United States Securities and Exchange Commission

                             Washington, D.C. 20549

                                   FORM 10-KSB

(Mark One)
  [X]             Annual  Report   Pursuant  to  Section  13  or  15(d)  of  The
                  Securities  Exchange  Act of 1934 For the  Fiscal  Year  Ended
                  December 31, 1999

  [ ]             Transition  Report  Pursuant  to  Section  13 or  15(d) of the
                         Securities Exchange Act of 1934

                                                Commission File Number   1-15679

                               VENTURE TECH, INC.
                 (Name of small business issuer in its charter)

                     Idaho                                  87-0462258
          ------------------------------                 ------------------
         (State or other jurisdiction of                 (I.R.S. Employer
         incorporation or organization)                  Identification No.)

         1055 West 14th Street, Suite 400, North Vancouver, B.C. V7P 3P2
              (Address of principal executive officers) (Zip Code)

Issuer's telephone number:  (604) 990-9889

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 $0.001 per share

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 in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the  best  of  registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. [ ]

State issuer's revenues for its most recent fiscal year.  $29,710

State the  aggregate  market value of the voting  stock held by non-  affiliates
computed by reference  to the price at which the stock was sold,  or the average
bid and asked  prices of such stock,  as of a specified  date within the past 60
days. $5,127,593 (Based on price of $0.21 per share on May 19, 2000)

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date.

            Class                           Outstanding as of December 31, 1999
------------------------------              -----------------------------------
Common Stock, Par Value $0.001                         37,014,165

DOCUMENTS INCORPORATED BY REFERENCE

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


<PAGE>


<TABLE>
<CAPTION>
                               VENTURE TECH, INC.

                                TABLE OF CONTENTS

                                     PART I

<S>                                                                                                         <C>
Item 1.         Business...............................................................................      3

Item 2.         Properties..............................................................................    20

Item 3.         Legal Proceedings.......................................................................    20

Item 4.         Submission of Matters to a Vote of Security
                  Holders...............................................................................    20

                                     PART II

Item 5.           Market for Registrant's Common Equity and
                    Related Stockholder Matters.........................................................    21

Item 6.           Management's Discussion and Analysis of

                    Financial Condition and Results of Operations.......................................    23

Item 7.           Financial Statements and Supplementary Data...........................................    27

Item 8.           Changes in and Disagreements with Accountants
                    on Accounting and Financial Disclosure..............................................    55

                                    PART III

Item 9.           Directors and Executive Officers of the
                    Registrant..........................................................................    55

Item 10.          Executive Compensation................................................................    58

Item 11.          Security Ownership of Certain Beneficial

                    Officers and Management.............................................................    61

Item 12.          Certain Relationships and Related Transactions........................................    63

                                     PART IV

Item 13.          Exhibits, Financial Statement Schedules, and

                    Reports on Form 8-K.................................................................    64

                  Signatures............................................................................    65

</TABLE>

                                       -2-


<PAGE>



                                     PART I

Item 1.           Business

Business Development

         Venture  Tech,  Inc.,  an  Idaho  corporation  ("Venture  Tech"  or the
"Company"), is engaged in the acquisition,  development and licensing of certain
computer based technology designed to offer a full range of casino-style gaming,
entertainment, information and financial transaction services over the worldwide
Internet. Through its technology agreements and licenses, the Company intends to
establish a series of virtual  casinos over the Internet from various  locations
around the world.  The Company will employ various cultural and ethnic themes to
target  different  cultures around the world. A casino is deemed to be "virtual"
when it  emulates  actual  casino-style  games of  chance  offered  in  existing
land-based casinos,  but provides such gaming services via computer software and
hardware  instead of actual gaming  equipment  and casino  sites.  The Company's
initial virtual casino,  Asia Casino,  provides for three different languages on
the  website;  Chinese,  Japanese and  English.  Although the virtual  casino is
accessible  around the world via the  Internet,  the  Company's  marketing  will
primarily target Asian countries.  The Company further intends to use its client
base of Internet  gaming players to market more basic  commodities  and services
through electronic commerce ("e-commerce").

         History

         The Company was  organized on July 19, 1948 under the laws of the State
of Idaho as Giant Ledge Mining Company,  with the stated purpose of,  acquiring,
exploring and developing  mineral ore prospects and operating mining and milling
facilities.  The Company  initially  engaged in sporadic mining  operations and,
since its inception, has undergone several name changes and business changes. On
October 25, 1999, the Company's  shareholders approved a proposal to empower the
Board of Directors to take all necessary action to change the Company's domicile
of incorporation  from Idaho to the State of Nevada. As of the date hereof,  the
Company has not finalized that change.

         During 1988,  the Company  became  engaged in arranging for funding for
medical  research,  particularly  certain cancer research being conducted at the
Harvard School of Dental  Medicine.  However,  none of the projects in which the
Company was involved  proved to be  economically  successful and no commercially
viable products resulted from the research.  The Company ultimately  assigned or
transferred any potential marketing rights to its research products.

         In 1992,  the Company was engaged in only  minimal  activities  and the
Board of Directors  determined  that the Company should become active in seeking
potential  operating  businesses and business  opportunities  with the intent to


                                       -3-


<PAGE>


acquire or merge with such businesses. To better reflect the Company's business,
the Company adopted the name, Venture Tech, Inc.

         During 1995, the Company  became engaged in the  development of certain
computer technology designed to ultimately offer a full range of gaming services
and casino-style games over the worldwide Internet.  The Company created two new
wholly  owned  subsidiaries,  EuroAsian  E-Casinos,  Inc.,  a  Marshall  Islands
corporation  ("E-  Casinos"),  and Cybernet  Currency  Clearing,  Inc., a Nevada
corporation ("CCCI"), for development of certain technologies  applicable to the
Internet.  E-Casinos  was  formed as a foreign  entity to own and  operate  full
service gambling casinos on the Internet. However, when the Company entered into
a new licensing  agreement requiring  operations in Antigua,  management decided
not to use  E-Casinos as  originally  planned.  The  subsidiary  remains in good
standing and may be used for future  operations  in the Marshall  Islands  under
licensing with other third party gaming providers.  However,  the Company has no
current  plans or  agreements to do so. CCCI was formed to focus on acting as an
international  currency converter of wold currency into "e-cash" or "e-dollars",
which  is  used  as  a  monetary  instrument  in  many  international   business
transactions.

         On March 4, 1996, the Company  entered into a licensing  agreement with
CasinoWorld Holdings,  Ltd. ("CWH").  Pursuant to the agreement,  CWH granted to
the Company a nonexclusive license to use and market CWH's Virtual CasinoWorldTM
software and hardware  applications,  know-how,  trade  secrets,  copyrights and
trademarks.  The Company is obligated to market,  finance and  contribute one or
more foreign  gaming  licenses  under a separate  operating  agreement with CWH.
Through  August  1998,  the Company made  approximately  $1.3 million in license
payments to CWH in  anticipation  of receiving a fully  operational and reliable
gaming  website.  In August 1998, the Company  determined  that CWH would not be
able  to  adequately  provide  such a  website  and  operational  services  and,
accordingly, discontinued its relationship with CWH.

         On March 14,  1996,  in order to focus its  strategy  on the gaming and
Internet related service  industry,  management  effected the sale of its wholly
owned subsidiary, Tessier Resources, Ltd. ("Tessier") to Kaniksu Ventures, Inc.,
now known as Ocean Power  Corporation  ("PWRE").  In exchange for  Tessier,  the
Company  received a $3,000,000  debenture  convertible  into 2,000,000 shares of
PWRE  common  stock.  The  Debenture  matured in four (4) years from the date of
issuance, carried no interest, and was convertible into PWRE common stock at the
conversion  price of $1.50  per  share at any  time  prior to  repayment  of the
debenture.

         Tessier, a Manitoba, Canada corporation,  is engaged in the development
of an  apparatus  for  removing  snow and ice.  It was  formed  in 1996,  and is
presently considered, a development stage company. Development of its technology
has been essentially  completed,  its planned commercial operations have not yet
materially  commenced.  Tessier is currently  seeking  licensing  agreements  to

                                       -4-


<PAGE>


further the commercial  value of its product.  At the time of the Company's sale
of Tessier in 1996,  Tessier had not generated any revenues from  operations and
its  principal  assets were the  intellectual  property  rights and  prototypes.
However,  Tessier had invested approximately $250,000 in technology research and
was in the  process of  finalizing  patents  on the  technology  and  developing
prototypes.  Since 1996,  Tessier has built two prototypes and received  patents
for its ice removal  technology  (U.S.  patent no.  5,540,004  and Canada patent
no.2126249).  On  October  6,  1997  PWRE sold  Tessier  to a  private  Canadian
corporation.

         The  Company's   sale  of  Tessier  was  treated  as  a  related  party
transaction.  Craig Bampton,  a Vice President and director of the Company,  had
served as Vice President of Tessier  subsidiary and was also a director of PWRE.
Mr.  Bampton  did  recuse  himself  from the  final  approval  by the  Boards of
Directors of both the Company and PWRE. Presently,  Mr. Bampton is President and
a director of Tessier.

         During 1999, the Company  converted the Debenture into 2,000,000 shares
of PWRE common stock.  This amount was reduced to 200,000  shares due to the one
(1) share for ten (10) shares reverse stock split effected by PWRE.

         As additional consideration for the acquisition of Tessier, PWRE agreed
to issue, to eligible  shareholders of the Company,  shares of PWRE common stock
and  rights to  purchase  additional  shares.  Under  the terms of the  original
agreement,  prior to the reverse  stock split of PWRE  shares,  each  individual
Company  shareholder  of record as of April 5,  1996,  is  entitled  to five (5)
shares of  authorized  but  previously  unissued  PWRE common stock for each 100
shares of Company  common stock  owned.  Only  shareholders  owning at least 100
shares of Company common stock are eligible for the distribution.  Further, each
five shares of PWRE common  stock  issued to Company  shareholders  includes ten
(10) rights,  each right entitling the holder thereof to purchase one additional
share of PWRE  common  stock for $2.25 per share for a period of sixty (60) days
following  receipt of the PWRE  shares and rights.  PWRE  intends to include the
equivalent shares and rights in a registration statement to be filed by PWRE.

         Based on 6,200,014  qualifying  shares of the  Company's  common stock,
310,000 PWRE dividend shares and 620,000  equivalent rights are available to the
Company's shareholders as of the record date of April 5, 1996.

         Currently,  the Company  owns less than one percent of the common stock
of PWRE. There is no other relationship  between the two companies and there are
no common  employees,  officers or directors.  PWRE shares are traded on the OTC
Bulletin  Board and the closing price on May 10, 2000 was $4.50 per share.  PWRE
has filed a registration statement with the Commission pursuant to Form 10-SB of
the Securities Exchange Act of 1934.

         Development of Internet Gaming Activities

         In March 1999, the Company entered into a nonexclusive software license
agreement  with Starnet  Systems  International  Inc.,  formerly  Softec Systems
Caribbean Inc.  ("SSII"),  a wholly owned  subsidiary of Starnet  Communications
International  Inc.  ("Starnet"  -  OTCBB:  "SNMM").  Pursuant  to  the  license
agreement,  SSII was to provide the Company  with a complete  turn-key  computer
hardware, software and customer support package for the operation of one or more
on-line casino websites. As a requirement of the license agreement,  the Company
was obligated to establish an Antigua  corporation  to hold a gaming license and
to  conduct  operations  from  that  jurisdiction.  In July  1999,  the  Company
established,  under the  authorization of the Government of Antigua and Barbuda,
EuroAsian E-Casinos  International Ltd. ("E-Casinos  International") as a wholly
owned subsidiary.  In July 1999, E-Casinos International was granted an Offshore
Virtual Casino Wagering license by the Free Trade & Processing Zone of Antigua.

                                       -5-


<PAGE>



         Given the nature of its software and technology  license agreement with
SSII,  the  Company  does  not  anticipate   using  its  E-Casinos   subsidiary,
incorporated in the Marshall Islands,  in conjunction with its series of on-line
casino  websites  created under that agreement.  All primary  operations will be
conducted from the Antigua corporation,  E-Casinos  International.  However, the
Company  expects to enter into  similar  arrangements  with  other  third  party
software  development  companies to provide gaming  services for other series of
on-line  casinos.  With the rapid change and evolution  taking place in Internet
based  technology,  the Company has decided to not  restrict  itself to a single
technology  platform  or  approach.  The  Company  intends  to limit its risk of
rapidly changing technology by using multiple vendors.

          The Company's  does not intend to accept wagers from  residents of the
United States.  The United States  Congress has  attempted,  but failed to pass,
legislation seeking to prohibit on-line gaming within the United States. Because
of possible  legislation  that could ban or  severely  restrict  on-line  gaming
within the United States, many companies in the industry, including the Company,
have elected to operate only in countries that expressly  permit on-line gaming,
or have not specifically prohibited on-line gaming.

         The Company is  currently  in the process of changing  its  domicile of
incorporation  from Idaho to the State of Nevada.  The Company also  anticipates
that it will  re-domicile  its  CCCI  subsidiary  as an  offshore  international
business  corporation.  It is anticipated  that CCCI will eventually  assume the
merchant  account   responsibility  for  the  on-line  casinos.   This  involves
coordinating  on-line financial  transactions  required by the casino and with a
banking  institution  to provide  credit card  processing for the patrons of the
casino.

Services and Products

         In conjunction with the SSII license agreement, the Company established
a website  (www.asiacasino.com)  to conduct initial gaming operations.  The Asia
Casino  website  and  Sportsbook  became  operational  in July of 1999 and began
accepting wagers from various  jurisdictions  around the world, with the notable
exceptions of the United States and Canada.  The Company's current policy is not
to accept  wagers  from  residents  of those two  countries  because of possible
legislation  limiting or banning  on-line gaming in these  countries.  Also, the
Company's  agreement with SSII prohibits the Company from accepting  wagers from
Canadian residents.  However, if the laws in the United States and/or Canada are
clarified, or if the Company receives an appropriate opinion from legal counsel,
the Company  reserves the right to consider  offering its gaming services in the
two countries.  Presently, the Company's primary market focus is on Asia, Europe
and the Middle  East.  In  addition,  the  Company  has  adopted a policy of not
accepting wagers from individuals less than 18 years old.

         The  Company  recognizes  the  potential  risk of  improper  use of its
website by minors or by persons in jurisdiction where such use is not permitted.
There is also the risk that  players  may be  inclined  to not pay their  gaming
debts.  Through  its  online  gaming  provider,  SSII,  the  Company  employs  a


                                       -6-


<PAGE>


registration   process  that  establishes  and  confirms  the  identity  of  the
prospective player prior to the authorization of gaming activities. This process
is intended to screen out minors and other unauthorized applicants.  Once gaming
activities are initiated,  the Company uses  encryption and password  protection
methods to validate  the player.  In the  unlikely  event that a minor does gain
access to the system  through  deceptive  means,  the Company can invalidate any
winnings  generated by the player. It is possible,  however,  that such a player
could make a claim  against  paying any gaming  losses due to their  status as a
minor. In this case the Company may have to authorize a chargeback  against such
gaming  losses  and accept a  reduction  against  gross  winnings.  The  Company
believes  that  its  registration   screening  system  and  password  protection
mechanism will reasonably deter minors from accessing the system.

         Individuals seeking to gamble at the Company's website must place funds
"on-account"  with the Company prior to the initiation of any gaming  activities
for real money.  As a player  loses,  those  funds are debited  from their funds
account and  transferred to the Company's  account.  On occasion and for various
reasons, a player may claim that their gaming activities were not authorized and
may request a chargeback on their debited funds. Given that reasonable  wagering
limits are placed on all accounts and noting that such  chargebacks  represent a
minimal  problem for the Company  and the  industry as a whole,  the Company may
find it expedient to authorize such a chargeback and not contest the claim.  The
account  holder would then likely be voided from future play.  The online gaming
industry has also effectively employed a "negative credit card database" to help
screen out minors,  fraudulent bettors,  and other questionable  accounts during
the application process.

         The  SSII  license  agreement  provides  for  over 20  interactive  and
computer  generated  casino-style  games of chance developed in conjunction with
Nevada State Gaming Guidelines.  A Sportsbook also offers wagering action on all
the  professional  sports  leagues from Europe and North  America.  In addition,
capabilities for wagering on pari-mutuel racing,  lotteries and bingo are in the
development  stage.  All gaming  operations and transactions are being conducted
from the facilities of SSII located in St. Johns, Antigua.

         The key  features  of Asia Casino  include,  but are not limited to the
following:

         *        The  ability to play games in either the  English,  Chinese or
                  Japanese languages;
         *        Traditional  Las  Vegas  games of  chance  such as  Blackjack,
                  Craps,  Roulette,  Poker, Baccarat, Pai Gow, Sic Bo and Slots;
                  over 20 casino games in all are available;
         *       The  Company's  licensed  Java games use the Java  language to
                  provide  easily  accessible  on-line  games  to the  Company's
                  website(s).   The  cross-platform  nature  of  Java  makes  it
                  possible to play these games on all major  operating  systems,
                  on-line, with virtually no downloading required. The games are
                  simplified to optimize  loading times.  The Company  currently
                  has four  casino  style  Java  Games  (Videopoker,  Blackjack,
                  Caribbean  Stud  poker,  and Gold Rush  slots) for  players to
                  wager on, with several  additional  Java games projected to be
                  released throughout 2000.
         *        A  Sportsbook   which  offers   wagering  action  on  all  the
                  professional  leagues from Europe and North America  including
                  baseball, football, basketball, hockey, English Premier League
                  Soccer  and  Italian  Series  "A";   college   basketball  and
                  football;  boxing, horse racing and other sporting events from
                  around the world such as World Cup Soccer, cricket and rugby.

                                       -7-


<PAGE>


         The  Company's  revenues are derived  primarily  from the  operation of
E-Casinos International,  that receives monthly sales statements from SSII and a
net  remittance.  The net remittance is the  difference  between gaming wins and
losses  from the  casino-style  games and  sportsbook  offered on the  Company's
websites.  There are no  registration,  acceptance or membership  fees collected
from customers.

         Venture Tech is one of ten charter  members of the  Interactive  Gaming
Council  ("IGC")  that  intends to  establish  standards  and a  self-regulation
methodology  as the on-line  gaming  industry's  trade  association.  The IGC, a
non-profit  organization,  was  formed in  October  1996 with a mission  to: (a)
provide a forum to address  global  issues with respect to on-line  gaming;  (b)
establish fair and responsible  trade  guidelines and practices;  and (c) be the
public  policy  advocate  and  clearinghouse  for the on-line  gaming  industry.
Presently,  there are approximately 80 members of the IGC and it is a recognized
representative  of the on-line gaming  industry.  The Company's  Chief Operating
Officer has served on the Council's Board of Directors.  Members of the IGC have
been  asked  to  testify  before  Congress  and the  President's  Commission  of
Gambling.

Potential Market

         The  estimated  size  of the  Internet  gambling  market  is  naturally
dependent  upon the projected  growth of the Internet,  now estimated to be over
170 million users worldwide.  The Asia/Pacific  region appears to be the fastest
growing area for Internet adoption.  For example, in 1998, Asia had 14.1 million
on-line users,  which represented  14.8% of the worldwide  Internet user base of
81.3 million. By the year 2002, it is projected that Asia will have 60.7 million
Internet users,  which will represent 27.5% of the projected  worldwide total of
221 million  on-line  users.  (Source:  eStats,  1999).  China in  particular is
expected to experience the fastest  growth.  Starting from an estimated  on-line
population  of 2.1 million in 1998,  it is  projected  that China will have 17.3
million  on-line by 2001 and 33.6 million on-line by 2003.  (Source:  Strategis,
1999). Of China's current population of 1.26 billion, the projected 33.6 million
Chinese on-line users will represent less than 3% of its total population.  When
compared to current Internet  penetration rates such as Australia (23.4%),  Hong
Kong (13.4%),  Japan (11%) or South Korea (6.7%), the potential for products and
service that are sold via the  Internet to Chinese on- line users is  exception.
(Source: Nua Internet Services).

         The following table illustrates that estimated Internet gaming revenues
worldwide,  currently  less than $900 million,  could increase to a an estimated
$2.3 billion by the end of 2001. Because most companies involved in the Internet
gaming market are private entities,  it is difficult to estimate the actual cash
flow of these Internet casinos.

                                       -8-


<PAGE>


<TABLE>
<CAPTION>

                                                 1997       1998       1999    2000       2001
<S>                                                <C>       <C>      <C>       <C>       <C>
Adult Home Internet (in Millions)                  46        81       121       145       159
Percentage of Users Conducting On-line
  Transactions                                     15%       18%       21%       24%       27%
Potential Internet Gamblers
  (in Millions)                                   0.9      14.5      25.4      34.8      43.0
Per capita Expenditure (in $ Millions)         $  146    $  154    $  155    $  160    $  165
Potential Internet Gambling Revenue
  (in $ Millions)                              $1,009    $2,182    $3,922    $5,555    $7,080
Estimated Actual Internet Gambling
  Revenue (in $ Millions)                      $    0    $   51    $  811    $1,520    $2,330
-------------------
</TABLE>

(Source:  Deutsche Bank - Christiansen/ Cummings Assoc., 1999)

         Asiacasino.com Website

         The Company's primary gaming website (www.asiacasino.com) is accessible
by a  minimum  hardware  configuration  consisting  of: A 486/66  microprocessor
personal  computer  with  Windows 95 or greater,  8 MB RAM, 30 MB free hard disk
space, a 14,400 modem and a direct Internet  connection.  All games are provided
in a  Windows-based,  menu driven  format with "point and click"  interactivity.
Prospective  players who desire to conduct gaming  operations at Asia Casino are
able to subscribe  over the Internet by completing an  application  appearing at
the website.  Part of the application  process requires that the subscriber open
an account and make a minimum  deposit  with the Company to activate the account
for real money  play.  Prospective  players are also able to play for fun, at no
cost,  for  entertainment  purposes or to practice  their skills prior to actual
wagering.

         The Company's websites are controlled  through its licensing  agreement
with SSII.  Physical operations and transactions are conducted by SSII personnel
at SSII's  facilities  located in St. Johns,  Antigua.  The Company  retains the
right to reasonably  audit SSII's  activities on its behalf.  SSII's  network is
connected to the Internet via  redundant  high-speed  fiber,  ensuring  multiple
backup connections to the Internet. This high performance network infrastructure
ensures reliable and responsive game play for the end users/players.  The system
is  composed  of high  speed  Sun  Microsystems  servers  and  Cisco  networking
equipment. Most of the critical system components,  such as the game servers and
web servers, are distributed across multiple machines,  which protect the gaming
service  from  failures due to  malfunctioning  equipment.  The highly  scalable
nature of SSII's  system  design  makes  provisioning  for  additional  capacity
simple.  The network monitoring staff tracks the system at all times to maintain
constant  awareness  of the  system's  operating  parameters.  New  equipment is
installed  when  necessary to compensate  for increased  activity or anticipated
peak demands for popular events.

         SSII uses  advanced  technologies,  such as site  identification,  data
encryption,  and secure  servers to provide  users with a safe  environments  to
perform  secure  transactions,  and data  transmission  over the  Internet.  Any
transaction  made with SSII on-line is secure and  convenient.  SSII's system is
protected  by the Secure  Sockets  Layer  (SSL)  protocol,  which  encrypts  all
information and confirms the identity of the Company's server, before allowing a
transaction to be completed. Data encryption hides sensitive information such as
the customer's name, address, and credit card number. Even if someone manages to
obtain a  player's  personal  information  from the  transaction  process,  data
encryption will not allow him or her to either read or use it.

                                       -9-


<PAGE>



         The  Company's  website is  designed to invite  prospective  players to
register  and apply for casino and  sportsbook  membership.  After a  membership
application  is reviewed,  it is either  accepted or rejected  based on criteria
including,  but not limited to, age and geographic location of the customer. The
Company's policy is to accept subscriptions only from persons over the age of 18
and believed to reside in jurisdictions that are not known to expressly prohibit
Internet gaming.  Subscriptions will not be accepted from persons believed to be
residents of the United States or Canada. The Company uses screening  techniques
in order to verify that the  subscriber  resides in a  jurisdiction  that is not
known to prohibit Internet gaming.

         Upon acceptance,  the approved customer is then allowed to download the
gaming software over the Internet for installation on their personal computer or
to request a CD with additional graphics, music and video capabilities contained
thereon.  The customer is then given a username and password and is thereby able
to access the Company's  gaming servers over the Internet through their personal
Internet service provider.

         The Company's website allows the subscriber to review all terms,  rules
and  conditions  applicable  to gaming  and other  uses at the site.  All gaming
winnings  and losses are debited and  credited  to the  customer's  account on a
real-time basis. All games are conducted  pursuant to house rules and advantages
that are published at the website.

         Subscriber's  may make  deposits  to their  gaming  accounts  by way of
credit card or wire payment.  Through the  Company's  licensing  agreement  with
SSII, EFS Caribbean Inc., a wholly owned subsidiary of Starnet,  supplies credit
card  transaction  services to the Company for an  additional  fee.  The Company
primarily accepts Visa, MasterCard,  American Express credit cards over a secure
platform provided through EFS.

Regulation

         Gaming  activities are  stringently  regulated in the United States and
most developed countries.  Gaming regulations and supervisory  procedures in the
United  States and most  developed  countries  are based upon  policies that are
concerned  with,  among other things,  (i)  prevention of unsavory or unsuitable
persons  from  having  a  direct  or  indirect  involvement  with  gaming;  (ii)
establishment   and   maintenance  of  responsible   accounting   practices  and
procedures; (iii) maintenance of effective controls over the financial practices
of licensees,  including establishment of minimum procedures for internal fiscal
affairs and safeguarding assets and revenues,  providing reliable record keeping
and requiring the filing of periodic  reports with the governing  jurisdictions;
(iv) prevention of cheating and fraudulent practices; and (v) providing a source
of government revenue through taxation and licensing fees.

         The Company is subject to applicable laws in the jurisdictions in which
it intends to operate. Some jurisdictions have introduced regulations to attempt
to restrict or prohibit Internet gaming.  However,  other  jurisdictions such as
several  Caribbean  countries,  Latin  America  and  Australia,  have  taken the
position  Internet  gaming is legal and/or have adopted or are in the process of
reviewing  legislation to regulate  Internet  gaming in such  jurisdictions.  As


                                      -10-


<PAGE>



companies  and  consumers  involved  in Internet  gaming are located  around the
world, there is uncertainty  regarding exactly which government has jurisdiction
or  authority to regulate or  legislate  with respect to various  aspects of the
industry.  Further,  it may be  difficult to identify or  differentiate  gaming-
related transactions from other Internet activities and link those transmissions
to  specific  users,  in  turn  making   enforcement  of  legislation  aimed  at
restricting  Internet  gaming  activities  difficult.  However,  because on-line
gaming is a relatively  new industry,  it is possible that in the future some or
all of these foreign jurisdictions may take action to more severely regulate, or
even  prohibit,   Internet  gaming  operations  in  their   jurisdictions.   The
uncertainty  surrounding the regulation of Internet gaming could have a material
adverse  effect on the  Company's  business,  revenues,  operating  results  and
financial condition.

         The Company, along with other industry representatives,  have adopted a
proactive policy of lobbying international jurisdictions, where appropriate, for
purposes of seeking  approval of Internet  gambling and the  regulation of those
activities on a basis that is favorable to the Company. Pursuant to its position
with the  Interactive  Gaming  Council,  the Company's  management  has met with
representatives  of organizations,  such as the International  Gaming Regulators
Association,  to  educate  regulators  and  legislators  on- line  gaming and to
advocate an international regulatory framework.

         Legislation  designed to restrict  or prohibit  Internet  gaming may be
adopted  in the  future  in the  United  States  or other  jurisdictions.  After
previous similar proposals failed to pass in 1998, Senator Jon Kyl of the United
States Senate  introduced in March 1999 a revised proposal  intended to prohibit
and criminalize Internet gambling (Internet Gambling Prohibition Act of 1997; S.
474).  There  can be no  assurance  whether  any  such  bill  will  become  law.
Additionally,   existing  legislation,   including  United  States  and  federal
statutes,  could be construed to prohibit or restrict  gaming through the use of
the  Internet.  The  Company's  former  Chief  Operating  Officer was invited to
testify before the  President's  National  Gambling  Impact Study  Commission in
Washington,  D.C. on the merits of on-line gaming regulation and against the Kyl
bill. At the present time,  however, it is the Company's policy not to offer its
Internet gaming services to residents of the United States until laws pertaining
to on-line gaming are clarified,  or the Company receives an appropriate opinion
from legal  counsel  that such  activities  are not  illegal.  The Company  will
endeavor to comply with  federal and state laws in the United State in regard to
gaming regulation.

Insurance

         The Company  does not carry  liability  insurance  with  respect to the
business risks  associated  with its on-line  gaming  business.  Presently,  the
Company relies on its gaming vendor, SSII, to provide the necessary software and
servers to properly operate the Company's  business.  SSII's system is protected
by the Secure Sockets Layer (SSL)  protocol,  which encrypts all information and
confirms the identity of the Company's  server before  allowing a transaction to
be  completed.  To date,  SSII has  adequately  provided  its  services  with no
material disruptions or problems.  Accordingly, the Company believes that SSII's
security coverage  adequately  protects the Company's  interest and that further
liability insurance coverage by the Company is not warranted.

                                      -11-


<PAGE>

Competition

         The rapid  expansion of the Internet  and the  potential  profitability
associated  with the  Internet  gambling  business has  attracted an  increasing
number of operators.  Consequently, the Company presently encounters significant
competition from existing providers of Internet gaming operations and expects to
encounter increasing competition as additional Internet gaming service providers
come on-line. The following table illustrates the growth in Internet gambling.

                    On-line Casinos Lotteries        Bingo        Sports-books
May 1998         90                        39          8                93
May 1999         250+                      64         20               139
April 2000       400+                      66         24               246
----------
Source:  Rolling Good Times Online, 1999 and 2000

         The Company  estimates that there are over 100 on-line gaming operators
on the World Wide Web providing  Internet  gambling,  with  approximately  45 of
these being publicly traded companies.  A listing of the various publicly traded
companies can be found on the website www.streetdice.com.

         A key factor  behind the growth in the number of gambling  sites is the
underlying  structure of the  industry.  The nature of the industry is such that
once the  initial  gaming  site  has been  established,  the  marginal  costs of
modifying the look of the site and registering it under another URL are minimal.
Thus, in theory,  the more sites that a company has established,  the larger the
percentage of the Internet  gambling market  attainable.  It is not uncommon for
some  operators to have multiple  sites that are slight  modifications  from one
another or multiple URLs that lead to the main site.

         Many of the Company's present and future competitors have, or may have,
as the case may be, greater capital and other resources than the Company and may
choose to adopt an international marketing plan similar to the Company's.  There
can be no  assurance  that  the  Company  will be able  to  generate  meaningful
revenues  or  earnings  from  its  Internet   gaming   operations  or  otherwise
successfully compete in the future.

         Given the number of operators,  the Internet  gambling market initially
appears  to be  highly  competitive.  However,  many  of the  companies  in this
fledgling  industry can be characterized as small entities with limited finances
and are without sophisticated marketing strategies. Also, many of these entities
operate with a single technology, focus on primarily on the United States market
and typically  have limited  contacts and exposure in the  international  arena.
Management believes that many of these companies will ultimately fail which will
result in only a reasonable number of dominant operators remaining.

Marketing Strategy

         The rapid  development  of the  Internet has created  opportunities  to
develop new, efficient and secure ways to deliver  information and entertainment


                                      -12-


<PAGE>



to  customers.  The Company  primary  focus is to expand its market share of the
Internet  gambling market and become a leader in the Internet  gaming  industry.
The key strategic objectives for the Company are:

         1.       Develop  its role as a leading  provider  of  Internet  gaming
                  services;

         2.       Expand geographically to other markets; and

         3.       Selectively pursue opportunities that allow it to leverage its
                  marketing and Internet competencies into other market segments

         E-Casinos  International  will  employ a variety  of tactics to achieve
these objectives. These tactics include the following:

         *        Rapidly expanding its presence in Internet gaming markets:

         By increasing the number of gambling  websites that it will operate and
the number of its gaming  product  offerings  at these  sites,  the  Company can
expand its reach into the  Internet  gaming  market.  The  addition of different
language sites targeted at the German,  Italian,  French, Spanish and Portuguese
and Middle  Eastern  markets  are  already in  planning  and are  expected to be
launched in 2000. In addition, a portal site, www.ecasino.com,  is available for
access and the Company  anticipates  that it will provide a mechanism to collect
and funnel traffic into the Company's gaming network.

         The Company  presently uses three primary forms of marketing to attract
prospective  players to its on-line casino;  on-line banner ads, print marketing
and direct CD  distribution  through third  parties.  The Company has used print
based  periodicals,  such as the Hong Kong Daily  News and  Gaming  and  Leisure
International  to promote its  websites.  The Company  believes,  however,  that
direct CD distribution and targeted  Internet banner ads are more effective.  To
that end, the Company has placed  banner ads on such  websites as Hong  Kong.com
and  Taiwan.com,  as well as Internet  search  engines  such as  Hotbot.com  and
Asiaco.com.  The  Company is  currently  developing  its third  party  strategic
relationships for further direct CD distribution to prospective end users.

         The  Company  has  obtained a  registered  trademark  for  "E-CASINOS."
Management  believes  that the  trademark  will help  protect the  Company  from
conflicting use of the mark or similar marks by prospective  competitors seeking
to gain benefit from this highly recognizable association with on-line gaming.

         *        Aggressively  pursue  partnership   opportunities  with  other
                  gaming   suppliers  and  local   partners  who  have  specific
                  geographical   expertise   to  expand   the   E-Casinos   name
                  internationally:

         Recognizing  that local  presence is essential  for the  marketing  and
promotion  of Internet  gaming in local  markets,  the  Company  intends to form
licensing  or joint  venture  partnerships  with native  investors  in countries
wherever possible.  Although gambling is an international  activity, each region
has its own  preferences as to how gaming is promoted and marketed.  The Company
will rely on its local  partners for the financial  and  marketing  resources to
promote  the  gaming  websites  in their  respective  regions.  The  Company  is
currently in discussions with potential interested partners in Western Europe.
                                      -13-


<PAGE>

         *        Provide high  quality,  innovative  and superior  products and
                  services:

         Working with its existing  suppliers as well as entering into strategic
relationships with alternative  suppliers,  The Company will focus on delivering
the best Internet  gaming  services.  Rapid  adoption of the latest  product and
service offerings by its suppliers is a priority for the Company.  The Company's
current  technology  partner (SSII) is planning to launch in the near future new
product offerings such as horse race betting,  international lottery tickets and
an  interactive  bingo game.  The Company  will,  in turn,  market these product
offerings  to its  customer  base.  To insure  against the risk of being  overly
dependent  upon a single  technology,  the  Company  is  evaluating  alternative
providers of gaming technology.

         *        Use its expanding  customer base to generate ancillary revenue
                  streams:

         Upon  registering at the Company's  gaming  websites,  customers become
part  of the  Company  database  and are  then  eligible  for  cross-promotional
activities such as merchandise offers or casino "comp" type programs.

         *        Offer user-friendly Internet gaming:

         As Internet  gaming is a relatively  new form of  entertainment,  it is
important  that the  Company  provides  a  complete  gaming  experience  for the
gamblers,  many of whom may be new to the Internet. To address these issues, the
Company intends to offer:

         (a)     State-of-the-art,  easy to play Internet games.  The Company's
                  relationship  with key software  developers  to provide  their
                  Internet gaming expertise and casino game  development  skills
                  means  the  Company  can  provide  the  best  possible  gaming
                  environment.  Easy to use graphical  interfaces,  state of the
                  art  graphics,  accessible  help  programs and  familiar  game
                  mechanics  will  allow  gamblers  to  understand  and play the
                  games.


         (b)      Credible  Internet Gaming. A key factor for the success of the
                  Company  will  be the  provision  of  secure,  legitimate  and
                  credible casino gambling. Through participation of the various
                  partners, independent auditors and its corporate commitment to
                  ethical business practices, the objective of the Company is to
                  provide  a  fair  and  secure  gambling  environment  for  its
                  patrons.  The  Company has  committed  to  participate  in the
                  regulatory  review processes being established by the industry
                  to ensure the fairness,  quality and  legitimacy of the gaming
                  provided.

Proposed Acquisition of Cyberdome

         Part of the  Company's  long-term  strategy  is to expand  its on- line
business to include more conventional  gaming  (non-gambling) and other Internet
related activities.  Accordingly, the Company entered into a letter of intent in
November 1999 to acquire Cyberdome Entertainment Inc. ("Cyberdome"), a privately
held company located in Ottawa, Ontario,  Canada. The Company desires to acquire
Cyberdome subject to the completion of satisfactory due diligence by the Company

                                      -14-


<PAGE>


and approval by the Boards of  Directors  of both  parties.  The  Company's  due
diligence  includes,   but  is  not  limited  to,  the  satisfactory  review  of
Cyberdome's  audited  financial  statements when they become  available.  If the
acquisition  proceeds,  the  Company  intends  to  issue  a  certain  amount  of
convertible securities in exchange for the assets, liabilities, and intellectual
property  rights of  Cyberdome.  Final terms of the  potential  acquisition  are
subject to financial and business  considerations  at the  completion of the due
diligence period.

         Cyberdome is a technology entertainment ("technotainment") company that
operates a 25,000  square foot  Virtual  Reality  Theme Park  located in the St.
Laurent  Shopping  Center,   Ottawa,   Ontario,   Canada.  This  facility  would
potentially   provide  a  base  for  a  network  of  affiliated  Location  Based
Entertainment Centers ("LBE's") providing the infrastructure for members to play
multi- player games, either onsite or on-line using the Internet.  A typical LBE
would include a full-service restaurant that potentially could obtain up half of
its revenues from food and drink with the balance from amusements.

         The  Company  believes  that  the  acquisition  of  Cyberdome  could be
finalized  during the  second or third  quarter of 2000.  The  Company  will not
proceed  with  the  acquisition  unless  it  satisfactorily  completes  its  due
diligence  investigation,  including  review of  Cyberdome's  audited  financial
statements.  There  can be no  assurance  that  the  Company  will  successfully
complete the acquisition.

Year 2000 Risks

         The Year 2000 issue results from a computer  industry-wide  practice of
representing  years with only two digits instead of four.  Beginning in the year
2000,  date code  fields  need to  accept  four  digit  entries  to  distinguish
twenty-first  century dates from  twentieth  century dates (2000 or 1900).  As a
result,  computer  systems and/or  software used by many companies  needed to be
upgraded to comply with such Year 2000 requirements. Through April 30, 2000, the
Company has not experienced any  significant  problems  associated with the Year
2000 issue nor has it been made aware of or  experienced  date related  problems
with any third-party software. Although it appears that the Year 2000 issue will
not have a significant  adverse  effect on the Company,  it continues to monitor
the Year 2000  compliance  of its  internal  systems.  Undetected  errors in its
internal  systems  that may be  discovered  in the future  could have a material
adverse effect on its business, operating results or financial condition.

Employees

         As of the  date  hereof,  the  Company  has  four  full-time  employees
functioning in senior  management and marketing  positions.  Because the Company
licenses and  subcontracts  primary  services,  it primarily use consultants and
advisors  to  provide  other,  mostly  "part-time"  services,  required  for its
operations.  The Company has entered into a consulting agreement with its former
Chief Operating  Officer to supply guidance and advisory  services to management
in matters related to the on-line gaming  industry.  Management  intends to hire
additional  qualified employees only as business conditions warrant and as funds
are available.

                                      -15-


<PAGE>

         The Company has entered into certain  licensing  agreements  with third
parties  as  an  initial  means  of  developing   its  service   offerings  and,
accordingly,  relies upon the work performed by its licensing  partners.  As the
Company's  virtual casinos become more fully  developed,  it is anticipated that
the Company will hire additional  qualified  personnel  consistent with workload
requirements and as business conditions warrant.

Trademarks

         The  Company has  received  notice  from The United  States  Patent and
Trademark Office of its approval of "E-CASINOS" as a registered  trademark.  The
certificate  of  registration  (Service Mark Reg. No.  2,018,862)  was issued on
October 28,  1997 by the U.S.  Patent and  Trademark  Office.  The  registration
covers  entertainment  services,  namely  providing  on-line casino style gaming
services  accessed  via a  computer  network.  The  Company  intends  to  defend
vigorously its trademark in the on-line gaming industry.

Research and Development

         The Company has relied upon the developers of the technology,  which it
has acquired or licensed to carry out the research  and  development  related to
the particular  technologies.  Thus, during the most recent three fiscal years,,
the  Company  did not  expend  any  material  funds  directly  on  research  and
development related to the Company's entry into the Internet gaming business.

         The Company  relies upon its Vice  President  of  Technology  and other
consultants  hired  from  time  to time  to  monitor  and  review  its  licensed
technology,   as  well  as  keeping  the  Company   appraised  of  new  industry
developments in the Internet and on-line gaming business. The Company expects to
continue to license or  otherwise  acquire  technology  in the  future,  but may
expend funds to further any acquired  technology to suit its  individual  needs.
However,  management  anticipates  that in the  future it may  expend  funds for
ongoing  research and development of new products and to enhance  existing ones.
As of the date hereof,  management has made no estimates as to the extent of any
future research and development expenditures.

Risk Factors Relating to the Company's Business

         Because of the nature of the Company's business,  it encounters certain
risk  factors.  Each of these  factors  could  adversely  affect  the  business,
operating results and financial condition of the Company.

         Possible Difficulties from Operations in Foreign Countries

         Most of the Company's  business is being conducted in foreign countries
which may encounter unfavorable economic or political situations.  Also, some of
these countries do not have highly developed  telecommunications  infrastructure
which can result in overloaded  lines, slow speed of electronic  traffic,  and a
potential  for  break-downs.  Thus,  because of the nature of the its  business,
potential  telecommunication  problems  could  have  an  adverse  effect  on the
Company.

                                      -16-


<PAGE>



         Maintenance of Rapid Technology Change

         The Company's  business  involves  operations  on the Internet,  a fast
growing  and  rapidly  changing  industry.   Internet   technology,   commercial
applications and on-line users are constantly evolving. If the Company is unable
to respond to rapid  changes  involving  the  Internet and its  technology,  the
Company's business could be adversely affected.

         Risk of Potential Technology Failures

         The  Company's  Internet  business is  dependent on the  efficient  and
uninterrupted  operation of its computer and communication hardware and software
systems.   System   interruptions  that  cause  the  Company's  websites  to  be
unavailable or that reduce the ability to process  transactions could materially
and negatively  affect the Company's  business,  operating results and financial
conditions.  Interruptions  could result from natural disasters as well as power
loss,  telecommunications  failure and similar events.  Although the Company has
experienced occasional short-term  interruptions,  it has not developed a formal
disaster recovery plan in the event of a prolonged interruption.

         Susceptibility to On-line Security Breaches

         On-line security breaches could negatively impact the Company's on-line
business. To protect confidential information,  the Company relies on encryption
technology,  which transforms information into code designed to be unreadable by
third  parties.  The Company also employs  authentication  technology  that uses
passwords and other information to prevent unauthorized persons from accessing a
customer's information. If a person circumvents existing security measures, that
person could  misappropriate  confidential  information  about the Company,  its
customers, or cause interruption in operations. Security breaches that result in
access to confidential  information  also could damage the Company's  reputation
and  expose  the  Company  to a risk of loss and  liability.  Additionally,  the
Company may be required to make significant expenditures and expend considerable
effort and time to protect against security breaches.

         Risk of Improper Use by Customers or Non Payment

         As  with  most  on-line  providers,  there  exists  a  risk  of  use by
unauthorized  persons or by persons  that do not pay for the  services  or goods
offered.  Because the Company offers gaming services on its websites,  there are
special   considerations.   These  include  the  use  by  unauthorized  persons,
particularly  by a minor  or by a person  in a  jurisdiction  where  such use is
prohibited.  Improper use or fraudulent  activities could cause monetary loss to
the Company and create  potential legal  liabilities.  The Company relies on its
on-  line  gaming  provider,   SSII,  to  employ  a  registration  process  that
establishes and confirms the identity of the prospective player. This process is
designed  to  screen  out  minors  and  other  undesired   applicants  prior  to
authorizing gaming activities. There also is a risk of not being able to collect
funds from a player on the Company's  website.  The Company requires a potential
player on its website to first place funds  "on-account"  with the Company prior
to the initiation of any gaming  activities  for real money.  As a player loses,
those  funds are  debited  from  their  funds  account  and  transferred  to the
Company's account.  On occasion and for various reasons, a player may claim that

                                      -17-


<PAGE>




their gaming  activities  were not  authorized  and may request a chargeback  on
their  debited  funds.  Because  the  Company  places  monetary  limits  on  its
customers,  it may find it  expedient to  authorize  such a  chargeback  and not
contest the claim in order to prolong a dispute.  In such an event,  the account
holder would then likely be voided from future play.

         Risk of Possible Legislation Adverse to On-Line Gaming

         Gaming  activities are  stringently  regulated in the United States and
most other  developed  countries.  Because of the  Company's  gaming  activities
offered over the Internet, it is subject to applicable laws in the jurisdictions
in which it operates.  Some jurisdictions have introduced regulations to attempt
to restrict or prohibit Internet gaming,  and other  jurisdictions have adopted,
or are in the process of  reviewing  legislation  to regulate  Internet  gaming.
Currently,   there  is  uncertainty   regarding  exactly  which  government  has
jurisdiction  or  authority  to regulate or  legislate  with  respect to various
aspects  of  Internet  gaming.  There  is  the  possibility  that  some  or  all
jurisdictions  may take  action to more  severely  regulate,  or even  prohibit,
Internet gaming operations in their jurisdictions. The uncertainty about present
and future  regulation of Internet  gaming and potential new  legislation  could
have a material adverse effect on the Company's  business,  revenues,  operating
results and financial condition.

         Competition Could Negatively Effect Our Gaming Services

         The  Internet  gaming  industry  is  highly   competitive  and  rapidly
changing.  The Company faces such  competition  on a regional and  international
basis in those  jurisdictions in which it operates.  Additional  competitors may
also enter the market and competition may intensify.  Some of these  competitors
have substantially greater financial resources than the Company.  These entities
generally may be able to accept more risk than the Company prudently can manage,
including risks with respect to the  creditworthiness  of customers and evolving
technology.

         Short Operating History - No Assurance of Profitability

         The  Company  has a  short  operating  history  and is  deemed  to be a
development  stage company in the early phases of operation.  Its  likelihood of
success must be  considered  in light of the many  unforeseen  costs,  expenses,
problems, difficulties and delays frequently associated with new ventures. Also,
there is no assurance that the Company's business ventures will be successful or
that it will be able to attract and retain  sufficient  customers and clients to
attain its goals.  The Company  anticipates  that its  operating  expenses  will
increase  substantially as its business expands and there will be a greater need
to generate significantly more revenues to achieve profitability.  There is also
the possibility that the Company will have to secure future funding, either debt
or equity,  in order to finance its  activities.  There can be no assurance that
any such  funding will be available to the Company or, that if it is, it will be
available on terms favorable to the Company.

                                      -18-

<PAGE>

         Concentration of Share Ownership

         The  Company's  directors,   executive  officers  and  other  principal
shareholders own approximately  34.5% of the Company's  outstanding common stock
as of  December  31,  1999.  As a  result,  these  persons  possess  significant
influence over the Company on matters including the election of directors.  This
concentration  of share  ownership may: (i) delay or prevent a change in control
of the Company; (ii) impede a merger, consolidation, takeover, or other business
involving the Company;  or (iii)  discourage a potential  acquirer from making a
tender offer or otherwise attempting to obtain control of the Company.

         Possible Difficulties in Future Funding

         In the past,  the  Company has  financed  much of its  operations  from
borrowing and from the sale of its securities. It is unlikely that these funding
sources will be sufficient to satisfy the Company's future, increasing financing
demands. Accordingly, the Company may have to seek additional funding from other
outside  sources.  There  can be no  assurance  that  outside  funding  will  be
available to the Company at the time and in the amount to satisfy the  Company's
needs,  or, that if such funds are  available,  they will be  available on terms
favorable  to the Company.  If the Company  issues  additional  shares of common
stock, current shareholders may experience immediate and substantial dilution in
their ownership of Company shares. In the event the Company issues securities or
instruments  other  than  common  stock,  it  may  be  required  to  issue  such
instruments with greater rights than that currently  possessed by holders of the
Company's common stock.

         Possibility  That the  Company  May Not Be Able to  Continue as a Going
Concern

         The Company has incurred  operating  losses since its inception and has
not  established a source of revenues  sufficient to cover its operating  costs.
For the years ended  December 31, 1999 and 1998,  the Company had net  operating
losses of $1,133,481 and $681,671,  respectively.  The Company's  management and
independent  auditors  have  included a footnote in the  Company's  consolidated
financial  statements  for the periods ended  December 31, 1999 and 1998 stating
that because of the Company's  continued losses and need for additional funding,
there is  substantial  doubt as to whether the  Company can  continue as a going
concern. See Note 5 to the consolidated financial statements.

         Possibility of Limited Public Market for the Common Stock

         Presently,   the  Company's   common  stock  is  traded  in  the  over-
the-counter market and included on the OTC Bulletin Board. However,  unless this
registration  statement  becomes  effective in a timely manner,  there is a risk
that the Company's common stock could be removed from the OTC Bulletin Board. In
this  event,  the  company  will have to apply for and be  accepted to the "pink
sheet" in order to have its  securities  quoted and  traded by broker-  dealers.
This could  severely  limit the liquidity of the trading market in the Company's
shares and have an adverse effect on the price of the shares. Accordingly, there
can be no assurance that an active  trading market in the Company's  shares will
be sustained.

                                      -19-


<PAGE>



Item 2.           Properties

         The Company does not  presently  own any real  property.  From February
1996 through June 1999, the Company conducted its primary  corporate  activities
from  rented  facilities  in  Northern  Virginia.   The  Company  conducted  its
technical,  marketing and promotional activities from leased facilities in North
Vancouver, BC, Canada. In accordance with the trend for on-line gaming companies
to operate its business outside United States jurisdictions and the proximity of
its software technology licensor in Vancouver,  the Company decided in June 1999
to consolidate all of its business  activities in North  Vancouver.  The Company
occupies  approximately 2,750 square feet of leased office space located at 1055
West 14th  Street,  North  Vancouver,  BC.  These  facilities  are  leased  from
Pulverizer Systems, Inc., a subsidiary of Tessier.

         The Company has  established  Venture Tech  Holdings  (Canada)  Inc., a
British Columbia corporation, as a wholly owned subsidiary to provide management
services  to its  gaming  subsidiaries.  The  Company  believes  that it is more
efficient to have the majority of its  operations  located next to its principal
vendor,  SSII,  which is also  located in Canada.  The Company  will  maintain a
corporate liaison office in Northern  Virginia,  primarily to serve investors in
the United States and to provide information about the Company upon request.

         Two of the Company's directors,  Kenneth Fitzpatrick and Craig Bampton,
primarily use their own independent office space located in their homes in Santa
Barbara, California and Winnepeg, Canada, respectively,  to conduct the business
of the  Company.  The Company  reimburses  Messrs.  Fitzpatrick  and Bampton for
"out-of-pocket" expenses related to the Company's business. The Company believes
that its current  facilities,  including the home offices,  are adequate for its
current  needs and  anticipates  securing  additional  office  space as business
conditions warrant.

Item 3.           Legal Proceedings

         There are presently no material pending legal  proceedings to which the
Company or any of its subsidiaries is a party or to which any of its property is
subject and, to the best of its knowledge,  no such actions  against the Company
are contemplated or threatened.  In 1998, the Company took a reserve of $100,000
on its books against any possible  litigation  arising out of the termination of
its  licensing  agreement  with Casino World  Holdings  (CWH).  Based on a legal
opinion,  the Company  reasonably  believes  that it would be  successful in any
litigation  brought  by CWH and that any  claims  that may be brought by CWH are
without  merit.  The Company may elect to litigate  against CWH in the future to
recover its prior investment, but has no immediate plans to do so.

Item 4.           Submission of Matters to a Vote of Security Holders

         On October 25, 1999,  pursuant to proper  notice to  shareholders,  the
Company held a special meeting of shareholders at its corporate offices in North
Vancouver,  BC, Canada. At the meeting,  the following directors were elected by
the  indicated  vote to serve as  directors  until the next  annual  meeting  of
shareholders or until their successors are elected and qualified:

                                      -20-


<PAGE>


                    Nominee                    For                    Withheld
                    -------                    ---                    --------
         G. Michael Cartmell                20,023,752                 52,050
         Kenneth F. Fitzpatrick             20,023,752                 52,050
         Crag J. Bampton                    20,023,752                 52,050

         In addition to the election of  directors,  shareholders  also ratified
the proposal to empower the Board of Directors to take all  necessary  corporate
action  to  relocate  the  domicile  of the  Company  from the State of Idaho to
Nevada, and to prepare and file with the appropriate authorities,  all requisite
documents and reports.  The proposal was approved by the  shareholders by a vote
of 19,717,220 for, 32,835 shares against, and 36,300 shares abstaining.

                                     PART II

Item 5.           Market for Registrant's Common Equity and Related
                  Stockholder Matters

         The Company's Common Stock is traded in the over-the-counter market and
quotations are published on the OTC Bulletin Board under the symbol "VTEH",  and
in the National Quotation Bureau, Inc. "pink sheets" under Venture Tech, Inc.

         The following table sets forth, for the periods  indicated the range of
quarterly high and low bid prices of the Company's common stock as obtained from
the NASD for the past two years and  through  the date set forth for the current
year. Price quotations issued by  broker-dealers  reflect  inter-dealer  prices,
without  retail market  mark-up,  mark-down or commission  and may not represent
actual  transactions.  The  high  and low bid  prices  set  forth  below  do not
necessarily  represent what an investor might have bought or sold his shares for
during the periods indicated.  Rather, the prices are representative of the high
and low bid reported for the periods.

                                                  High               Low
                                                  ----               ---
                  1998

                          First Quarter          $  .50           $  .22
                          Second Quarter         $ 1.42           $  .42
                          Third Quarter          $ 1.00           $  .50
                          Fourth Quarter         $  .78           $  .14
                  1999

                          First Quarter          $  .91           $  .34
                          Second Quarter         $  .98           $  .47
                          Third Quarter          $  .50           $  .23
                          Fourth Quarter         $  .30           $  .17
                  2000

                          First Quarter          $  .44           $  .16
                          Second Quarter(1)      $  .53           $  .21

                           --------------------
                  (1)      Through May 21, 2000


         The ability of an  individual  shareholder  to trade their  shares in a
particular  state may be subject to various rules and regulations of that state.

                                      -21-


<PAGE>


A number of states  require that an issuer's  securities  be registered in their
state or  appropriately  exempted from  registration  before the  securities are
permitted  to  trade  in that  state.  Presently,  the  Company  has no plans to
register  its  securities  in any  particular  state.  Further,  most likely the
Company's  shares will be subject to the  provisions  of Section  15(g) and Rule
15g-9 of the Securities  Exchange Act of 1934, as amended (the "Exchange  Act"),
commonly referred to as the "penny stock" rule. Section 15(g) sets forth certain
requirements for transactions in penny stocks and Rule 15g-9(d)(1)  incorporates
the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act.

         The Commission  generally defines penny stock to be any equity security
that  has a  market  price  less  than  $5.00  per  share,  subject  to  certain
exceptions.  Rule 3a51-1 provides that any equity security is considered to be a
penny  stock  unless  that  security  is:  registered  and  traded on a national
securities exchange meeting specified criteria set by the Commission; authorized
for  quotation on The NASDAQ  Stock  Market;  issued by a registered  investment
company;  excluded from the definition on the basis of price (at least $5.00 per
share) or the issuer's net tangible  assets;  or exempted from the definition by
the Commission.  If the Company's shares are deemed to be a penny stock, trading
in the shares  will be subject to  additional  sales  practice  requirements  on
broker-  dealers  who sell  penny  stocks  to  persons  other  than  established
customers and accredited  investors,  generally persons with assets in excess of
$1,000,000 or annual income exceeding $200,000,  or $300,000 together with their
spouse.

         For  transactions  covered by these rules,  broker-dealers  must make a
special  suitability  determination for the purchase of such securities and must
have received the purchaser's  written  consent to the transaction  prior to the
purchase.  Additionally,  for any  transaction  involving a penny stock,  unless
exempt,  the rules require the delivery,  prior to the first  transaction,  of a
risk disclosure  document  relating to the penny stock market.  A broker- dealer
also must disclose the  commissions  payable to both the  broker-dealer  and the
registered representative,  and current quotations for the securities.  Finally,
monthly  statements  must be sent  disclosing  recent price  information for the
penny stocks held in the account and  information on the limited market in penny
stocks. Consequently,  these rules may restrict the ability of broker-dealers to
trade and/or maintain a market in the Company's  common stock and may affect the
ability of shareholders to sell their shares.

         As of December 31, 1999, there were approximately 195 holders of record
of the  Company's  common  stock,  which figure does not take into account those
shareholders  whose certificates are held in the name of broker-dealers or other
nominees.

         As of December 31, 1999 the Company has issued and outstanding
37,014,165  shares of common stock. Of this total,  6,919,111 shares were deemed
"restricted securities" as defined by the Act and
certificates representing such shares bear an appropriate
restrictive legend.

         Of the Company's total  outstanding  shares,  approximately  29,995,054
shares may be sold, transferred or otherwise traded in the public market without
restriction,  unless held by an  affiliate  or  controlling  shareholder  of the
Company. None of these shares have been identified as being held by affiliates.

         In general, under Rule 144 as currently in effect, a person (or persons
whose shares are aggregated) who has beneficially owned restricted shares of the
Company for at least one year,  including  any person who may be deemed to be an
"affiliate"  of the Company (as the term  "affiliate" is defined under the Act),
is entitled to sell,  within any  three-month  period,  an amount of shares that


                                      -22-


<PAGE>




does not exceed the  greater of (i) the  average  weekly  trading  volume in the
Company's common stock, as reported through the automated  quotation system of a
registered securities association, during the four calendar weeks preceding such
sale or (ii) 1% of the shares then outstanding. A person who is not deemed to be
an  "affiliate" of the Company and has not been an affiliate for the most recent
three months, and who has held restricted shares for at least two years would be
entitled to sell such shares  without  regard to the resale  limitations of Rule
144.

Dividend Policy

         The  Company  has  not   declared  or  paid  cash   dividends  or  made
distributions  in the past, and the Company does not anticipate that it will pay
cash dividends or make  distributions  in the  foreseeable  future.  The Company
currently   intends  to  retain  and  invest  future  earnings  to  finance  its
operations.

Item 6.           Management's Discussion and Analysis of Financial
                  Condition and Results of Operations

         The  following  information  should  be read in  conjunction  with  the
financial statements and notes thereto appearing elsewhere in the Form 10-SB.

Overview

         The Company is a development stage company and has incurred losses from
its  inception  through  December  31,  1999.  Since 1995,  the Company has been
engaged in the development,  acquisition and licensing of certain computer based
technology  designed to ultimately  offer a full range of  casino-style  gaming,
entertainment, information and financial transaction services over the worldwide
Internet. The Company further intends to leverage its anticipated client base of
Internet  gaming  players to the more  expansive  world of  electronic  commerce
("e-commerce") for purchase of more basic commodities and services.

         In March of 1999,  the Company  entered  into a  nonexclusive  software
license agreement with Starnet Systems  International Inc. ("SSII"),  to provide
the Company with a complete  turn-key computer  hardware,  software and customer
support  package for the operation of one or more on-line  casino  websites.  In
July 1999, the Company established a corporation to operate said on-line casinos
under the  authorization  of the  Government  of Antigua and Barbuda.  EuroAsian
E-Casinos  International Ltd. ("E-Casinos  International") was incorporated as a
wholly owned  subsidiary  of the Company.  Pursuant to this  incorporation,  the
E-Casinos  International was granted an Offshore Virtual Casino Wagering license
in July of 1999 by the Free Trade & Processing Zone of Antigua.

         In  conjunction  with the  SSII  license  agreement,  the  Company  has
established a website (www.asiacasino.com) to conduct initial gaming operations.
The Asia Casino  website and Sportsbook  became  operational in July of 1999 and
began marketing and accepting wagers from various jurisdictions around the world
(primarily targeted to Asia) with the exception of the United States and Canada.
Revenues are derived primarily from the operation of E- Casinos International.

                                      -23-


<PAGE>



         In the past,  the  Company  has not  established  a source of  revenues
sufficient to cover its  operating  costs and to allow it to continue as a going
concern.  The  Company  intends to seek  additional  financing  through  private
placements  of its  securities,  although  there  can be no  assurance  that the
Company will be successful in any such funding.  The Company anticipates that it
will begin to realize cash flows from its operations during fiscal 2000 and that
it expects to need from  $1,000,000 to $2,000,000  of funds for  operations  and
expansion in 2000. However,  unless the Company is able generate revenues and/or
raise sufficient capital to finance its operations in 2000, there is substantial
doubt about its ability to continue as a going concern.

Results of Operations

         Information is presented for the Company's most recent two fiscal years
ended December 31, 1999.

Fiscal Year Ended December 31, 1999 Compared to Fiscal Year Ended
December 31,1998

         The  Company  realized  revenues  of $29,710  from its  on-line  gaming
operations  during fiscal year ended  December 31, 1999. The Company first began
gaming operations for real money in the latter half of 1999. The Company did not
have  revenues  for  fiscal  year  ended  December  31,  1998,  as it elected to
terminate its software  licensing  arrangement  with CWH and seek other suitable
licensing arrangements. A new arrangement with SSII was secured in 1999. Cost of
sales for 1999 were  $10,232  or 34.4% of  revenues  compared  to $-0- for 1998,
resulting  in a gross  margin  of $ 19,478  for  1999.  Cost of  sales  includes
royalties  (payable to SSII)  incurred on gambling  activities and bank discount
fees incurred by the Company for the  acceptance of credit cards.  Cost of sales
are expected to remain at this percentage level for the foreseeable  future, but
as casino  volume  increases,  the  percentage  of royalty  payment  will likely
decrease per a negotiated schedule with SSII.

         General  and   administrative   expenses  for  1999  increased  69%  to
$1,091,453  from $645,754 for the  comparable  period in 1998.  This increase is
primarily  attributed to  commencement  of the Company's  on-line casino in July
1999.  Factors  contributing  to the increase  include the addition of staff and
consultants  in support of casino  operations,  an increase in office expense in
support of added personnel,  inclusion of amortization expense for the Company's
gaming and software  licenses,  legal and  professional  fees,  and  promotional
expenses  related to the  acquisition of  prospective  players for the Company's
website.

         Depreciation and amortization for 1999 increased $25,589 (71%) compared
to the 1998 period.  The increase was  primarily  due to the $25,000 in software
license  amortization  recorded by the Company in 1999.  The balance of the 1999
expense  was  $36,505  in  depreciation  of  property  and  equipment  that  was
consistent  with the amount  recorded  for 1998.  The Company  also had interest
expense of  $434,105  in 1999  compared  to $0 for the same 1998  periods.  This
interest  expense  resulted  from payment of interest on monies  advanced to the
Company in the form of a convertible  debenture,  and the issuance of debentures
and  warrants  at less than  market  value.  The  Company  recorded  $400,000 in
interest  expense  to  reflect  the  debt  conversion/warrant  component  of the
convertible debenture. The debenture is convertible into shares of the Company's
common  stock at $0.20 per share,  which  amounts to a $0.04  difference  in the
price of the stock at closing on the date of issue.  The  $400,000  reflects the
difference  in fair market  value of the stock  should the entire  debenture  be
converted.

                                      -24-


<PAGE>



         The Company  experienced a 66.3%  increase in net loss from  operations
for its fiscal year ended December 31, 1999 over the comparable  period in 1998.
The increase in net loss is primarily attributable to an increase in general and
administrative  expenses of $445,700  and,  to a lesser  extent,  an increase in
depreciation  and  amortization  of $25,590.  Gross  margin of $ 19,478 from the
initiation of gaming  operations in 1999 did not materially  offset the increase
general  and  administrative  expenses.  Also,  in  1999  the  Company  recorded
additional  interest  expense of $400,000  to reflect  the  discount of 20% on a
debenture  issued in 1999 with attached  warrants.  This was partially offset by
the unrealized gain of $116,900 on marketable  securities held by the Company at
December 31,1999. In 1998, the Company recognized an expense of $1,400,000 for a
loss  associated  with the write-off of capitalized  license fees paid to Casino
World Holdings in 1996 and 1997. No additional  interest expense was recorded in
1998 as  warrants  issued  were  above or at  market  prices.  Noting  the above
factors,  the  Company's  net loss for 1999  decreased  30% to  $1,450,698  from
$2,081,671 in 1998.

Net Operating Losses

         The Company has accumulated  approximately  $5,000,000 of net operating
loss  carryforwards  as of December  31,1999,  that may be offset against future
taxable  income  through 2019 when the  carryforwards  expire.  The use of these
losses to reduce future income taxes will depend on the generation of sufficient
taxable income prior to the expiration of the net operating loss  carryforwards.
In the event of certain  changes in  control  of the  Company,  there will be an
annual limitation on the amount of net operating loss carryforwards which can be
used. No tax benefit has been reported in the financial statements,  because the
Company believes there is a 50% or greater chance the carryforwards  will expire
unused.  Accordingly,  the potential tax benefits of the loss  carryforwards  is
offset by valuation allowance of the same amount.

Liquidity and Capital Resource

         Historically,  the Company's  working capital needs have been satisfied
primarily  through the Company's  private  placement of  securities  and through
other debt instruments,  such as convertible debentures.  The Company reasonably
expects to continue to do so in the future.  At December 31,  1999,  the Company
had working capital of $66,869  compared to working capital at December 31, 1998
of a negative  $123,541.  The increase is primarily  attributed to the Company's
minority interest in Ocean Power Corporation  ("Ocean Power") accounted for at a
fair market value of $275,000 at December 31,  1999.  At December 31, 1999,  the
Company had $17,944 in cash compared to $53,324 at December 31, 1998.

         As of December 31,  1999,  the Company had total assets of $552,849 and
total  stockholders'  equity of $159,307  compared with total assets of $306,806
and total  stockholders'  equity of $129,941 at December  31,  1998.  Assets and
stockholders'  equity  increased in 1999 due to  appreciation  of the  Company's
investment in Ocean Power and its acquisition of the software license  agreement
with SSII.

                                      -25-


<PAGE>



         During 1999, the Company converted the Debenture received from the sale
of Tessier,  into 200,000 shares of PWRE common stock. At December 31, 1999, the
shares were valued at $1.35 per share, or $275,000.  During the first quarter of
2000,  the Company sold 95,000 PWRE shares at an  approximate  average  price of
$6.50 per share and received net proceeds of $618,000. As of March 31, 2000, the
Company had  expended  approximately  $275,000 of the net  proceeds  for general
operating  expenses  including,  but  not  limited  to,  license  fee  payments,
salaries, consultant fees, professional fees, marketing, rent and utilities. The
Company  anticipates that it may sell additional  shares during 2000 and use the
proceeds for general operating expenses.

         For the year ended December 31, 1999, cash used by operating activities
increased to  $1,081,871  compared to $682,062  for the year ended  December 31,
1998.  This 59%  increase is  primarily  attributed  to the  recognition  of the
$1,400,000  loss on  disposition  of assets in 1998 and partially  offset by the
smaller net loss in 1999.  The 1999 increase is also  attributed to the increase
in  general  and  administrative  expenses  of  $445,699  and  prepaid  expenses
associated with the launch of the Company's casino operations in 1999.

         Also during 1999, the Company  realized cash from financing  activities
of $1,089,064 compared to $721,456 in 1998. The 1999 results are due to proceeds
received  from notes  payable  resulting  from the  conversion  of a convertible
debenture.  In September 1999, the Company authorized the convertible  debenture
for up to  $1,000,0000  to repay funds  advanced  to the  Company by  Enterprise
Capital,  Inc., in conjunction with VanAus Investments Ltd. The debenture was to
repay  funds  advanced  to the Company  during  1999 and  supercedes  a previous
debenture issued in January 1999,  and$379,458 in previously advanced funds. The
debenture carried an interest rate of 10% and provides for a two year conversion
period in which the debenture  holder may convert  advanced funds into shares of
the  Company's  common  stock at the  conversion  price of $.20 pe  share.  Each
converted  share  includes the right to purchase an  additional  share of common
stock at $.20 per  share  for a five  year  period  commencing  from the date of
original conversion.

         In 1999, in connection with the Company's  license agreement with SSII,
E-Casinos  International  was granted  virtual  casino  gaming  license from the
government of Antigua.  SSII agreed to advance  funds for the gaming  license in
return for installment  payments  totaling  $120,000.  As of March 31, 2000, the
Company has paid $50,000,  leaving a balance still owed of $70,000.  The Company
has also paid SSII $60,000 towards its software  technology  license,  leaving a
balance owed of $40,000.  Further, as of December 31, 1999, the Company owed the
Taxin Network $48,000 in outstanding fees for professional services. As of March
31, 2000, the outstanding balance was reduced to $8,000.

         The Company  leases its facilities on a quarter to quarter basis and is
not required to obligate itself to a minimum commitment for rental time.

         During fiscal year 2000, the Company  anticipates  meeting its cash and
working  capital  needs  primarily  from the  proceeds of the sale of its shares
through  private  placements  or similar  convertible  instruments  and revenues
generated from operations.

                                      -26-


<PAGE>




Effect of Inflation

         In the opinion of management,  inflation has not had a material  effect
on the operations of the Company.

Risk Factors and Cautionary Statements

         This report contains certain  forward-looking  statements.  The Company
wishes to advise readers that actual results may differ  substantially from such
forward-looking  statements.  Forward-  looking  statements  involve  risks  and
uncertainties  that could cause actual results to differ  materially  from those
expressed in or implied by the  statements,  including,  but not limited to, the
following:  the possible success of the Company's websites, the effect of future
legislation on the Internet gaming business,  the ability of the Company to fund
its  current  and future  projects  and its ability to meet its cash and working
capital needs, and other risks detailed in the Company's periodic report filings
with the Securities and Exchange Commission.

Recent Accounting Pronouncements

         In June 1999, the Financial  Accounting Standards Board ("FASB") issued
SFAS No. 133,  "Accounting for Derivative  Instruments  and Hedging  Activities"
which  requires  companies  to record  derivatives  as  assets  or  liabilities,
measured at fair market  value.  Gains or losses  resulting  from changes in the
values of those  derivatives  would be accounted for depending on the use of the
derivative and whether it qualifies for hedge accounting.  The key criterion for
hedge  accounting is that the hedging  relationship  must be highly effective in
achieving  offsetting  changes  in fair  value or cash  flows.  SFAS No.  133 is
effective for all fiscal quarters of fiscal years beginning after June 15, 1999.
Management  believes the adoption of this statement will have no material impact
on the Company's financial statements.

Item 7.           Financial Statements and Supplementary Data

                  The  Company's  Consolidated  Balance Sheet as of December 31,
1999  and the  related  Consolidated  Statements  of  Operations,  Stockholders'
Equity,  and Cash Flows for the years ended December 31, 1999, and 1998 have all
been  examined  to the extent  indicated  in their  report by H J &  Associates,
independent  certified public accountants,  and have been prepared in accordance
with generally accepted accounting  principles and pursuant to Regulation S-B as
promulgated  by the  Securities  and  Exchange  Commission.  The  aforementioned
financial  statements  are  included  herein in  response to Item 7 of this Form
10-KSB.

                                      -27-


<PAGE>


                                VENTURETECH, INC.
                          (A Development Stage Company)

                        CONSOLIDATED FINANCIAL STATEMENTS

                                December 31, 1999




                                      -28-

<PAGE>

                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------


To the Board of Directors
VentureTech, Inc.
(A Development Stage Company)
Vancouver, British Columbia


We have audited the accompanying consolidated balance sheet of VentureTech, Inc.
(a  development  stage  company)  as of  December  31,  1999,  and  the  related
consolidated statements of operations,  stockholders' equity, and cash flows for
the years ended December 31, 1999 and 1998 and from inception on January 1, 1986
through  December 31, 1999.  These  consolidated  financial  statements  are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable  assurance about whether the  consolidated  financial  statements are
free of material  misstatement.  An audit includes  examining,  on a test basis,
evidence  supporting the amounts and disclosures in the  consolidated  financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in  all  material  respects  the  consolidated  financial  position  of
VentureTech,  Inc. (a development stage company) as of December 31, 1999 and the
consolidated  results  of their  operations  and their  cash flows for the years
ended  December 31, 1999 and 1998 and from  inception on January 1, 1986 through
December 31, 1999 in conformity with generally accepted accounting principles.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue  as a  going  concern.  As  discussed  in  Note 5 to the
consolidated  financial  statements,  the Company is a development stage company
with no  significant  operating  results to date and a  substantial  accumulated
deficit,  which together raises  substantial doubt about its ability to continue
as a going  concern.  Management's  plans in  regard to these  matters  are also
described in Note 5. The  consolidated  financial  statements do not include any
adjustments that might result from the outcome of this uncertainty.

/s/Jones, Jensen & Company
--------------------------
Jones, Jensen & Company
Salt Lake City, Utah
April 4, 2000

                                      -29-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                           Consolidated Balance Sheet


                                     ASSETS
                                     ------

                                                       December 31,
                                                          1999
                                                        --------

CURRENT ASSETS

   Cash                                                 $ 17,944
   Marketable securities (Note 8)                        275,000
   Accounts receivable - net (Note 2)                     15,584
   Note receivable (Note 2)                               27,470
   Prepaid expenses (Note 9)                              74,413
   License fees - current (Note 9)                        50,000
                                                        --------

     Total Current Assets                                460,411
                                                        --------

PROPERTY AND EQUIPMENT (Note 2)                           67,438
                                                        --------

OTHER ASSETS

   License fees (Note 9)                                  25,000
                                                        --------

     Total Other Assets                                   25,000
                                                        --------

     TOTAL ASSETS                                       $552,849
                                                        ========

                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f

                                      -30-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                     Consolidated Balance Sheet (Continued)


                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------

                                                                    December 31,
                                                                       1999
                                                                    -----------

CURRENT LIABILITIES

   Accounts payable and accrued expenses                            $   213,542
   Reserve for legal fees (Note 9)                                      100,000
   License fee payable (Note 9)                                          80,000
                                                                    -----------

     Total Current Liabilities                                          393,542
                                                                    -----------

COMMITMENTS AND CONTINGENCIES (Note 10)

STOCKHOLDERS' EQUITY

   Common stock; 100,000,000 shares authorized of $0.001
    par value, 37,014,165 shares issued and outstanding                  37,015
   Additional paid-in capital                                         7,207,676
   Deficit accumulated during the development stage                  (7,085,384)
                                                                    -----------

     Total Stockholders' Equity                                         159,307
                                                                    -----------

     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                     $   552,849
                                                                    ===========






                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f
                                       -31-

<PAGE>


<TABLE>
                                VENTURETECH, INC.
                          (A Development Stage Company)
                      Consolidated Statements of Operations
<CAPTION>

                                                                               From
                                                                             Inception on
                                                   For the Years Ended        January 1,
                                                      December 31,          1986 Through
                                             ---------------------------    December 31,
                                                  1999            1998         1999
                                             ------------    -----------    -----------
<S>                                           <C>            <C>            <C>
REVENUE

  Sales                                       $    29,710    $      --      $   585,356
  Cost of sales                                    10,232           --           10,232
                                              -----------    -----------    -----------

     Gross Margin                                  19,478           --          575,124
                                              -----------    -----------    -----------

EXPENSES

  Research and development                           --             --           50,215
  General and administrative                    1,091,453        645,754      5,260,227
  Depreciation and amortization                    61,506         35,917        452,250
                                              -----------    -----------    -----------

     Total Expenses                             1,152,959        681,671      5,762,692
                                              -----------    -----------    -----------

     LOSS FROM OPERATIONS                      (1,133,481)      (681,671)    (5,187,568)
                                              -----------    -----------    -----------

OTHER INCOME (EXPENSE)

   Unrealized gain on marketable securities       116,888           --          116,888
   Net loss on disposal of asset                     --       (1,400,000)    (1,400,000)
   Interest expense                              (434,105)          --         (477,489)
                                              -----------    -----------    -----------

     Total Other Income (Expense)                (317,217)    (1,400,000)    (1,760,601)
                                              -----------    -----------    -----------

LOSS BEFORE LOSS FROM
 DISCONTINUED OPERATIONS
 AND PROVISION FOR INCOME TAX                  (1,450,698)    (2,081,671)    (6,948,169)
                                              -----------    -----------    -----------

LOSS FROM DISCONTINUED
 OPERATIONS                                          --             --         (137,215)

PROVISION FOR INCOME TAX                             --             --             --
                                              -----------    -----------    -----------

NET LOSS                                      $(1,450,698)   $(2,081,671)   $(7,085,384)
                                              ===========    ===========    ===========

BASIC LOSS PER SHARE                          $     (0.04)   $     (0.07)
                                                    =====          =====

WEIGHTED AVERAGE  NUMBER OF
 SHARES OUTSTANDING                            35,895,870     29,230,096
                                               ==========     ==========
</TABLE>


                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f
                                      -32-

<PAGE>


<TABLE>
                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Consolidated Statements of Stockholders' Equity
<CAPTION>


                                                                                                                         Deficit
                                                                                                                      Accumulated
                                                                                                     Additional         During the
                                                                          Common Stock                 Paid-in         Development
                                                                   Shares             Amount           Capital            Stage
                                                                   -------           -------           -------            -------

<S>                                                                <C>               <C>               <C>               <C>
Balance, January 1, 1986 (inception)                               278,692           $   279           $  (279)          $   --

Assessment of existing
 shareholders to increase
 paid-in capital                                                      --                --               8,722               --

Net loss for the year ended
 December 31, 1987                                                    --                --                --               (8,722)
                                                                   -------           -------           -------            -------

Balance, December 31, 1987                                         278,692               279             8,443             (8,722)

Stock issued to an  individual  who became
 an officer and  director for services
 performed  to  acquire  rights to
 Harvard  Medical  Project  on July 13, 1988
 recorded at predecessor cost of $0.00 per
 share                                                           1,188,889             1,189            (1,189)              --

Stock issued to Spartan
 Medical Corporation to
 acquire rights to the Harvard
 Medical Project on
 November 1, 1988 recorded at
 predecessor cost of $0.00 per
 share                                                             200,000               200              (200)              --

Net loss for the year ended
 December 31, 1988                                                    --                --                --               (5,644)
                                                                   -------           -------           -------            -------

Balance, December 31, 1988                                       1,667,581        $   1,668            $ 7,054           $ 14,366)
                                                                   -------           -------           -------            -------
</TABLE>

                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f

                                       -33-

<PAGE>


<TABLE>
                                VENTURETECH, INC.
                          (A Development Stage Company)
           Consolidated Statements of Stockholders' Equity (Continued)
<CAPTION>

                                                                                                    Deficit
                                                                                                 Accumulated
                                                                                 Additional       During the
                                                        Common Stock              Paid-in        Development
                                                          Shares       Amount     Capital           Stage
                                                          -------      -------    -------          -------

<S>                                                     <C>         <C>         <C>              <C>
Balance forward                                         1,667,581   $   1,668   $   7,054        $ (14,366)

Stock issued for services
 at an average price of
 $0.21 per share                                           61,667          62      12,638             --

Stock issued for cash in
 private placements at an
 average price of $2.48                                    98,005          98     242,502             --

Stock offering costs offset
 against paid-in capital                                     --          --       (93,687)            --

Net loss for the year ended
 December 31, 1989                                           --          --          --           (134,399)
                                                          -------      -------    -------          -------

Balance, December 31, 1989                              1,827,253       1,828     168,507         (148,765)

Stock issued for services
 valued at $0.06 per share                                 19,301          19       1,140             --

Stock issued to an individual
 for services valued at
 $12.00 per share                                           1,667           1      19,999             --

Stock issued to individuals
 for $3.92 per share                                       11,933          12      46,788             --

Net loss for the year ended
 December 31, 1990                                           --          --          --           (174,522)
                                                          -------      -------    -------          -------

Balance, December 31, 1990                              1,860,154   $   1,860   $ 236,434        $(323,287)

</TABLE>


                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f

                                      -34-

<PAGE>


<TABLE>

                                                         VENTURETECH, INC.
                                                   (A Development Stage Company)
                                    Consolidated Statements of Stockholders' Equity (Continued)
<CAPTION>

                                                                                                  Deficit
                                                                                                Accumulated
                                                                                  Additional     During the
                                                               Common Stock        Paid-in      Development
                                                           Shares       Amount     Capital         Stage
                                                          -------      -------    -------         -------

<S>                                                      <C>         <C>         <C>            <C>
Balance forward                                          1,860,154   $   1,860   $ 236,434      $(323,287)

Stock issued to Ballater, Ltd. in
 exchange for services recorded
 at predecessor cost of $0.00 per share                    100,000         100        (100)          --

Net loss for the year ended
 December 31, 1991                                            --          --          --           (2,457)

Balance, December 31, 1991                               1,960,154       1,960     236,334       (325,744)

Debt converted into additional
 paid-in capital by Park Avenue, Inc.                         --          --        45,750           --

Debt converted into additional
 paid-in capital by  stockholder                              --          --        12,400           --

Net loss for the year ended
 December 31, 1992                                            --          --          --           (1,981)

Balance, December 31, 1992                               1,960,154       1,960     294,484       (327,725)

Common stock issued in settlement
 of debt at $0.012 per share                             1,500,000       1,500      16,252           --

Net loss for the year ended
 December 31, 1993                                            --          --          --          (15,200)

Balance, December 31, 1993                               3,460,154       3,460     310,736       (342,925)

Common stock issued for cash
 at $0.50 per share                                        340,000         340     169,660           --

Stock issuance costs                                          --          --       (67,500)          --

Net loss for the year ended
 December 31, 1994                                            --          --          --          (29,190)

Balance, December 31, 1994                               3,800,154   $   3,800   $ 412,896      $(372,115)


</TABLE>

                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f
                                       -35-

<PAGE>


<TABLE>
                                VENTURETECH, INC.
                          (A Development Stage Company)
           Consolidated Statements of Stockholders' Equity (Continued)
<CAPTION>

                                                                                                            Deficit
                                                                                                         Accumulated
                                                                              Additional     Stock        During the
                                                      Common Stock             Paid-in    Subscription    Development
                                                 Shares          Amount        Capital     Receivable       Stage
                                              ---------        ---------    ---------        ---------      ---------
<S>                                           <C>         <C>            <C>             <C>             <C>
Balance forward                               3,800,154   $      3,800   $    412,896    $       --      $   (372,115)

Common stock issued to
 acquire Tessier Resources Ltd.               3,200,000          3,200        (80,856)           --              --

Debt converted into additional
 paid-in capital                                   --             --           10,417            --              --

Common stock issued in
 settlement of debt at $1.70
 per share                                      591,774            592      1,005,425            --              --

Net loss for the year ended
 December 31, 1995                                 --             --             --              --        (1,037,235)
                                              ---------        ---------    ---------        ---------      ---------
Balance, December 31, 1995                    7,591,928          7,592      1,347,882            --        (1,409,350)

Common stock issued in
 settlement of debt at $1.70
 per share                                    1,408,126          1,408      2,392,473            --              --

Common stock issued as a
 partial conversion of the
 convertible debenture at
 $0.03 per share                              2,300,000          2,300         66,700            --              --

Common stock issued for
 cash at $10.00 per share                     6,000,000          6,000     59,994,000     (60)000,000            --

Net loss for the year ended
 December 31, 1996                                 --             --             --              --        (1,590,888)
                                              ---------        ---------    ---------        ---------      ---------
Balance, December 31, 1996                   17,300,054   $     17,300   $ 63,801,055    $(60,000,000)   $ (3,000,238)
                                             ----------        ---------   ----------      -----------      ---------
</TABLE>


                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f

                                      -36-

<PAGE>


<TABLE>

                                VENTURETECH, INC.
                          (A Development Stage Company)
           Consolidated Statements of Stockholders' Equity (Continued)
<CAPTION>
                                                                                                            Deficit
                                                                                                          Accumulated
                                                                           Additional         Stock        During the
                                                      Common Stock           Paid-in       Subscription    Development
                                                 Shares          Amount      Capital         Receivable       Stage
                                              ---------        ---------    ---------        ---------      ---------

<S>                                          <C>           <C>             <C>             <C>             <C>
Balance, December 31, 1996                   17,300,054    $     17,300    $ 63,801,055    $(60,000,000)   $ (3,000,238)

Common stock issued as a
 conversion of the convertible
 debenture at $0.03 per share                 3,533,333           3,533         102,467            --              --

Common stock issued as a full
 exercise of the "A" warrants
 associated with the convertible
 debenture at $0.03 per share                 5,833,333           5,834         169,166            --              --

Common stock issued as a partial
 exercise of the "B" warrants
 associated with the convertible
 debenture at $0.03 per share                 1,133,334           1,133          32,867            --              --

Cancellation of stock
 subscription receivable                     (6,000,000)         (6,000)    (59,994,000)     60,000,000            --

Common stock issued in
 settlement of debt
 at $0.22 per share                           3,495,000           3,495         765,321            --              --

Net loss for the year ended
 December 31, 1997                                 --              --              --              --          (552,777)
                                           ------------    ------------    ------------    ------------    ------------

Balance, December 31, 1997                   25,295,054    $     25,295    $  4,876,876    $       --      $ (3,553,015)
                                           ------------    ------------    ------------    ------------    ------------
</TABLE>


                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f

                                      -37-

<PAGE>


<TABLE>
                                VENTURETECH, INC.
                          (A Development Stage Company)
           Consolidated Statements of Stockholders' Equity (Continued)
<CAPTION>

                                                                                                                      Deficit
                                                                                                                    Accumulated
                                                                                Additional         Stock             During the
                                                      Common Stock                Paid-in       Subscription         Development
                                                 Shares          Amount           Capital         Receivable            Stage
                                              ---------        ---------         ---------        ---------           ---------

<S>                                         <C>          <C>               <C>                <C>                <C>
Balance, December 31, 1997                  25,295,054   $        25,295   $      4,876,876   $        --        $   (3,553,015)

Common stock issued as a complete
 exercise of the "B"
 warrants  associated with
 the convertible debenture at $0.03
 per share                                   4,700,000             4,700            136,300             --                 --

Common stock issued as a
 partial exercise of warrants
 for cash at $0.25 per share                    35,000                35              8,715             --                 --

Common stock issued in
 settlement of debt at $0.45
 per share                                   1,583,791             1,585            711,121             --                 --

Net loss for the year ended
 December 31, 1998                              --                 --                  --               --            (2,081,671)
                                              ---------        ---------         ---------        ---------           ---------

Balance, December 31, 1998                  31,613,845            31,615          5,733,012             --             (5,634,686)

Issuance of debenture,
 convertible at less than
 market value (Note 12)                         --                 --                 400,000           --                 --

Common stock issued for
 conversion of debenture at
 $0.20 per share                             5,000,000             5,000            995,000             --                 --

Common stock issued for
 exercise of warrants at
 $0.20 per share                               400,320               400             79,664             --                 --

Net loss for the year ended
 December 31, 1999                              --                 --                  --               --             (1,450,698)
                                              ---------        ---------         ---------        ---------           ---------

Balance, December 31, 1999                  37,014,165   $        37,015   $      7,207,676   $         --         $   (7,085,384)
                                            ==========         =========          =========       =========            ==========
</TABLE>



                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f

                                     -38-

<PAGE>


<TABLE>
                                VENTURETECH, INC.
                          (A Development Stage Company)
                      Consolidated Statements of Cash Flows
<CAPTION>

                                                                                            From
                                                                                         Inception on
                                                                                          January 1,
                                                              For the Years Ended       1986 Through
                                                                  December 31,          December 31,
                                                              1999          1998           1999
                                                          -----------    -----------    -----------

CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                       <C>            <C>            <C>
   Net (loss)                                             $(1,450,698)   $(2,081,671)   $(7,085,384)
   Adjustments to reconcile
    net (loss) to net cash
    used by operating activities:
     Common stock issued for services                            --             --           34,259
     Debentures and warrants issued at
       less that market value                                 400,000           --          400,000
     Depreciation and amortization                             61,506         35,917        452,250
     Loss on sale of investments                                 --             --           20,390
     Net loss on disposition of asset                            --        1,400,000      1,400,000
     Unrealized gain in marketable securities                (116,888)          --         (116,888)
   Changes in assets and liabilities:
     (Increase) decrease in accounts
      receivables and other assets                           (117,467)          --         (123,492)
     Increase (decrease) in accounts
      payable and other current liabilities                   141,676        (36,308)       113,316
                                                          -----------    -----------    -----------

       Net Cash Used by Operating Activities               (1,081,871)      (682,062)    (4,905,549)
                                                          -----------    -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES

   Purchase of investments                                       --             --         (378,313)
   Sale of investments                                           --             --            7,110
   Purchase of fixed assets                                    (8,573)          --         (257,724)
   Disposal of fixed assets                                      --             --            3,223
   Purchase of license fees                                   (25,000)          --       (1,575,000)
                                                          -----------    -----------    -----------

       Net Cash Used by Investing Activities                  (33,573)          --       (2,200,704)
                                                          -----------    -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES

   Issuance of convertible debenture                             --          175,000
   Conversion of debt to equity                                  --             --           75,902
   Proceeds from notes payable                              1,080,064        712,706      6,348,610
   Common stock issued for cash                                  --            8,750        515,963
   Shareholder assessment                                        --             --            8,722
                                                          -----------    -----------    -----------

       Net Cash Provided by Financing Activities          $ 1,080,064    $   721,456    $ 7,124,197
                                                          -----------    -----------    -----------
</TABLE>


                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f

                                      -39-

<PAGE>


<TABLE>
                                VENTURETECH, INC.
                          (A Development Stage Company)
                      Consolidated Statements of Cash Flows (Continued)
<CAPTION>

                                                                                                 From
                                                                                             Inception on
                                                                                              January 1,
                                                              For the Years Ended            1986 Through
                                                                  December 31,               December 31,
                                                                    1999          1998           1999
                                                                -----------    -----------    -----------
<S>                                                             <C>            <C>           <C>
NET INCREASE (DECREASE)
 IN CASH                                                        $   (35,380)   $    39,394   $    17,944

CASH AT BEGINNING OF PERIOD                                          53,324         13,930          --
                                                                -----------    -----------    -----------

CASH AT END OF PERIOD                                           $    17,944    $    53,324   $    17,944
                                                                ===========    ===========   ===========


SUPPLEMENTAL CASH FLOW INFORMATION

CASH PAID FOR:

  Interest                                                      $     6,667    $      --     $     6,667
  Income taxes                                                  $      --      $      --     $      --

NON CASH FINANCING ACTIVITIES:

  Conversion of debt into additional
    paid-in capital                                             $      --      $      --     $    75,902
  Common stock issued in settlement
    of debt                                                     $ 1,080,064    $   712,705   $ 5,979,235
  Conversion of debenture and warrants
    to common stock                                             $      --      $   141,000   $   525,526
  Debenture and warrants issued at less
    than market value                                           $   400,000    $      --     $   400,000

</TABLE>



                 The accompanying notes are an integral part of
                    these consolidated inancial statements.

f

                                     -40-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 1 -      ORGANIZATION AND DESCRIPTION OF BUSINESS

              The  consolidated  financial  statements  presented  are  those of
              VentureTech, Inc. and its wholly-owned subsidiaries.

              VentureTech,  Inc. (VTI) was  incorporated  on July 19, 1948 under
              the laws of the State of Idaho. VTI has had limited activity since
              the mid 1950's  and is  considered  a  development  stage  company
              because no  significant  revenues  have been  realized and planned
              principal  operations  have  not yet  commenced.  The  Company  is
              engaged in the  development,  acquisition and licensing of certain
              computer  based  technology  designed to  ultimately  offer a full
              range of  casino  style  gaming,  entertainment,  information  and
              financial  transaction services over the world-wide Internet.  The
              Company  intends to  establish a series of multi-  themed  virtual
              casinos over the Internet  from  authorized  locations  around the
              world.

              The Subsidiaries:

              Cybernet Currency Clearing, Inc. (CCCI) was incorporated on August
              23,  1995  under  the laws of the  State of  Nevada  as a  foreign
              corporation to provide  encoding  protection  for secure  Internet
              transactions.  CCCI is  considered  a  development  stage  company
              because no  revenues  have been  realized  and  planned  principal
              operations have not yet begun.

              Euro Asian  E-Casinos,  Inc (E-Casinos) was  incorporated on April
              18, 1996 in accordance  with the Associates Law of the Republic of
              the Marshall  Islands as a foreign  corporation to own and operate
              full  service  gaming  casinos on the  internationally  accessible
              Internet.  E- Casinos is  considered a  development  stage company
              because no  revenues  have been  realized  and  planned  principal
              operations have not yet begun.

              Euro Asian  E-Casinos  International,  Ltd.  (E-Casinos  Ltd.) was
              incorporated in St. John's Antigua, West Indies to own and operate
              full  service  gaming  casinos on the  internationally  accessible
              Internet.  E-Casinos  Ltd. owns the gaming  license  issued by the
              government of Antigua.

              VentureTech  Holdings Canada,  Ltd. (VHC) was incorporated in July
              1999 under the laws of the Province of British Columbia, Canada.

              CCCI,  E-Casinos,  E-Casinos Ltd. and VHC are all  wholly-owned by
              the Company.

NOTE 2 -      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

              a. Accounting Method

              The Company's financial  statements are prepared using the accrual
              method of  accounting.  The Company has elected a December 31 year
              end.


                                     -41-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 2 -      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

              b. Basic Loss Per Share

              The  computation  of basic loss per share of common stock is based
              on the weighted  average number of shares  outstanding  during the
              period of the financial  statements.  Fully diluted loss per share
              is not presented  because of the antidilutive  nature of the stock
              equivalents.

<TABLE>
<CAPTION>
                                                                           For the Year Ended
                                                                            December 31, 1999
                                                                            ----------------------------------
                                                              Loss               Shares               Per Share
                                                           (Numerator)        (Denominator)            Amount
                                                           -----------        -------------            ------

<S>                                                <C>                          <C>            <C>
              Net loss                             $       (1,450,698)          35,895,870     $           (0.04)
                                                            ==========          ==========            ==========


                                                                                               For the Year Ended
                                                                                               December 31, 1998
                                                        Loss                 Shares               Per Share
                                                        (Numerator)          (Denominator)          Amount

              Net loss                             $       (2,081,671)          29,230,096     $           (0.07)
                                                            ==========          ==========            ==========
</TABLE>

              c. Provision for Taxes

              At  December  31,  1999,   the  Company  has  net  operating  loss
              carryforwards  of  approximately  $5,000,000  that  may be  offset
              against  future  taxable  income  through 2019. No tax benefit has
              been  reported in the  financial  statements,  because the Company
              believes there is a 50% or greater chance the  carryforwards  will
              expire unused. Accordingly, the potential tax benefits of the loss
              carryforwards  are  offset by a  valuation  allowance  of the same
              amount.

              d. Cash and Cash Equivalents

              The  Company  considers  all  highly  liquid  investments  with  a
              maturity  of  three  months  or  less  when  purchased  to be cash
              equivalents.

              e. Principles of Consolidation

              The December 31, 1999 financial  statements are consolidated  with
              CCCI,  E-Casinos,  E-  Casinos,  Ltd.  and  VHC.  All  significant
              intercompany accounts and transactions have been eliminated.



                                      -42-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 2 -      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

              f.  Property and Equipment

              Office equipment and leasehold  improvements are recorded at cost.
              Minor  additions  and renewals are expensed in the year  incurred.
              Major additions and renewals are capitalized and depreciated  over
              their estimated useful lives. Depreciation of office equipment and
              leasehold  improvements is computed using the straight-line method
              over the  estimated  useful  lives of the asset of 5 and 10 years,
              respectively.  Depreciation expense for continuing  operations for
              the  years  ended  December  31,  1999 and 1998  was  $36,305  and
              $35,917, respectively.

              Property and equipment consists of the following:

                                                                December 31,
                                                                   1999
                                                                 --------

                   Office equipment                     $         169,912
                   Leasehold improvements                          36,491
                   Accumulated depreciation                      (138,965)
                                                                 --------

                   Net Property and Equipment           $          67,438
                                                                 ========

              g. Estimates

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

              h.  Change in Accounting Principle

              In June  1998,  the FASB  issued  SFAS No.  133,  "Accounting  for
              Derivative  Instruments  and Hedging  Activities"  which  requires
              companies to record derivatives as assets or liabilities, measured
              at fair market value.  Gains or losses  resulting  from changes in
              the values of those  derivatives  would be accounted for depending
              on the use of the  derivative  and whether it qualifies  for hedge
              accounting.  The key  criterion  for hedge  accounting is that the
              hedging   relationship  must  be  highly  effective  in  achieving
              offsetting  changes in fair value or cash  flows.  SFAS No. 133 is
              effective for all fiscal  quarters of fiscal years beginning after
              June 15,  1999.  The  adoption of this  statement  had no material
              impact on the Company's financial statements.



                                     -43-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 2 -      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

              i.  Revenue Recognition Policy

              The Company  recognizes  as revenue the net  winnings  from gaming
              activities,  which  is the  difference  between  gaming  wins  and
              losses.  The earnings  process is complete upon receipt of the net
              winnings, and no further obligations exist to the customer.

              Cost of sales includes royalties,  payable to Softec,  incurred on
              Casino activity and bank discount fees incurred by the Company for
              the acceptance of credit cards.

              j.  Advertising

              The  Company   follows  the  policy  of  charging   the  costs  of
              advertising to expense as incurred.

              k.  Accounts Receivable

              Accounts  receivable  are shown net of an  allowance  for doubtful
              accounts of $2,462 at December 31, 1999.

              l.  Long-lived Assets

              All long-lived assets are evaluated yearly for impairment per SFAS
              121. Any  impairment  in value is  recognized as an expense in the
              period when the impairment occurs.

              m.  Note Receivable

              The Company has a note receivable from an unrelated  company.  The
              note is unsecured,  due upon demand and bears  interest at 10% per
              annum. The note includes accrued interest of $266.

NOTE 3 -      RELATED PARTY TRANSACTIONS

              During the year ended  December  31,  1999,  a related  party made
              advances to the Company totaling $1,048,416.  Through December 31,
              1999, interest in the amount of $31,648 was accrued on the amounts
              advanced.   The  amounts   advanced  with  accrued  interest  were
              converted to 4,282,025 shares of common stock, at $0.20 per share,
              on  September  30, 1999 and  1,118,295  shares of common  stock at
              $0.20 per share on December 31, 1999.  These two conversions  were
              for a  $1,000,000  convertible  debenture  and $80,064 of warrants
              attached to the debenture.

              In 1998, a related party converted $712,706 of debt into 1,583,791
              shares of common stock at $0.45 per share (Note 12).

              In 1998, a related  party  converted  $141,000 of the "B" warrants
              into 4,700,000 shares of common stock.

                                      -44-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 3 -      RELATED PARTY TRANSACTIONS (Continued)

              In 1997,  a related  party  converted  $106,000  of a  convertible
              debenture,  and exercised  $175,000 of "A" warrants and $34,000 of
              "B" warrants into 10,500,000 shares of common stock (Note 4).

              On December 31, 1997, the Company issued  3,495,000  shares of its
              common stock in  consideration  for cash  received  from a related
              party. At the date of issuance, $909,816 was owed and $768,816 was
              converted to common  stock.  At December 31, 1997,  an  additional
              note payable of $141,000 was still owed by the Company.  This note
              was non-interest bearing and was due upon demand.

              On December 31, 1996,  the Company  issued  159,818  shares of its
              common stock in consideration of money owed to a related party. At
              the date of issuance  $271,691  was owed and  converted  to common
              stock.  At  December  31,  1996,  an  additional  note  payable of
              $387,125 was still owed by the Company. This note payable was non-
              interest bearing and was due upon demand.

              On September 30, 1996,  the Company  issued  210,050 shares of its
              common stock in consideration of money owed to a related party. At
              the date of issuance,  $357,085 was owed and converted into common
              stock.

              On July 26, 1996,  the Company  issued 80,000 shares of its common
              stock in  consideration  of money owed to a related party.  At the
              date of  issuance,  $136,000  was owed and  converted  into common
              stock.

              On June 30, 1996,  the Company issued 419,086 shares of its common
              stock in  consideration  of money owed to a related party.  At the
              date of the  issuance  $712,445  was owed and  converted to common
              stock.

              In April,  1996, the Company issued 2,300,000 shares of its common
              stock as a partial  conversion of the convertible  debenture.  The
              shares were issued at $0.03 per share (Note 4).

              On March 31, 1996, the Company issued 539,172 shares of its common
              stock in  consideration  of money owed to a related party.  At the
              date of issuance  $916,660 was owed and  converted to common stock
              (Note 12).

              On December 31, 1995,  the Company  issued  210,888  shares of its
              common stock in consideration of money owed to a related party. At
              the date of issuance  $358,510  was owed and  converted  to common
              stock (Note 12).

              On October 31,  1995,  the Company  issued  380,886  shares of its
              common stock in consideration of money owed to a related party. At
              the date of issuance  $647,507  was owed and  converted  to common
              stock (Note 12).

                                      -45-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 3 -      RELATED PARTY TRANSACTIONS (Continued)

              The Company has granted 720,000 warrants to officers and directors
              of the Company.  The warrants  were issued at prices  ranging from
              $0.25 to $5.75  which  represented  the fair  market  value of the
              stock at the time of grant,  and for periods  ranging from four to
              five years (Note 12).

              On May 14, 1994, officers and directors of the Company were issued
              stock options to purchase  120,000 shares of the Company's  common
              stock  at  $2.50  per  share.  No  compensation  expense  has been
              recorded as the option price exceeded the fair market value of the
              shares when the options were issued.

              On November 1, 1993,  the Company issued  1,500,000  shares of its
              common stock in consideration of $17,752 owed to a related party.

NOTE 4 -      CONVERTIBLE DEBENTURE - RELATED PARTY

              In March of 1994, the Company issued a $175,000 fixed and floating
              convertible  debenture.  The  debenture  bore  interest at 10% per
              annum.  The debenture was convertible  into common stock at a rate
              of $0.03 per share. The debenture  carried "A" and "B" warrants to
              purchase  additional  shares of the Company's  common  stock.  The
              terms of the  warrants  were also $0.03 per share.  In April 1996,
              the Company  issued  2,300,000  shares of common  stock to convert
              $69,000 of the  debenture.  At  December  31,  1996,  the  balance
              payable on the debenture was $106,000. In 1997, the Company issued
              10,500,000  shares of common stock to convert the balance  payable
              on the  debenture  of $106,000 as well the  exercise of all of the
              "A" warrants  for  $175,000 and  1,133,334 of the "B" warrants for
              $34,000 that  accompanied  the  debentures.  In 1998,  the Company
              issued  4,700,000  shares of common stock to exercise  $141,000 of
              "B" warrants. No compensation expense was recorded on the issuance
              of the warrants  because the exercise  price  exceeded the trading
              price at the time of issuance.  At December 31, 1998,  the balance
              payable on the debenture was $-0-.

              In January  1999,  the Company  approved  convertible  debentures,
              totaling no more than $1 million in the aggregate.  The debentures
              were convertible into "restricted"  common stock of the Company at
              $0.40 per share with one (1)  four-year  $0.40  warrant  attached.
              This  authorization  was canceled in September 1999 in conjunction
              with the Company authorizing a separate convertible  debenture for
              up to $1 million. This debenture is convertible at $0.20 per share
              into  "restricted"  common stock of the Company with one five-year
              $0.20 warrant attached.  The Company recorded  additional interest
              expense  of  $400,000  to  reflect  the  discount  of  20%  on the
              debenture and the attached warrants.  Unconverted  balances accrue
              10% interest per annum on a quarterly  basis and all balances must
              be  converted  within two years of the receipt of the funds by the
              Company.  On  September  30,  1999,  $856,405  of the  $1  million
              authorized had been converted into shares of common stock.



                                      -46-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999

NOTE 4 -      CONVERTIBLE DEBENTURE - RELATED PARTY (Continued)

              On December 31,  1999,  the Company  converted  the balance of the
              debenture  into  common  stock as well as $80,064 of the  attached
              warrants.  The total shares issued  pursuant to this debenture and
              the attached warrants as of December 31, 1999 is 5,400,320.

NOTE 5 -      GOING CONCERN

              The Company's  financial  statements are prepared using  generally
              accepted accounting principles applicable to a going concern which
              contemplates   the   realization  of  assets  and  liquidation  of
              liabilities  in the normal  course of  business.  The  Company has
              incurred losses from its inception  through December 31, 1999. The
              Company does not have an established source of revenues sufficient
              to cover  its  operating  costs and to allow it to  continue  as a
              going concern.  It is the intent of the Company to seek additional
              financing  through  private  placements of its common stock.  This
              will be  accomplished  through the use of convertible  debentures.
              Management  believes  the  funds  will  more  likely  than  not be
              successfully  raised,  but  there  can be no  assurance  of  this.
              Additionally, the Company intends to use the marketable securities
              as additional  cash flow. The Company expects that operations will
              increase  in 2000,  and will  start to  provide  cash  flows  from
              operations  and expansion.  The Company  expects that it will need
              $1,000,000 to $2,000,000 of additional  funds for  operations  and
              expansion in 2000. In the first quarter of 2000,  the Company sold
              95,000 of  200,000  shares of its  marketable  securities  for net
              proceeds of $618,600.

NOTE 6 -      STOCK TRANSACTIONS

              On December 31, 1999, the Company issued  1,118,295  shares of its
              common stock as full conversion of the convertible debenture,  and
              a partial exercise of attached  warrants is $0.20 per share (Notes
              4 and 12.)

              On September 30, 1999, the Company issued  4,282,025 shares of its
              common  stock as a  conversion  of a  convertible  debenture.  The
              shares were issued at $0.20 per share (Notes 4 and 12).

              On December 31, 1998,  the Company issued 310,189 shares of common
              stock in settlement of debt at $0.45 per share.

              On June 30, 1998,  the Company issued  1,273,602  shares of common
              stock in settlement of debt at $0.45 per share (Note 3).

              In 1998,  the Company  issued  35,000 shares of common stock as an
              exercise of warrants at $0.25 per share.

              In 1998, the Company issued 4,700,000 shares of common stock as an
              exercise of "B" warrants at $0.03 per share (Note 4).

              On December 31, 1997, the Company issued  3,495,000  shares of its
              common stock in settlement of debt at $0.22 per share (Notes 3 and
              12).

                                      -47-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 6 -      STOCK TRANSACTIONS (Continued)

              During 1997, the Company issued  10,500,000 shares of common stock
              as a  conversion  of  a  convertible  debenture  and  exercise  of
              warrants. The shares were issued at $0.03 per share (Note 4).

              On December 31, 1996,  the Company  issued  159,818  shares of its
              common stock in settlement of debt at $1.70 per share (Note 3).

              On September 30, 1996,  the Company  issued  210,050 shares of its
              common stock in settlement of debt at $1.70 per share (Note 3).

              On July 26, 1996,  the Company  issued 80,000 shares of its common
              stock in settlement of debt at $1.70 per share (Note 3).

              On June 30, 1996,  the Company issued 419,086 shares of its common
              stock in settlement of debt at $1.70 per share (Note 3).

              On May 6, 1996, the Company issued  6,000,000 shares of its common
              stock to an  escrow  agent  who was to hold the  shares  until the
              Company is paid  $60,000,000.  This  $60,000,000 was recorded as a
              stock subscription receivable until it was canceled in 1997.

              During April 1996, the Company issued  2,300,000  shares of common
              stock as a partial  conversion  of a  convertible  debenture.  The
              shares were issued at $0.03 per share and  represented  conversion
              of $69,000 of the initial $175,000 debenture.

              On March 31, 1996, the Company issued 539,172 shares of its common
              stock in settlement of debt at $1.70 per share (Note 3).

              On December 31, 1995,  the Company  issued  210,888  shares of its
              common stock in settlement of debt at $1.70 per share (Note 3).

              On October 31,  1995,  the Company  issued  380,886  shares of its
              common stock in settlement of debt at $1.70 per share (Note 3).

              During 1994, the Company issued 340,000 shares of its common stock
              for cash,  at $0.50  per  share.  The  Company  incurred  costs of
              $67,500 in connection with the stock offering which were offset to
              additional paid-in capital.

              In November  1993,  the  Company  issued  1,500,000  shares of its
              common stock in settlement of debt at $0.012 per share (Note 3).



                                      -48-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 7 -      DISCONTINUED OPERATIONS

              On  March  14,  1996 the  Company  sold  its  subsidiary,  Tessier
              Resources, LTD. (Tessier) to a public shell corporation controlled
              by some of the Company's  shareholders,  Ocean Power (formerly PTC
              Group,  Inc.).  The  consolidated  financial  statements have been
              restated to reflect this  transaction as discontinued  operations.
              Tessier had no revenues  and no income tax benefit was  attributed
              to the sale. (Note 8)

NOTE 8 -      MARKETABLE SECURITIES

              The  investment  represents  a minor  ownership  interest in Ocean
              Power  of less  than 1% at  December  31,  1999  from  the sale of
              Tessier  Resources,  Ltd.,  whereby Ocean Power gave the Company a
              convertible  debenture with a face value of $3,000,000 in exchange
              for all of the issued and outstanding stock of Tessier  Resources,
              Ltd. The debenture would have matured in four years if it were not
              converted.  The  debenture  is  convertible  at  any  time  before
              repayment into an aggregate of 2,000,000  shares of authorized but
              previously  unissued  shares  of  Ocean  Power  common  stock at a
              conversion  price of $1.50 per share.  The investment was recorded
              at its predecessor  cost of $158,112,  because the sale of Tessier
              was to a  related  party.  Accordingly,  no gain on the  sale  was
              recorded. The investment is being carried at its fair market value
              in  accordance   with  SFAS  No.  115   "Accounting   for  Certain
              Investments in Debt and Equity  Securities."  As the investment is
              considered   "trading",   unrealized   gains  and  losses  on  the
              investment are recognized as components of income. At December 31,
              1999,  the  Company  has  converted  all  of  the  debenture  into
              2,000,000  shares of Ocean Power  common  stock and has  deposited
              those shares with a brokerage  house. In August 1999,  Ocean Power
              effected a 1-for-10 reverse stock split. At December 31,1999,  the
              200,000  shares of Ocean  Power  common  stock held by the Company
              carried an aggregate fair market value of $275,000,  or $1.375 per
              share. The investment is presented as a current asset.

NOTE 9 -      LICENSE FEES

              The fees are amounts paid for software  licenses and the rights to
              use the software related to the Company's  conduct of its Internet
              related gaming.

                                                          December 31,
                                                              1999
                                                            -------

              Softec Systems Caribbean, Inc.           $    100,000
              Accumulated amortization                      (25,000)
              Current portion                               (50,000)
                                                            -------

              Long-Term Portion                        $     25,000
                                                            =======

              The Company  has also  prepaid  $58,333 in license  fees which are
              included in prepaid expenses.



                                      -49-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 9 -      LICENSE FEES (Continued)

              In August of 1998,  Casino World  Holdings,  Ltd.  (CWH) ceased to
              supply  necessary  services  related to its license and  operating
              agreements  with  the  Company.   The  Company  has   subsequently
              questioned CWH's ability to provide an online  interactive  gaming
              system  and  support  services  as  originally   outlined  in  the
              aforementioned agreements.  Consequently, the Company, in its best
              judgment,  has elected to write-off the unamortized portion of its
              paid  investment in the license  agreement a well as the remaining
              unpaid balance of $700,000.  The Company has subsequently  entered
              into a similar  licensing  agreement  with another  third party to
              provide its required gaming  software and transaction  processing.
              As  practicable,  the Company may seek to reclaim a portion or all
              of its investment in CWH through  appropriate legal action.  Based
              upon  consultation  with its  attorney,  the  Company  has accrued
              $100,000 as the estimated cost of settling this liability.

              The Company,  through its subsidiary,  E-Casinos Ltd., has entered
              into an agreement with Softec  Systems  Caribbean,  Inc.  (Softec)
              which will provide  software and  operating  services  relating to
              Internet gaming. Under the terms of the agreement,  E-Casinos Ltd.
              is  required  to  pay a  non-refundable  one-time  license  fee of
              $100,000. Payment of this fee is to be made in accordance with the
              following schedule:

              o    $25,000 upon signing the agreement.

              o    $5,000  thirty-days  from the  acceptance  of the first wager
                   using the licensed software, and

              o    $10,000 per month,  for seven  consecutive  months,  with the
                   first payment  being made 60-days from the  acceptance of the
                   first wager using the licensed software.

              The  license  fee  will be  amortized  over a 2-year  period.  The
              Company   began   amortizing   the   license  fee  in  July  1999.
              Amortization  of  the  license  fee  for  the  nine  months  ended
              September 30, 1999 was $12,500.  At December 31, 1999, the Company
              currently  owes $70,000 for the license fee under the terms of the
              agreement.

              Through its subsidiary, E-Casinos Ltd., the Company paid an annual
              non-refundable  fee of $100,000 to the government of Antigua for a
              gaming  license.  As the gaming  license  was  granted on July 22,
              1999, it will be amortized over a one-year period beginning August
              1, 1999 Softec.  Amortization  of the gaming  license for the year
              ended  December 31, 1999 was $41,667.  Funds to pay for the gaming
              license were advanced to the Company by Softec (Note 10).



                                      -50-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 10 -      NOTES PAYABLE

               In  conjunction  with the startup of E-Casinos  Ltd., the Company
               was  required to pay a yearly  non-refundable  fee of $100,000 to
               the government of Antigua for a gaming license. The funds for the
               gaming license were advanced to the Company by Softec.  Under the
               terms of the note,  the Company is  obligated  to repay Softec in
               twelve  monthly  installments  of $10,000.  Through  December 31,
               1999, the Company had made payments totaling $40,000 on the note.
               As of December 31, 1999, the remaining balance outstanding on the
               note was $80,000.

NOTE 11 - COMMITMENTS AND CONTINGENCIES

               Software Licensing Agreement

               In the first quarter of 1999, the Company entered into a software
               licensing  agreement  with  Softec  Systems  Caribbean  Inc.,  to
               provide online-gaming software and hardware services. The license
               agreement  calls  for a  commitment  by the  company  to  spend a
               certain  portion of the net  revenues  generated  by its Internet
               casino for ongoing promotion and marketing. The license agreement
               also  calls  for  sharing  of net  revenues  based on a  specific
               formula  agreed  to by the  Company  and  licensor.  The  minimum
               monthly payment from the Company to the licensor  related to such
               sharing of net revenues is $25,000  beginning  180-days  from the
               date the first wager is accepted using the licensed software. The
               first wager was  accepted in July 1999.  Accordingly,  in January
               2000, the Company will begin accruing the minimum monthly payment
               of $25,000.  As the license  agreement  may be  terminated by the
               Company at the end of any one-year term or by the licensor at the
               end of any  one-year  term  subsequent  to the first  year of the
               agreement,  the License  Agreement is  amortized  over a two-year
               period.

               Consultants

               The  Company  currently  pays a  shareholder  $12,000 a month for
               advisory services provided by the shareholder to the Company.

NOTE 12 - DILUTIVE INSTRUMENTS

               In August  1999,  the  Company  granted  360,000  warrants  to an
               officer  of the  Company  at $0.28  per  share.  No  compensation
               expense was  recorded  at the time of  issuance  as the  exercise
               price was equal to the trading price at the time of issuance. The
               warrants  become  exercisable  over a two-year period with 45,000
               warrants  vesting at the end of each  quarter  over the  two-year
               period provided the individual  continues his employment with the
               Company.



                                      -51-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 12 -      DILUTIVE INSTRUMENTS (Continued)

               In June 1999,  the Company  granted  595,000  warrants to certain
               individuals,  consultants, Directors and Officers of the Company.
               These   warrants   were  granted  for   services  or   beneficial
               contributions to the Company and/or for the expectation of future
               contributions  to the success of the Company.  The warrants  were
               issued to 15 individuals.  Of the 595,000  warrants,  545,000 are
               exercisable  at $0.47 per share and  50,000  are  exercisable  at
               $0.61 per share.  No  compensation  expense  was  recorded on the
               issuance of warrants  because the exercise price was either equal
               to or  exceeded  the  trading  price  at the time of  issue.  All
               warrants expire June 30, 2002.

               In  January  1999,  the  Company  granted  825,000   warrants  to
               officers,  shareholders and other certain individuals for service
               and consulting activities. The warrants were issued to 11 persons
               and are exercissble at $0.44 per share.  No compensation  expense
               was  recorded on the  issuance of warrants  because the  exercise
               price was either  equal to or exceeded  the trading  price at the
               time of issue. The warrants expire January 27, 2002.

               In January  1999,  the Company  approved one or more  convertible
               debentures,  totaling  no more than $1 million in the  aggregate.
               The debentures were convertible into "restricted" common stock of
               the  Company  at $0.40 per  share  with one (1)  four-year  $0.40
               warrant  attached.  This  authorization was canceled in September
               1999 in  conjunction  with the  Company  authorizing  a  separate
               convertible  debenture  for up to $1 million.  This  debenture is
               convertible at $0.20 per share into "restricted"  common stock of
               the Company with one (1) five-year  $0.20 warrant  attached.  The
               Company  recorded  additional  interest  expense of  $400,000  to
               reflect the  discount on the  debenture  and  attached  warrants.
               Unconverted balances accrue 10% interest per annum on a quarterly
               basis and all balances must be converted  within two years of the
               receipt of the funds by the Company.

               At December 31, 1999,  the Company  converted  the balance of the
               debenture  into common  stock as well as $80,064 of the  attached
               warrants.  Total shares  issued  pursuant to this  debenture  and
               attached warrants as of December 31, 1999 is 5,400,320.

               In April  1998,  the  Company  approved a private  placement  for
               1,111,111 shares of its common stock with accompanying  1,111,111
               warrants at $0.45 per share and  warrants.  All of the  1,111,111
               shares and 472,680 shares from the exercise of warrants have been
               issued.

               In 1998, the Company converted  warrants for 35,000 shares of its
               common stock at $0.25 per share.



                                      -52-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 12 -      DILUTIVE INSTRUMENTS (Continued)

               In  December  1997,  the  Company  granted  830,000  warrants  to
               officers and  shareholders  of which 710,000 are  exercisable  at
               $0.25 per share and 120,000 are  exercisable  at $0.50 per share.
               No compensation  expense was recorded on the issuance of warrants
               because the exercise price exceeded the trading price at the time
               of  issuance.  Additionally,  the  Company has  reserved  100,000
               warrants for future  issuance.  All warrants  expire December 29,
               2001.

               In December  1997, the Company  approved a private  placement for
               3,500,000  shares at $0.22 per share.  All but 5,000  shares were
               issued pursuant to this private placement at December 31, 1997.

               In March 1996, the Company authorized 1,000,000 stock options for
               possible  future  allocation to an individual  and his associates
               for their services in raising funds and  completing  projects for
               the  Company.   Issuance  of  these  stock  options  are  at  the
               discretion of the Company's  Board of Directors.  The options are
               exercisable at $6.00 per share which  represented the fair market
               value  of the  stock  at the time of  grant,  with no time  limit
               associated with the allocation. These stock options were canceled
               by the Company on July 23, 1999.

               In June  1995 the  Company  initiated  a  private  placement  for
               1,000,000 shares of its common stock with accompanying  1,000,000
               warrants at $1.70 per share and warrant.  Of the 2,000,000 shares
               which  have  been  issued  pursuant  to this  private  placement,
               591,774 shares were issued in 1995,  while 1,408,126  shares were
               issued in 1996.

               Over the period of May 1994 through  November  1995,  the Company
               granted 1,532,000 warrants to certain  individuals,  consultants,
               Directors  and  Officers  of the  Company.  These  warrants  were
               granted for services or beneficial  contributions provided to the
               Company and/or for the expectation of future contributions to the
               success  of the  Company.  The  warrants  were  issued  to thirty
               individuals  or  organizations  at exercise  prices  ranging from
               $2.50 to $5.75,  which  represented  the fair market value of the
               stock at the time of grant,  and for periods ranging from four to
               five years.  The warrants will be issued to these  individuals or
               organizations  pursuant to a warrant  agreement with the Company.
               The  Company  intends to  register  the shares  underlying  these
               warrants at a time deemed  suitable by  management.  The warrants
               are  conditional  upon the Company  achieving a listing  with the
               NASDAQ stock exchange. Of the 1,532,000 warrants granted, 637,000
               expired on May 31, 1999,  640,000 expired in October and November
               1999,  and 135,000 were canceled by mutual consent of the Company
               and one of its officers on  September  30,  1999.  The  remaining
               120,000 expires on May 18, 2000.


                                      -53-

<PAGE>



                                VENTURETECH, INC.
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                                December 31, 1999


NOTE 12 -      DILUTIVE INSTRUMENTS (Continued)

               The  following  is a  schedule  of  outstanding  warrants  as  of
December 31, 1999:

<TABLE>
<CAPTION>

                                           Expiration          Exercise       Warrants           Warrants
                   Date of Issue             Date               Price          Issued           Outstanding
                   -------------            ----                -----          ------           -----------

<S>            <C>                    <C>                   <C>               <C>                <C>
               May 18, 1994           May 18, 2000          $    2.50           120,000            120,000
               December 29, 1997      December 29, 2001          0.25           710,000            675,000
               December 29, 1997      December 29, 2001          0.50           120,000            120,000
               September 1, 1999      September 1, 2004          0.20         5,000,000          4,599,680
               June 3, 1999           June 3, 2002               0.61            50,000             50,000
               June 30, 1999          June 30, 2002              0.47           545,000            545,000
               August 31, 1999              --                   0.28           360,000            360,000
                                                                                -------            -------

                                                                              6,905,000          6,469,680
                                                                              =========          =========
</TABLE>

               FASB Statement 123,  "Accounting  for  Stock-Based  Compensation"
               ("SFAS No.  123"),  requires  the  Company  to  provide  proforma
               information  regarding  net income and net stock  awards had been
               determined  in  accordance  with  the  fair  value  based  method
               prescribed in SFAS No. 123. The Company  estimates the fair value
               of each stock award at the grant date by using the  Black-Scholes
               option  pricing  model  with  the  following   weighted   average
               assumptions used for grants, respectively; dividend yield of zero
               percent for all years;  expected volatility of 32 percent for all
               years; risk-free interest rates of 8.0 percent and expected lives
               of 4 years.

               Under the  accounting  provisions  of SFAS No. 123, the Company's
               net  income  would  have been  unchanged  during  the year  ended
               December 31, 1999.

NOTE 13 -      SUBSEQUENT EVENT

               In the first  quarter of 2000,  the Company sold 90,000 shares of
               its marketable securities for net proceeds of $618,600.

                                      -54-

<PAGE>


Item 8.           Changes in and Disagreements with Accountants on
                  Accounting and Financial Disclosure

              There have been no changes in or disagreements with accountants.

                                    PART III

Item 9.       Directors and Executive Officers of the Registrant

              The current Executive Officers and Directors of the Company are as
follows:

             Name                      Age                 Position
             ----                     ---                  --------
     Kenneth F. Fitzpatrick            58       President, and Director
     Craig J. Bampton                  45       Vice President and Director
                                                Chief Financial Officer

     G. Michael Cartmel                61       Vice President-Public
                                                Relations and Director

     William D. Baker                  50       Vice President and Chief
                                                Executive  Officer

     Victor W. Y. Jung                 37       Vice President-Technology
     Alyssa J. Bampton                 28       Secretary

         All directors hold office until the next annual meeting of stockholders
and until their successors have been duly elected and qualified.  Directors will
be elected  at the annual  meetings  to serve for one year  terms.  There are no
agreements  with  respect to the  election  of  directors.  The  Company has not
compensated its directors for service on the Board of Directors or any committee
thereof.  Any  non-employee  director of the  Company  shall be  reimbursed  for
expenses  incurred for  attendance at meetings of the Board of Directors and any
committee of the Board of  Directors.  The  Executive  Committee of the Board of
Directors,  to the extent permitted under Idaho law,  exercises all of the power
and  authority of the Board of Directors in the  management  of the business and
affairs  of the  Company  between  meetings  of the  Board  of  Directors.  Each
executive  officer is appointed by and serves at the  discretion of the Board of
Directors.

         With the  exception of Mr.  Fitzpatrick,  none of the  officers  and/or
directors  of the  Company are  currently  officers  or  directors  of any other
publicly  traded  corporation.  None of the directors,  officers,  affiliates or
promoters of the Company have filed any bankruptcy  petition,  been convicted in
or been the subject of any pending criminal  proceedings,  or the subject or any
order,  judgment,  or decree  involving  the  violation  of any state or federal
securities laws within the past five years.

         The business  experience of each of the persons listed above during the
past five years is as follows:

         Kenneth F. Fitzpatrick.  Mr.  Fitzpatrick  joined the Company in August
1995 as the President, Chief Executive Officer and Director. Mr. Fitzpatrick has
over 30 years of experience in the investment business. For the past nine years,
Mr.  Fitzpatrick  has owned and operated the VanSan Group of San  Francisco,  an
investment  banking and corporate  financing  firm doing  business in the United


                                      -55-


<PAGE>


States and Canada.  For the past three years,  Mr.  Fitzpatrick  has been a Vice
President and provided executive level services to Turbodyne Technologies, Inc.,
a  leading  engineering  company  in the  design  and  development  of  charging
technology to enhance the performance of internal combustion engines.  Turbodyne
is a public company with annual sales of approximately  $50 million in 1999. Mr.
Fitzpatrick  holds a B.S.  degree in Business  from Babson  College in Wellsley,
Massachusetts.

         Craig J. Bampton.  Mr. Bampton became the Vice President and a director
of the Company following the acquisition of Tessier Resources,  Ltd. ("Tessier")
in 1994. He became Chief  Financial  Officer on May 1, 2000,  replacing  William
Baker.  Mr.  Bampton has been Vice  President  of Tessier and  President  of its
wholly owned subsidiary, Pulverizer Systems, Inc., since 1991. In that capacity,
Mr. Bampton supervised  development of technology that resulted in patents being
granted  to  Tessier  for its ice  removal  apparatus.  He  also  had  oversight
responsibility  for  construction of two prototype  models of the apparatus.  To
date, Tessier has not realized any revenues. Mr. Bampton served as President and
a director of PTC Group,  Inc. a publicly traded  corporation now known as Ocean
Power  Corporation,  from 1996 to 1999. As  President,  he was  instrumental  in
coordinating  the merger with PTC  Holdings,  Inc.,  which is now known as Ocean
Power corporation.  Prior to joining Tessier, Mr. Bampton was employed from 1973
to 1991 by Burlington  Northern  Railways  Manitoba Ltd.,  where he was an agent
/office manager for the Manitoba,  Canada region. Mr. Bampton attended Red River
Community College. Mr. Bampton is the uncle of the Company's  Secretary,  Alyssa
Bampton.

         G. Michael  Cartmel.  Mr.  Cartmel  became the Vice President of public
relations  and a director  of the  Company  in April  1994.  His duties  include
providing  investor  relations,  support for general operations and assisting in
facility and corporate  management.  He was also a director of PTC Group,  Inc.,
from 1996 to 1999.  Mr.  Cartmel has been  self-employed  for several years as a
consultant to the investment  community  providing investor and public relations
services to publicly held companies.  From 1991 to the present,  Mr. Cartmel has
been a principal of BMB  Holdings,  Ltd., a provider of investor  relations  and
consulting  services.  BMB has no  other  employees  and  has  not had  material
revenues for the past five years.  Mr. Cartmel holds a B.A.  degree in economics
and psychology from the University of British Columbia.

         William D. Baker,  C.A. Mr. Baker joined the Company as a consultant in
August 1999 and became Vice President and Chief  Financial  Officer on September
1, 1999. On May 1, 2000, Mr. Baker  relinquished his position as Chief Financial
Officer and became Chief Executive Officer.  Mr. Baker has experience in finance
and  operations  with early stage,  high growth  technology  companies who serve
international  markets.  He has  been  C.F.O./C.O.O.  for a number  of  startups
including  Cardlink  Worldwide,  Inc. a private  data  networking  company  with
operations in Brazil,  PopMedia Ltd. a specialty media company in North America,
and  Bynamics  Inc.,  a   telecommunications   manufacturer  with  international
operations.  His  experience  includes  two  years as Vice  President  for Bytec
Management  Corporation.,  a high  technology  venture  capital firm and several

                                      -56-


<PAGE>


         years as Principal Consultant for Willabeth Capital Corp., a firm which
specializes  in  business  planning  and early  stage  financing  of high growth
technology  companies.  Mr.  Baker  is a member  of the  Canadian  Institute  of
Chartered  Accountants  and the  Institute of Chartered  Accountants  of British
Columbia and is a Commerce  graduate  from McGill  University.  Mr. Baker is the
founder of  Willabeth  Capital  Corporation,  a private  Canadian  company  that
provides  management  consulting  services to early-stage  high growth potential
businesses.  His assignments have included high technology,  telecommunications,
manufacturing  and  publishing.  Since  these firms were  primarily  early stage
development  entities,  they generally did not have material revenues during his
tenure with the firms.  Mr. Baker provided Chief Financial  Officer  services to
Cardlink  Worldwide,  Inc., a development  stage company with  capitalization of
approximately  $6 million (US), in 1998 and 1999.  Mr. Baker also provided Chief
Operating  Officer services to Peaksoft  Corporation,  a publicly listed company
trading on the Alberta  exchange,  in 1996 and 1997. Sales for fiscal years 1996
and 1997 amounted to $784,000 (CND) and $1,340,000 (CND), respectively.

         Victor W.Y.  Jung.  Mr.  Jung  joined the Company in October  1996 as a
consultant  providing  technology  management  and guidance as Vice President of
Technology.  Mr. Jung became a full time  employee in October  1999 and retained
his office of Vice  President.  Mr.  Jung  brings  ten (10) years of  commercial
software development  experience to the Company. Mr. Jung was the founder of the
engineering group at EyeTel Communications Inc. that developed the award-winning
DeskTop Communicator video conferencing product. Prior to this, Mr. Jung was the
software manager for MTI, which produces  computerized  vehicle diagnosis system
for new vehicles such as GM, Chrysler and Ford. Mr. Jung obtained his Bachelor's
Degree in Computing.

         Alyssa J.  Bampton.  Ms.  Bampton  has  worked  with the  Company  on a
part-time basis since April 1994 performing various  administrative  duties. She
acts  as  an  executive   assistant  to  management  and  Board  members  on  an
as-needed-basis.  She is also  responsible  for production and  coordination  of
investor materials and mailings. Additionally, Ms. Bampton oversees and provides
corporate customer service to both the registered and prospective gaming clients
to the Asia Casino website. From 1991 to 1993, she worked as an administrator at
Eyetel Technologies, Inc. handling a variety of duties such as customer service,
public   relations,   advertising   and   product   promotion   for  the   video
teleconferencing  technology  being  developed  and sold for that  company.  Ms.
Bampton attended Capilano College for two years. Ms. Bampton is the niece of the
Company's Vice President, Craig J. Bampton.

         Other Key Persons

         Arthur Rosenberg.  Mr. Rosenberg joined the Company in February 1996 as
its  Chief  Operating  Officer  and  Chief  Financial  Officer.  Pursuant  to  a
consolidation  of the  Company's  operations  in  Vancouver,  BC, Mr.  Rosenberg
resigned on September 30, 1999 and has agreed to provide consulting and advisory
services to the Company on a mutually  agreeable basis. Mr. Rosenberg has been a
high-profile  individual  in the on-line  gaming  industry and has served on the


                                      -57-


<PAGE>


board of directors of the Interactive Gaming Council,  the trade association for
the industry. Mr. Rosenberg has also been invited to provide testimony on behalf
of the  industry at United  States  government  hearings,  such as the  National
Gambling  Impact  Study  Commission.  Since  1992,  Mr.  Rosenberg  has  been an
independent  corporate  consultant  offering  his clients  advice on  financial,
strategic,  investment and operational matters. From 1992 to 1996, Mr. Rosenberg
was the  Chief  Operating  Officer  and Chief  Financial  Officer  of  LottoFone
Incorporated,  a company  located  in  Alexandria,  Virginia  seeking to provide
telephone based wagering capabilities to state and international  lotteries. Mr.
Rosenberg  is a  graduate  of  Northeastern  University  with a B.A.  degree  in
chemistry and also earned a M.B.A. in management from Boston College.

         The  online   gaming   industry   is   characterized   by   independent
entrepreneurial    ventures.   With   the   advent   of   key   on-line   gaming
software/hardware  providers such as SSII, many entrepreneurial  ventures become
the  marketing  arms of the virtual  casinos  and allow  actual  on-line  gaming
operations  to be  conducted  by  the  gaming  providers.  Consequently,  direct
conventional casino operational experience is not critical to the success of the
operation.  The Company's  management avails of consulting expertise and studies
in both Internet marketing and on-line gaming. Management also routinely attends
on-line gaming industry  meetings.  In addition,  the Company contracts with its
former Chief Operating  Officer,  Mr. Rosenberg,  for consulting  services.  Mr.
Rosenberg  was  directly   involved  in  forming  the  on-line  gaming  industry
association  (Interactive  Gaming  Council)  and  has  served  on its  board  of
directors.

Section 16(a) Beneficial Ownership Reporting Compliance

         Each of the Company's officers and directors is required to file a Form
5, Annual  Statement of Changes in Beneficial  Ownership,  on or before the 45th
day after  the end of the  fiscal  year.  These  reports  will be  prepared  and
submitted to the Securities and Exchange Commission.

Item 10.          Executive Compensation

         The  Company  does  not  have a  bonus,  profit  sharing,  or  deferred
compensation plan for the benefit of its employees, officers or directors. As of
December 31,  1999,  no employee of the Company has earned in excess of $100,000
per annum.

         The  following  table  sets  forth  all cash  compensation  paid by the
Company for services rendered to the Company for the fiscal years ended December
31, 1999 and 1998 to the  Company's  Chief  Executive  Officer and former  Chief
Operating  Officer.  No  executive  officer of the  Company  has earned a salary
greater than $100,000 annually for the period depicted.

                                      -58-


<PAGE>


<TABLE>
<CAPTION>
                                            Summary Compensation Table


                                                                                        Other             All
                                                                                        Annual           Other
Name and                                                                                Compen-          Compen-
Principal Position                          Year             Salary          Bonus      sation           sation
------------------                          ----             ------          -----      ------           ------

<S>                                          <C>           <C>             <C>            <C>             <C>
Kenneth Fitzpatrick,                         1999          $  -0-          $  -0-         $ -0-           $ -0-
President, C.E.O.                            1998             -0-             -0-           -0-             -0-
                                             1997             -0-             -0-           -0-             -0-
Arthur Rosenberg,(1)                         1999           60,500            -0-          2,700          27,250
C.O.O. and C.F.O.                            1998           72,000            -0-          4,059            -0-
                                             1997           78,000            -0-          5,437            -0-
</TABLE>

---------------
         (1)      On October 1, 1999, the board of directors granted a severance
                  payment  to  Mr.   Rosenberg   of  $25,000   payable  in  four
                  installments  beginning in November  1999 and ending  February
                  2000.  The  payments  are  contingent  on  sufficient  capital
                  resources  being  available to the Company so as not to impact
                  the Company's ongoing operations.

         The   preceding   table  does  not  include  any  amounts  for  noncash
compensation,  including  personal  benefits,  paid to the Company's  C.E.O.  or
C.O.O.  The  Company  believes  that the  value  of such  noncash  benefits  and
compensation  paid to Messrs.  Fitzpatrick  and  Rosenberg  during  the  periods
presented  did not exceed the lesser of $50,000 or 10% 0f the cash  compensation
reported for them.

         The following  table includes those stock purchase  warrants  (options)
issued by the Company to its C.E.O.,  C.F.O.,  C.O.O.  and directors  during the
last fiscal year. For purposes of  calculating  the percent of the total options
granted to employees, the aggregate number issued to all officers, directors and
employees is used.

<TABLE>
<CAPTION>

                                       Option/SAR Grants in Last Fiscal Year
                                        Number of     Percent of total
                                        securities      options/SARs
                                        underlying      granted to
Name and                               options/SARs     employees in             Exercise or base    Expiration
Principal Position                      granted(#)      fiscal year               price ($/Sh.)          date
------------------                      ----------      -----------               -------------          ----
<S>                                       <C>                 <C>                     <C>               <C>
Kenneth Fitzpatrick,                      50,000              2.8%                    $  .44            01-27-02
  President, C.E.O.                       75,000              4.2%                    $  .47            06-30-02
Arthur Rosenberg,                        150,000              8.4%                    $  .47            06-30-02
  C.O.O.
William Baker,                           360,000             20.2%                    $  .28              (1)
 C.F.O.
</TABLE>
--------------
         (1)      Pursuant to an  employment  letter  dated  August 31, 1999 and
                  board of director's resolution,  Mr. Baker was granted 360,000
                  four-year term warrants  exerciseable on an installment  basis
                  (45,000 warrants per quarter beginning on December 1, 1999 and
                  ending on  September  1,  2001)  contingent  on his  continued
                  employment with the Company.

Employment Agreements

         As of the date thereof, the Company has not entered into any employment
contracts with any of its employees,  officers or directors, nor has the Company


                                      -60-


<PAGE>


had a bonus,  profit sharing,  or deferred  compensation plan for the benefit of
its employees,  officers or directors.  Mr. William Baker's (C.F.O.)  employment
offer letter from the Company  specifies a thirty day notice of termination  and
provides for the exercise of warrants (see table above) on an earned basis.  Mr.
Rosenberg  (C.O.O.)  was  granted a  severance  payment of $25,000 to be paid in
installments commencing in November 1999 and ending in February 2000, contingent
on adequate resources being available to the Company.

Item 11.          Security Ownership of Certain Beneficial Owners and
                  Management

         The following  table sets forth  information,  to the best knowledge of
the  Company,  as of December  31, 1999 with respect to each person known by the
Company to own beneficially  more than 5% of the outstanding  Common Stock, each
director and all directors and officers as a group.

 Name and Address                   Amount and Nature of              Percent
of Beneficial Owner                 Beneficial Ownership            of Class(1)
--------------------                 --------------------           -----------
William D. Baker*                          360,000(2)                   1.0%
  4588 Teviot Place
  North, Vancouver, BC,
  Canada V7R 4M5
Alyssa J. Bampton*                       1,290,900(3)                   3.5%
  441 New Lance Place
  West Vancouver, BC,
  Canada V7P 1W4
Barry G. Bampton                         1,165,800                      3.1%
  5295 Gulf Place
  West Vancouver, BC,
  Canada V7W 2V9
Craig J. Bampton*                        1,327,000(4)                   3.6%
  65 Fletcher Crescent
  Winnepeg, Manitoba,
  Canada R3T 0K9
G. Michael Cartmel*                        735,000(5)                   2.0%
  302-2170 West Third Ave.
  Vancouver, BC,
  Canada V6K 1L1
Cybertech Investments Ltd.               3,000,000                      8.1%
  Brian Lomgpre
  East Bay Centre #b-66
  Nassau, Bahamas
Kenneth F. Fitzpatrick*                    784,000(6)                   2.1%
  709 Park Lane
  Santa Barbara, CA.  93108
Victor Jung                                175,000(7)                    .5%
  c/o 1055 West 14th Street
  Suite 400
  North Vancouver,
  B.C. 7P 3P2
Manasia Development Ltd.                 2,249,700                      6.1%
  David Tang
  701 United Chinese Bank Bldg.
  Des Voeux Road,
  Central Hong Kong



                                      -61-


<PAGE>

 Name and Address                   Amount and Nature of              Percent
of Beneficial Owner                 Beneficial Ownership            of Class(1)
--------------------                 --------------------           -----------

Texco Investments                        2,272,859                      6.1%
  Robert Wang
  No. 2, Jalan37
  Taman Desa Jaya

  Kepong, 52100 Kuala Lumpur
  Malaysia

VanAus Investments Ltd.                    438,000                      1.2%
  Barry G. Bampton
  5295 Gulf Place
  West Vancouver, BC,
  Canada V7W 2V9
All directors and executive
  officers as a group                    4,510,700(8)                  11.9%
------------------
          *       Director and/or executive  officer Unless otherwise  indicated
Note:             in the footnotes below, the Company has been advised that each
                  person above has sole voting  power over the shares  indicated
                  above.

         (1)      Based upon  37,014,165  shares of common stock  outstanding on
                  December 31, 1999, but does not take into consideration  stock
                  options owned by certain officers,  directors and/or principal
                  shareholders entitling the holders to purchase an aggregate of
                  1,040,000  shares  of common  stock  and  which are  currently
                  exercisable.  Therefore,  for  purposes  of the  table  above,
                  38,054,165  shares of common stock are deemed to be issued and
                  outstanding  in  accordance  with Rule  13d-3  adopted  by the
                  Securities  and  Exchange   Commission  under  the  Securities
                  Exchange  Act of 1934,  as amended.  Percentage  ownership  is
                  calculated  separately  for each  person  on the  basis of the
                  actual  number of  outstanding  shares as of December 15, 1999
                  and assumes the exercise of stock  options held by such person
                  (but not by anyone else) and exercisable within sixty days.

         (2)      Includes  360,000  shares  which may be acquired by Mr.  Baker
                  pursuant  to the  exercise of warrants  and/or  stock  options
                  exercisable on a quarterly basis from December 1, 1999 through
                  September 1, 2001.

         (3)      Includes  90,000  shares which may be acquired by Ms.  Bampton
                  pursuant  to the  exercise of warrants  and/or  stock  options
                  exercisable at various  prices and expiring  during the period
                  December 29, 2001 through June 30, 2002.

         (4)      Includes  130,000  shares which may be acquired by Mr. Bampton
                  pursuant  to the  exercise of warrants  and/or  stock  options
                  exercisable at various  prices and expiring  during the period
                  December 29, 2001 through June 30, 2002.

         (5)      Includes  135,000  shares which may be acquired by Mr. Cartmel
                  pursuant  to the  exercise of warrants  and/or  stock  options
                  exercisable at various  prices and expiring  during the period
                  December 29, 2001 through June 30, 2002.

         (6)      Includes   150,000   shares  which  may  be  acquired  by  Mr.
                  Fitzpatrick  pursuant to the exercise of warrants and/or stock
                  options  exercisable at various prices and expiring during the
                  period December 29, 2001 through June 30, 2002.

         (7)      Includes  175,000  shares  which may be  acquired  by Mr. Jung
                  pursuant  to the  exercise of warrants  and/or  stock  options
                  exercisable at various  prices and expiring  during the period
                  December 29, 2001 through January 27, 2002

         (8)      Includes  1,040,000  shares  which  may  be  acquired  by  the
                  Company's  directors  or  executive  officers  pursuant to the
                  exercise of  warrants  and/or  stock  options  exercisable  at
                  various  prices and  expiring  during the period  December 29,
                  2001 through June 30, 2002.

                                      -62-


<PAGE>


Item 12.          Certain Relationships and Related Transactions

         There have been no  transactions  between the Company and any  officer,
director,  nominee for election as director,  or any shareholder  owning greater
than five percent (5%) of the Company's  outstanding  shares,  nor any member of
the above referenced individuals' immediate family, except as set forth below.

         During 1999 and 1998, the Company granted  warrants to certain officers
and directors. See Note 12 to Financial Statements. These warrants are set forth
below in Part II, Item 4, "Recent Sales of Unregistered  Securities,"  under the
heading  "Funding  and  Dilutive  Instruments,".  The  warrants  were  issued in
consideration for services rendered, or expected to be rendered, to the Company.
No compensation  expense has been recorded as the option price exceeded the fair
market value of the shares when the options were issued.

         The Company  currently  pays  $12,000 per month to Barry G. Bampton for
certain advisory and financial  services rendered to the Company.  Mr. Bampton's
services involve assisting the Company in financing activities and in public and
investor  relations.  He has been instrumental in raising  substantial funds for
the  Company's  operations  and securing  important  technological  and business
contractual  relationships.  Mr. Bampton is the  beneficial  owner of Enterprise
Capital that has provided funding to the Company for more than five years. He is
the brother of Craig J. Bampton,  Vice  President and a director of the Company,
and the father of Alyssa J. Bampton, Secretary of the Company.

         The Company occupies facilities in Vancouver, B.C. that are leased from
Pulverizer Systems,  Inc.  ("Pulverizer"),  a subsidiary of Tessier.  Pulverizer
also provides  certain  bookkeeping and accounting  services to the Company on a
contract basis. Craig J. Bampton, President and director of the Company, is also
Vice President of Tessier and President of Pulverizer.

                                      -63-


<PAGE>



                                     PART IV

Item 13.          Exhibits, Financial Statement Schedules, and Reports on

                  Form 8-K.

Exhibit No.                              Exhibit Name
-----------                              ------------

      3.1*            Articles of Incorporation and Amendments
      3.2*            By-Laws of Registrant
      4.*             See Exhibit No. 3.1, Articles of Incorporation

                      Article V and amendments thereto
     21.1*            Subsidiaries
     10.1*            Software License Agreement
     27.              Financial Data Schedule

----------------

         *        Previously filed as Exhibit to Form 10-SB.

         (b)      No Form 8-K was filed for the three month period ended
                  December 31, 1999.


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<PAGE>



                                   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.

                                           VENTURE TECH, INC.

                                       BY: /S/ WILLIAM D. BAKER
                                           --------------------
                                           William D. Baker
                                           Vice President and Chief
                                           Executive Officer
                                           DATE:  May 22, 2000

         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.

                                       BY: /S/ WILLIAM D. BAKER
                                           --------------------
                                           William D. Baker
                                           Vice President and Chief
                                           Executive Officer
                                           DATE:  May 22, 2000

                                       BY:  /S/ KENNETH F. FITZPATRICK
                                            --------------------------
                                            Kenneth F. Fitzpatrick
                                            President and Director
                                            DATE:  May 22, 2000

                                       BY: /S/ CRAIG J. BAMPTON
                                           ---------------------
                                           Craig J. Bampton
                                           Vice President, Chief
                                           Financial Officer,
                                           Principal Accounting Officer
                                           and Director
                                           DATE:  May 22, 2000



                                       BY:  /S/ G. MICHAEL CARTMEL
                                            ----------------------
                                            G. Michael Cartmel
                                            Vice President and
                                            Director
                                            DATE:  May 22, 2000

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