<PAGE>   1

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

                                   FORM 10-KSB

[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

         FOR THE FISCAL YEAR ENDED APRIL 30, 2001

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

                        COMMISSION FILE NUMBER 333-57043

                              BANNER HOLDING CORP.
                 (Name of small business issuer in its charter)

          Florida                                         65-0826508
  (State or jurisdiction of                 (I.R.S. Employer Identification No.)
incorporation or organization)


                           120 North U.S. Highway One
                             Tequesta, Florida 33469
                                 (561) 747-0244
          (Address and telephone number of principal executive offices)

       Securities registered under Section 12(b) of the Exchange Act: NONE

         Securities registered under Section 12(g) of the Exchange Act:
                     COMMON STOCK, PAR VALUE $.01 PER SHARE

         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act of 1934 during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes [X] No [ ].

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

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

         As of July 31, 2001, there were 3,000,000 shares of common stock
outstanding excluding 200,000 common shares subject to redemption. The aggregate
market value of such shares held by non-affiliates of the registrant was $0.

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      None


<PAGE>   2


                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS

The Company was formed as a Florida corporation in January 1998 to effect a
merger, exchange of capital stock, asset acquisition or other similar business
combination (a "Business Combination") with an operating business (a "Target")
which the Company believes has significant growth potential. The Company filed a
Registration Statement on Form SB-2 with the Securities and Exchange Commission
which became effective April 20, 2000. An Initial Public Offering Prospectus
dated May 3, 2000 was included in the Registration. The Company has not engaged
in any commercial business since the offering and has not determined when it
will do so. The Company has no plan, proposal, agreement, understanding or
arrangement to acquire or merge with any specific business or entity and has not
identified any specific business or entity for investigation and evaluation. The
Company intends to utilize cash (derived from the proceeds of the offering),
equity, debt or a combination thereof to effect a Business Combination.

BUSINESS COMBINATION

The Company's officers and directors, shareholders, its legal counsel or other
professional associates may introduce prospective Business Combinations. The
Company's search is not restricted to any specific business, industry or
geographic location. It may participate in a business venture of virtually any
kind. In implementing a structure for a particular Business Combination, the
Company may become party to a merger, consolidation, reorganization, joint
venture or licensing agreement with another corporation or entity. The Company
may acquire assets and establish wholly-owned subsidiaries in various
businesses, or acquire existing businesses as subsidiaries.

EVALUATION OF BUSINESS COMBINATION BY INVESTORS

The offering is a "blank check" offering due to management's broad discretion
with respect to the specific application of the net proceeds of the offering.
Substantially all of the net proceeds of the offering are intended to be
generally applied toward effecting a Business Combination, but have not been
marked for any specific purpose. Management has sole discretion in determining
which businesses, if any, are to be acquired, and the terms of such acquisition.
Investors in the blank check offering will have the opportunity to evaluate the
merits and risks of an acquisition and will be entitled to elect whether they
desire to remain investors in the Company. An acquisition will only be
consummated if investors representing 80% of the maximum offering proceeds
reconfirm their investments (as described in the following paragraph).

The "blank check" offering is subject to Rule 419 of Regulation C under the
Securities Act of 1933 as Amended. Rule 419 requires that net offering proceeds
and the securities issued to investors must be deposited in an escrow account.
The deposited funds (except for an amount up to 10% of the deposited funds) and
deposited securities may not be released until an acquisition conforming to
certain specified criteria has been consummated and a sufficient number of
investors reconfirm their investment in accordance with the procedures set forth
in Rule 419. At that time a new prospectus describing the acquisition candidate
and its business and including audited financial statements will be delivered to
all investors. The Company must return the pro




                                       1
<PAGE>   3

rata portion of the deposited funds to any investor who does not elect to remain
an investor. A sufficient number of investors must elect to remain investors, or
all investors will be entitled to the return of a pro rata portion of the
deposited funds (plus interest) and none of the deposited securities will be
issued to investors. In the event an acquisition is not consummated within 18
months of the effective date of the prospectus, the deposited funds will be
returned on a pro rata basis to all investors.

IDENTIFYING A TARGET

The selection of a Target is complex and risky because of competition for such
business opportunities among all segments of the financial community. In
searching for a Target, the Company is considering various factors:

   - costs associated with effecting a Business Combination
   - equity interest in and possible management participation in the
     Target
   - growth potential of the Target and its industry
   - experience and skill of management and availability of additional
     personnel of the Target
   - capital requirements of the Target
   - competitive position of the Target
   - potential for further research, development or exploration
   - degree of current or potential market acceptance of product/service
   - risk factors
   - regulatory environment of the Target's industry
   - profit potential

The evaluation as to the merits of a particular Business Combination will be
based on relevant factors as listed above as well as other considerations deemed
by management to be relevant to effecting a Business Combination consistent with
the Company's business objective. Management will conduct an extensive due
diligence review which will encompass, among other things, meeting with
incumbent management and inspection of facilities, as well as a review of
financial or other information made available to the Company.

TERMS OF BUSINESS COMBINATION AGREEMENT

The actual terms of an acquisition or merger transaction are unpredictable. Tax
considerations as well as other relevant factors will be evaluated in
determining the precise structure of a particular Business Combination, which
could be effected through various forms of a merger, consolidation or stock or
asset acquisition. The parties will endeavor to structure the Business
Combination to achieve the most favorable tax treatment to the Company, the
Target and their respective shareholders. Although the Company has no
commitments to date to issue any Shares other than as described in the Initial
Public Offering Prospectus, the Company will, in all likelihood, issue a
substantial number of additional Shares in connection with a Business
Combination. To the extent that such additional Shares are issued, dilution to
the interests of the Company's shareholders will occur, or a change in control
of the Company may occur. The written agreements executed in consummation of a
Business Combination will contain, but not be limited to, the following:

   - representations and warranties by all parties thereto
   - specifications as to default penalties
   - terms of closing



                                       2
<PAGE>   4

   - conditions to be met prior to closing
   - conditions to be met after closing
   - allocation of costs, including legal and accounting fees

The Company is subject to all the reporting requirements included in the
Exchange Act. It will therefore exercise its affirmative duty to file
independent audited financial statements with the Securities and Exchange
Commission as part of its Form 8-K upon consummation of a merger or acquisition.
The closing documents will provide that such audited financial statements be
available at closing or within ample time to comply with reporting requirements.
If such statements are not available, or do not conform to representations made
by the Target, the proposed transaction will be voidable at the discretion of
present Company management.

ITEM 2. DESCRIPTION OF PROPERTY

The Company has an oral agreement with the Company President that permits the
Company to share with related companies executive offices rent-free in
approximately 1200 square feet of office space located at 120 N. U.S. Highway
One, Tequesta, Florida 33469. The Company considers this space adequate for its
needs and has no plans with respect to office space in the future. The Company
does not own any property and does not intend to make any such acquisitions in
the near future.

ITEM 3 LEGAL PROCEEDINGS

The Company is not a party to, nor is it aware of, any threatened litigation of
any nature.

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

None.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

There is no trading market for the shares of the Company nor is there any
assurance that a regular trading market will develop for the Shares, or that, if
developed, any such market will be sustained. The Company anticipates that
trading of the Shares will be conducted through what is customarily known as the
"pink sheets" and/or on the National Quotation Bureau's Over-the-Counter
Electronic Bulletin Board (the "Bulletin Board"). Any market for the Shares
which may result will likely be less well developed than if the Shares were
traded on NASDAQ or on an exchange.

The Company has registered the shares of the Offering only in New York. The
shares may only be traded in New York. There can be no assurances that the
shares will be eligible for sale or resale in any other jurisdiction other than
New York. The Company may apply to register the shares in several states or for
secondary trading.

As of July 31, 2001 two persons own the 3,000,000 shares of common stock
outstanding (excluding 200,000 common shares subject to redemption). On January
26, 1998, the Company issued 1,650,000 shares of its Common Stock to John M.
O'Keefe, the Company's President and a Director, and 1,350,000 shares to Vicki
J. Lavache, the Company's Secretary/Treasurer and a Director. Each paid $0.013
per share for an aggregate of $39,000.




                                       3
<PAGE>   5

In addition, the shareholders have contributed $37,227 for offering and
administrative expenses to April 30, 2001.

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

The Company, a development stage entity, has neither engaged in any operations
nor generated any revenues to date. Its entire activity since its inception has
been fund raising through an offering of equity securities.

The Company's administrative expenses to date are approximately $44,000.
Included in the expenses is $19,500 in non-cash general and administrative
expense.

Substantially all of the Company's working capital needs will be attributable to
the identification of a suitable Target, and thereafter to effectuate a Business
Combination with such Target. Although no assurances can be made, the Company
believes it can satisfy its cash requirements until a Business Combination is
consummated with 10% of the net proceeds derived from the Offering. Expenses to
date have been limited to accounting, legal, and filing fees, escrow agent fees
and transfer agent fees.

ITEM 7. FINANCIAL STATEMENTS

The financial statements that constitute Item 7 follow the text of this report.
An index to the financial statements appears in Item 13(a) of this report.

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

None.

                                    Part III

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

Name                                Age     Title
----                                ---     -----

John M. O'Keefe                      59     President, Director
Vicki J. Lavache                     54     Secretary/Treasurer, Director

Mr. O'Keefe, President and Director since January 1998, serves as chief
executive officer of Merit First, Inc. (which he formed in June 1996), an
investment banking firm specializing in advising development stage enterprises
concerning finance, located in Tequesta, Florida. Prior to that, he served as
chief financial officer of Eutro Group Holding, Inc., a publicly-traded company
located in Jupiter, Florida in the medical diagnostic business, since 1993.
Earlier in his career, Mr. O'Keefe sold life and health insurance and worked as
a bank loan officer. He spent four years in the U.S. Navy after attending
Fordham University in New York in 1964. Mr. O'Keefe is a promoter of three
"public shell" companies registered with the Securities and Exchange Commission:
Zenith Holding Corp., Liege Holding, Inc., and Haven Holding, Inc., all Florida
corporations.

Ms. Lavache, Secretary/Treasurer, Director since January 1998, serves as
secretary/treasurer of Merit First, Inc. Previously, she served with Mr. O'Keefe
on the Board of Eutro Group Holding. From 1986 through 1999



                                       4
<PAGE>   6

she owned Executive Line Business Services, Inc. in Jupiter, Florida, a provider
of secretarial, bookkeeping and other business services. Ms. Lavache serves as
President and Director of three "public shell" companies registered with the
Securities and Exchange Commission: Zenith Holding Corp., Liege Holding, Inc.,
and Haven Holding, Inc., all Florida corporations.

The directors of the Company hold office until the next annual meeting of the
shareholders and until their successors have been elected and qualified. The
directors receive no compensation for serving as such, other than reimbursement
of reasonable expenses incurred in attending meetings. Officers are appointed by
the Board of Directors and serve at the discretion of the Board. Messrs. O'Keefe
and Lavache, the current executive officers of the Company, devote approximately
40% of their time to the affairs of the Company.

There are no agreements or understandings for any officer or director to resign
at the request of another person and neither of the officers or directors is
acting on behalf of or will act at the direction of another person.

As detailed in Items 6 and 9 of this report and as reported on Forms 3 as filed
with the Securities and Exchange Commission, officers and directors, John M.
O'Keefe and Vicki J. Lavache own 3,000,000 shares of common stock constituting
100% of the outstanding shares.

ITEM 10. EXECUTIVE COMPENSATION

No compensation has been paid to any officers or directors since inception. The
Company does not expect to pay any direct or indirect compensation to its
officers and directors except for reimbursement for reasonable out-of-pocket
expenses. There are no understandings or arrangements otherwise relating to
compensation. Management anticipates that shares of the Company's authorized but
unissued Common Stock may be utilized in connection with a business acquisition
or combination and not as compensation to the Company's management, promoters,
or their affiliates or associates.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information as of July 31, 2001 with respect to
the beneficial ownership of shares of Common Stock by (i) each person known by
the Company to be the owner of more than 5% of the outstanding shares of Common
Stock, (ii) each director, and (iii) officers and directors as a group.

                             AMOUNT AND APPROXIMATE
                        PERCENTAGE OF OUTSTANDING SHARES

<TABLE>
<CAPTION>

                                                              Beneficial                Percentage
Class             Shareholder                                 Ownership                  of Class
-----             -----------                                 ---------                 ----------
<S>      <C>                                                  <C>                            <C>
Common            John M. O'Keefe (1)                         1,650,000                      55%
                  8671 SE Somerset Island Way
                  Jupiter, Florida 33458

Common            Vicki J. Lavache (1)                        1,350,000                      45%
                  1510 Seabrook Road
                  Jupiter, Florida 33469

Common            Officers and directors
                  as a group (2 persons)                      3,000,000                     100%
</Table>

(1) An officer and director




                                       5
<PAGE>   7

Unless otherwise noted, the persons named in the table have sole voting and
investment power with respect to all Shares beneficially owned by them. Neither
person named in the tables is acting as nominee for any persons or is otherwise
under the control of any person or group of persons.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Since inception the Company has maintained its executive offices in
approximately 1200 square feet of office space at 120 N. U.S. Highway One in
Tequesta, Florida. The space is provided at no cost by Merit First, Inc., a
private company owned by Company shareholders John O'Keefe and Vicki Lavache.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a)      Financial Statements - April 30, 2001

         Table of Contents                                             i
         Report of Independent Public Accountant                      F-1
         Balance Sheet                                                F-2
         Statement of Operations                                      F-3
         Statement of Changes in Stockholders' Equity                 F-4
         Statements of Cash Flows                                     F-5
         Notes to Financial Statements                                F-6

(b)      Reports on Form 8-K

         None




                                       6
<PAGE>   8

                                   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.

                                            BANNER HOLDING CORP.

                                            By: /s/ John M. O'Keefe
                                                --------------------------------
                                                    John M. O'Keefe
                                                    President


August 17, 2001











                                       7
<PAGE>   9


                              BANNER HOLDING CORP.
                          (A DEVELOPMENT STAGE COMPANY)

                              FINANCIAL STATEMENTS

                                 APRIL 30, 2001


<PAGE>   10







                              BANNER HOLDING CORP.
                         (A DEVELOPMENT STAGE COMPANY)

                                    CONTENTS

                                                                        Page
                                                                        ----

Independent Auditor's Report                                             F-1

Financial Statements:

 Balance Sheet                                                           F-2

 Statements of Operations                                                F-3

 Statements of Changes in Stockholders'
 Equity                                                                  F-4

 Statements of Cash Flows                                                F-5

 Notes to Financial Statements                                        F-6 - F-9








<PAGE>   11
                          INDEPENDENT AUDITOR'S REPORT

To The Board of Directors
Banner Holding Corp.

We have audited the accompanying balance sheet of Banner Holding Corp. (a
development stage company), as of April 30, 2001 and the related statements of
operations, changes in stockholders' equity and cash flows for the year then
ended and for the period from January 26, 1998 (inception) through April 30,
2001. 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. The financial statements of Banner Holding Corp.
as of April 30, 2000, were audited by other auditors whose report dated August
14, 2000, on those statements included an explanatory paragraph that described
the substantial doubt about the Company"s ability to continue as a going concern
discussed in Note 2 to the financial statements.

We conducted our audit in accordance with auditing standards generally accepted
in the United States. 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 April 30, 2001 financial statements referred to above
present fairly, in all material respects, the financial position of Banner
Holding Corp. (a development stage company) as of April 30, 2001, and the
results of its operations and its cash flows for the year then ended and for the
period from January 26, 1998 (inception) through April 30, 2001 in conformity
with accounting principles generally accepted in the United States.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 6 to the
financial statements, the Company has no revenues and has experienced net losses
of $43,930 since inception and a working capital deficiency of $30,793 as of
April 30, 2001. The Company's financial position and operating results raise
substantial doubt about its ability to continue as a going concern. Management's
plans regarding those matters are also described in Note 6. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

August 9, 2001
Boca Raton, Florida

                                       F-1


<PAGE>   12


                              BANNER HOLDING CORP.
                          (A Development Stage Company)
                                  BALANCE SHEET
                                 APRIL 30, 2001

                                     ASSETS

CURRENT ASSETS
 Cash                                                                  $    172
 Cash - restricted                                                       47,220
 Prepaid expenses                                                           940
                                                                       --------

         Total Current Assets                                            48,332

DEFERRED OFFERING COSTS                                                  66,072
                                                                       --------

TOTAL ASSETS                                                           $114,404
                                                                       ========



                      LIABILITIES AND STOCKHOLDERS" EQUITY

CURRENT LIABILITIES
 Accounts payable and accrued expenses                                 $ 26,905

COMMON STOCK SUBJECT TO REDEMPTION                                       52,220

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS" EQUITY                                                     35,279
                                                                       --------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                             $114,404
                                                                       ========












                Read accompanying Notes to Financial Statements.


                                       F-2


<PAGE>   13


                              BANNER HOLDING CORP.
                          (A Development Stage Company)
                            STATEMENTS OF OPERATIONS
                       YEARS ENDED APRIL 30, 2001 AND 2000
                                       AND
         PERIOD FROM JANUARY 26, 1998 (INCEPTION) THROUGH APRIL 30, 2001

<TABLE>
<CAPTION>

                                                                              January 26, 1998
                                      Year Ended           Year Ended            (Inception)
                                       April 30,            April 30,            To April 30,
                                         2001                 2000                  2001
                                     -----------           -----------        -----------------
<S>                                  <C>                   <C>                   <C>
REVENUES                             $        --           $        --           $        --

EXPENSES
 General and administrative               24,682                11,290                43,930
                                     -----------           -----------           -----------

NET LOSS                             $   (24,682)          $   (11,290)          $   (43,930)
                                     ===========           ===========           ===========

LOSS PER SHARE                       $      (.01)          $        --
                                     ===========           ===========

WEIGHTED AVERAGE NUMBER OF
 SHARES OUTSTANDING                    3,166,575             3,000,000
                                     ===========           ===========

</TABLE>













                Read accompanying Notes to Financial Statements.


                                       F-3


<PAGE>   14


                              BANNER HOLDING CORP.
                          (A Development Stage Company)
                  STATEMENTS OF CHANGES IN STOCKHOLDERS" EQUITY
         PERIOD FROM JANUARY 26, 1998 (INCEPTION) THROUGH APRIL 30, 2001


<TABLE>
<CAPTION>
                                                                                         Deficit
                                                Common Stock                           Accumulated
                                           ------------------------      Additional     During the
                                            Number of        Par          Paid-in      Development     Stockholder
                                             Shares         Value         Capital          Stage        Receivable         Total
                                           ---------      ---------      ---------       ---------       ---------       ---------
<S>                                        <C>            <C>            <C>             <C>             <C>             <C>
Common shares issued to
 founders                                  3,000,000      $  30,000      $   9,000       $      --       $ (29,528)      $   9,472
Noncash general and administrative
 expenses                                         --             --          1,500              --              --           1,500
Net (loss)                                        --             --             --          (1,500)             --          (1,500)
                                           ---------      ---------      ---------       ---------       ---------       ---------
Balance - April 30, 1998                   3,000,000         30,000         10,500          (1,500)        (29,528)          9,472

Repayment of stockholders" receivable             --             --             --              --          19,945          19,945
Noncash general and administrative
 expenses                                         --             --          6,000              --              --           6,000
Net (loss)                                        --             --             --          (6,458)             --          (6,458)
                                           ---------      ---------      ---------       ---------       ---------       ---------
Balance - April 30, 1999                   3,000,000         30,000         16,500          (7,958)         (9,583)         28,959

Repayment of stockholders" receivable             --             --             --              --           9,583           9,583
Contribution to capital                           --             --         26,452              --              --          26,452
Noncash general and administrative
 expenses                                         --             --          6,000              --              --           6,000
Net (loss)                                        --             --             --         (11,290)             --         (11,290)
                                           ---------      ---------      ---------       ---------       ---------       ---------
Balance - April 30, 2000                   3,000,000         30,000         48,952         (19,248)             --          59,704

Deferred offering costs attributable
 to common stock subject to
 redemption                                       --             --        (16,518)             --              --         (16,518)
Contribution to capital                           --             --         10,775              --              --          10,775
Noncash general and administrative
 expenses                                         --             --          6,000              --              --           6,000
Net (loss)                                        --             --             --         (24,682)             --         (24,682)
                                           ---------      ---------      ---------       ---------       ---------       ---------
Balance - April 30, 2001                   3,000,000      $  30,000      $  49,209       $ (43,930)      $      --       $  35,279
                                           =========      =========      =========       =========       =========       =========

</TABLE>

                Read accompanying Notes to Financial Statements.



                                       F-4


<PAGE>   15




                              BANNER HOLDING CORP.
                          (A Development Stage Company)
                             STATEMENTS OF CASH FLOW
                       YEARS ENDED APRIL 30, 2001 AND 2000
                                       AND
         PERIOD FROM JANUARY 26, 1998 (INCEPTION) THROUGH APRIL 30, 2001

<TABLE>
<CAPTION>

                                                                            January 26, 1998
                                          Year Ended        Year Ended        (Inception)
                                           April 30,         April 30,        To April 30,
                                             2001              2000               2001
                                          ----------        ----------      ----------------
<S>                                       <C>                <C>                <C>
CASH FLOWS FROM OPERATING
 ACTIVITIES:
  Net (loss)                              $(24,682)          $(11,290)          $(43,930)
  Adjustments to reconcile
   net loss to cash provided
   by (used in) operating
   activities:
    Noncash charge for general
     and administrative expenses             6,000              6,000             19,500
   (Increase) in prepaid
     expenses                                 (940)                --               (940)
    Increase in accounts
     payable                                 3,875              5,970             26,905
                                          --------           --------           --------
NET CASH PROVIDED BY (USED IN)
 OPERATING ACTIVITIES                      (15,747)               680              1,535
                                          --------           --------           --------
CASH FLOWS FROM FINANCING
 ACTIVITIES:
 Increase in deferred offering
  costs                                         --            (37,318)           (82,590)
 Proceeds of stockholder
  receivable                                    --              9,583             29,528
 Sale of common stock and
  contribution of capital                   60,775             26,452             96,699
 Restricted cash for common
  stock subject to redemption              (45,000)                --            (45,000)
                                          --------           --------           --------
NET CASH PROVIDED BY (USED IN)
 FINANCING ACTIVITIES                       15,775             (1,283)            (1,363)
                                          --------           --------           --------
NET INCREASE (DECREASE) IN CASH                 28               (603)               172

CASH - BEGINNING                               144                747                 --
                                          --------           --------           --------

CASH - ENDING                             $    172           $    144           $    172
                                          ========           ========           ========

</TABLE>




                Read accompanying Notes to Financial Statements.


                                       F-5


<PAGE>   16


                              BANNER HOLDING CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             APRIL 30, 2001 AND 2000

NOTE 1. ORGANIZATION

Banner Holding Corp. was incorporated on January 26, 1998 under the laws of the
State of Florida and has a fiscal year ending April 30. The company is a "shell"
company, the purpose of which is to seek and consummate a merger or acquisition.
The company's headquarters is in Tequesta, Florida.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DEFERRED OFFERING COSTS

Costs incurred in connection with the public offering were originally
capitalized but are recorded as a reduction in additional paid-in capital upon
the sale of common stock.

INCOME TAXES

Deferred income taxes are provided for differences between the basis of assets
and liabilities for financial and income tax reporting. A valuation allowance is
provided against deferred income tax assets in circumstances where management
believes recoverability of a portion of the assets is not reasonably assured.

LOSS PER SHARE

Loss per share is computed by dividing net loss for the year by the weighted
average number of shares outstanding.

STATEMENT OF CASH FLOWS

For purposes of this statement the Company considers all highly liquid
investments with an original maturity of three months or less to be cash
equivalents.



                                       F-6


<PAGE>   17


                              BANNER HOLDING CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             APRIL 30, 2001 AND 2000

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

USE OF ESTIMATES

Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses. Accordingly, actual results could vary from the estimates that were
assumed in preparing the financial statements.

NOTE 3. INCOME TAXES

As of April 30, 2001, the Company has a net operating loss carryforward for
income tax purposes of approximately $24,400 expiring through April 30, 2021,
available to offset future taxable income. No deferred income taxes have been
recorded due to the Company having no history of profitable operations.
Significant components of the Company"s net deferred income tax asset are as
follows:

                                                         2001      2000
                                                       -------   --------

                   Net operating loss carryforward     $ 8,300   $  7,000
                   Less: Valuation allowance            (8,300)    (7,000)
                                                       -------   --------

                   Net deferred income tax asset       $    --   $     --
                                                       =======   ========

The reconciliation of income tax (benefit) computed at the federal statutory
rate to income tax expense (benefit) is as follows:

                    Tax (benefit) at federal statutory
                     rate                                           (34.00)%
                    State tax (benefit), net of federal
                     benefit                                         (3.63)
                    Valuation allowance                              37.63
                                                                    ------

                    Tax provision (benefit)                          00.00%
                                                                    ======


                                       F-7


<PAGE>   18


                              BANNER HOLDING CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             APRIL 30, 2001 AND 2000

NOTE 4. CAPITAL STOCK

The Company has authorized 5,000,000 preferred shares and 25,000,000 common
shares each with a par value of $.01 per share. As of April 30, 2001 and 2000,
3,200,000 (including 200,000 shares subject to redemption) and 3,000,000 shares
were issued and outstanding, respectively. No preferred shares have been issued.

The Company is in the process of selling to the public an initial offering of
common stock which calls for a minimum of 200,000 or a maximum of 1,000,000
common shares to be sold at $.25 per share on a "best effort" basis. As of April
30, 2001, the Company sold 200,000 shares for a total of $50,000 less offering
costs of $16,518. Under SEC Rule 419, the proceeds must be deposited in a escrow
cash account but the Company has the option to withdraw up to 10% of the
proceeds, excluding any interest, from the escrow account. On October 3, 2000,
$5,000 was withdrawn from the escrow account.

If proceeds from this offering are insufficient to conclude a business
combination, the Company may be required to seek additional capital. No
assurance can be given that the Company will be able to obtain such additional
capital, or even if available, that such additional capital will be available on
terms acceptable to the Company. In the event that management determines that
the Company is unable to conduct any business whatsoever, management, subject to
the requirements of SEC Rule 419, which provides that the deposited funds from
the offering be returned on a pro rata basis if an acquisition meeting certain
prescribed criteria is not consummated within 18 months of the date of the
prospectus (May 3, 2000), may, in its sole discretion, seek stockholders
approval to liquidate the Company. While management has not established any
guidelines for determining at what point in time it might elect to discontinue
its efforts to engage in a business combination and seek stockholder approval to
liquidate the Company, management is subject to the 18 month time frame set
forth in Rule 419 in which to effect an acquisition.




                                       F-8


<PAGE>   19


                              BANNER HOLDING CORP.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                             APRIL 30, 2001 AND 2000


NOTE 5. RELATED PARTY TRANSACTIONS

OFFICE FACILITIES

The Company shares office space and other administrative costs with a company
owned by the majority stockholders at no charge. The Company estimated these
costs to be approximately $500 per month. For the years ended April 30, 2001 and
2000, $6,000 has been recorded as an increase in general and administrative
expenses and additional paid-in capital.

LOANS FROM RELATED PARTY

During the years ended April 30, 2001 and 2000, a company owned by the majority
stockholders advanced $10,775 and $26,452, respectively. These advances were
recorded as increases in additional paid-in capital.

NOTE 6. GOING CONCERN

The Company has no revenues to date and has incurred operating losses of $43,930
since inception and has a working capital deficit of $30,793 as of April 30,
2001. Since inception, the Company has been dependent upon the receipt of
capital investment or other financing to fund its continuing activities.
Although the Company believes that the proceeds of the offering referred to in
Note 4 will be sufficient to effect a business combination, the offering has not
been completely sold and the Company has not identified any business combination
and therefore, cannot ascertain with any degree of certainty the capital
requirements for any particular transaction. In addition, the Company is
dependent upon certain related parties to provide continued funding and capital
resources. The accompanying financial statements have been presented on the
basis of the continuation of the Company as a going concern and do not include
any adjustments relating to the recoverability and classification of recorded
asset amounts or the amounts and classification of liabilities that might be
necessary should the Company be unable to continue as a going concern.



                                       F-9