jordan, Utah   84095            595,000(8)            1.8%               Nil               N/A

Jeffrey Swain (VP-Sales)
10542 South Jordan Gateway
South Jordan, Utah   84095            412,500(9)            1.3%               Nil               N/A

All officers  and  directors as a
group (8 persons)                     11,498,940           36.7%               Nil               N/A

5% Shareholders
(Who are not Executive Officers
or Directors)

Paul Henriod
1835 Laird Avenue
Salt Lake City, Utah  84108          2,924,240(10)        9.3%(10)             Nil               N/A

Caldera Holdings LLC
36 South State St.
Suite 2000
Salt Lake City, UT 84111             1,550,000(11)        4.9%(11)             Nil               N/A

Larry Battison
PO Box 1465
Duncan, OK  73534                         Nil               N/A              50,000              8.6%
</TABLE>
                                       10
<PAGE>
<TABLE>
<CAPTION>
                                                                                 Beneficial Ownership of
                                   Beneficial Ownership of Common Stock          Series B Preferred Stock
                                   ------------------------------------    ---------------------------------
                                   Ownership Amount                        Ownership Amount
                                     and Nature of                           and Nature of
                                      Beneficial          Percentage          Beneficial        Percentage
           Name                      Ownership(1)        Ownership(2)        Ownership(1)      Ownership(2)
---------------------------------- ------------------    --------------    -----------------   -------------
<S>                                  <C>                   <C>             <C>                 <C>
B. Joe Clayton
4600 Clinton Hwy
Knoxville, TN  37912                      Nil               N/A              50,000              8.6%

Chapman Automotive Group
6601 East McDowell Road
Scottsdale, AZ  85257                     Nil               N/A              50,000              8.6%

Donald Ray Herring
4225 W. Plano Parkway
Plano, TX  75093                          Nil               N/A              50,000              8.6%

Anne K. Swope
1100 North Dixie
Elizabethtown, KY  42701                  Nil               N/A              75,000              13%

Robert Woodhouse
2171 S. Hwy 30
Blair, NE  68008                          Nil               N/A              50,000              8.6%

Lance Pittack
Box 546
Blair, NE  68008                          Nil               N/A              50,000              8.6%

Paul Cech
Box 546
Blair, NE  68008                          Nil               N/A              50,000              8.6%

H2 Land Trust
Box 467
Pontiac, IL  61764                        Nil               N/A              75,000              13%
</TABLE>
* Indicates the ownership of less than 1% of the outstanding Common Stock.
---------------------------
(1)  Beneficial  ownership for each person  holding  options,  warrants or other
rights exercisable within 60 days of July 15, 2004 has been calculated as though
shares of Common Stock or Series B Preferred  Stock,  as applicable,  subject to
such options,  warrants or other rights were  outstanding,  but such shares have
not been deemed outstanding for the purpose of calculating the percentage of the
class owned by any other person.

(2) The  percentage  indicated  represents the number of shares of Common Stock,
together  with the  number of shares of Common  Stock  subject to  warrants  and
options  to  purchase  Common  Stock  exercisable  within  60  days  held by the
indicated  person  divided  by the sum of (a) the  number of shares  subject  to
options and warrants to purchase  Common Stock  exercisable by such  shareholder
within  60 days of July 15,  2004 and (b)  31,331,532,  which is the  number  of
shares of Common Stock issued and outstanding as of July 15, 2004.

(3) The  percentage  indicated  represents  the  number  of  shares  of Series B
Preferred  Stock held by the indicated  person divided by 575,000,  which is the
number of shares of Series B Preferred  Stock issued and  outstanding as of July
15, 2004.
                                       11
<PAGE>

(4) Includes 100,000 options granted under the Company's incentive plan that are
exercisable within 60 days of the date of the table, and includes 70,000 options
granted to Mr. Rudd by Caldera that are  exercisable  within 60 days of the date
of the table,  and  includes  940,000  warrants to purchase  Common  Stock.  See
"Certain Relationships and Related Transactions."

(5) Includes 800,000 options granted under the Company's incentive plan that are
exercisable within 60 days of the date of the table and includes 420,000 options
granted to Mr.  Holland by Caldera  that are  exercisable  within 60 days of the
date of the table. See "Certain Relationships and Related Transactions."

(6) Includes 88,000 options granted under the Company's  incentive plan that are
exercisable within 60 days of the date of the table.

(7) Includes 275,000 options granted under the Company's incentive plan that are
exercisable within 60 days of the date of the table.

(8) Includes 75,000 options granted under the Company's  incentive plan that are
exercisable within 60 days of the date of the table and includes 520,000 options
granted to Mr. Russo by Caldera that are exercisable  within 60 days of the date
of the table. See "Certain Relationships and Related Transactions."

(9) Includes 267,500 options granted under the Company's incentive plan that are
exercisable within 60 days of the date of the table and includes 145,000 options
granted to Mr. Swain by Caldera that are exercisable  within 60 days of the date
of the table. See "Certain Relationships and Related Transactions."

(10)  Includes  warrants to  purchase  909,090  shares of Common  Stock that are
exercisable within 60 days of the date of the table.

(11) Caldera  became  beneficial  owner of such shares  pursuant to an agreement
with  certain  founding  shareholders  of the  Company  described  in this Proxy
Statement under the heading "Certain  Relationships  And Related  Transactions."
Although  Caldera does not have the right to receive any  dividends or financial
benefits associated with such shares, Caldera is considered the beneficial owner
of the shares subject to its agreement with the founding shareholders because it
has dispositive power and voting power with respect thereto.

Item 12.  Certain Relationships and Related Transactions

         During the six month ended  September  30,  2003,  the  Company  raised
$575,000  by selling  575,000  shares of Series B  Preferred  Stock at $1.00 per
share to a group of 13 investors.  This group  included Larry  Battison,  B. Joe
Clayton,  Chapman Automotive Group,  Donald Ray Herring,  Anne K. Swope,  Robert
Woodhouse,  Lance Pittack, Paul Cech and H2 Land Trust, each of which, following
the purchase, beneficially owned 5% or more of the Company's 575,000 outstanding
shares of Series B Preferred Stock.

         Each  share of  Series B  Preferred  Stock is  convertible  to five (5)
common shares at the option of the preferred shareholder. Each share of Series B
Preferred  Stock  receives the same dividends as Common Stock on an as converted
basis.  Shares of Series B Preferred Stock carry a liquidation  preference equal
to the price per share of Series B  Preferred  Stock,  plus  accrued  and unpaid
dividends on each share. In the event of a liquidation,  the balance of proceeds
is paid to the holders of the Common Stock.  A merger,  reorganization  or other
transaction  in which  control  of the  Company is  transferred  is treated as a
liquidation.  If not earlier  converted  into Common  Stock,  shares of Series B
Preferred  Stock are redeemable with 30 days advance notice at the option of the
Company after June 30, 2008.  Each share of Series B Preferred Stock has one (1)
vote and votes together as a class with Common Stock,  except that the shares of
Series B Preferred  Stock vote  separately as a class for (i) any adverse change
to the rights,  preferences and privileges of the Series B Preferred Stock, (ii)
any  increase  or  decrease  in the  number  of  authorized  shares  of Series B
Preferred Stock.
                                       12
<PAGE>

         Certain  founding  shareholders of the Company obtained Common Stock in
return for contributions and development of the Company's  predecessor,  Arkona,
L.L.C.,  which  was  subsequently  merged  into  the  Company.   These  founding
shareholders  received  a total of  7,000,000  shares of Common  Stock and then,
collectively,  entered into an agreement  with Caldera  Holding  Company,  L.C.,
wherein Caldera was given the right to grant secondary  options to third parties
with respect to 3,761,500  (subsequently reduced to 1,550,000) of such shares in
order to encourage the  development  and increased  productivity of the Company.
Holders of the shares underlying the secondary options are entitled to dividends
and  distributions  with respect to such shares until the options are exercised.
However,  Caldera has been granted  dispositive voting power with respect to all
shares  subject to its agreement with the founding  shareholders  so long as the
agreement  remains in place.  The right of Caldera  to grant  secondary  options
expired in January 2003;  however,  Caldera retains voting power with respect to
the underlying  shares. The secondary options have an exercise price of $.30 per
share and are required to expire prior to December 31, 2006. As an inducement to
the  officers of Arkona to join the Company,  Caldera has granted the  following
officers the number of secondary options following each of their names:  Richard
Holland  (600,000),  Alan Rudd (70,000),  Steve Russo (520,000),  and Jeff Swain
(145,000).

         Bryan Allen, Director, is a partner at the law firm of Stoel Rives LLP.
Mr. Allen  provides  legal  services to the Company when, if and as requested by
the Company.  During each of the fiscal years ended March 31, 2003 and March 31,
2004,  Stoel  Rives  billed the Company  for  approximately  $24,262 and $34,282
respectively in legal services.

         During  the 2003 and 2002  fiscal  years,  Alan Rudd,  Chief  Executive
Officer and director, loaned the Company an aggregate of $150,000 at an interest
rate of 12% per annum.  Outstanding  principal  and  interest on such loans were
convertible  into units,  comprised of one share of Common Stock and one warrant
to  purchase  Common  Stock at an  exercise  price of $.20 per share  during the
five-year period  following  issuance,  at a rate of $0.20 per unit.  During the
fiscal year ended March 31, 2004, Mr. Rudd converted all  outstanding  principal
and  interest  under such loans into an  aggregate  of 940,000  shares of Common
Stock and 940,000 warrants to purchase Common Stock.

         On July 14, 2004, the Company  granted options to purchase Common Stock
to the following  executive  officers:  Stephen Russo  (105,000),  Jeffrey Swain
(130,000)  and Blake  Nielson  (100,000).  All such options vest 40% on July 14,
2005,  30% on July 14, 2006 and 30% on July 14, 2007,  have an exercise price of
$0.30 per share and are exercisable at any time prior to July 14, 2014.

Item 14.  Principal Accountant Fees and Services

Independent Auditors

         The Company's  independent  auditor for the fiscal year ended March 31,
2004 was Mantyla McReynolds, a Professional Corporation ("Mantyla McReynolds").

Audit Fees

         The  aggregate  fees for  professional  services  rendered  by  Mantyla
McReynolds in connection with its audit of the Company's  consolidated financial
statements and reviews of the consolidated  financial statements included in the
Company's  Quarterly  Reports on Form  10-QSB  were  $13,194 for the fiscal year
ended March 31, 2004 and $13,710 for the fiscal year ended March 31, 2003.

Audit Related Fees

         Except as disclosed  under "Audit Fees" above,  Mantyla  McReynolds did
not provide to the Company any  audit-related  services  during the fiscal years
ended March 31, 2004 and March 31, 2003.

                                       13
<PAGE>

Tax Fees

         The aggregate  fee for tax related  professional  services  rendered by
Mantyla McReynolds during the fiscal year ended March 31, 2004 is expected to be
approximately $2,190 and the aggregate fee for tax related professional services
rendered by Mantyla  McReynolds  during the fiscal year ended March 31, 2003 was
$2,193.

All Other Fees

         Mantyla  McReynolds  did not provide to the Company any other  services
during the fiscal years ended March 31, 2004 and March 31, 2003.

Audit Committee Pre-Approval Policies

         The  Board,  acting  as  the  audit  committee,   has  not  established
pre-approval policies and procedures that would permit engagement of accountants
to render audit or non-audit  services without prior approval of the Board. As a
result, all engagements of the independent auditors to render audit or not audit
services require  pre-approval of the Board. No audit, review or attest services
were  approved in accordance  with Section  2-01(c)(7)(i)(C)  of Regulation  S-X
during the fiscal  year ended  March 31, 2004 or the fiscal year ended March 31,
2003.

                                       14
<PAGE>

                                   SIGNATURES

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

                                ARKONA, INC.


                                By:       /s/   Alan Rudd
                                     ---------------------------------------
                                         Alan Rudd
                                         Chief Executive Officer


Date: July 28, 2004



                                       15