SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549
                             Form 10-KSB/A (Amended)



[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 for the fiscal year ended December 31, 1996.

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 for the transition period from to


Commission File No. 0-17874


                                  XPLORER, S.A.
           (Name of small business issuer as specified in its charter)


           Nevada                                              88-0199674
-------------------------------                            -----------------
(State or other jurisdiction of                             (I.R.S. Employer
 incorporation or organization)                            Identification No.)

     4750 Kelso Creek Road, Weldon, California                    93238
     -----------------------------------------                 ----------
      (Address of principal executive offices)                 (Zip Code)

Issuer's telephone number, including area code:  (619) 378-3936

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

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

Common Stock, $.001 par value.

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  preceding 12 months (or
for such shorter  period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. 
YES [  ] NO [ X ]



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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. [ ]

Revenues for the fiscal year ended December 31, 1996 totaled -0-.

As of December 31, 1996, the aggregate  market value of the voting stock held by
non-affiliates  of the registrant (based upon the average of the closing bid and
asked prices on such date) was approximately $-0-. (Not Trading.)

As of May 30, 1997, the registrant had outstanding  18,782,445  shares of Common
Stock.

Transitional Small Business Disclosure Format:  [   ] Yes   [ X ] No

Exhibit index page number: 24-25
Total sequentially numbered pages in this document: 45



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                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

Introduction

The Registrant was incorporated  under the laws of the State of Nevada on May 2,
1984.  Effective  December 18, 1992, the  Registrant  changed its name from L.A.
Entertainment,  Inc.  to  Gerant  Industries,  Inc.  On  March 1,  1994,  Gerant
Industries,  Inc.  filed a petition for  reorganization  under Chapter 11 of the
United  States  Bankruptcy  Code in the United States  Bankruptcy  Court for the
Central    District   of   California.    The    Registrant    operated   as   a
debtor-in-possession  until the United States  Bankruptcy Court entered an order
confirming the Registrant's Third Amended Plan of Reorganization (the "Plan") on
July 24, 1996, and the Plan became  effective August 5, 1996. In accordance with
the Plan,  Restated  Articles of Incorporation  were filed with the Secretary of
State of Nevada in August,  1996,  changing  the  Registrant's  name from Gerant
Industries, Inc. to XPLORER, S.A. ("XPLORER" or the "Company").

Included  in the Plan was the  valuation  utilized  by  Atlantic  Pacific  Trust
("APT") for its gold ore reserves.  These values are based upon a  comprehensive
geological  reserve study  conducted by Christopher L. Pratt,  Geologist,  which
said report was updated December 31, 1996.

Pursuant to the Plan, certain holders of Units of Beneficial  Interest ("UBI's")
in the Atlantic  Pacific Trust,  LLC,  formerly  Atlantic  Pacific Trust ("APT")
exchanged  417,240 UBI's on August 5, 1996,  the effective date of the Plan, for
1,043,000  shares of Preferred Stock of XPLORER.  APT had provided the necessary
capital  and  arranged  loans for the  successful  completion  of the Plan.  The
Managers of APT are also officers and directors of the Company.  See  "Conflicts
of Interest."

Additionally,  APT holders of  approximately  $29,278,000  face value of XPLORER
Debtor Notes converted their XPLORER Debtor Notes into approximately  14,639,750
shares of XPLORER Common Stock. Furthermore, holders of securities in the Debtor
shared pro rata in a distribution  of 400,000 Units  consisting of one (1) share
of XPLORER's  Common Stock and one (1) Class A Warrant  entitling  the holder to
purchase  one (1) share of  XPLORER's  Common  Stock one year from the August 5,
1996 effective date of the Plan, at 70% of the market asking price. Such Warrant
must be exercised within 30 days of August 5, 1997.  Pursuant to Section 1143 of
the United  States  Bankruptcy  Code,  interest  holders  must  surrender  their
certificates  representing  the  securities of the Debtor within one (1) year of
the  Confirmation  Date of the Plan as a condition to receiving  the  securities
pursuant to the Plan. Certain other classes of creditors were given the right to
elect common shares of XPLORER in lieu of cash in satisfaction of their claims.

In November,  1996, the Company  acquired an additional  189,960 UBI's of APT in
exchange for 237,550  shares of its  Preferred  Stock.  Currently,  XPLORER owns
59.16% of APT.



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The Company's  principal executive offices are located at 4750 Kelso Creek Road,
Weldon, California 93282, and its telephone number is (619) 378-3936.


CAUTIONARY "SAFE HARBOR" STATEMENT UNDER THE UNITED STATES
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.

With the exception of historical  matters,  the matters discussed in this report
are forward- looking  statements that involve risks and uncertainties that could
cause actual results to differ  materially  from targeted or projected  results.
Such  forward-looking  statements include statements  regarding targets for gold
production, cash operating costs and certain significant expenses, schedules for
completion  of detailed  feasibility  studies and initial  feasibility  studies,
potential  increases in reserves and production,  the timing and scope of future
drilling and other  exploration  activities,  expectations  regarding receipt of
permits and commencement of mining or production, anticipated recovery rates and
potential  acquisitions or increases in property  interests.  Factors that could
cause actual results to differ materially include, among others, changes in gold
and  other  mineral  prices,  unanticipated  grade,  geological,  metallurgical,
processing,  access,  transportation  of supplies or other problems,  results of
current  exploration  activities,  results  of pending  and  future  feasibility
studies,  changes  in  project  parameters  as  plans  continue  to be  refined,
political, economic and operational risks of foreign operations, availability of
materials and equipment,  the timing of receipt of governmental  permits,  force
majeure  events,  the failure of plant,  equipment  or  processes  to operate in
accordance with  specifications  or  expectations,  accidents,  labor relations,
delays  in  start-up  dates,  environmental  costs and  risks,  the  outcome  of
acquisition  negotiations  and general domestic and  international  economic and
political  conditions,  as well as  other  factors  described  herein  or in the
Company's  filings with the U.S.  Securities  and Exchange  Commission.  Many of
these  factors are beyond the Company's  ability to predict or control.  Readers
are cautioned not to put undue reliance on forward-looking statements. See "Risk
Factors" for items which could affect forward-looking statements.

General Business

Glossary

The following  terms are described to aid in  understanding  the Company's  Form
10-KSB.

CORE DRILLING (OR DRILL HOLE)--Drilling with a hollow diamond-studded bit to cut
out a solid rock core. A column of rock is  extracted  from inside the drill rod
for geological examination and assay.

GRADE--The  metal content of ore. With  precious  metals,  grade is expressed as
troy ounces per ton of ore.

KILO (KILOGRAM)--A measure of weight equal to 32.15 troy ounces.


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ORE  BODY--A  mineral  deposit  that can be mined  at a  profit  under  existing
economic conditions.

ORE RESERVES--The  tonnage and grade of an economically and legally  extractable
ore body.

OUNCE--Throughout  this report,  the term "ounce" is used as an abbreviation for
the troy ounce measure of weight.  The troy ounce has been used exclusively as a
previous metals measurement, probably since the 16th Century.

PROVEN ORE  RESERVES--"Proven  ore" or "measured  ore" means that material which
tonnage is  computed  from  dimensions  revealed  in  outcrops  or  trenches  or
underground workings or drill holes and for which the grade is computed from the
results of adequate sampling,  and for which sites for inspection,  sampling and
measurement are so spaced and the geological  character so well defined that the
size,  shape and mineral  content are  established,  and for which the  computed
tonnage and grade are judged to be accurate within limits which shall be stated.

PROBABLE ORE RESERVES--"Probable ore" or "indicated ore" means that material for
which tonnage and grade are computed partly from specific measurements,  samples
or production  data,  and partly from  projection  for a reasonable  distance on
geological  evidence,   and  for  which  the  sites  available  for  inspection,
measurement and sampling are too widely or otherwise  inappropriately  spaced to
outline the material completely or to establish its grade throughout.

TON--The short ton is used in this report. It is a unit of weight equal to 2,000
pounds, or 907.2 kilograms.

The  Company  is  a  development  stage  company.   Through  its  majority-owned
subsidiary,  APT,  the Company is engaged in the  acquisition,  exploration  and
development,  which will lead to operation and production of mineral properties.
Except  where  otherwise  noted,  the  "Company"   includes  its  majority-owned
subsidiary, APT.

As a result of a series of  transactions,  between  1993 and 1995,  APT acquired
eight  unpatented  mineral  claims  located  on  Piute  Mountain,  Kern  County,
California. This group of claims is commonly known as the Evening Star Mine. APT
also leases  approximately  95.45 acres of adjacent  property  containing  three
patented mining claims and the Weldon Research Center. See "Item 2.
Description of Property."

APT does,  and continues to,  finance its  exploration  and  development  of the
Evening  Star Mine through the sale and  issuance of its  securities  in private
transactions  and through the sale in Germany  and Austria of  Convertible  Gold
Bonds, 9% Investment  Certificates and gold certificates.  See "Item 1. Business
Financing."

To date, no gold or other precious metals have been mined  commercially from the
Evening Star Mine.  There has been extensive  development  work conducted in the
past,  including  underground and surface sampling.  The Evening Star Mine has a
nine-foot  wide and ten-foot  tall tunnel.  This tunnel cross cuts several small
veins and ore bodies.  The tunnel system is  approximately  1,650 feet in length
and is  approximately  380 feet below the surface.  The Evening Star Mine tunnel



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provides  access to the area where the ore has been  blocked  out  ("Proven  Ore
Reserves").  Proven Ore Reserves are determined  from exposure in  outcroppings,
cuts, pits, shafts,  mine workings,  drill holes or otherwise where measurements
are so closely  spaced that the  computed  tonnage and grades of ore will have a
high degree of accuracy.  Underground tunnel samples were taken every five feet.
The results of the  sampling  indicated  that the mine  contained  approximately
435,000 ounces of gold. The Company has  downgraded the  classification  of this
ore from Proven to Probable Ore Reserves.

Upon the  completion  of the Pilot  Plant,  feasibility  studies and  additional
drilling and sampling,  the Company will then upgrade the reserves from Probable
to  Proven  Ore  Reserves.  The 1996 ore  reserves  have  been  estimated  by an
independent company, Precious Metals Exploration. The reserves were estimated by
an  independent  geological  engineering   consultant,   Christopher  L.  Pratt,
President of Precious Metals Exploration.


Proposed Operations

In July, 1995, APT entered into an Operating  Agreement (the  "Agreement")  with
EMTEC,  L.L.C.  ("Emtec")  principally  owned by officers  and  directors of the
Company and Managers of APT.  See "Item 12.  Certain  Relationships  and Related
Transactions." In accordance with the Agreement,  Emtec will provide a full turn
key mining and refining  operation for the Evening Star Mine. APT will pay Emtec
all of its costs and expenses  plus 18% of same.  Costs are defined as all costs
directly  and  indirectly   related  to  Emtec  performing  its  duties  in  the
exploration,  development, production and support facilities of the Evening Star
Mine.  Through March 31, 1997, APT has paid Emtec $548,318 for its developmental
work in the Evening Star Mine.

The Registrant intends to develop its mining properties in two phases.

Phase I.

The  Registrant  will  continue  drilling  and  sampling to block out Proven and
Probable  Ore  Reserves.  A core  drilling  rig will be used in order to produce
approximately  1,000  feet of drill hole  weekly.  Due to  seasonal  conditions,
drilling will only be conducted for approximately 36 weeks annually.

The  Registrant  will  also  construct  a pilot  ore  processing  plant  ("Pilot
Refinery")  capable of processing up to two tons of ore per hour.  Included with
the Pilot Refinery will be the construction of all support facilities, including
laboratory, repair shops and storage bins.


                                                                   Page 6 of 45

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All  engineering  and permits  necessary for the operation of the Pilot Refinery
and for its expansion are planned to be completed  during Phase I. APT estimates
that Phase I will cost  between  $2.8 to $3.4 million and will take between nine
and 12 months to complete.  There is no assurance  that the Company will be able
to raise the required capital to complete Phase I.

Phase II.

After  the  Pilot  Refinery  is  operational  and gold and  other  minerals  are
successfully and cost effectively being processed, a larger ore processing plant
("Main  Refinery")  will be built.  Current plans provide for a Main Refinery to
process  anywhere from 125 to 250 tons of ore per day. The size and cost of such
Main Refinery is dependent upon several factors,  including a) test results from
the Pilot Refinery,  b) present and future Proven and Probable Ore Reserves that
have been blocked-out, and c) completion of a feasibility report.

Phase II  development  is estimated to cost between $6.8 to $10 million and will
take between 14 to 18 months after Phase I to complete.

There is no assurance that the  Registrant  will be able to raise the capital to
complete Phase I or, if Phase I is completed, to proceed with Phase II. To date,
the  Registrant's  primary funds for operations have come from the sale of bonds
and gold  contracts in Germany and Austria.  See "Item 1. Business - Financing."
The Registrant  intends to continue to sell bonds in Germany and Austria.  There
is no assurance  that sales of bonds will continue in amounts  necessary to fund
any of the Registrant's planned operations, including completion of Phase II.


Transportation

The  Evening  Star Mine is located in the Piute  Mountains  of Kern County at an
elevation  of 7,800 feet MSL.  Site  access is  provided  via paved,  all season
highways (State Route 178 and Kelso Valley Road) terminating in approximately 17
miles of graded dirt and gravel road. This dirt road is well maintained and snow
removal by the Company for 17 miles during the winter provides year-round access
to the project site.  The Piute  Mountains  experience  only  moderate  snowfall
during the winter,  and it is estimated that snow removal would be limited to an
average of six episodes per year  clearing  approximate  four to twelve miles of
roadway.


Power

An existing Company-owned diesel power plant,  producing  approximately 400kW of
power, provides electricity necessary for the operation of the mine. Maintenance
of the access  roadways will provide for timely truck  delivery of fuels for the
power plant.  The existing  storage  facility will be expanded to  approximately
6,000  gallons,  or one week of fuel  supply.  Typical  operation  will  include
semi-weekly fuel deliveries.

                                                                   Page 7 of 44

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Water Supply and Waste Disposal

Water for mining, dust control, and domestic use will be provided by water wells
proximate to the project  site.  Domestic and process  demand is estimated to be
15,000  gallons per day  (10.4gpm).  Storage  tanks will allow for constant well
pumping rates and fluctuating demands.

Domestic  wastewater  disposal will be via standard  septic tank and leach field
systems located adjacent to their respective sources. Process wastewater will be
recycled and reused in the process,  with the only process discharge  comprising
the moisture contained within the spent ore, estimated at 4,400 gallons per day.


Financing

Between  February 1, 1996 and August 6, 1996,  APT sold  $196,000 of  Industrial
Revenue Bonds  ("Bonds").  The Bonds were sold in Germany and Austria by Senator
Securities  Corporation,  Dusseldorf,  Germany  ("Senator").  The Bonds are zero
discount  bonds issued in  denominations  of $12,500 with maturity dates between
one to five years. Upon maturity, APT must pay $12,500 U.S., plus interest at 9%
per annum,  or deliver One Kilo of  Internationally  Hallmarked  99.99 Fine Gold
Bullion  (32.15 Troy Ounces).  As of March 31, 1997,  APT owed $337,500 on these
Bonds of which $112,500 is due on or before December 31, 1997.

Between June 1, 1996 and January 15, 1997,  APT sold  $735,000 of 9%  Investment
Certificates ("Certificates"). The Certificates were sold in Germany and Austria
by  Senator  and  by  Atlantic  Pacific   Finanzprodukte,   GmbH  ("APF"),   the
Registrant's  wholly-owned subsidiary.  The Certificates provide for interest at
9% per annum payable with principal at maturity. The Certificates mature between
one and five  years  from  date of  purchase.  As of March  31,  1997,  APT owed
$1,130,200 on these  Certificates of which $529,500 is due on or before December
31, 1997.

Between  September,  1995 and  September,  1996,  APT sold  $444,000 of Gold Ore
Contracts  ("Contracts") in One Kilo Units. Each Unit was sold for $9,645. There
are 32.15  troy  ounces in one kilo.  All  contracts  were sold in  Germany  and
Austria by Senator.  All  Contracts  are due within one year of purchase.  As of
March 31, 1997, there were $273,000 Contracts owing by APT, all of which are due
and payable on or before December 31, 1997.

On   November   1,   1996,   APT   began   selling,   through   APF,   9%   Bond
Certificate/Convertible  to Gold (the "9% Bond"). The total face amount offering
is 45,000,000  Deutsche  Marks. At an exchange rate of 1.5 DEM (one and one-half
Deutsche Marks) to 1 (one) U.S. Dollar, the total face amount in U.S. Dollars is
$30,000,000.  From this  offering,  the total net capital to APT,  assuming  the
entire  offering was sold out, and assuming a 1.5 to 1 exchange  rate,  would be
DEM 35,009,280, or U.S.$23,339,540.  The 9% Bond is non-interest bearing, but is
issued to an  interest-bearing  account,  in which the  difference  between  the
issuing  price and face value meets an effective  yield of 9% per annum.  The 9%
Bonds  are  issuable  only as fully  registered  bonds in  denominations  of 600
Deutsche Marks ("DM600") and may be increased by  denominations  of DEM 600. The


                                                                   Page 8 of 45

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9% Bonds mature between one and five years from date of purchase.  The Bearer of
the 9% Bond  shall,  within 60 days prior to the  maturity  date of the 9% Bond,
notify  APT of the  Bearer's  election  of  either  (A)  payment  in cash in the
Principal  Amount of the 9% Bond paid in Deutsche  Marks, or (B) receive payment
in the form of one  ounce of gold  bullion  issued  to Bearer at the rate of one
ounce  for every DEM 600 owed to  Bearer  by AT,  or (C)  Bearer  shall  receive
payment  in cash in the amount of the  market  value of the gold  bullion at the
maturity date, with the cash payment being in Deutsche  Marks.  The 9% Bonds are
being issued and are subject to a Trust  Resolution  dated October 1, 1996 and a
Prospectus  dated October 28, 1996. Both the Trust Resolution and the Prospectus
were prepared by attorneys for the German selling agents.  The 9% Bonds are only
being offered for sale in Germany and Austria.  Through March 31, 1997, $316,611
9% Bonds were sold of which $37,968 is due within one year.


Assignment of Assets

In  connection  with the sale by APT of Bonds,  Certificates,  Contracts  and 9%
Bonds (the  "Securities"),  APT has assigned its eight mineral claims,  known as
the Evening Star Mine, to Benjamin C. Rice, Esq. ("Trustee"),  a director of the
Company,  to be held in trust for a term of ten  years or until all  obligations
owed on the Securities are fully satisfied. The Trustee will allow APT to remove
and process  gold ore from the  Evening  Star Mine for  delivery  and payment of
Securities  as they  mature.  APT may also remove  additional  gold ore to cover
expenses  only but may not remove any gold ore for any other  purpose  until all
the  Securities  have been fully paid.  Upon default,  the Trustee may cause the
gold ore to be refined by a third party refiner or he may sell the claims to pay
all indebtedness evidenced by the Securities.


Regulation

The Company's operations are subject to comprehensive regulation with respect to
operational,  environmental,  safety and  similar  matters  by federal  agencies
including  the  U.S.  Department  of  the  Interior,   the  U.S.  Department  of
Agriculture  (U.S.  Forest Service),  the U.S.  Environmental  Protection Agency
("EPA"),  the U.S.  Mine Safety and Health  Administration  ("MSHA") and similar
state and local agencies.  Failure to comply with applicable  laws,  regulations
and permits can result in  injunctive  actions,  damages and civil and  criminal
penalties. If the Company expands or changes its existing operations or proposes
any new operations,  it may be required to obtain  additional or amended permits
or  authorizations.  The Company intends to spend  substantial  time, effort and
funds in planning,  constructing and operating its proposed facilities to ensure
compliance  with U.S.  environmental  and other  regulatory  requirements.  Such
efforts and  expenditures  are common  throughout the U.S.  mining  industry and
generally should not have a material adverse effect on the Company's competitive
position.

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Legislation  to change the  general  mining laws  applicable  to  operations  on
federal lands has been  introduced  into the 105th  Congress,  which convened in
January 1997,  and  additional  introductions  are expected.  The result of such
proposals is speculative.


Risk Factors

Mining and Processing

The Company's  business  operations are subject to risks and hazards inherent in
the mining industry,  including but not limited to  unanticipated  variations in
grade and other geological  problems,  water conditions,  surface or underground
conditions,  metallurgical and other processing  problems,  mechanical equipment
performance problems, the unavailability of materials and equipment,  accidents,
labor force and force majeure factors,  unanticipated  transportation  costs and
weather  conditions,  any of which can  materially and adversely  affect,  among
other things,  the development of properties,  production  quantities and rates,
costs and expenditures and production commencement dates.

In the case of development projects,  including new pits or underground mines at
currently  operated  properties or expansions  of existing  mines,  although the
Company utilizes the operating history of its existing mines to derive estimates
of future  operating costs and capital  requirements,  such estimates may differ
materially  from actual  operating  results.  The  economic  feasibility  of any
individual  project is based upon,  among other things,  the  interpretation  of
geological  data  obtained  from  drill  holes  and other  sampling  techniques,
feasibility  studies (which derive  estimates of cash operating costs based upon
anticipated  tonnage  and  grades  of  ore  to  be  mined  and  processed),  the
configuration of the ore body,  expected  recovery rates of metals from the ore,
comparable  facility  and  equipment  costs,  anticipated  climatic  conditions,
estimates of labor  productivity and other factors.  Such  development  projects
also are subject to the  successful  completion  of final  feasibility  studies,
issuance of necessary permits and receipt of adequate financing.

As a result of the foregoing risks, among other things,  expenditures on any and
all projects,  actual  production  quantities  and rates,  and cash costs may be
materially and adversely  affected and may differ  materially  from  anticipated
expenditures,  production  quantities  and rates,  and costs,  just as estimated
production  dates may be  delayed  materially,  in each case  especially  to the
extent  development  projects are involved.  Any such events can  materially and
adversely  affect  the  Company's  business,  financial  condition,  results  of
operations and cash flows.


Uncertainty of Reserve and Other Mineralization Estimates

There are numerous  uncertainties in estimating proven and probable reserves and
other  mineralization,   including  many  factors  beyond  the  control  of  the
Registrant.  The  estimation  of  reserves  and  other  mineralization  involves
subjective  judgments about many relevant factors,  and the accuracy of any such
estimate is a function of the quality of available data and of  engineering  and
geological  interpretation  and  judgment.  Results  of  drilling,  testing  and


                                                                   Page 10 of 45

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production  subsequent  to the date of an estimate may justify  revision of such
estimate. Assumptions about prices are subject to great uncertainty and gold and
silver prices have fluctuated widely in recent years. See "Gold and Silver Price
Volatility."  No  assurance  can be given that the volume and grade of  reserves
mined and  processed  and  recovery  rates  will not be less  than  anticipated.
Declines in the market price of gold and related precious metals also may render
reserves  or  other  mineralization   containing   relatively  lower  grades  of
mineralization  uneconomic to exploit.  If the price  realized by the Registrant
for its gold or silver bullion were to decline  substantially below the price at
which  ore  reserves  were  calculated  for a  sustained  period  of  time,  the
Registrant  potentially  could  experience  reductions  in  reserves  and  asset
write-downs.  Under certain  circumstances,  the Registrant may  discontinue the
development  of a project or mining at one or more of its  properties.  Further,
changes in operating  and capital  costs and other  factors,  including  but not
limited  to  short-term  operating  factors  such  as the  need  for  sequential
development  of ore bodies and the processing of new or different ore grades and
ore types, may materially and adversely affect reserves.


Gold and Silver Price Volatility

The profitability of the Registrant's current operations is directly related and
sensitive  to the  market  price of gold and  silver.  Gold  and  silver  prices
fluctuate  widely and are affected by numerous  factors beyond the  Registrant's
control,  including  expectations  with  respect to the rate of  inflation,  the
exchange  rates of the  dollar and other  currencies,  interest  rates,  forward
selling by  producers,  central  bank sales and  purchases  of gold and  silver,
production and cost levels in major gold-producing  regions such as South Africa
and the former Soviet Union, global or regional political, economic or financial
situations and a number of other factors.

The current demand for, and supply of, gold and silver affect the prices of such
minerals,  but not  necessarily  in the same manner as current demand and supply
affect the prices of other commodities. The potential supply of gold consists of
new mine  production plus existing stocks of bullion and fabricated gold held by
governments,  financial institutions,  industrial organizations and individuals.
Since mine production in any single year constitutes a very small portion of the
total potential supply of gold, normal  variations in current  production do not
necessarily have a significant  effect on the supply of gold or on its price. If
gold or silver  prices  should  decline  below the  Registrant's  cash  costs of
production  and remain at such levels for any sustained  period,  the Registrant
could  determine  that it is not  economically  feasible to continue  commercial
production  at any or all of its mines.  Although the  Registrant  has a hedging
program  in place to  reduce  the risk  associated  with gold and  silver  price
volatility,  there is no assurance that the Company's hedging strategies will be
successful.



                                                                   Page 11 of 44

<PAGE>



Exploration and Development

Exploration  for gold and  related  precious  metals  is highly  speculative  in
nature,  involves  many risks and  frequently is  unsuccessful.  There can be no
assurance that the Registrant's exploration efforts will result in the discovery
of  significant  gold  or  silver  mineralization  or  that  any  mineralization
discovered  will result in an increase of the  Company's  Proven or Probable Ore
Reserves. If Proven or Probable Ore Reserves are developed, it may take a number
of years and substantial  expenditures from the initial phases of drilling until
production is possible, during which time the economic feasibility of production
may change. No assurance can be given that the Registrant's exploration programs
will result in new reserves or that the Registrant's development program will be
able to extend the life of the Registrant's existing mines.


Insurance and Mining Risks

The business of gold and silver mining is generally subject to a number of risks
and hazards,  including environmental  conditions,  industrial accidents,  labor
disputes,  encountering unusual or unexpected geological  conditions,  ground or
slope  failures,  cave-ins,  changes in the regulatory  environment  and natural
phenomena  such  as  inclement  weather   conditions,   floods,   blizzards  and
earthquakes.  Such  occurrences  could result in damage to, or  destruction  of,
mineral  properties  or  production   facilities,   personal  injury  or  death,
environmental  damage to  properties  or the  properties  of  others,  delays in
mining,  monetary losses and possible legal  liability.  The  Registrant's  mine
operator,  Emtec,  maintains insurance against certain risks that are typical in
the gold  mining  industry  and in amounts  that the  Registrant  believes to be
reasonable,  but which may not provide adequate  coverage in certain  unforeseen
circumstances.  However,  insurance  against  certain risks  (including  certain
liabilities  for  environmental  pollution  or  other  hazards  as a  result  of
exploration and  production) is not generally  available to the Registrant or to
other companies within the industry on acceptable terms.


Competition

The Company operates in an industry that is characterized by intense competition
for  resources,  equipment  and  personnel.  Some  of  the  Company's  principal
competitors are substantially larger, have substantially greater resources,  and
expend  considerably  larger sums of capital  than the Company for  exploration,
rehabilitation and development.


ITEM 2.  DESCRIPTION OF PROPERTY

The   Registrant's   executive   offices  are  located  in  rented  premises  of
approximately  12,960 square feet at 4750 Kelso Creek Road,  Weldon,  California
93238.  The leased  facilities  are known as the Weldon  Research  Center.  They
include approximately 37.5 acres of chainlink fenced land, 12,960 square feet of
buildings,  including  a  scale  house,  guardhouse,  a 300' x 12"  water  well,
lab/shop,  refinery buildings and domestic power. The Registrant has a five-year


                                                                   Page 12 of 45

<PAGE>



lease on the premises at $3,000 per month rental  renewable for like terms.  The
Registrant considers the facilities adequate for current needs.


Evening Star Mine Group

Registrant owns eight unpatented  mining claims located on Piute Mountain,  Kern
County, California. Unpatented mining claims only give the Registrant possessory
title.  Because  title to  unpatented  mining  claims  is  subject  to  inherent
uncertainties,  it is  difficult  to  determine  conclusively  ownership of such
claims. Since a substantial portion of all mineral exploration,  development and
mining in the  United  States  now  occurs on  unpatented  mining  claims,  this
uncertainty is inherent in the mining industry.  In addition, in order to retain
title to an  unpatented  mining  claim,  a claim  holder  must  have met  annual
assessment work  requirements  through  September 1, 1992 and must have complied
with  stringent  state  and  federal  regulations  pertaining  to the  filing of
assessment  work  affidavits.  Moreover,  after  September 1, 1992, the right to
locate or maintain a claim  generally is conditional  upon payment to the United
States of a maintenance fee of $100 per claim per year for each assessment year.
State law may, in some instances, still require performance of assessment work.

The present  status of the  Company's  properties  as  unpatented  mining claims
located on public lands of the U.S.  allows the claimant the exclusive  right to
mine  and  remove  valuable  minerals,  such as  precious  and base  metals  and
industrial  minerals,  found  therein,  and also to use the  surface of the land
solely for purposes related to mining and processing the  mineral-bearing  ores.
However, legal ownership of the land remains with the U.S. Accordingly,  with an
unpatented  claim,  the U.S. retains many of the incidents of ownership of land,
the U.S. regulates use of the surface,  and the Company remains at risk that the
claims may be forfeited either to the U.S. or to rival private  claimants due to
failure to comply with statutory  requirements as to location and maintenance of
the claims.  If there exists a valuable deposit of locatable  minerals (which is
the  requirement for the unpatented  claim to be valid in the first place),  and
provided  certain  levels of work and  improvements  have been  performed  on an
unpatented  mining claim,  the Mining Law of 1872  authorizes  claimants to then
seek to  purchase  the full title to the  claim,  thereby  causing  the claim to
become the private  property of the claimant.  Such full  ownership  expands the
claimant's  permissible  uses of the property (to any use authorized for private
property)  and  eliminates  the need to comply with  maintenance  and  reporting
requirements necessary to protect rights in an unpatented claim.

For  the  last  several  Congressional  sessions,  bills  have  been  repeatedly
introduced  in the U.S.  Congress  which would  supplant or radically  alter the
provisions  of the Mining Law of 1872.  As of December 31,  1995,  no such bills
have passed,  although a number of differing and sometimes conflicting bills are
now pending. If enacted, such legislation could substantially  increase the cost
of holding unpatented mining claims and could impair the ability of companies to
develop  mineral  resources  on  unpatented  mining  claims.  Under the terms of
certain  proposed  legislation,  the ability of  companies to obtain a patent on
unpatented mining claims would be nullified or substantially impaired. Moreover,


                                                                   Page 13 of 44

<PAGE>


certain forms of such proposed legislation contain provisions for the payment of
royalties to the federal  government  in respect of production  from  unpatented
mining claims,  which could  adversely  affect the potential for  development of
such claims and the economics of operating  existing mines on federal unpatented
mining claims. The Company's  financial  performance could therefore be affected
adversely by passage of such  legislation.  It is  impossible to predict at this
point what any  legislated  royalties  might be, but a  potential  three to four
percent gross  royalty,  assuming a gold price of $400 per ounce,  would have an
approximated  $12 to $16 per ounce impact on the  Company's  costs of production
from unpatented mining claims.

APT entered into a lease in July, 1995, with Sequoia Trust,  which is controlled
by some of the officers and directors of the  Registrant.  See "Item 12. Certain
Relationships  and Related  Transactions."  The lease  terminates in July, 2000,
unless renewed by mutual  consent of the parties,  so long as minerals are being
mined,  processed or marketed  from the  property on a continuous  basis with no
cessation of operations for more than 120  consecutive  days. APT is required to
pay $3,000 per month, plus a 12% royalty of the "gross value of metals and other
leased substances recovered from the refining of ores" from the property.

The leased  properties  consist of 57 acres and include  three  patented  mining
claims.  The Company plans to construct its main refinery and support  buildings
on this  land upon the  successful  completion  of Phase I. One of the  patented
mines was preliminarily explored by drilling eight 45-degree holes approximately
200 feet  apart  and to a depth of 700  feet.  A  commercial  grade ore body was
encountered  and  estimated  to be 17 to 36 feet wide.  The  Company  intends to
redrill this area in order to reconfirm and more precisely estimate the size and
quantity of such ore body.

Also  in  July,  1995,  APT  leased  from  Sequoia  Trust  property  in  Weldon,
California,  known as the Weldon Research Center, for $3,000 per month.  William
M. Moreland,  Chief Operating  Officer of the Company,  is a Trustee for Sequoia
Trust. The lease  terminates in July,  2000,  unless renewed under like terms by
mutual  consent of the parties.  The property  consists of 12,960 square feet of
mill   buildings,   a  laboratory,   office,   shops  and  refinery   buildings,
approximately  37.5 acres of fenced land.  The property also contains a 300-foot
water well, scale house, guardhouse and domestic power.


ITEM 3.  LEGAL PROCEEDINGS

None.




                                                                   Page 14 of 45

<PAGE>


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

There were no matters submitted to shareholders during the fourth quarter of the
fiscal year ended December 31, 1996.


                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

The Company's  Common Stock was inactive for from June 23, 1984 until  September
22, 1997, when it began trading on the Bulletin Board  Over-the-Counter  Market.
The  trading  market  is  limited  and  sporadic  and  should  not be  deemed to
constitute an "established trading market".

The  following  table  sets forth the range of Bid and Ask prices for the Common
Stock during the periods indicated, and represents inter-dealer prices, which do
not  include  retail  mark-ups  and   mark-downs,   or  any  commission  to  the
broker-dealer, and may not necessarily represent actual transactions.

                     1997                                Bid     Asked

         Quarter ending March 31, 1997                  $0.50    $1.75


(a)  Holders:
         The  approximate  number of holders of record of Common  Shares,  as of
         March 31, 1997, was 743.

(b)  Dividends:
         The Company has not paid cash  dividends  on its common stock since its
         inception.  At the present  time,  the  Company's  anticipated  working
         capital  requirements  are such that it  intends  to follow a policy of
         retaining  any  earnings  in order to finance  the  development  of its
         business.



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

The following discussion and analysis should be read together with the financial
statements and notes thereto included elsewhere herein.

I.    Gerant merged from its Chapter 11 proceeding in August 1996. Prior to that
date,  the  reorganization  with  Xplorer,   S.A.,  Gerant  had  no  significant
operations,  cash flows,  or changes in  financial  condition,  and was inactive
since January 1, 1994.  Legal fees  incurred  during the  bankruptcy  period are
presently being paid by the Company.


                                                                   Page 15 of 44

<PAGE>



II.   Plan of Operation

      The  Registrant  is  preparing  for the  construction  of a Pilot Plant to
process  both  new and  existing  ore of the  Evening  Star  Mine  (the  "Mine")
location.  Upon the  receipt  of the  capital,  the Pilot  Plant  will  commence
simultaneously  with the Filing of the Form  10-KSB for the year ended  December
31, 1996. The Pilot Plant will  demonstrate the feasibility of extraction of the
precious metals contained within the ore.

      The  Pilot  Plant  should  be in  operation  continually  until  the  full
operating plant is completed and in operation.

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

      The  Registrant  is a  development  stage  enterprise  and,  as  such,  is
incurring  expenses  related to the  development of the Mine and the preparation
for the beginning of the Pilot Plant.  Funds for these purposes have been raised
through the sale of Forward Gold Contracts,  sale of Industrial Bonds in Europe,
and the strategic placement of equity securities. These activities are necessary
to assure the funding of anticipated operating costs and the satisfaction of the
$1.2 million negative working capital.

      It is not  anticipated  that  income  from the Pilot  Plant will  commence
before  the  end of the  summer  of  1997.  As a  result,  it is  essential  for
management  to continue its fund  raising  activities  until this income  source
commences and continuing afterwards until the full operation is in progress.

      Registrant  continues its efforts towards achieving a profitable operation
and, although management is confident of achieving that goal,  Registrant cannot
assure its  shareholders  that it will be  successful  in operating a profitable
business.









                                                                   Page 16 of 45

<PAGE>



ITEM 7.  FINANCIAL STATEMENTS

The following financial  statements are included as a separate section following
the  signature  page to  this  Form  10-KSB/A  and are  incorporated  herein  by
reference:

         INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
                                                                     Page
         Report of Independent Auditor................................F-1


         Consolidated Balance Sheet...................................F-2

         Consolidated Statement of Operations for the year
            ended December 31, 1996...................................F-3

         Consolidated Statement of Shareholders' Equity for the
            year ended December 31, 1996..............................F-4

         Consolidated Statement of Cash Flows for the year
            ended December 31, 1996...................................F-5

         Notes to Financial Statements................................F-6



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

None.










                                                                   Page 17 of 44

<PAGE>








                                    PART III


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

        Name               Age                    Position
------------------------  ----   ----------------------------------------------
Steven B. Mortensen        36    Chairman of the Board and Secretary

Thomas C. Roddy, PE.       44    Director, President and Chief Executive Officer

William M. Moreland        48    Chief Operating Officer and Director

Jon W. Bice                52    Director, Treasurer and Chief Financial Officer

Joyce J. Pellet            60    Director

Benjamin C. Rice           58    Director


Steven B.  Mortensen has been  Chairman of the Board and  Secretary  since July,
1996.  Mr.  Mortensen  majored in  computer  science  and math at Brigham  Young
University.  Mr.  Mortensen is also  responsible for investor  relations for the
Company and its subsidiaries,  including overseeing its European operations. Mr.
Mortensen served as Trustee of Atlantic Pacific Trust and as Manager of Atlantic
Pacific  Trust,  LLC.  Mr.  Mortensen's  experience  is in real  estate,  mining
development,  and public  relations.  He is also  co-trustee  of Rocky  Mountain
Trust. In that capacity,  he is solely  responsible for asset management and all
investments. Previously, in 1991, Mr. Mortensen was senior vice president of the
"B" paper  division of Trump  Mortgage  Group Inc.  Mr.  Mortensen's  other past
positions include: President of North Star Industries, a mining, residential and
commercial contractor;  President and owner of Hillcrest Development and Land, a
land and mine  development  company;  Sales and Marketing  Director of Mortensen
Construction and Lifestyle Homes, Inc.


Thomas C. Roddy has been President, Chief Executive Officer and a director since
July, 1996. Mr. Roddy is a registered civil engineer in the State of California.
He received a B.S. in civil engineering from California State University, Fresno


                                                                   Page 18 of 45

<PAGE>



in 1978.  From 1978  through  1985,  Mr.  Roddy was a senior  engineer for Boyle
Engineering Corporation, Bakersfield, California. Since 1985, Mr. Roddy has been
a consulting engineer in Bakersfield,  California. His engineering background is
extensive and includes experience as project manager/engineer for various mining
projects in California and Nevada,  engineering  superintendent for construction
of the Almond Power Plant near  Modesto,  California,  extensive  experience  in
road, sewer water, and drainage system design, and engineering  services related
to Santa Fe Energy Company and Shell Western  Exploration and Production Co. for
the construction of enhanced recovery  facilities.  Mr. Roddy is a former member
of the Kern County Air Pollution Control District Hearing Board.


William M.  Moreland  has been Chief  Operating  Officer  and a director  of the
Company since April,  1997, and a consultant to the company since August,  1996.
Mr. Moreland has been in the mining business since he was a child,  working with
his father and  grandfather on the Moreland  Mines.  He has been a consultant to
several mining companies on various mining projects,  including platinum, silver
and gold. From 1971 through 1985, Mr. Moreland was the owner of a commercial and
residential  contracting  company and held a Class A General Engineering License
and Class B General Building License from the State of California.  Mr. Moreland
has constructed  processing mills and has designed a proposed Pilot Mill for the
Company's  Evening Star Mine.  Mr.  Moreland is a Co-Manager of Emtec,  LLC, the
mine operator of the Evening Star Mine, and he is a Trustee of the Sequoia Trust
and a Co-Manager of Atlantic Pacific Trust, LLC, a majority-owned  subsidiary of
the Company.  Mr.  Moreland's  over 40 years of experience in assay  procedures,
precious metals refining, mine development and production is a valuable asset of
the Company.


Jon W. Bice has operated his own  accounting  and tax  business  since 1971.  He
prepares  over  600  individual  tax  returns,  40  corporate  returns,  and  15
partnership  returns per year.  His tax practice is national  with clients in 29
states, ranging from shall, individual businesses to $100 million multi-national
corporations.  Mr.  Bice is licensed to  practice  before the  Internal  Revenue
Service  and the  United  States  Tax  Court on tax  matters,  and  performs  an
estimated annual average of 100 to 125 tax and examination  audits. Mr. Bice has
been the CFO for other  corporations  in the past whose  sales  ranged  from $36
million per year to $100 million in international sales.


Joyce J. Pellet  presently  serves as trustee of Bedrock  Trust,  which owns and
manages  several  rental  properties.  She also  actively  serves as trustee for
Sequoia Trust and was co-trustee of Atlantic Pacific Trust. Ms. Pellet presently
serves as one of the  Managers of EMTEC,  LLC,  which is the mine  operator  for
Atlantic Pacific Trust's mining properties.


Benjamin C. Rice is an attorney  licensed to practice in the State of Idaho.  He
received a B.S. in  psychology  and economics  from Brigham Young  University in
1964 and a Juris  Doctorate  degree from Golden Gate  university in 1971. He has
been engaged in the private practice of law since

                                                                   Page 19 of 44

<PAGE>



1988,  specializing in constitutional  law, trust, tax law, asset protection and
mining law. He serves as corporate counsel for several  corporations and trusts,
including  Atlantic  Pacific  Trust  and  Emtec,  Inc.  Mr.  Rice has been a law
professor  at  National  University  and has  served as general  counsel  for an
operating mining company, Toone- Mitchell Mining Company.

Compliance with Section 16(a) of the Securities Exchange Act of 1934.

Section  16(a) of the  Securities  Exchange Act of 1934  requires the  Company's
directors and executive officers, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file with the Securities
and Exchange  Commission  ("SEC")  initial  reports of ownership  and reports of
changes  in  ownership  of  Common  Stock  and other  equity  securities  of the
Registrant.  Officers,  directors and greater than ten percent  stockholders are
required by SEC regulation to furnish the Registrant and Exchange with copies of
all Section 26(a) forms they file.

Based  solely on its  review  of the  copies of such  forms  received  by it, or
written  representations  from  certain  reporting  persons  that  no Form 5 was
required for such persons,  the Company  believes that,  other than as disclosed
below,  during the fiscal year ended December 31, 1996, all filing  requirements
applicable  to its officers,  directors and greater than ten percent  beneficial
owners were complied with.

All of the officers,  directors and ten percent shareholders , including Messrs.
Moreland,  Roddy,  Mortensen,  Bice and Rice, Ms. Pellet,  and Atlantic  Pacific
Trust,  LLC, failed to report timely on Form 3's when they had become directors,
officers and ten percent  shareholders of the Registrant at the  confirmation by
the  Bankruptcy  Court of the Third Amended Plan in August 1996.  Procedures and
controls have been instituted to assure future  compliance with Section 16(a) of
the Exchange Act.

ITEM 10.  EXECUTIVE COMPENSATION

No  executive  officer of the  Company  earned in excess of  $10,000  during the
fiscal year ended  December 31, 1996.  All executive  officers as a group (three
persons) received cash  compensation of approximately  $30,000 during the fiscal
year ended December 31, 1996.  Beginning January 1, 1997, the Company has agreed
to pay to  Messrs.  Mortensen,  Roddy,  Moreland  and Bice an  annual  salary of
$60,000 for each person.  Bonuses,  based on sales and revenues,  may be paid to
such employees at the discretion of the Board of Directors. There are no written
employment agreements with any employee of the Company.

1997 Stock Incentive Plan

On January 24, 1997,  the  Company's  Board of  Directors  approved a 1997 Stock
Incentive Plan (the "1997 Plan").  The purpose of the 1997 Plan is to enable the
Company to recruit and retain selected officers and other employees by providing
equity  participation in the Company to such  individuals.  Under the 1997 Plan,


                                                                   Page 20 of 45

<PAGE>



regular salaried employees, including directors who are full time employees, and
non-employee directors, may be granted options exercisable at not less than 100%
of the fair value of the share at the date of grant.  The exercise  price of any
option  granted to an optionee  who owns stock  possessing  more than 10% of the
voting  power of all  classes of stock of the  Company  must be 110% of the fair
market  value of the Common  Stock on the date of grant and the duration may not
exceed five years. Since there is no public market for the Company's shares, the
fair  market  value  has  been  determined  from  time to time by the  Board  of
Directors.  The duration of options may not exceed ten years.  Options under the
Plan are  nonassignable,  except in the case of death and may be exercised  only
while the optionee is employed by the Company,  said employment  shall include a
leave of absence,  with the consent of the  Company,  but shall not exceed three
months,  or death. The purchase price and number of shares that may be purchased
upon exercise of options are subject to adjustment in certain  cases,  including
stock splits, recapitalizations and reorganizations.

The  amount of  options  granted  and to whom,  are  determined  by the Board of
Directors  at their  discretion.  There are no  specific  criteria,  performance
formulas or measures.

Under the 1997 Plan, of the 1,500,000 shares  available for grant,  600,000 were
granted  in  January  1997,  of which  550,000  were  granted  to  officers  and
directors.

The following table sets forth certain information with respect to all qualified
stock options held as of May 30, 1997 by the Company's  executive officers under
the 1997 Plan. All options are exercisable at a price equal to fair market value
on date of grant  and  terminate  10 years  from  date of  grant.  None of these
options has been exercised.

                                         Number of      Exercise   Expiration
                Name                      Options     Price/Share     Date
         -------------------             ---------    -----------  ----------
         Steven B. Mortensen              150,000         $.50           *
         William M. Moreland              150,000          .50           *
         Thomas C. Roddy                   75,000          .50           *
         Jon W. Bice                       75,000          .50           *
         All executive officers
          as a group (4 persons)          450,000          .50           *
__________________________
*  All options expire on January 30, 2007.

Non-Qualified Stock Options

On January 31,  1997,  80,000  non-qualified  stock  options were granted to two
persons in  consideration  for services  rendered to the  Company.  The exercise
price  for all  options  is $.50  per  share.  None of  these  options  has been
exercised. All of these options expire on January 30, 2007.

                                                                   Page 21 of 44

<PAGE>


ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following  table sets forth certain  information,  as of May 30, 1997,  with
respect to the beneficial  ownership of the Registrant's Common Stock, par value
$.001 per share, by holders of more than five percent of the Registrant's Common
Stock,  by each director and  executive  officer of the  Registrant,  and by all
directors and officers of the Registrant as a group.

Name and Address                           Number of Shares           Percent
of Beneficial Owner                      Beneficially Owned(1)      of Class(2)
-------------------                      --------------------       ----------
Steven B. Mortensen                          425,000 (3)                2.4
Thomas C. Roddy                               50,000 (4)                 *
William M. Moreland                           50,000 (5)                 *
Jon W. Bice                                   70,000 (6)                 *
Joyce J. Pellet                               35,000 (5)                 *
Benjamin C. Rice                              10,000 (7)                 *
Compania Comercial Atlantis, S.A.          1,000,000 (8)                5.4
____________________
*        Less than one percent (1%).

(1)      Unless otherwise  indicated,  all shares are beneficially owned and the
         sole  voting and  investment  power is held by the person  named in the
         table above and the address  for each  beneficial  holder is in care of
         the Company.

(2)      Based upon 18,782,445 shares of Common Stock outstanding.

(3)      Does not include 125,000 shares in the Hughes Irrevocable Trust for the
         benefit of Mr. Mortensen's wife. Mr. Mortensen disclaims any beneficial
         interest in these shares.  Does not include options to purchase 150,000
         shares of the Company's common stock.

(4)      Does not include  options to purchase  75,000  shares of the  Company's
         common stock.

(5)      Does not include 750,000 shares held by the Sequoia  Irrevocable  Trust
         of which  Mr.  Moreland's  and Mrs.  Pellet's  adult  children  are the
         beneficiaries.  Mr.  Moreland  and Mrs.  Pellet are the trustees of the
         trust  and both  disclaim  any  beneficial  interest  in these  shares.
         Furthermore,  does not  include  options  granted  to Mr.  Moreland  to
         purchase  150,000  shares of the  Company's  common  stock nor  options
         granted  to Mrs.  Pellet to  purchase  50,000  shares of the  Company's
         common stock.

(6)      Does not include  options to purchase  75,000  shares of the  Company's
         common stock.


                                                                   Page 22 of 45

<PAGE>



(7)      Does not include  options to purchase  50,000  shares of the  Company's
         common stock.

(8)      The address for this beneficial holder is P.O. Box 5747-1000, San Jose,
         Costa Rica, C.A.



ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

On July 15,  1995,  the  Company's  majority-owned  subsidiary  entered into the
following agreements:

a)       A lease from Sequoia  Trust of  approximately  57 acres of land in Kern
County, California, containing three patented mining claims. The Company intends
to explore,  develop and operate  mines and extract,  sell and ship any precious
metals discovered on the property. The lease terminates on July 15, 2000, unless
renewed for like terms by mutual consent.  The Company pays $3,000 per month and
is  obligated  to pay 12% of the  gross  value of metals  and  other  substances
recovered from refining of ore from the property.

b)       A lease from  Sequoia  Trust of the  Weldon  Research  Center,  Weldon,
California,  consisting of several buildings,  including a laboratory,  offices,
repair  shops and storage  facilities.  The lease  terminates  on July 15, 2000,
unless renewed for like terms by mutual consent. The Company pays lease payments
of $3,000 per month.  The Trustees of the Sequoia Trust are William M. Moreland,
an officer and director of the Company,  and Joyce J. Pellet,  a director of the
Company. The beneficiaries of the Trust are the children of Mr. Moreland and the
children of Mrs. Pellet.  The children are all over 21 years old and do not live
with either Mr.  Moreland or Mrs.  Pellet and both Mr.  Moreland and Mrs. Pellet
disclaim any beneficial interest in the Sequoia Trust.

c)       The  Company  entered  into an  Operating  Agreement  with  Emtec,  LLC
("Emtec") wherein Emtec will perform all exploration, development and production
services  for the Evening  Star Mine.  Emtec will be the  operator  for all mine
operations.  The  Company  has  agreed  to pay to  Emtec,  on a  monthly  basis,
reimbursement  of all  expenses  and costs of Emtec  related to the Evening Star
mining  operations  plus 18%.  From July 15, 1995 through  March 31,  1997,  the
Company has paid Emtec $462,143.

Mr.  Moreland,  an officer  and  director of the  Company,  and Mrs.  Pellet,  a
director of the Company,  are the  Co-Managers of Emtec,  LLC. Both Mr. Moreland
and Mrs. Pellet disclaim any beneficial ownership in Emtec, LLC.

In each of the transactions  described in the preceding  paragraphs in which the
Company purchased goods or services from an affiliate, the Company believes that
the terms of the transaction  were no less favorable to it than those that could
have been  obtained in a comparable  transaction  with an unrelated  party.  Any
future  transactions  between  the  Company  and  its  officers,  directors  and


                                                                   Page 23 of 44

<PAGE>


affiliated parties will be subject to approval by a majority of the directors of
the Company, including a majority of the disinterested directors.

Pursuant to the Company's  Third Amended Plan of  Reorganization  filed with the
Bankruptcy Court in July, 1996 (the "Plan"),  Compania Comercial Atlantis,  S.A.
("Compania")  exchanged 417,200 APT Units owned by Compania for 1,043,000 shares
of the Company's Series A Convertible  Preferred Stock (the "Preferred  Stock").
In December,  1996,  the Company  exchanged an additional  237,550 shares of its
Preferred  Stock for  189,960 APT Units.  The  Preferred  Stock is  convertible,
commencing  October 1, 2002,  into ten shares of the Company's  Common Stock for
each share of Preferred Stock. Dividends are payable quarterly at a monthly rate
of one percent of the Preferred  Stock held. The dividends are payable in Common
Stock of the  Company on the basis of ten shares of Common  Stock for each share
of Preferred Stock. In addition,  the holder of the Preferred Stock could,  upon
written  notice,  have any dividends due payable in additional  Preferred  Stock
instead of Common Stock.

On December 11, 1996, the Company agreed to issue 1,000,000 shares of its Common
Stock to Compania and Compania waived its right to receive any dividends,  past,
present or future, associated with the Preferred Stock. As of December 11, 1996,
no dividends had been paid to Compania.


ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

The following documents are filed as part of this report:

a.  Listing of Exhibits

  2.1    (1)      Disclosure  Statement  For  Debtor's  Third  Amended  Plan  of
                  Reorganization.

  2.2    (1)      Order    Confirming    Debtor's    Third   Amended   Plan   of
                  Reorganization.

  2.3    (2)      Agreement and Plan of Reorganization  between Atlantic Pacific
                  Trust and its Beneficiaries and Atlantic Pacific Trust,  LLC.,
                  dated December 26, 1996.

  3.1(a) (2)      Articles   of   Incorporation   and   Amendments   thereto  of
                  Registrant.

  3.1(b) (2)      Articles of  Organization of Atlantic  Pacific Trust,  LLC and
                  Amendment thereto.

  3.2    (2)      By-Laws of Registrant.


                                                                   Page 24 of 45

<PAGE>



  4.1    (2)      Certificate of  Designation of Series A Convertible  Preferred
                  Stock of Registrant.

  4.1(a) (2)      Waiver  of  Preferred   Stockholder   between  Registrant  and
                  Compania Comercial Atlantis, S.A. dated December 11, 1996.

  4.2    (2)      $450,000 10%  Subordinated  Convertible  Note dated  September
                  25,1996  between  Registrant  and  Gardner  Investments,  Inc.
                  (lender).

  4.3    (2)      Warrant Certificate for Common Stock issued to shareholders of
                  the   Registrant   pursuant   to   Third   Amended   Plan   of
                  Reorganization  approved by the United States Bankruptcy Court
                  on August 5, 1996.

  4.4    (2)      "B" Warrant Agreement between  Registrant and Atlantic Pacific
                  Trust dated August 5, 1996.

  4.5    (2)      "C" Warrant Agreement between  Registrant and Atlantic Pacific
                  Trust dated August 5, 1996.

  10.1   (2)      Lease  Agreement  between  Sequoia Trust and Atlantic  Pacific
                  Trust dated July 15, 1995.

  10.2   (2)      Lease  Agreement  between  Sequoia Trust and Atlantic  Pacific
                  Trust dated July 15, 1995.

  10.3   (2)      Operating  Agreement between Atlantic Pacific Trust and Emtec,
                  LLC dated July 25, 1995.

  10.4   (2)      Assignment of Assets by Atlantic  Pacific Trust to Benjamin C.
                  Rice, Trustee dated October 25, 1995.

  10.5   (2)      Bill of Sale between Sequoia Trust and Atlantic  Pacific Trust
                  dated July 15, 1995.

  10.6   (2)      Regulation  "S" Stock  Purchase  Agreement  between  Stonehill
                  Investments, Ltd. and Registrant.

  10.7   (2)      Security   Agreement   between   Plaza   Realty  One   Limited
                  Partnership and Registrant dated August 19, 1994, and $400,000
                  Promissory  Note between Plaza Realty One Limited  Partnership
                  and Registrant dated August 19, 1994.

  10.8            1997 Stock Incentive Plan.

                                                                   Page 25 of 44

<PAGE>



_____________________
(1)      Filed as exhibits to Registrant's Form 8K which was filed with
         the Commission on September 12, 1996, and incorporated  herein
         by this reference.

(2)      Filed as exhibits to Registrant's  Form 10-KSB which was filed
         on June 3, 1997 and incorporated herein by this reference.

         b.  Reports on Form 8-K
A report on Form 8-K was filed by the Registrant on November 15, 1996.


                                   SIGNATURES

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

                                                       XPLORER, S.A.

Date:  January, 1998                                   By:/s/ Thomas C. Roddy
                                                       ----------------------
                                                       Thomas C. Roddy
                                                       President

In  accordance  with the Exchange  Act, this report has been signed below by the
following  persons on behalf of the  Registrant and in the capacities and on the
dates indicated.

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

/s/ Steven B. Mortensen    Chairman of the Board             January 19, 1998
------------------------   and Secretary
Steven B. Mortensen

/s/ Thomas C. Roddy        President, Chief Executive        January 19, 1998
-----------------------    Officer and Director
Thomas C. Roddy

/s/ William M. Moreland    Chief Operating Officer           January 19, 1998
-----------------------    and Director
William M. Moreland

/s/ Jon W. Bice            Treasurer, Chief Financial        January 19, 1998
-----------------------    Officer and Director
Jon W. Bice
                                                                   Page 26 of 45

<PAGE>





/s/ Joyce J. Pellet        Director                          January 19, 1998
-----------------------
Joyce J. Pellet

/s/ Benjamin C. Rice       Director                          January 19, 1998
-----------------------
Benjamin C. Rice



                                                                   Page 27 of 44

<PAGE>





                                  XPLORER, S.A.

                                DECEMBER 31, 1996






































                                                                   Page 28 of 45

<PAGE>



                                  XPLORER, S.A.
                                DECEMBER 31, 1996



                                Table of Contents

                                                                           Page

Independent Auditors' Report ...............................................F-1

Consolidated Balance Sheet .................................................F-2

Consolidated Statement of Operations .......................................F-3

Consolidated Statement of Stockholder's Equity .............................F-4

Consolidated Statement of Cash Flows .......................................F-5

Notes to Consolidated Financial Statements ............................. F-6-14

























                                                                   Page 29 of 44

<PAGE>



                             JAY J. SHAPIRO, C.P.A.
                           A Professional Corporation

                             16501 Ventura Boulevard
                                    Suite 650
                            Encino, California 91436
                     Tel. (818) 990-4878 Fax (818) 990-4944


                          INDEPENDENT AUDITORS' REPORT

The Board of Directors of XPLORER, S.A.:

         We have audited the accompanying consolidated balance sheet of XPLORER,
S.A. (the "Company"),  a development stage  enterprise,  as of December 31, 1996
and 1995, and the related consolidated  statements of operations,  shareholders'
equity and cash flows for each of the two years ended  December 31, 1996.  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 audit in accordance with generally  accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

         In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects,  the financial position of the Company
as of December 31, 1996,  and the results of its  operations  and its cash flows
for each of the two years ended December 31, 1996, in conformity  with generally
accepted accounting principles.

         The financial statements reflect a reverse acquisition  transaction and
the acquirer had insignificant operation prior to July 1, 1996.

         As of December 31, 1996, the Company has significant  negative  working
capital and exposure to financial uncertainties (See Notes 1 and 2).


December 30, 1997

                                                      JAY J. SHAPIRO, C.P.A.
                                                      a professional corporation

                                                                   Page 30 of 45
                                       F-1


<PAGE>

                                  XPLORER, S.A.
                        (a development stage enterprise)
                           CONSOLIDATED BALANCE SHEET
                                As of December 31
                                                  
Assets                                                 1996          1995
                                                   -----------   ------------
Current Assets:
Cash                                               $   166,000    $   100,000
Note receivable (Note 5)                                16,000
Marketable securities (Note 4)                         226,400
Prepaid commissions                                    210,000      
                                                   -----------    -----------
Total Current Assets                                   618,400        100,000

Property, plant & equipment - net
 (Notes 6, 8 & 11)                                   3,404,400      2,830,300
Other investments (Notes 7 and 10)                   1,019,000        500,000
                                                   -----------    -----------

Total Assets                                       $ 5,041,800    $ 3,430,300
                                                   ===========    ===========

Liabilities and Shareholders' Equity
Current Liabilities:
Gold contracts (Note 11)                               273,000        390,000
Zero-coupon bonds - Current                            915,000         25,000
Related party payable (Note 12)                        149,000         50,000
Note payable (Notes 7 and 10)                          450,000
Payroll obligations                                      3,200
Other accrued expenses                                  38,000         12,000
                                                   -----------    -----------
Total Current Liabilities                            1,828,200        477,000

Accrued legal fees (Note 9)                            147,000
Long-term zero-coupon bonds                            552,700         87,500
Minority interest in consolidated
 subsidiary (Note 8)                                   852,000      1,175,000
                                                   -----------    -----------
                                                     3,379,900      1,739,500


                                                                   Page 31 of 44
                                       F-2
                                                                    

<PAGE>

                                  XPLORER, S.A.
                        (a development stage enterprise)
                       CONSOLIDATED BALANCE SHEET (Cont'd)
                                As of December 31
                                                  
                                                       1996          1995
                                                   -----------   ------------

Commitments and contingencies
 (Notes 2, 7, 8, 10, 11 & 12)
Shareholders' Equity:
Preferred stock, par value $0.001;
 authorized 15,000,000 shares;
 convertible beginning in 2006;
 1,280,550 shares issued and
 outstanding                                             1,300
Common stock subscribed                                  1,000
Common stock, $0.001 par value; authorized
  60,000,000 shares; 18,554,000 and 964,000
  shares issued and outstanding in 1996 and 1995        17,600          1,000
Capital surplus                                      2,546,000      1,793,800
Deficit accumulated during the development stage      (904,000)      (104,000)
                                                   -----------    -----------
Total shareholders' equity                           1,661,900      1,690,800
                                                   -----------    -----------
Total Liabilities and Shareholders' Equity         $ 5,041,800    $ 3,430,300
                                                   ===========    ===========

 The notes to the financial statements are an integral part of these statements

                                                                   Page 32 of 45

                                       F-3

<PAGE>

                 XPLORER, S.A. (a development stage enterprise)
                      CONSOLIDATED STATEMENT OF OPERATIONS
                          Year Ended December 31, 1996

                                                     1996              1995
                                                 ------------      ------------
Revenue (Note 1)                                 $          0      $          0
                                                 ------------      ------------

Expenses:
  Compensation                                   ($   128,600)
  Professional fees                                  (113,500)
  Commissions                                        (450,900)          (90,000)
  Interest                                           (171,700)          (30,000)
  Administrative and depreciation                    (207,000)          (40,000)
                                                 ------------      ------------
     Total                                         (1,071,700)         (160,000)

Other income (expense):
  Gain on marketable securities-net                    37,000
  Interest income                                      48,400
  Loss on settlement of gold contracts               (106,000)
                                                 ------------
      Total                                           (20,600)

Net Loss Before Minority Interest
 in Loss of Company                                (1,092,300)         (160,000)


Minority Interest in Loss of Company                  340,300            56,000
                                                 ------------      ------------


Net Loss                                         ($   752,000)         (104,000)
                                                 ============      ============




Net Loss per Share                               ($      0.05)     ($      0.11)
                                                 ============      ============




Weighted Average Number of Shares                  16,800,000           964,000
                                                 ============      ============



                      The notes to the financial statements
                    are an integral part of these statements



                                                                   Page 33 of 44
                                       F-4


<PAGE>




                 XPLORER, S.A. (a development stage enterprise)
      CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (Notes 1, 2,3, and 8)

                                                                            
                                                                          
<TABLE>
<CAPTION>
                                                                                                  Deficit   
                                                                                                Accumulated      
                                           Common stock           Preferred Stock                   During
                                            ($.001 par)             ($.001 par)       Capital    Development
                                      Shares        Amount        Shares    Amount    Surplus       Stage         Total
                                   ------------    ---------    ---------   ------   ----------   ---------    ----------
<S>                                  <C>            <C>         <C>         <C>      <C>          <C>          <C>    
Balance , January 1, 1995               964,000       $1,000                         $1,793,800                $1,794,800
Net Loss for period                                                                               ($104,000)     (104,000)
                                   ------------    ---------    ---------   ------   ----------   ---------    ----------

Balance, December 31, 1995              964,000       $1,000                         $1,793,800    $104,000    $1,690,800
                                   ------------    ---------    ---------   ------   ----------   ---------    ----------

Balance, January 1, 1996                964,000        1,000                         $1,793,800    (104,000)   $1,690,800
Balance, August 15, 1996
 merger with Gerant
 pursuant to the Plan
 (August, 1996)                      14,639,000      $14,600    1,043,000   $1,000      252,800      52,000       320,400
Stock issued  to  special
  creditors pursuant to  the
  Plan (September, 1996)               996,000        1,000                             98,600                   $99,600
Preferred stock  issuance
  to Atlantic  beneficiary
  for 189,960 LLC's
  (December, 1996)                                                237,550      300      207,300                   207,600
Dividend  waiver
  on preferred stock
  (December 1996)                     1,000,000        1,000                             99,000    (100,000)
Stock issued to employees
  and consultants for
   professional services
  (December, 1996)                      955,000        1,000                             94,500                    95,500
Net loss for period                                                                                (752,000)    (752,000)
                                   ------------    ---------    ---------   ------   ----------   ---------    ----------
Balance, December 31, 1996           18,554,000      $18,600    1,280,550   $1,300   $2,546,000   ($904,000)   $1,661,900
                                   ============    =========    =========   ======   ==========   =========    ==========
</TABLE>



 The notes to the financial statements are an integral part of these statements

                                                                   Page 34 of 45
                                       F-5
                                                                    

<PAGE>

                 XPLORER, S.A. (a development state enterprise)
                      CONSOLIDATED STATEMENT OF CASH FLOWS

                                                        1996            1995
                                                    -----------     -----------
Net loss                                              ($752,000)      ($104,000)
Adjustment to net cash used by operations:
Minority interest in net loss of Company               (340,300)        (56,000)
Depreciation and amortization                           181,900
Accretion of interest                                   160,400
Gain on marketable securities                           (37,000)
Accrued expenses and other liabilities                   40,200          60,000
Related party payable                                   149,000
Prepaid commissions                                    (210,000)
Other                                                    24,500
                                                    -----------     -----------
  Total adjustments                                     (31,300)          4,000
                                                    -----------     -----------

Net cash used by operations                            (783,300)       (100,000)

Financing activities:
  Sale of Atlantic units for cash                       458,300
  Proceeds from sale of investment contracts          1,375,000         200,000
  Repayment of gold contracts                          (325,000)
  Note payable                                          450,000
                                                    -----------     -----------
  Net cash provided by financing activities           1,958,300         200,000
                                                    -----------     -----------
Investing activities:
  Computer equipment purchases                           (8,000)
  Mining property expenditures                         (527,000)
  Acquisition of marketable securities               (1,130,000)
  Proceeds from marketable securities                   911,000
  Gerant creditor expenditures                         (355,000)
                                                    -----------     -----------
  Net cash used by Investing Activities              (1,109,000)              0
                                                    -----------     -----------
Increase  in cash                                        66,000         100,000
Cash - Beginning                                        100,000               0
                                                    -----------     -----------
Cash - Ending                                          $166,000        $100,000
                                                    ===========     ===========

Supplemental cash flow information:
  Income taxes paid                                         800               0
                                                    ===========     ===========
  Interest paid                                         $11,300              $0
                                                    ===========     ===========

Atlantic exchanged 110,000 LLC units for commercial  properties ($500,000 value)
and professional  services.  The Company issued 1,995,000 shares of common stock
for compensation and a preferred stock dividend.

 The notes to the financial statements are an integral part of these statements

                                                                   Page 35 of 44
                                       F-6
                                                                             

<PAGE>


                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996

Note 1   Organization and Presentation:

         XPLORER, S.A., the "Company" (successor to Gerant Industries, Inc.) was
         organized by adoption of amended and restated Articles of Incorporation
         dated July 5, 1996 which were filed with the office of the Secretary of
         State of Nevada on August 15, 1996.

         Gerant Industries,  Inc. ("Gerant") filed a petition for reorganization
         under  Chapter 11 of the United States  Bankruptcy  Court (the "Court")
         for the Central  District of  California  on March 1, 1994. On July 24,
         1996 the Court confirmed  Gerant's Third Amended Plan of Reorganization
         (the  "Plan").  The Plan  approved  the  amendment  of the  Articles of
         Incorporation and By-laws,  change of corporate name,  authorization of
         common and preferred shares of stock, payment of claims and issuance of
         stock by the successors to this debtor-in-possession, XPLORER, S.A. The
         Company was to issue  16,500,000  shares of common stock and  1,043,000
         shares of preferred stock.

         The historical determinable value in accordance with generally accepted
         accounting  principles  was $320,000 and the Company  accounted for the
         transaction as a reverse acquisition.

         The Company is a development  stage enterprise and has not achieved its
         intended operations or related revenue as of this date.

         The Company,  a development  stage  enterprise,  anticipates  obtaining
         sufficient   cash  resources  in  1997  from  the  sale  of  investment
         contracts, warrant exercise, operations, or private placement of equity
         securities.  Such  proceeds  are  necessary  to assure  the  funding of
         anticipated  operating  costs  and  satisfaction  of  $1.2  million  in
         negative working capital as of December 31, 1996.

         Presentation:
         
         The Company  intends to engage in the  development of natural  resource
         properties.  As of 12/31/96  and 12/31/95 the Company does not have any
         operating  properties and is a development  stage enterprise owning 59%
         of Atlantic  Pacific  Trust,  L.L.C.  and its  wholly-owned  subsidiary
         Atlantic-Pacific  Finanzprodukte,  GmbH as of December 31,  1996.  Such
         presentation has been reflected as of December 31, 1995 for purposes of
         accounting  for the Gerant  transaction as a reverse  acquisition.  The
         accounts of this entity,  which made a $355,000  loan to Gerant as part
         of the Plan, are included in these  consolidated  financial  statements
         and all significant  inter-company  transactions  have been eliminated.
         The  loan  was   converted  to  common  stock   special  units  of  the
         Company (Note 8).



                                                                   Page 36 of 45
                                       F-7
                                                                           

<PAGE>


                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996

         For  purposes of  financial  reporting,  Xplorer S.A. is treated as the
         purchaser  in  a  reverse  acquisition  of  Gerant  (See  Note  3)  and
         accordingly,  the 1995 financial  statements reflect the Company on the
         same basis.

         Gerant   had  net  assets  of   approximately   $52,000   (Note3)   and
         insignificant  operations  from January 1, 1994 to August 15, 1996. The
         quasi-reorganization  of this entity  resulted in retained  earnings of
         -0- as of January 1,1996.


Note 2   Summary of Significant Accounting Policies:

         Mining Properties:
     
         Mining  properties are reflected in property,  plant,  and equipment at
         cost of acquisition  and  development.  Costs include efforts to remove
         ore and waste, exploration,  development of new ore bodies and defining
         further mineralization in existing ore bodies. These costs are deferred
         and will be charged to operating costs utilizing the unit-of-production
         method in the period in which commercial production occurs.

         When a property is  identified  as having  development  potential,  the
         costs of engineering,  contract labor, financing, and professional fees
         related to  development  are  capitalized  as they are  incurred.  If a
         project is determined not to be  economically  feasible,  unrecoverable
         costs  are  expensed  in the year in which the  determination  is made.
         Mining  properties are reflected at net  realizable  value based on the
         Company's ability to generate future value.

         Revenue Recognition:

         Revenue is recognized  when title to delivered  gold or other  precious
         metals passes to the buyer.

         Reporting Currency:

         While the Company has significant financing transactions denominated in
         German  currency,  its operations are located in the U.S.  Accordingly,
         all financial  information  regarding these  transactions is translated
         into U.S. dollars and no material transaction effect exists at December
         31, 1996.

         Loss Per Share:

         The loss per share is calculated  using the weighted  average number of
         shares outstanding.  Warrants outstanding are anti-dilutive and are not
         included.


                                                                   Page 37 of 44
                                       F-8
                                                                    

<PAGE>

                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996

         Property, Plant & Equipment and Depreciation:

         All property,  plant and equipment is stated at cost and depreciated on
         a  straight-line  basis  over  individual  useful  lives - three  years
         (computers),  five years (mining equipment),  and units-of-  production
         based upon proven and probable  reserves once mining property is at the
         operational level.

         Financial Uncertainties:
 
         The Company is in the development  stage and has experienced a net loss
         of $752,000.  The loss is principally  due to commissions  and interest
         associated with the 1996 German  financing.  There is no assurance that
         commercial quantities of mineral resources can be developed and sold in
         a  profitable  market.  Also,  mining  production  could be delayed and
         uninsurable risks could be incurred (See Note 9).

         The  Company's  profitability  is subject to change in gold  prices and
         exchange rates. To reduce the impact of such changes, the Company locks
         in  the  future  value  of  certain  of  these  items  through  hedging
         transactions.  These  transactions are accomplished  through the use of
         financial instruments,  the value of which is derived from movements in
         the  underlying  gold  prices,  the  Company's  actual  production,  or
         exchange rates.

         The Company  intends to engage in financial  instruments  to reduce the
         financial  impact caused by  fluctuations  in the exchange rate of U.S.
         dollars to German Deutsche Mark liabilities.

         The carrying values of investment  contracts  involving gold settlement
         are  re-measured  using the market  value of gold at the balance  sheet
         date($369  per troy ounce).  The price of gold has  decreased as of the
         report date.

         Income Taxes:

         XPLORER,  S.A.  and its  predecessor  company  have a  substantial  net
         operating  loss of an uncertain  amount as of December 31, 1996.  Prior
         year tax returns are now being prepared.

         Common Stock Issuance:

         Shares issued to Gerant special creditors, employees,  consultants, and
         preferred shareholder of the Company are valued at the nominal value of
         $.10 per share.  Common  stock  Units  include one share of stock and a
         warrant to acquire an additional share at 70% of market value.

         Use of Estimates:

         The  preparation of financial  statements in conformity  with generally

                                                                   Page 38 of 45
                                       F-9
                                                                             

<PAGE>

                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996

Note 2   Summary of Significant Accounting Policies (cont'd)

         accepted  accounting  principles  requires management to make estimates
         and  assumptions  that  affect  the  reported  amounts  of  assets  and
         liabilities  at the date of the financial  statements  and the reported
         amounts of revenues and expenses  during the reporting  period.  Actual
         results could differ from those estimates.


Note 3   Reverse Acquisition:

         Gerant  changed  its  corporate  name to  XPLORER,  S.A  pursuant to an
         exchange of stock and the provisions outlined in the Plan.

         The  Gerant's  balance  sheet  prior to the  execution  of the Plan and
         reorganization with newly-formed XPLORER, S.A. was:

                                                 $000's
                                                 ------
         Cash (Note 8)                             335
         Other current assets                       17
                                                  ----
                                                   352
                                                  ----
         Net fixed assets                            3
         Investments                               500
                                                  ----
         Total Assets                             $855

         Current liabilities                      (298)
         Pre-petition liabilities                 (150)
         Atlantic advance (Note 8)                (355)
                                                  ----
         Total liabilities                        (803)
                                                  ----
         Net Assets                                $52
                                                  ====

         Under the Plan,  the  Company  would  realize  the assets of Gerant and
         assume the liabilities at Gerant basis,  and issue common and preferred
         stock in exchange for  1,005,000  units of Atlantic  equity held by the
         Company.   Such  units  had  a  nominal  book  value  of  $0.32.  These
         transactions  created a  valuation  for the  Company's  new  common and
         preferred stock issuance of $320,000.


Note 4   Marketable Securities:

         The amounts  disclosed  below  represent  marketable  securities of the
         Company. All securities have been classified as "trading".

                                                                   Page 39 of 44
                                      F-10
                                                        

<PAGE>

                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996

Note 4   Marketable Securities (cont'd)

                                          Cost      Fair Value
                                       ---------    ----------        
         Equity securities              $211,400     $243,900

         Options - equity securities     (15,000)     (17,500)
                                       ---------    ----------

                                        $196,400     $226,400
                                       =========    ==========


         At December 31, 1996,  gross unrealized gains were $30,000 and realized
         gains were  $7,000.  Most options are covered  call  positions  thereby
         limiting any market risk to the Company.

         The  Company  does  not  use  derivatives   financial  instruments  for
         speculative  purposes.  The Company enters into gold equity investments
         to manage exposure to changes in gold prices.  Such agreements are used
         to  participate  in a rising gold price and the  Company's  undelivered
         commitments.


Note 5   Note Receivable:

         SYM-TEK  filed  Chapter  11  bankruptcy  proceedings  with  Gerant as a
         creditor.  The amount of $16,000  was  received on January 23, 1997 and
         used to pay legal obligations of Gerant's bankruptcy proceeding.

Note 6   Property, Plant and Equipment:

                                                 Accumulated     Net Book
                                      Cost      Depreciation      Value
                                   ----------   ------------   -----------
         Computer equipment           $11,100       ($1,900)        $9,200
         Development costs -
            Evening Star            2,666,000                    2,666,000
         Mining equipment -
            Evening Star              909,200      (180,000)       729,200
                                   ----------   -----------    -----------
                                   $3,586,300     ($181,900)    $3,404,400
                                   ==========   ===========    ===========

         The  Company's  majority-owned  subsidiary  (Note 8) owns eight  claims
         known as the Evening Star Mine located in Piute Mountain,  Kern County,
         California.  Most of the  development  costs for Evening Star Mines are
         from related parties (Note 13).



                                                                   Page 40 of 45
                                      F-11
                               

<PAGE>


                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996


Note 7   Other Investments:

         The  Company  holds a  $500,000  full  recourse  promissory  note at 8%
         interest per annum,  payable monthly and principal due August 18, 1997.
         This note is secured by 500,000  Class C Units of United  Realty  Group
         Limited  Partnership  redeemable  by issuer at $1.00 per unit in August
         1997 and 75% tenant in common  interest  in the net  proceeds  from the
         Southwood  Plaza  Shopping  Center in Charlotte,  North  Carolina.  The
         property presently generates positive cash flow.  However,  the Company
         has  elected  not to reflect a $400,000  non-recourse  promissory  note
         secured  only by  400,000  units of United  Realty  Group  Partnership.
         Interest on the $500,000  note of $3,333 has been received on a monthly
         basis during 1996.  Atlantic owns 100% of the common stock of a company
         that has two investments in commercial property located in Bakersfield,
         California.  The net realizable value of this investment is $500,000 as
         of December 31, 1996.

         Atlantic owns 466,000  shares of XPLORER,  S.A. This  investment is 59%
         eliminated  in  consolidated  financial  statements  and reflected at a
         nominal value of $.10 per share or $19,000.

Note 8   Atlantic Pacific Trust, L.L.C.:

         Atlantic Pacific Trust, L.L.C. ("Atlantic"), a Nevada limited liability
         company,  is a natural  resource  company owned by XPLORER and three of
         the Company's shareholders (the "Minority Interest").  Such corporation
         is the  successor to Atlantic  Pacific  Trust  ("APT") and is the legal
         owner of certain mining properties located in Kern County, California.

         These mining properties  (approximately 117 mining claims) were held by
         a trust controlled by William M. Moreland ("Moreland"), and transferred
         to a new entity, North Star Industries  ("North").  North was 30% owned
         by Moreland, 30% owned by Gardner, and 40% owned by Compania Comerciale
         Atlantis,   S.A.,  a  Costa  Rican  entity  ("CCA").  The  claims  were
         eventually  divided into four  separate  trusts.  One of these  trusts,
         Nevada  Trust,  which owned eight  claims  known as the  "Evening  Star
         Mine", was acquired at cost by APT.

         APT was funded by sale of investment contracts,  precious metal forward
         contracts,  and equity  units ("LLC").  The Company owns 1,254,960  LLC
         units as of December 31, 1996 (59%).

         APT made a loan to the  Company  for  $355,000  that was  converted  to
         Company  special units (one share of common stock and one B warrant and
         C warrant  each  exercisable  within  five years at $2.00 and $3.00 per
         share,  respectively)  and paid a Gerant creditor  $110,000 in exchange
         for 111,667 shares of the Company's  common stock These funds were used


                                                                   Page 41 of 44
                                      F-12


<PAGE>

                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996

Note 8   Atlantic-Pacific Trust, LLC (cont'd)

         by the  Company  to pay  Gerant  creditors  according  to the Plan.  At
         December  31,  1996,  the value of 275,334  shares (59% of 466,667) has
         been eliminated upon consolidation.

         The Plan provided that Compania Comercial Atlantis, S.A. would exchange
         500,000  of it's  LLC  units  for  1,250,000  preferred  shares  of the
         Company.  However,  only 417,200  units were  exchanged  for  1,043,000
         preferred  shares under this Plan. In December  1996,  this company did
         exchange  189,960 units for an additional  237,550  shares of preferred
         stock.  The preferred  stock is partially  convertible to ten shares of
         common  stock at the end of six years and had a  dividend  of 1.00% per
         month payable in common stock at time of conversion.  In December 1996,
         the  preferred  stockholder  agreed to waive  all  present  and  future
         preferred  dividend rights for the future issuance of 1,000,000  common
         shares of the Company.

         The  Plan  also  provided  that  585,560  LLC  units  held by  Atlantic
         beneficiaries be exchanged for Debtor Notes and converted to 14,639,000
         shares of common stock. In addition, the former Gerant shareholders had
         a reverse  split of 5 to 1 to  400,000  total  shares  which were to be
         exchanged  pursuant to the Plan for 400,000  common  stock Units of the
         Company.  Each common stock Unit consisting of one common share and one
         Warrant for one share of common at 70% of market asking price on August
         5, 1997. (287,000 Units were issued as of 12/31/96)


Note 9   Accrued Legal Fees:

         Per the Plan,  Atlantic agreed to purchase an estimated  $257,000 legal
         fee administrative  claim of the law firm, Robinson,  Diamant,  Brill &
         Klausner (the" Firm"). Upon the purchase,  Atlantic intends to exchange
         the claim for 257,000 of its Xplorer,  S.A. common stock special units.
         During 1996,  the Firm was paid $159,000 and a bonus of 100,000  shares
         of Company common stock.


Note 10  Note Payable:

         In  September,   1996  the  Company  borrowed   $450,000  from  Gardner
         Investments.  The  terms of the  note  are  10.00%  per  annum  payable
         monthly.  The principal is due and payable on September 25, 1997 and is
         secured by 500,000 Class C Units of United Realty Group,  L.P. The note
         is  convertible,  at the option of the holder,  at any time for 150,000
         shares of common stock of the Company.





                                                                   Page 42 of 45
                                      F-13


<PAGE>


                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996

Note 11  Investment Contracts Payable:

         Atlantic has issued investment  contracts under German securities laws.
         Such contracts are four types:

         a)     Contract  of  $9,645  per  kilo  received  in U.S.  dollars  for
                purchase  of  undelivered  kilos  (32.15  troy  ounces)  of gold
                bullion. All contracts have a one year maturity.  As of December
                31, 1996,  the balance is $273,000.  The Company has covered its
                gold risk on outstanding contracts up to $369 per ounce.

         b)     Zero-coupon  contract  of $12,500  payable in U.S.  dollars  and
                bearing  interest  at  9.00%  per  annum.   Such  contracts  are
                repayable  with  related  interest in one to five  years.  As of
                December 31, 1996 the balance is $337,500  and interest  expense
                of $28,100 has been accreted.

         c)     Zero-coupon  contract  payable in 5,000  German  Deutsche  Marks
                ("DM")  units and  bearing  interest  at 9.00% per  annum.  Such
                contracts  are repayable  with related  interest in DM in one to
                five years.  The balance as of December  31, 1996 is  $1,129,500
                and interest expense of $132,300 has been accreted.

         d)     Zero-coupon contract payable in DM or gold at the rate of 600 DM
                principal  per 1 troy ounce of gold did not result in funding to
                the  Company  until  January  1997.  This  is the  only  type of
                contract that will be offered in the future.

         All bonds are secured by the  Company's  interest  in the Evening  Star
         mining claims per assignment to a bond trustee.

         The Company paid commissions of approximately 33% and raised $1,375,000
         in net funds during 1996.

         Investment contracts are due as follows:

                  1997     $1,188,000
                  1998        267,000
                  1999        150,000
                  2000         45,000
                  2001         86,700
                  2002          4,000
                           ----------
                  Total    $1,740,700
                           ==========




                                                                   Page 43 of 44
                                      F-14


<PAGE>


                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996

Note 12  Related Party Payable:

         In 1995, Atlantic entered into agreements with Sequoia Trust, a related
         party,  to lease surface and mineral rights related to 57 acres of land
         adjacent to Evening Star Mine and certain  improved real property known
         as the Weldon Research Center for total cost of $6000 per month.  These
         lease are renewable after a five year term and require a future minimum
         annual payment of $72,000 to Sequoia Trust.  Total charges  capitalized
         to development during 1996 were $104,000.

         These  properties  provide the Company with the  opportunity to develop
         three patented  mining claims with probable  commercial  grade ore (12%
         royalty  due to Sequoia  Trust),  construct  a primary  ore  processing
         refinery,  and utilize 13,000 square feet at the Weldon Research Center
         for its mineralization analysis and other testing procedures.

         Atlantic  also has a cancellable  contract with EMTEC,  Inc., a related
         party,  for  development of the all eleven mining claims and the future
         operation of the mine and refinery.  The contract  requires the Company
         to pay EMTEC  bi-monthly  at  invoiced  cost plus 18%  overhead.  Total
         charges capitalized to development during 1996 were $459,000.

         As of December  31, 1996 the Company owes these  entities  $147,000 for
         past  services  and such amount is accrued into  development  costs for
         Evening Star Mine (See Note 6).

Note 13  New Accounting Pronouncements:

         Statement of Financial Accounting Standards No 121, "Accounting for the
         Impairment of Long-Lived  Assets to be Disposed Of" (SFAS 121) requires
         that long-lived  assets be reviewed for impairment  whenever changes in
         circumstances  indicate that the carrying amount of an asset may not be
         recoverable. The adoption of this statement as of December 31, 1996 had
         no material effect on the consolidated financial statements.

         Statement of Financial  Accounting  Standards Nos. 123, "Accounting for
         Stock-Based  Compensation" (SFAS 123) establishes  financial accounting
         and reporting standards for stock-based employee  compensation plans as
         well as transactions  in which an entity issues its equity  instruments
         to acquire  goods or  services  from  non-employees.  However,  it also
         allows an entity to continue to measure  compensation cost based on APB
         Opinion  No.  125,  "Accounting  for Stock  Issued to  Employees".  The
         Company has  determined  that the fair value of stock  transactions  is
         similar to the issue price at the time of granting and accordingly, has
         elected to continue to apply the intrinsic value based method.

         In June,  1996,  Statement of Financial  Accounting  Standards No. 125,
         "Accounting  for  Transfers  and  Servicing  of  Financial  Assets  and
         Extinguishments of Liabilities" (SFAS No.

                                                                  Page 44 of 45
                                      F-15


<PAGE>


                 XPLORER, S.A. (a development stage enterprise)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          Year Ended December 31, 1996

Note 13  New Accounting Pronouncements (cont'd)

         125), which provides  accounting and reporting  standards for transfers
         and servicing of financial  assets and  extinguishments  of liabilities
         occurring after December 31, 1996 was issued.  The adopting of SFAS No.
         125 is not expected to have any impact on the  financial  statements of
         the Company.







         



















                                                                  Page 45 of 45

                                      F-16