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

                                   FORM 10-KSB

               [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d)
                   OF THE THE SECURITIES EXCHANGE ACT OF 1934
                   For the Fiscal Year Ended December 31, 1997

             [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                   OF THE THE SECURITIES EXCHANGE ACT OF 1934
             For the Transition Period from __________ to: _________

                        Commission File Number: 333-06966

                               IMMECOR CORPORATION
                 (Name of small business issuer in its charter)


                                   California
                                   68-0324628
(State or jurisdiction of incorporation or                                      
(I.R.S. Employer Identification No.)
                   Organization)

       100 Professional Center Drive, Rohnert Park, California 94928-2137
                    (Address of principal executive offices)

                                                            (707) 585-3036
                           (Issuer's Telephone Number)

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

         Securities registered under Section 12(g) of the Exchange Act:
                         Common Stock, Without Par Value

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

Check if there is no disclosure of delinquent  filers  contained in this form in
response to item 405 of Regulation S-B, 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 the Form  10-KSB  or any
amanedment to this Form 10-KSB. [X]

         State Issuer's revenues for its most recent fiscal year: $ 5,360,090.

         The aggregate  market value of the issuer's  Common Stock,  without par
value, held by non-affiliates of December 31, 1997, was $ 1,686,300. This amount
is based upon the offering price of $ 5.25 per share since there is currently no
public market for the Company's Common Stock as described in PART II, ITEM 5.

         As of December 31, 1997,  there were  2,421,000  shares of the issuer's
Common Stock, without par value, outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      NONE


                                       -1-
<PAGE>
                               IMMECOR CORPORATION

                                      INDEX
                                TABLE OF CONTENTS

                                     PART I

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

                                     PART II

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

                                    PART III

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

                           FORWARD LOOKING STATEMENTS

         Immecor  Corporation  (the  "Company")  cautions  readers  that certain
important  factors may affect the Company's  actual results and could cause such
results to differ  materially  from any  forward-looking  statements that may be
deemed to have been made in this Form 10-KSB or that are otherwise made by or on
behalf of the Company.  For this purpose,  any  statement  contained in the Form
10-KSB  that  are  not  statements  of  historical  fact  may  be  deemed  to be
forward-looking  statements.  Without  limiting the generality of the foregoing,
words  such as "may",  "expect",  "believe",  "anticipate",  "intend",  "could",
"estimate", or "continue" or the negative other variations thereof or comparable
terminology are intended to identify  forward-looking  statements.  Factors that
may affect the Company's results include,  but are not limited to, the Company's
limited  history  of  profitability,  its  dependence  on a  limited  number  of
customers and key personnel,  its possible need for additional financing and its
dependence  on certain  industries.  The Company is also  subject to other risks
detailed herein or detailed from time to time in the Company's  filings with the
Securities and Exchange Commission.

                                     PART I

ITEM 1.           DESCRIPTION OF BUSINESS

         The Company designs and assembles  specialized computer systems used in
semiconductor   manufacturing   processes  in  addition  to  personal  computers
customized to  specifications  by business and individual  users.  The necessary
components   are  purchased   from  domestic  and  foreign   manufacturers   and
distributors.  The Company  markets the finished  product  through its own sales
force.

         The Company's  initial direct public offering filed with the Securities
and  Exchange  Commission  on Form SB-2 became  effective  on November 18, 1997.
California  approved the filing effective December 19, 1997. The price per share
has been set at $5.25 per share and the Company will receive $3,937,500 assuming
that all 750,000 shares are sold. There is no minimum number of shares that have
to be sold.  No shares of this offering had been issued as of December 31, 1997.
The Company expects to use the net proceeds to (i) increase  assembly  capacity,
(ii) increase demonstration equipment and wholesale inventory, (iii) develop new
products,  and (iv) for working capital and general corporate purposes.  None of
the net  proceeds  of this  offering  will be used to pay  existing  debt as the
Company is virtually debt-free.

                                       -2-
<PAGE>
         The Company was  incorporated in the State of California on January 14,
1994. The Company's corporate offices are located at 100~105 Professional Center
Drive, Rohnert Park,  California  94928-2137.  The Company's telephone number is
(707) 585-3036.  The Company's facsimile number is (707) 585-6838. The Company's
email address is immecor@immecor.com, and the Company's world wide web home page
is http//www.immecor.com.

EMPLOYEES

As of  December  31,  1997,  the  Company  had eleven  full time and 4 part time
emplyees. The Company hires part time employees for non-technical jobs.

ITEM      2.      DESCRIPTION OF PROPERTY

          The   Company's   corporate   headquarters   are  located  at  100~105
Professional  Center Drive,  Western  Business Park,  Rohnert Park,  California,
where the Company  maintains 6,000 square feet of office,  showroom and assembly
space.

ITEM     3.       LEGAL PROCEEDINGS

         The  Company  filed a  lawsuit  against  three  shareholders  who  were
formerly  officers  and  directors  of the  Company  seeking  rescission  of the
issuance of 500,000  shares of common in the  acquisition  of  Advanced  Network
Communications, Inc. in 1994. In addition, the Companmy is seeking the return of
funds it believes  were  embezzled  and taken  through  fraud during 1994 by the
three defendants. The Company and its legal counsel are rigorously pressing this
litigation  but the case has not been set for  trial.  It is  unlikely  that the
trial  will  commence  before the end of 1998 and there is no  assurance  of the
outcome of the  litigation.  Although the Company is the  Plaintiff and does not
incur the risk of an adverse judgment, the litigation costs of the action may be
material to any individual  interim period or fiscal year and may be material to
the outstanding share balance. See also "Note 6 of Financial Statements".

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

         None.

                                     PART II

ITEM     5.       MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         The Company filed a Registration Statement on Form SB-2 for the sale of
750,000  shares  of  common  stock.  The  Registration  Statement  was  declared
effective  November  18, 1997.  Qualification  by  coordination  in the State of
California was declared  effective  December 19, 1997.  Qualifications  in other
states  are  pending.  The price per share has been set by the  Company at $5.25
without  retail  markups,  mark-downs or  commissions.  The  securities are sold
directly  to  the  public.  There  are no  broker/dealer  agreements  in  effect
regarding this offering.

         The  Company  commenced  selling  of its  securities  in the  State  of
California December 26, 1997. No shares had been issued as of December 31, 1997.

         The stock transfer  agent and registrar for the Company's  common stock
is U.S. Stock Transfer  Corporation  located at 1745 Gardena  Avenue,  Glendale,
California 91204-2991.

         There is currently no public market for the Company's  Common Stock and
there is no assurance that a public market will develop.

         The Company  expects to list its common  stock on various  exchanges as
soon as it can meet the  numerical  requirements  imposed  upon new  listings by
these stock exchanges.

HOLDERS
         As of December 31, 1997 there were  approximately  33 holders of record
of the Common Stock.

DIVIDENDS
         The Board of Directors  does not currently  contemplate  the payment of
cash dividends. Any decisions as to the payment
                                       -3-

<PAGE>
of cash  dividends on the Common Stock will depend on the  Company's  ability to
generate  earnings,  its need for capital,  its overall financial  condition and
such other factors as the Board of Directors deems relevant.

SALES OF UNREGISTERED SECURITIES

         None.

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

         The following  discussion  and analysis  should be read in  conjunction
with the Company's  financial  statements and the notes thereto included in Part
II, item 7 of this report.

RESULTS OF OPERATIONS

FISCAL 1997 AS COMPARED TO FISCAL 1996

         Net sales  increased by  $1,768,708  or 49% from  $3,591,382 in 1996 to
$5,360,090 in 1997.  Sales to major  customers who accounted for over 10% of the
Company's sales increased by $2,187,697 from $1,417,168 in 1996 to $3,600,865 in
1997. Sales to these corporate  customers for high-end specialty  computers have
continued  to increase  steadily  since the Company has been able to meet strict
shipping deadlines and to maintain high quality control  standards.  Firm orders
on the books of the Company for the first two  quarters  of 1998  indicate  that
this  trend  will  continue.  Nevertheless,  the loss of any one of these  major
customers  would  have a  material  adverse  effect on the  Company's  financial
position and results of operation.

         Gross profit increased,  as a percentage of net sales, from 13% in 1996
to 24% in 1997  primarily  because of higher gross profit  margins  realized for
high-end specialty computers sold to major customers.

         Selling,  general and administrative expenses increased as a percentage
of net sales from 12% in 1996 to 15% in 1997.  The  increase  in  expenses  as a
percentage of net sales was due to hiring of additional  employees and increased
compensation levels for employees offset by increased sales volume..

         Net  profit  before  income  taxes  increased  from  $71,581or  2% as a
percentage  of net sales in 1996 to $466,040 or 9% as a percentage  of net sales
in 1997.

         Net income per share on 2,421,000 shares  outstanding  increased from 2
cents in 1996 to 12 cents in 1997.

LIQUIDITY AND CAPITAL RESOURCES

STATEMENTS OF CASH FLOWS

         The Company had net cash provided by operating  activities of $5,235 in
1996  compared  to $268,441  in 1997.  The net  increase  relates  primarily  to
increased profitability.  The increase in cash used by investing activities from
1996 to 1997 relates to higher purchases of equipment.  The Company had net cash
provided by financing  activities of $64,688 in 1996 compared with net cash used
by financing activities of $117,180 in 1997. The net change relates primarily to
significant  repayments  of notes payable and  shareholder  advances in 1997 and
higher offering costs in 1997.

LINE OF CREDIT

         The Company's line of credit with  WestAmerica  Bank currently  permits
borrowing of up to 80% of eligible accounts  receivable to a maximum of $250,000
and is secured by a security interest in all accounts receivable,  inventory and
equipment.  The line of credit is also  personally  guaranteed  by the Company's
major  shareholder.  Interest is 4.0% over prime rate  (12.50% at  December  31,
1997)  with a  maturity  date of May 31,  1998.  The line of  credit  had a zero
balance as of December 31, 1997.

NET OPERATING LOSS CARRYFORWARDS

         The Company had federal  net  operating  losses for income  purposes of
approximately  $63,900 at December  31,  1996 which were used to offset  taxable
federal income in 1997. In addition,  the Company had state net operating losses
for income  purposes of  approximately  $44,900 at December  31, 1996 which were
used to offset taxable state income in 1997. See Note 9 of Financial Statements.


                                       -4-


<PAGE>
TEM      7.       FINANCIAL STATEMENTS

         The following Financial Statements are filed as part of this report:

         Independent Auditor's Report                                  F-1

         Balance Sheets - December 31, 1996 and 1997                   F-2

         Statements of Income for the years ended                      F-3
         December 31, 1996 and 1997

         Statements of Cash Flows for the years ended
         December 31, 1996 and 1997                                    F-4

         Statements of Shareholder Equity for the years ended          F-5
         December 31, 1996 and 1997

         Notes to Financial Statements                                F-6 to F12


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

DIRECTORS AND EXECUTIVE OFFICERS

                                   MANAGEMENT

The  following  table sets forth the names of all  directors and officers of the
Company and the position held held by them:

         Name                               Age      Position

         Heinot H. Hintereder               66       President & CEO, Director

         Jason C. Lai                       30       Vice President, Sales & 
                                                     Marketing, Director

         Keith W. Racuya                    52       Secretary, Director

         Richard C. Thiede                  60       Treasurer, Director

         Nhon K. Tran                       34       Vice President,Engineering,
                                                     Director

         Heinot H.  Hintereder is cofounder of the Company.  Was the Founder and
served  as  President  and CEO of  Immecor  Corporation  of  Delaware  until its
acquisition  by the  Company.  Served  5 years as  Manager  of the  Financial  &
Corporate Support Unit,  Fireman's Fund Insurance  Companies until retirement in
1992. For 25 years held various other  managerial and  supervisory  positions at
Firemans Fund. President, Founder, and CEO of Biblionics Corporation, a software
development company. Founder, Partner, and General Manager of W. Koehler K.G., a
German trading company.  In all, Mr. Hintereder has 35 years experience in large
business   systems   design,   selection  of  computer   equipment   and  system
configuration.  Mr.  Hintereder  was  educated  in Germany  and holds the German
equivalent of a Masters degree in Business Administration.

         Jason C. Lai is  cofounder  of the  Company.  Served as Vice  President
Sales & Marketing of Immecor  Corporation of Delaware  until its  acquisition by
the Company in 1994.  Before joining the Company Mr. Lai served 3 years as Sales
and Marketing Executive for

                                       -5-
<PAGE>
Comrex  Systemation  from 1991 to 1993.  Before 1991 Mr. Lai was an  independent
distributor for Apple computers. Mr. Lai has 10 years experience in the computer
business.

         Keith W. Racuya is a local businessman for the last 4 years. Mr. Racuya
previously  served as large scale computer  equipment planner for Fireman's Fund
Insurance  Companies until retirement in 1994 after 30 years of service,  all in
computer related capacities.

         Richard C. Thiede  served as  executive  in the Systems  Department  of
Firemans Fund Insurance  Companies  where he was responsible for the development
and implementation of several large corporate  computer systems.  He also served
as Director of M.I.S.  Administration for the same company from which he retired
in 1991 after 25 years of  service.  Mr.  Thiede  was  director  of finance  and
administration  for the Sea Ranch  Association for 4 years and in 1995 became an
independent computer  consultant.  Mr. Thiede combines 30 years of experience in
the field of computer system design and computer  financing.  Mr. Thiede holds a
B.S. degree in Finance from Lehigh University.

         Nhon K. Tran is a major  investor in the  Company.  Before  joining the
Company in July of 1995 as Vice President, Engineering, Mr. Tran served 10 years
with Parker Hannifin  Corporation in the field of computer driven robotic motion
control  products,  five years of which he served as Associate  Engineer for new
product development. Mr. Tran received part of his education in Vietnam.

         Directors  of the  Company  hold their  offices  until the next  annual
meeting of the Company's  stockholders and until their successors have been duly
elected and  qualified  or their  earlier  resignation,  removal  from office or
death.

         Officers of the Company serve at the pleasure of the Board of Directors
and until the first meeting of the Board  following  the next annual  meeting of
the  Company's  stockholders  and until  their  successors  have been chosen and
qualified.

ITEM     10.      EXECUTIVE COMPENSATION

         The  Company's  Summary  Compensation  Table is set forth below.  As in
previous  years the  Company had no  Option/SAR  Grants,  Aggregated  Option/SAR
Grants Exercises or Fiscal Year End Option/SAR's for the year ended December 31,
1997, nor were there any long-term  incentive  plan awards,  or stock options or
stock appreciation rights. The Company's  compensation to non-employee directors
consists of a fee of $100 per meeting of the Board of Directors.

                           SUMMARY COMPENSATION TABLE
                      For the Year ended December 31, 1997
<TABLE>
<CAPTION>
Name and                                             Compensation      Compensation      All Other
Principal Position                                       Paid           Deferred(1)      Compensation

<S>                                                    <C>                <C>               <C>    
Heinot H. Hintereder, Chief Executive Officer          $ 82,666           $ 50,000          None

Jason C. Lai, Vice President, Sales & Marketing        $160,048           $ 14,093          None

Nhon K. Tran, Vice President, Engineering              $107,618              None           None
<FN>

Note 1: All deferred  compensation was accrued in the financial statements as of
December 31, 1997.
</FN>
</TABLE>

EMPLOYMENT AGREEMENTS

         On April 16, 1997, the Company  entered into a one (1) year  employment
agreement  with Jason C. Lai ("Lai") the Company's  Vice  President of sales and
marketing.  The  agreement is renewable for  successive  one year terms with the
consent of both  parties.  The Company may  terminate the agreement for cause at
any time and Lai may  terminate  the  agreement  at any time by  giving  written
notice to the  Company.  For a period of one year  after its  expiration  or its
termination by the Company for cause,  the agreement  prohibits Lai from selling
any products  then being  marketed by the Company to its three major  customers.
This provision may not be enforceable in whole or in part, subject to California
court  determination.  As consideration for performance of specified duties, the
Company payS Lai a base annual  salary of $100,000 and, in months in which gross
sales exceed  $250,000,  a monthly  cash bonus  ranging from 0.5% to 1.5% of the
Company's gross sales.

                                       -6-

<PAGE>
INDEMNIFICATION AGREEMENTS

         The  Company  has  entered  into or will enter into an  indemnification
agreement  with its  directors  and  executive  officers.  Each  indemnification
agreement  provides or will provide that the Company will  indemnify such person
against certain liabilities (including settlements) and legal action, procedding
or  investigation  (other than actions brought by or in the name of the Company)
to which he or she is, or is  threatened to be, made a party by reason of his or
her status as a director,  officer or agent of the Company,  provided  that such
director,  executive  officer or agent acted in good faith and in a manner he or
she  reasonably  believed  to be in or not  opposed to the best  interest of the
Company and, with respect to any criminal  proceedings,  had no reasonable cause
to believe his or her conduct was unlawful.  With respect to any action  brought
by or in the right of the Company,  a director,  executive officer or agent will
also be  indemnified,  to the extent not prohibited by applicable  law,  against
expenses  and  amounts  paid  in  settlement,  and  certain  liabilities  if  so
determined  by a  court  of  competent  jurisdiction,  actually  and  reasonably
incurred by him or her in connection with such action if he or she acted in good
faith and in a manner he or she  reasonably  believed to be in or not opposed to
the best interest of the Company.  Insofar as  indemnification  for  liabilities
arising under the federal securities laws may be permitted, the Company has been
advised  that in the opinion of the  Securities  and  Exchange  Commission  such
indemnification is against public policy and is, therefore, unenforcable.

ITEM     11.      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The  following  table sets forth as of December  31, 1997 the number of
shares of Common  Stock  owned of  record or  beneficially  owned by each of the
Company's  officers,  directors,  and  stockholders  owning  at  least 5% of the
Company's issued and outstanding shares of Common Stock, by all of the Company's
officers and directors as a group,  and the percentage of the total  outstanding
shares represented by such shares.
<TABLE>
<CAPTION>

Name and Address                    Shares Beneficially                         Approximate
Beneficial Owner                            Owned                             Percent of Class

<S>                                      <C>                                        <C>  
Mr. Jason C. Lai                         337,500                                    13.94
5625 Mireille Drive
San Jose, CA 95118

Heinot H. Hintereder                     887,300                                    36.65
131 Keppel Way
Cotati, CA 94931

Nhon K. Tran                             375,000                                    15.49
7235 Cadiz Court
Rohnert Park,  CA 94928

James Chu *                              166,666                                     6.88
Address
Unknown

Fred Pao *                               166,667                                     6.88
Address
Unknown

Grace Lee *                              166,667                                     6.88
Address
Unknown

All officers and directors             1,599,800                                    66.08
as a group
<FN>

* The  issuance  of these  shares may be  rescinded  subject to the outcome of a
pending law suit as described in PART I, ITEM 3.

</FN>
</TABLE>

                                       -7-

<PAGE>
COMPLIANCE WITH SECTION 16 (A) OF THE 1934 ACT

         Section  16  (a) of the  1934  Act  requires  the  Company's  executive
officers,  directors and holders of more than 10% of the Company's Common Stock,
to file reports of ownership and changes in ownership  with the  Securities  and
Exchange  Commission.  Such  persons are  required  to furnish the Company  with
copies of all Section 16 (a) forms they file.

         Based solely on oral or written  representations from certain reporting
persons that no Forms 5 were required for those  persons,  the Company  believes
that, with respect to 1997, its executive  officers,  directors and greater than
10% beneficial owners complied with all such filing requirements.

ITEM     12.      CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         Since its inception,  from time to time,  certain  executive  officers,
directors  and  shareholders  have provided  short-term  funds to the Company in
order to finance medium to large purchases of computer components.  All of these
funds have been repaid by the Company as noted in Notes to Financial Statements.


 ITEM    13.      EXHIBITS AND REPORTS ON FORM 8-K

A.       All schedules have been omitted,  as the information is inapplicable or
the information is presented in the Financial stetements or Notes thereto.

B.       No reports on Form 8-K were required to be filed in the last quarter of
1997.


































                                       -8-

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

                                           IMMECOR CORPRATION

Date:    April 3, 1997                     By:   /s/  Heinot H. Hintereder
                                           -----------------------
                                           Heinot H. Hintereder
                                           President and Chief Executive Officer

Date:    April 3, 1997                     By:   /s/  Richard C. Thiede
                                           -----------------------
                                           Richard C. Thiede
                                           Chief Financial Officer


         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.requirements  of the  Securities  Act  of  1933,  this
Pre-Effective  Amendment  to  the  Registration  Statement  was  signed  by  the
following persons in the capacities and on the dates stated.

SIGNATURE                                                     DATE


/s/ Heinot H. Hintereder
_____________________________________                April 3, 1997
Heinot H. Hintereder, Director

/s/ Richard C. Thiede
_____________________________________                April 3, 1997
Richard C. Thiede

/s/ Jason C. Lai
_____________________________________                April 3, 1997
Jason C. Lai, Director

/s/ Keith W. Racuya
_____________________________________                April 3, 1997
Keith W. Racuya, Director

/s/ Nhon K. Tran
_____________________________________                April 3, 1997
Nhon K. Tran, Director














                                       -9-
<PAGE>
                                  L.V. DORN II
                           CERTIFIED PUBLIC ACCOUNTANT
                             530 N. HARRISON STREET
                          FORT BRAGG, CALIFORNIA 95437

                               TEL: (707) 964-0866
                               FAX: (707)964-7163


                          INDEPENDENT AUDITOR'S REPORT


To the Shareholders and Board of Directors
of Immecor Corporation

I have  audited the  accompanying  balance  sheets of Immecor  Corporation  (the
Company) as of December 31, 1996 and 1997, and the related statements of income,
cash flows and  shareholders'  equity for the years then ended.  These financial
statements are the responsibility of the Company's management. My responsibility
is to express an opinion on these financial statements based on my audit.

I conducted my audit in accordance with generally  accepted auditing  standards.
Those standards  require that I plan and perform the audit to obtain  reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatements. 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.
I believe that my audit provides a reasonable basis for my opinion.

In my  opinion,  the  financial  statements  present  fairly,  in  all  material
respects,  the financial position of Immecor Corporation as of December 31, 1996
and 1997,  and the  results of its  operations  and its cash flows for the years
ended  December  31,  1996 and  1997,  in  conformity  with  generally  accepted
accounting principles.




L. V. Dorn II
March 12, 1997

























<PAGE>
                               Immecor Corporation
                                 Balance Sheets

<TABLE>
<CAPTION>
                                                                                                  Year ended
                                                                                                  December 31,
                                                                                              1996             1997 
ASSETS
Current assets:
<S>                                                                                     <C>               <C>        
   Cash                                                                                 $    54,677       $   164,125
   Accounts receivable (net of allowance for doubtful
      accounts of $ 10,000, $ 10,478)                                                       380,357           520,426
   Inventories (Note 2)                                                                     129,421           343,158
   Notes receivable                                                                           5,765                 -
   Prepaid expenses and other current assets                                                  4,550             9,231
   Deferred income taxes                                                                     14,83              7,743
                                                                                             -----              -----
                                  
                  Total current assets                                                      589,604         1,044,683

Equipment and improvements, net (Note 3)                                                     41,960            54,955

Offering costs (Note 10)                                                                     16,238                 -
                                                                                             ------                  

                  Total assets                                                            $  647,802      $ 1,099,638
                                                                                          ----------      -----------
                           

LIABILITIES and SHAREHOLDERS' EQUITY

Current liabilities:
   Notes payable, due within one year (Note 4)                                            $   29,606      $     3,800
   Accounts payable                                                                          254,374          321,391
   Accrued liabilities                                                                        30,671          122,191
   Advances from shareholders (Note 5)                                                        61,579              643
   Customer deposits                                                                           2,794            1,362
   Stock escrow liability (Note 10)                                                                -            4,563
   Income taxes                                                                                    -          131,725
                                                                                                              -------
                                          
                  Total current liabilities                                                  379,024          585,675

Long-term liabilities:
   Notes payable, due after one year (Note 4)                                                      -           12,659
   Deferred income taxes                                                                           -           11,484
                                                                                                               ------
                              
                  Total long-term liabilities                                                      -           24,143
                                                                                                               ------
                             

                  Total liabilities                                                          379,024          609,818

Commitments and Contingencies (Note 6)

Shareholders' equity:
   Common stock, no par value, 50,000,000 shares authorized;
       2,421,000 shares issued and outstanding (Note 10)                                     320,500          256,602
   Preferred stock, no par value, 20,000,000 shares authorized;
       no shares issued and outstanding                                                            -                -
   Retained earnings (deficit)                                                             (  51,722)         233,218
                                                                                           -  ------          -------
                  Total shareholders' equity                                                 268,778          489,820
                                                                                             -------          -------

                  Total liabilities and shareholders' equity                           $     647,802   $    1,099,638
                                                                                       -------------   --------------
</TABLE>

See accompanying notes to financial statements

                                      -11-
<PAGE>
                               Immecor Corporation
                              Statements of Income

<TABLE>
<CAPTION>
                                                                                            Year ended
                                                                                            December 31,
                                                                                      1996                 1997


<S>                                                                              <C>                  <C>        
Net sales (Note 7)                                                               $ 3,591,382          $ 5,360,090
Cost of sales                                                                      3,137,320            4,096,793
                                                                                   ---------            ---------

Gross profit                                                                         454,062            1,263,297

Operating costs and expenses:
    Selling, general and
          administrative expenses                                                    435,253              785,138
    Depreciation                                                                       9,408               13,572
    Flood insurance proceeds (Note 8)                                                (65,244)                   -
                                                                                     -------                     
         Total operating costs and expenses                                          379,417               798,710
                                                                                     -------               -------

         Operating income                                                             74,645               464,587

Interest income                                                                          722                 3,994
Interest expense                                                                      (3,786)               (2,541)
                                                                                      ------                ------ 

         Income (loss) before income taxes                                            71,581               466,040

Income taxes (Note 9)                                                                 18,800               181,100
                   -                                                                  ------               -------

         Net income (loss)                                                       $    52,781          $    284,940
                                                                                 -----------          ------------



Net income (loss) per share                                                     $       .022           $      .118
                                                                                ------------           -----------

Weighted average shares outstanding                                                2,421,000             2,421,000
                                                                                   ---------             ---------
</TABLE>















See accompanying notes to financial statements
                                      -12-
<PAGE>
                               Immecor Corporation
                            Statements of Cash Flows
<TABLE>
<CAPTION>


                                                                                                   Year ended
                                                                                                   December 31,
                                                                                        1996                   1997


Operating Activities:
<S>                                                                             <C>                   <C>          
Net income (loss)                                                               $      52,781         $     284,940
Adjustments to reconcile net income (loss) to
   net cash provided by operating activities:
      Depreciation                                                                      9,408                13,572
      Provision for losses on accounts receivable                                           -                10,000
      Deferred income taxes                                                            18,000                18,575
      Disposal of equipment                                                             2,761                15,246
Changes in:
         Accounts and notes receivable                                                (69,641)             (144,304)
         Inventories                                                                   13,246              (213,737)
         Income taxes                                                                   4,266               131,725
         Prepaid expenses and all other                                                (1,500)               (4,681)
         Accounts payable                                                             (42,074)               67,017
         Accrued liabilities and customer deposits                                     17,988                90,088
                                                                                       ------                ------

Net cash provided by operating activities                                               5,235               268,441
                                                                                        -----               -------

Investing Activities:
   Purchase of equipment                                                             (21,604)               (41,813)
   Other                                                                                   -                      -
Net cash used by investing activities                                                (21,604)               (41,813)
                                                                                     -------                ------- 

Financing Activities:
   Proceeds from sale of common stock (Note 10)                                            -                  4,563
   Additions to notes payable                                                         29,606                 17,314
   Offering costs                                                                    (16,238)               (47,660)
   Principal payments on notes payable                                                     -                (30,461)
   Shareholder advances                                                               51,320                (60,936)
                                                                                      ------                ------- 
Net cash (used) provided by financing activities                                      64,688               (117,180)
                                                                                      ------               -------- 

Increase (decrease) in cash                                                           48,319                109,448

Cash balance, beginning of period                                                      6,358                 54,677
                                                                                       -----                 ------
Cash balance, end of period                                                    $      54,677         $      164,125
                                                                               -------------         --------------

Supplemental Disclosure of Cash flow Information:
   Cash paid during the year for:
      Interest                                                                 $       2,086        $         4,241
                                                                               -------------        ---------------
      Income taxes                                                             $         800        $        30,800
                                                                               -------------        ---------------
</TABLE>




See accompanying notes to financial statements

                                      -13-
<PAGE>
                               Immecor Corporation
                       Statements of Shareholders' Equity
<TABLE>
<CAPTION>


                                           Number of                            Retained
                                           Outstanding           Common         Earnings
                                            Shares                Stock         (Deficit)          Total


<S>                                       <C>                <C>             <C>              <C>         
Balance, December 31, 1995                2,421,000          $   320,500     $   (104,503)    $    215,997

Year ended December 31, 1996:

  Net income                                                           -           52,781           52,781
                                                                                   ------           ------
Balance, December 31, 1996                2,421,000              320,500          (51,722)         268,778

Year ended December 31, 1997:

  Offering costs (Note 10)                                      ( 63,898)               -          (63,898)
  Net income                                                           -           284,940         284,940
                                                                                   -------         -------

Balance, December 31, 1997                2,421,000        $     256,602      $    233,218     $   489,820
                  --- ----                ---------        -------------      ------------      -----------




















</TABLE>


See accompanying notes to financial statements
                                      -14-
<PAGE>
                               IMMECOR CORPORATION
                          Notes to Financial Statements
                     Years ended December 31, 1996 and 1997

Note 1: Summary of Significant Accounting Policies
Basis of presentation: Immecor Corporation has prepared the financial statements
on an accrual basis of  accounting  and in accordance  with  generally  accepted
accounting  principles.  The  financial  statements  and notes  thereto  are the
responsibility  of the  Company's  management.  During  1996 the  Company  had a
division  which  operated  under the name of  Computer  2000.  During the second
quarter of 1997 the division's  operations were merged with Immecor  Corporation
and it no longer operated as a separate division.  Its results of operations for
1996  and 1997 and  financial  position  as of  December  31,  1996 and 1997 are
included in the accompanying financial statements.

Description of business:  The Company designs and assembles specialized computer
systems used in  semiconductor  manufacturing  processes in addition to personal
computers  customized to  specifications  by business and individual  users. The
necessary  components are purchased from domestic and foreign  manufacturers and
distributors.  The Company  markets the finished  product  through its own sales
force.

Inventories:  Inventories are stated at the lower of cost (first-in,  first-out)
or market.

Equipment and improvements:  Equipment and improvements are carried at cost less
accumulated  depreciation.  Depreciation is provided on the straight-line method
over estimated useful lives generally ranging from five to seven years.

Expenditures  for major  renewals  that extend  useful  lives of  equipment  and
improvements  are  capitalized.  Expenditures  for  maintenance  and repairs are
charged to expense as incurred.

For  income  tax  purposes,  depreciation  is  computed  using  the  accelerated
depreciation methods.

Advertising:  The  Company  expenses  costs of  advertising  the first  time the
advertising takes place.

Income  taxes:  The  Company  has  adopted  Statement  of  Financial  Accounting
Standards  No.  109,  Accounting  for Income  Taxes.  Accordingly,  the  Company
computes income taxes using the asset and liability method, under which deferred
income taxes are provided for temporary  differences between the financial basis
of the Company's assets and liabilities.

Earnings per share: Earnings per share amounts are based on the weighted average
number  of  common  stock  shares   outstanding   during  the  periods  adjusted
retroactively  to reflect a one for five  reverse  stock  split  approved by the
Company's  Board of  Directors  on May 14,  1997.  There  were no  common  stock
equivalents to be considered.
<TABLE>
<CAPTION>

Note 2: Inventories                                                                                December 31,
Inventories consist of the following:                                                   1996                         1997

<S>                                                                             <C>                             <C>        
         Purchased parts                                                        $   104,124                     $   263,570
         Finished systems                                                            25,297                          79,588         
                                                                                     ------                          ------  
</TABLE>
<TABLE>
<CAPTION>


Note 3: Equipment and Improvements                                                              December 31,                       
Equipment and improvements consist of the following:                                 1996                            1997
<S>                                                                          <C>                                 <C>       
          Equipment and furniture                                            $      49,497                       $   51,742
         Transportation equipment                                                   12,243                           24,814
                                                                                    ------                           ------
                                                                                    61,740                           76,556
Less accumulated depreciation                                                       19,780                           21,601
                                                                                    ------                           ------
                                                                             $      41,960                       $   54,955
                                                                             -------------                       ----------
</TABLE>
<TABLE>
<CAPTION>

Note 4: Notes Payable                                                                             December 31,
Notes payable consist of the following:                                              1996                              1997
Notes payable to Jerry Liu with interest at
<S>                                                                            <C>                               <C>       
         12% due in January 1997                                               $    15,000                       $        -
Note payable to Thu Tran with interest at
         18% due on demand                                                          14,606                                -
Line of credit with Westamerica with interest at
         4.0% over prime rate (12.50% at
         December 31, 1997) with a maturity
         date of May 31, 1998. Additional terms of
         the line of credit are described below                                          -                                -
Note     payable  to GMAC,  secured  by  transportation  equipment,  payable  in
         monthly installments of $443 including interest
         of 10.50% through September 2001                                                -                           16,459
                                                                                                                     ------
                                                                                    29,606                           16,459        
Total notes payable due
after one year                                                                      29,606                            3,800         
                                                                                    ------                            -----         
due after one year                                                              $        -                       $   12,659
                                                                                ---------                        ----------


</TABLE>
                                      -15-
<PAGE>
                               IMMECOR CORPORATION
                    Notes to Financial Statements, continued
                     Years ended December 31, 1996 and 1997

Note 4: Notes Payable, continued
The Company  received  approval on July 9, 1997 for a $250,000 line of credit to
finance  short term working  capital  needs.  Advances  under the line of credit
cannot exceed 80% of eligible  accounts  receivable and is secured by a security
interest in all accounts receivable, inventory and equipment. The line of credit
is also personally guaranteed by the Company's major shareholder.

Maturities of long-term debt are as follows for the years ended                 
                       December 31,

                           1998                                 $      3,600
                           1999                                        4,188
                           2000                                        4,650
                           2001                                        3,821
                                                                      ------
                                                                $      6,459

Note 5: Advances from Shareholders
The Company receives  advances from some of the corporate  officers who are also
major  shareholders  to meet working  capital  requirements.  These advances are
generally repaid within 30 to 60 days.

Note 6: Commitments and Contingencies
Long-Term  Lease  The  Company  leases  its  corporate   headquarters   under  a
non-cancelable  operating  lease which expires in January  2001.  The Company is
also  obligated  to pay to the lessor its pro-rata  share of  utilities  for the
building on a monthly basis.

Minimum future rental payments under the lease agreement as of December 31, 1997
are as follows:

                           1998                                $     56,578
                           1999                                      58,652
                           2000                                      60,998
                           2001                                       5,100
                                                                    --------
                                                                 $  181,328
Rental expense under the above lease was $37,983 in 1996 and $53,533 in 1997.

Litigation:
The Company filed a lawsuit against three former  shareholders who were formerly
officers and  directors  of the Company  seeking  rescission  of the issuance of
500,000  shares of the  Company's  common stock in the  acquisition  of Advanced
Network  Communications,  Inc. in 1994. In addition,  the Company is seeking the
return of funds it believes  were  embezzled and taken through fraud during 1994
by the three  defendants.  The  Company  and its legal  counsel  are  rigorously
pressing this litigation but the case has not been set for trial. It is unlikely
that the trial will commence before the end of 1998 and there is no assurance of
the outcome of the litigation. All legal expenses relating to this case have not
been  significant to date and have been expenses as incurred as reflected in the
accompanying financial statements.

Note 7:  Sales to Major Customers
A material  part of the  Company's  business  is  dependent  upon sales to major
customers,  the  loss of which  would  have a  material  adverse  effect  on the
Company's   financial   position  and  results  of  operations.   Two  customers
individually  accounted for over 10% of the Company's 1996 sales.  Two customers
individually  accounted  for  over 38% of total  sales  in  1996.  One  customer
individually  accounted for over 10% of the Company's 1997 sales.  Sales to this
customer  aggregated  over 67% of total sales in 1997. The Company is attempting
to expand its customer base to lessen the effect of having major customers.

Note 8: Insurance Proceeds
On February 4, 1996,  the Company  incurred  major rain damage to its  corporate
offices  and  production  facilities  due to leaks in the roof  which  caused an
interruption of its operations. The loss was covered by insurance as follows:
<TABLE>

<S>                                                                      <C>       
                  Inventory replacement                                  $   77,392
                  Business interruption                                      38,821
                  Equipment replacement                                       6,550
                  Miscellaneous cost reimbursement                           24,383
                                                                          ----------
                                                                            147,896
                  Less deductible                                               250
                                                                       ------------
                  Proceeds from insurance company                           146,896
                  Amounts allocated to inventory, equipment and repairs      81,652
                                                                          ---------
                  Insurance proceeds per statement of income              $  65,244
                                                                          ---------

</TABLE>
                                      -16-
<PAGE>
                               IMMECOR CORPORATION
                    Notes to Financial Statements, continued
                     Years ended December 31, 1996 and 1997

Note 9: Income Taxes
A reconciliation of the statutory federal income tax rate with the Company's 
effective tax rate is as follows for the periods ending:
<TABLE>
<CAPTION>
                                                                                  December 31,
                                                                       1996                        1997
         
<S>                                                                    <C>                         <C>  
Statutory rate for income from $100,000 to $335,000                    39.0%                       39.0%
Reduction due to income under $100,000 and over $335,000              (20.7)                       (5.0)
State income taxes, net of federal income tax benefit                   7.7                         5.8
                                                                        ---                         ---
Nondeductible costs                                                     1.0                          .1
                                                                        ---                          --
Other                                                                   (.7)                       (1.0)                 
Effective tax rate
                                                                       26.3%                       38.9%
                                                                       ----                        ---- 
</TABLE>

The provision (credit) for income taxes consists of the following for the years
ended:
<TABLE>
<CAPTION>
                                                                                     December 31,
                                                                         1996                       1997
Currently payable:
<S>                                                           <C>                             <C>           
Federal                                                       $             -                 $  125,540    
State                                                                     800                     36,985 
Deferred liability (benefit)                                       $   18,000                $    18,575                  
                                                                   ----------                ----------- 
</TABLE>
                           
Deferred income taxes (benefits) reflect the tax effect of temporary differences
between  the  amounts of assets and  liabilities  for  financial  reporting  and
amounts as measured for tax  purposes.  The tax effect of temporary  differences
and  carryforwards  that cause  significant  portions of deferred tax assets and
liabilities are as follows for the years ended:
<TABLE>
<CAPTION>

                                                                                       December 31,
                                                                            1996                        1997
<S>                                                                    <C>                              <C>      
Depreciation                                                           $          (255)                 $ (9,119)
Inventory, accounts receivable, allowances and prepaids                         18,375                         -
Tax loss carryforward                                                                -                    23,966
Other, net                                                                        (120)                    3,728
                                                                                  ----                     -----
                                                                              $ 18,000                  $ 18,575
                                                                              --------                  --------
</TABLE>

The  Company  had  federal  net   operating   losses  for  income   purposes  of
approximately  $63,900 at December  31,  1996 which were used to offset  taxable
federal income in 1997. In addition,  the Company had state net operating losses
for income  purposes of  approximately  $44,900 at December  31, 1996 which were
used to offset taxable state income in 1997.

Note 10:  Stock Offering
The  Company's  initial  direct  public  offering  filed with the  Security  and
Exchange Commission became effective November 18, 1997.  California approved the
filing effective December 19, 1997. The price per share of common stock has been
set at $5.25 and the Company will receive  $3,937,500  assuming that all 750,000
shares are sold. There is no minimum number of shares that have to be sold.

The  Company  received  $4,563  from this  offering  after the  offering  became
effective and these funds were placed in a separate bank account.  The shares of
common  stock  had not been  issued  by the  transfer  agent at year end so this
amount has been shown as a  liability  at  December  31,  1997 and not as common
stock issued.

Offering  cost which had been  classified  as an asset at December  31, 1996 and
offering  costs  incurred in 1997 were  recorded as a reduction  of common stock
once the offering became effective.