U.S. 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, 2002

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

     For the transition period from _____ to _______

                         Commission file number 0-32323

                                  TEN STIX INC.
         ---------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

         COLORADO                                                 84-1351184
(State or other jurisdiction of                                (I.R.S. Employer
incorporation of organization)                               Identification No.)

                              3101 Riverside Drive
                          Idaho Springs, Colorado 80452
                    (Address of Principal Executive Offices)

                                 (303) 567-0163
                           (Issuer's telephone number)

                                       N/A
              (Former name, former address and former fiscal year,
                          if changed since last report)

     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 here 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. X

     State the issuer's revenues for its more recent fiscal year (ending
December 31, 2002): $123,274.

     State the aggregate market value of the voting and non-voting common equity
held by non-affiliates computed by reference to the price at which the common
equity was sold, or the average bid and asked prices of such common equity, as
of February 28, 2003: $2,462,318.70.

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

Class                                      Outstanding as of April 8, 2003

Common Stock, $.001 par value                19,083,228

<PAGE>


PART I

ITEM 1. DESCRIPTION OF BUSINESS

ITEM 2. PROPERTIES

ITEM 3. LEGAL PROCEEDINGS

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

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

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

ITEM 7. FINANCIAL STATEMENTS

        BALANCE SHEET

        STATEMENTS OF OPERATIONS

        STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

        STATEMENTS OF CASH FLOWS

        NOTES TO FINANCIAL STATEMENTS

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

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

ITEM 10.EXECUTIVE COMPENSATION

ITEM 11.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

ITEM 12.CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

ITEM 13.EXHIBITS AND REPORTS ON FORM 8-K

ITEM 14.CONTROLS AND PROCEDURES

SIGNATURES

<PAGE>


                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS

BUSINESS DEVELOPMENT AND ORGANIZATION

     Ten Stix Inc. was incorporated on January 10, 1996 under the laws of the
State of Colorado to engage in the design, development and marketing of unique
card games, of which some are derived from Native American heritage, and other
gaming products for the gaming industry. The Company trades its shares of Common
Stock on the OTC Bulletin Board under the symbol "TNTI". The Company named
itself "Ten Stix" based on management's belief that "Ten Stix 21" will be its
most popular and creative product (currently being marketed and referenced
herein as "Ten to Win"). The Company has designed and developed certain card
games, which are currently being marketed to casinos located in the States of
California, Colorado, Kansas, New Mexico, Nevada, South Dakota and Wisconsin.

     The Company's principal executive offices are located at 3101 Riverside
Drive, Idaho Springs, Colorado 80542. Its telephone number is (303) 567.0163 and
its facsimile number is (303) 567.0163.

     As of the date of this Annual Report, the Company has generated limited
revenues and incurred substantial selling, general and administrative expenses,
expenses, which includes research and development expenses relating to the
design and development of the Company's gaming products. The Company's auditors,
AJ. Robbins, P.C., have expressed doubt about the Company's ability to continue
as a going concern, as evidenced in the auditor's report to the Financial
Statements. See "Part II. Item 7. Financial Statements."

BUSINESS OF THE COMPANY AND PRODUCTS

     The Company has designed and developed a line of card games and other
gaming products for the gaming industry. There are two types of gaming products
that the Company has designed and will distribute and market. One type of gaming
product is the "table game with electronics", which includes Ten to Win and
Shotgun 21. Both the Ten to Win and Shotgun 21 card games utilize an electronics
system that was designed and developed by the Company and which provides, among
other things, the managers of casinos with an accounting system allowing for
real-time win/loss statistics. The basic unit hardware is the same for the two
card games, although the Shotgun 21 electronics system has certain modifications
and will perform more sophisticated functions. The other type of gaming product
is a "layout game", which includes all of the other gaming products. The other
gaming products of the Company utilize a tablecover or layout with no electronic
system. The Company offers no warranty pursuant to the sale or lease of any of
its gaming products.

     During fiscal year ended December 31, 2002, the Company generated
approximately $99,225 in revenues from the lease of its gaming products.
Management of the Company believes that the Company will continue to generate
such revenues. Management further believes that there are certain material
factors applicable to all of the Company's products relevant to the generation
of revenues which include, but are not limited to, the following: (i) adequate
capital required to fund operational expenses, which directly and adversely

<PAGE>


affects travel associated with the market and distribution of products; and (ii)
state approval of the specific game being marketed. Together with the specific
material factors listed under the description of each gaming product, management
believes that all such material factors have been disclosed pertaining to the
timing of bringing each product to market and commencement of generation of
revenues.

     Ten to Win

     The Company, through its founders and officers/directors, Messrs. Thomas
Sawyer and Tony Cranford, has completed the design and development of its first
and most creative gaming product called "Ten to Win". Based on market testing
conducted by the Company and the popularity of and acknowledgment by casinos,
particularly Native American casinos, of Ten to Win at gaming shows, management
believes that Ten to Win will be the Company's most marketable product. Although
the Company has not generated any revenues from the distribution and sale of Ten
to Win, management believes that it will be able to successfully market and sell
Ten to Win.

     Ten to Win is a Class II (i.e., a game where the players bank all funds and
the casino takes a fee for the use of the game) and a Class III game (i.e., a
game where the casino banks all funds and takes all the risk in the outcome of
the game). The difference between a Class II and a Class III game is generally
that in a Class II game the casino does not act as the bank and merely takes a
percentage override or an hourly fee, i.e., the casino does not lease or win any
money from the card hands because the players take turns putting up the bank and
thus assuming the risk of loss. Management believes that no marketing advantages
exist relating to classification of a game as either a Class II or a Class III
game. Ten to Win can be classified as both a Class II and a Class III game
because it is based and played as a blackjack bonus system. If a casino plays
Class II games, Ten to Win will be classified as a Class II game. If a casino
plays Class III games, Ten to Win will then be classified as a Class III game.
Management believes that Ten to Win will primarily be marketed and used in
casinos playing Class III games. Management further believes, however, that
utilization of both classifications for Ten to Win provides an advantage because
of the potential increase in the number of casinos to which Ten to Win may be
marketed.

     Ten to Win is played on a Blackjack table with a special layout. Seven
positions are used around the table together with a six-deck shoe. The game is
played like Blackjack, however, the object is not only to win wagers but also to
collect ten Stix cards for a bonus prize. When a player is dealt a Stix card,
the player can either count it as 10 points and keep playing or trade it in to
the dealer and get the next card out of the shoe. There is an electronic
tracking system for each player position for the number of ten Stix they have
collected, and Stix may not be transferred between these positions or tables.
When a player leaves the table, the player looses the Stix that they had
accumulated.

     Management believes that a player's excitement and interest in playing Ten
to Win increases depending upon the different prizes being offered by the
casinos and the player's respective wagers. When a player has accumulated only
one or two Stix compared to a player who has accumulated eight or nine Stix, the
player strategies vary creating an exciting and challenging game for all
involved.

<PAGE>


     The electronic system used in conjunction with Ten to Win is comprised of a
"Ten to Win" sign, a dealer control box and seven player boxes. It is an
accounting system that awards prizes. When a player receives a "Stix" card, he
has the opportunity to play the card or trade it to the dealer for a "ten stix
light". The object of the game is for the player to win his blackjack wagers and
build up ten Stix lights to receive a bonus prize. Each time a player receives a
Stix light, the dealer uses the control box and turns on one of lights. When the
player receives the tenth Stix light, the player gets to electronically spin for
their prize. When activated from the dealer's control box, the player pushes the
button on their box, which randomly spins and stops on the winning prize.

     A Ten to Win sign is set up with adjustable prize amounts. The electronic
system is then operated by placing a small box in front of the player's seat.
The box has ten Stix lights together with a spin button. The dealer turns on the
respective player's Stix lights to add or subtract lights as necessary. When a
player leaves the table, all Stix lights are taken away and the next player
starts at zero.

     Management of the Company believes that the basic odds of Blackjack change
very little for the casino that is offering Ten to Win. The casino that offers
Ten to Win at their tables benefits because the players tend to spend more money
at the tables to collect Stix, even if the cards are not running in their favor.
Management believes that casinos have determined that it is difficult for a
player to walk away from a table when that player has already invested in
collecting a group of Stix.

     The casinos can change the prizes daily to stimulate more play on slower
days, such as offering larger prizes on weekdays than on weekends. The
variations for the casinos are innumerable, including linking tables together in
a pit for an even bigger prize. Management believes that the variations in
offering Ten to Win are numerous when used by the casinos.

     As of the date of this Annual Report, the Company continues to market Ten
to Win at gaming shows and to casinos, but has not generated any revenues.
Management anticipates that the Company will commence generating revenues from
the distribution and sale of Ten to Win by approximately fourth quarter 2003
based on certain material factors: (i) timing of installation of the electronic
system, which is now complete; (ii) acquisition of a testing site for the
working model that is currently in place to be used for demonstration
purposes,(which some states require testing results prior to approval and other
states do not require such testing results) (ii) determination by management of
those states in which to market Ten to Win, of which the Company has received
approval for play from California and New Mexico, (iii) commencement of such
marketing, and (iv) introduction of Ten to Win at trade shows. See "Part I. Item
1. Description of Business - Customers and Marketing."

     Bet the House

     Prior to the Company's incorporation, Mr. Tony Cranford created and
designed a card game called "Bet the House". Bet the House is a Class III game
in which the player can play regular blackjack or place side bets on the outcome
of the dealer's hand, i.e. how many cards the dealer ends up with, if the
dealer's hand is an even or odd number, or if the dealer's hand is all red or
all black. It is played together with a table that is similar to a roulette game
table, which is placed next to the blackjack betting spot. This is where the
player places the side bets. As of the date of this Annual Report, Bet the House
has been approved by the Gaming Control Board in the State of Nevada for
distribution and operation.

<PAGE>


     On approximately October 16, 2000, Mr. Cranford filed a provisional patent
application with the United States Patent and Trademark Office, application
number 60/240.091, for protection of Bet the House. As of the date of this
Annual Report, the U.S. Patent and Trademark Office has not issued a patent on
Bet the House. See "Part I. Item 1. Description of Business - Patents,
Copyrights and Trademarks."

     Pursuant to an assignment agreement between the Company and Mr. Cranford
dated January 19, 2001 (the "Cranford Assignment Agreement"), Mr. Cranford
assigned all of his right, title and interest in Bet the House, including his
rights to the provisional patent application no. 60/240.091, to the Company. In
accordance with the terms and provisions of the Cranford Assignment Agreement,
the Company agreed to pay Mr. Cranford (i) for a period of six months a monthly
royalty fee of $175.00 for each Bet the House game that the Company leases to a
third party during the six month period, and (ii) an aggregate purchase price of
either (a) an amount to be calculated by multiplying the average monthly gross
revenues generated by the Company for each Bet the House game leased during the
six month period by three (3), or (b) $30,000, whichever is greater. The terms
of Cranford Assignment Agreement further provide that such aggregate purchase
price may be paid by the Company to Mr. Cranford on a monthly basis or in one
aggregate payment, with such aggregate purchase price to be paid in full no
later than March 31, 2002.

     As of the date of this Annual Report, Mr. Cranford has not received any
payments from the Company and has agreed to extend such payment date to June 30,
2003. Management has not determined the manner of payment to be made to Mr.
Cranford and may not make such determination until the Company is adequately
funded and several Bet the House games have been successfully marketed
generating revenues. See "Part II. Item 6. Management's Discussion and Analysis
or Plan of Operation - Plan of Operation" and "Part III. Item 12. Certain
Relationships and Related Transactions."

     As of the date of this Annual Report, the Company has not generated any
revenues from the sale or distribution of Bet the House. Management anticipates
that the Company will commence generating revenues from the distribution and
sale of Bet the House by approximately May 2003 based on certain factors
including, but not limited to, the (i) determination by management of those
states in which to market Bet the House, (ii) commencement of such marketing,
and (iii) introduction of Bet the House at trade shows. See "Part I. Item 1.
Description of Business - Customers and Marketing."

     Shotgun 21

     The Company is currently in the process of completing the design and
development of a card game called "Shotgun 21". Shotgun 21 is a Class III game
and is also similar to Blackjack with two separate hand betting fields per
player and bonus prizes, which encourage extended play. Management of the
Company believes that Shotgun 21 presents the most sophisticated electronics
available to the table game industry and provides, among other things, an
accounting system allowing for real-time win/loss statistics.

     The electronic system used in conjunction with Shotgun 21 is comprised of a
dealer control box, a special layout or table top and six sensors. Players play
blackjack in the betting spaces that are set up like the barrels of a shotgun
with sensors on the top of the sight. The player places his wager(s) in one or
two of these circles. In addition, the player may wager an extra dollar by

<PAGE>


placing it on his sensor. At the beginning of each game, the dealer pushes a
start button on the dealer control box. This activates the sensors and shows on
the dealer control box whether or not a player made the extra dollar wager. At
the same time, the electronic system picks a dollar prize amount (within
predetermined parameters) and a card. Players who wagered the extra dollar have
an opportunity to win a portion of the selected dollar prize if their first two
cards match the card that has been chosen by the electronic system.

     As currently being designed and developed, Shotgun 21 will contain eight
languages, twelve different money conversions, calculate its own royalty
obligations, have remote shut down for non-payment of royalties, and can compute
prizes by linking tables within a casino and among tables at other local
casinos. Management believes that the characteristics of Shotgun 21 ultimately
will expand game interest.

     The table layout may be purchased by the Company from a number of companies
that manufacture such layouts. As of the date of this Annual Report, the Company
has not engaged in any contractual relations regarding the purchase of the table
layout.

     Management of the Company had previously made a strategic business decision
to hold introduction of Shotgun 21 into the marketplace until the patent
infringement case brought against the Company and others, alleging the Company's
product Shotgun 21 infringed upon certain existing patents, was resolved. The
Company reached a settlement agreement pursuant to which it was dismissed from
the suit. As of the date of this Annual Report, the Company has no further
liability in the suit in accordance with the settlement agreement and any
associated license agreements are null and void. Management of the Company
believes that the terms of any license agreement, if applicable, would not be
restrictive or unduly burdensome, and would be immaterial to the total business
operations of the Company.

     Management is currently contemplating the introduction of Shotgun 21 into
the marketplace after completion of certain final modifications to the system,
which are currently being finalized. Management of the Company does not expect
any generation of revenue from Shotgun 21 until approximately first quarter of
2004. There has been no previous or current interest expressed by any casino for
leasing of the product Shotgun 21. In the event Shotgun 21 is successfully
marketed, management of the Company believes that any such revenues generated
would represent a small portion of the aggregate revenues anticipated to be
realized from the marketing and distribution of all of the Company's products.

     Ten Stix Video

     The Company has designed and developed a video version game of Ten Stix 21
called the "Ten Stix Video" for use in slot machines. In the Ten Stix Video, the
player accumulates bonus points as the slot machine is played until a total of
ten points are reached. The slot machine then pays an additional "bonus
jackpot". Management believes that the attraction for the player is the bonus
for staying at the slot machine and a sense of competition in attempting to race
to get the ten points. Management further believes that the attraction for the
casino is having constant play on a slot machine utilizing the Ten Stix video
game. As of the date of this Annual Report, the Company has completed testing
the Ten Stix Video in several slot machines located in casinos in the State of
California and management intends to make necessary product modifications.
Therefore, management does not anticipate generation of revenues during fiscal
year 2003 from the marketing and sale of Ten Stix Video.

<PAGE>


     The Company is also designing and developing Ten Stix pull tabs, which will
generally follow the same format as the Ten Stix card game.

     Other Products

     The principals of the Company have recently assigned certain rights in
gaming products to the Company. As of the date of this Annual Report, the
Company has the rights to distribute and market certain gaming products, all of
which are listed and discussed below. See "Part I. Item 1. Description of
Business - Customers and Marketing" and "Part III. Item 12. Certain
Relationships and Related Transactions".

     Bonus 6

     The Company currently has the distributorship rights to market a card game
called "Bonus 6". Bonus 6 is a Class III game and is a five-card stud game.
Bonus 6 requires that the players pay a fee, which gives the player a second
chance to win. If the player does not have a winning hand that starts at a pair
of 6s or better, the player may then buy a sixth card to possibly turn a losing
hand into a winning hand.

     Prior to the Company's incorporation, Mr. Thomas Sawyer together with other
individuals created and designed a card game called "Bonus 6". On approximately
October 13, 1997, the Board of Directors of the Company held a special meeting
in which it was decided that the Company was not interested in acquiring or
marketing Bonus 6. Therefore, Mr. Sawyer in his individual capacity entered into
a distribution agreement (the "Distribution Agreement") with Tom Perkins, the
owner of Bonus 6 ("Perkins"), for the distribution rights of Bonus 6. Pursuant
to the terms of the Distribution Agreement, Mr. Sawyer was responsible for all
marketing costs and received 35% of gross revenues generated from the sale of
Bonus 6 to casinos. Mr. Sawyer individually proceeded to market and distribute
Bonus 6 to casinos located within Colorado. During fiscal years 1999 and 2000,
the income generated by Mr. Sawyer from the marketing and sale of the Bonus 6
game to casinos in Colorado were approximately $21,900, respectively.

     Therefore, the Company and Mr. Sawyer entered into an assignment agreement
dated December 28, 2000 (the "Sawyer Assignment Agreement") in which (i) Mr.
Sawyer agreed to gift and grant to the Company his distribution rights under the
Distribution Agreement to market and distribute Bonus 6 within the United
States, excluding the State of Colorado, and (ii) the Company agreed to assume
Mr. Sawyer's obligations under the Distribution Agreement as such obligations
pertain to the marketing and distribution of Bonus 6 within the United States,
excluding the State of Colorado. Pursuant to retention of the distribution
rights by Mr. Sawyer in the state of Colorado, Mr. Sawyer received approximately
$4,480 resulting from commissions during fiscal year ended December 31, 2002.
See "Part III. Item 10. Executive Compensation" and "Item 12. Certain
Relationships and Related Transactions."

     Bonus 6 Option Contract. On July 3, 2002, the Company and Perkins entered
into an option agreement (the "Bonus 6 Option"), pursuant to which Perkins
granted to the Company an option from July 5, 2002 through August 30, 2002 to
acquire the ownership rights to Bonus 6 table games which exist or may exist in
the future for the states of Colorado, South Dakota, California and Arizona.
Pursuant to the terms of the Bonus 6 Option, the Company (i) issued to Perkins
10,000 shares of its restricted Common Stock upon execution of the Bonus 6
Option; (ii) issued to Perkins an additional 65,000 shares of its restricted
Common Stock upon exercise of its option during August 2002; and (iii) will pay
to Perkins an aggregate of $100,000 (with $20,000 due upon exercise of the
option).

<PAGE>


     During August 2002, the Company exercised its option. As of the date of
this Annual Report, the Company has paid to Perkins an aggregate of $40,000. In
accordance with the terms of the Bonus 6 Option, management anticipates that the
Company will pay to Perkins an additional $60,000 due on April 30, 2003. In the
event the Company fails to make such payment, the terms of the Bonus 6 Option
provide that Perkins may retain all monies paid to him and may retain all of his
right, title and interest in and to Bonus 6. See "Part II. Item 6. Management's
Discussion and Analysis or Plan of Operation - Plan of Operation."

     As of the date of this Annual Report, the Company has generated revenues
from its distribution rights in connection with the marketing of Bonus 6 to
casinos located in South Dakota. Management anticipates that the Company will
generate further revenues by approximately fourth quarter 2003 from the
distribution and marketing of Bonus 6 in additional states based on certain
material factors: (i) determination by management of those states in which to
market Bonus 6, of which the Company has received approval for play from
Colorado, California, Nevada, New Mexico and Mississippi, (ii) complete
installation of Bonus 6 in casinos, (iii) introduction of Bonus 6 at trade
shows, and (iv) successful results from testing and private showings, which
included a test at the Stardust Casino in Las Vegas, Nevada, and a previous
private showing at Station Casinos. As of the date of this Annual Report, lease
agreements with casinos located in South Dakota have been executed. Approval
from South Dakota has taken approximately two years and was received in June
2001. See "Part I. Item 1. Description of Business - Customers and Marketing."

     Bonus 6 Video Option. On July 3, 2002, the Company and Perkins entered into
an option agreement (the "Bonus 6 Video Option"), pursuant to which Perkins
granted the Company an option from July 30, 2002 through January 30, 2003 to
acquire the ownership rights to Bonus 6 Stud Poker video games and to any and
all video applications related thereto for the United States. Pursuant to the
terms of the Bonus 6 Video Option, the Company: (i) issued to Perkins 20,000
shares of restricted Common Stock upon execution of the Bonus 6 Video Option;
(ii) will pay to Perkins an aggregate of $150,000, either in one lump sum or in
six equal consecutive monthly payments in the event the Company exercises its
option; (iii) will issue to Perkins an additional 200,000 shares of its
restricted Common Stock in the event the Company exercises its option; and (iv)
will pay to Perkins a 3.0% royalty interest on sales revenue generated from
Bonus 6 Stud Poker video games.

     As of the date of this Annual Report, the Company did not exercise its
option rights under the Bonus 6 Video Option, and such option expired January
30, 2003 in accordance with the terms and provisions of the Bonus 6 Video
Option.

     Bet the Set 21

     The Company entered into a letter of intent with Magnum Gaming Inc.
("Magnum") dated July 29, 2003 (the "Letter of Intent"). Pursuant to the terms
of the Letter of Intent, the Company was granted an option until November 30,
2002 to purchase the rights, title and interest to the casino card game known as
"Bet the Set 21", including all copyrights, trademarks, leases and associated
equipment. In accordance with the terms of the Letter of Intent, the Company:
(i) issued 10,000 shares of its restricted Common Stock to the owners of Magnum;
(ii) will issue an additional 150,000 shares of its restricted Common Stock and
pay $400,000 to Magnum in the event the option is exercised by the Company. As
of the date of this Annual Report, the Company has not exercised its option
under the Letter of Intent. The Company and Magnum, however, have verbally
agreed to extend such option.

<PAGE>


          Push Your Luck

     The Company has the distributorship rights to market a card game called
"Push Your Luck". Push Your Luck is a Class III game in which the player is
provided with optional betting on pushes.

     On approximately November 13, 2000, the Company and Long Games, Inc. ("Long
Games") entered into an agreement in which Long Games agreed to grant to the
Company non-exclusive distributorship and representation rights to its patented
card game known as "Push Your Luck". The provisions further provide that Long
Games will pay to the Company at least 40% of all leased revenues derived from
the "Push Your Luck" game distributed and sold by the Company.

     As of the date of this Annual Report, the Company has not derived any
revenues from the distribution and sale of the Push Your Luck card games. Since
Push Your Luck has received approval for play from several states, management
anticipates that by approximately fourth quarter 2003, the Company will commence
generation of revenues from such sales if there is sufficient capital available
to fund marketing and operational expenses. See "Part I. Item 1. Description of
Business - Customers and Marketing."

          Catalina Dice

     The Company also has the distributorship rights to market a patented table
game called "Catalina Dice". Catalina Dice is a Class III game which is a
version of craps.

     On approximately November 13, 2000, the Company entered into an agreement
with John P. Bonito, the owner of Catalina Dice (the "Catalina Dice Agreement")
in which the Company was granted non-exclusive distributorship and
representation rights to Catalina Dice. The provisions of the Catalina Dice
Agreement further provide that Catalina Dice will pay to the Company (i) an
amount equal to 40% of all revenues generated from the lease of Catalina Dice in
which the Company sold, trained and installed Catalina Dice; and (ii) an amount
equal to 25% of all revenues generated from the lease of Catalina Dice which
were derived from contracts made by the Company.

     As of the date of this Annual Report, the Company has not derived any
revenues from the distribution and lease of Catalina Dice. Since Catalina Dice
has received approval for play from Nevada, Iowa and New Mexico, management
anticipates that by approximately fourth quarter 2003, the Company will commence
generation of such revenues if there is sufficient capital to fund marketing and
operational expenses. See "Part I. Item 1. Description of Business - Customers
and Marketing."

          Pro Shuffle

     On approximately May 1, 2001, the Company and Summit International Group,
Inc., a Colorado corporation ("Summit") entered into an asset purchase agreement
(the "Asset Purchase Agreement"). Under the terms of the Asset Purchase
Agreement, the Company acquired from Summit (i) all of Summit's right, title and
interest to U.S. Patent No. 5,718,427 regarding a card shuffling device marketed
by Summit under the name "Pro Shuffle"; (ii) all Pro Shuffle devices, parts,
inventory and equipment related to the manufacturing and assembly of the Pro
Shuffle; (iii) all contracts related to the Pro Shuffle; (iv) all accounts

<PAGE>


receivable arising out of the sale or lease of the Pro Shuffle; (v) two
promissory notes made by Mr. Tony Cranford, one payable to Summit in the
approximate amount of $2,500.00 and one payable to Phil Lacerte in the
approximate amount of $6,000.00; (vi) two Blackjack tables located in Las Vegas,
Nevada; and (vii) all other business assets located in Colorado (of which no
material assets were actually acquired).

     Under the terms of the Asset Purchase Agreement, the Company assumed (i) on
the part of Summit a liability to Xpectra of up to an aggregate amount of
$110,000.00 related to approximately forty-two updated Pro Shuffle devices and
parts; and (ii) two liabilities owed by Summit to Jerry Delferro and Dick
Stewart in the approximate amount of $3,000.00, respectively. Management of the
Company negotiated a settlement of the liability due and owing to Xpectra.
During fiscal year 2002, the Company has paid $15,000.00 as settlement of the
aggregate liability due to Xpectra and $6,000.00 to Messrs. Delferro and
Stewart.

     Pursuant to further terms of the Asset Purchase Agreement, the Company
agreed to (i) pay the amount of $300,000.00 to Summit as evidenced by the
execution of two promissory notes, one payable to Summit in the amount of
$220,000.00 and the other payable to Michael Humecki in the amount of
$80,000.00; and (ii) surrender to Summit all of the shares of common stock of
Summit held of record by Mr. Sawyer and Mr. Cranford, respectively (an
approximate 10% equity interest each.) During fiscal year 2002 and as of the
date of this Annual Report, the Company has paid $80,000.00 to Mr. Humecki and
the promissory note is deemed paid in full. During March 2003, the Company paid
to Summit the amount of $28,177.40. See "Part II. Item 6. Management's
Discussion and Analysis or Plan of Operation - Material Commitments".

     In order to facilitate consummation of the Asset Purchase Agreement, an
agreement was entered into dated May 1, 2001 among the Company, Thomas Sawyer,
Tony Cranford, Michael Humecki, P. Chad Lacerte, Roger Adams, and Summit (the
"Agreement"). The purpose of the Agreement was to resolve any and all claims,
counterclaims and defenses that Messrs. Humecki, Lacerte and Adams may have
against Summit pursuant to ongoing litigation. According to the terms of the
Agreement, the parties agreed that (i) the Company would acquire from Mr.
Humecki his 10.04% equity interest in Summit (which was returned to Summit);
(ii) the Company would pay Mr. Humecki $100,000, with $20,000 paid by Summit
upon execution of the Agreement and $80,000 evidenced by a promissory note (as
discussed above); (iii) the Company would sign a security agreement for the
benefit of Mr. Humecki as security for the payments under the promissory note;
and (iv) Messrs. Humecki, Lacerte, Adams and Summit would waive and release all
claims, counterclaims, causes of action and demands, known or unknown, that they
have or may claim to have against each other.).

     As of the date of this Annual Report, the leasing of the Pro Shuffle
generates approximately $4,050 in monthly revenue.

CUSTOMERS AND MARKETING

     Customers

     The Company anticipates marketing its gaming products to casinos located
within the States of California, Colorado, Kansas, New Mexico, Nevada, South
Dakota, Mississippi, Arizona and Wisconsin. As of the date of this Annual
Report, contract proposals with approximately six casinos are pending. Customers
for the Company's gaming products are primarily casinos. The Company's current

<PAGE>


market concentration has been in the State of Colorado due to existing
relationships with certain clients. Management's primary objective is to
continue to successfully penetrate the Colorado market, and by approximately
June 2003 further its penetration in the marketplaces of the States of New
Mexico, Nevada, South Dakota, Mississippi and Wisconsin and strengthen its
marketing campaign in the states of Arizona and California.

     During fiscal year ended December 31, 2002, the Company generated $123,274
in total revenues. During fiscal year ended December 31, 2001, the Company
generated $46,470 in total revenues.

     Marketing of Gaming Products

     There are two types of gaming products that the Company has designed and
will distribute and market. One type of gaming product is the "table game with
electronics", which includes Ten to Win and Shotgun 21. Management believes that
the table game using an electronic system, such as Ten to Win and Shotgun 21,
will generally be leased by casinos on a monthly basis at the rate of
approximately $600.00 and $800.00, respectively. However, in the alternative,
Ten to Win and Shotgun 21 can be purchased by a casino at the approximate price
of $5,000.00, plus royalty fee, and $10,000.00, plus royalty fee, respectively.

     The other type of gaming product is a "layout game", which includes all of
the other gaming products. The layout game is a table game utilizing a
tablecover or layout with no electronic system. Management believes that the
layout games will typically be leased on a monthly basis at approximately
$400.00 per month.

     In general, the marketing of Ten to Win and the Company's other gaming
products will involve implementation of either a sales agreement or a leasing
arrangement with a third party.

     The Company's gaming products may be subject to approval by state
regulatory agencies prior to distribution and marketing the games. State
regulations vary regarding which gaming products may be played in that
respective state. In general, the Company is required to apply to the respective
state regulatory agency for verification that the game is legal under the
state's laws and for approval to distribute and market such game. Management
believes that in general such approvals are rarely denied by the respective
state regulatory agencies, unless the particular game is not legal in that
state. See "Part I. Item 1. Description of Business - State Gaming
Regulation/Federal Legislation" The table below identifies and lists each of the
Company's gaming products, the applicability of state regulatory requirements in
each state where the Company is or will be distributing and marketing the
respective game, and the current status of the regulatory process.

<TABLE>
<CAPTION>


-------------------------------------------------------------------------------------
                                                 States and Status of
Gaming Product                              Regulatory Approval
-------------------------------------------------------------------------------------

                              CA       CO       KN       NM      NV       SD       WI

<S>                           <C>               <C>     <C>      <C>    <C>     <C>
Ten to Win                    (1)               (3)     (1)      (5)     PA      PA(4)
--------------------------------------------------------------------------------------

ShotGun 21                    (1)          PA(5)(3)     (1)      (5)     (3)      Not
                                                                                 Legal
--------------------------------------------------------------------------------------

Bet the House                 (1)     PA       PA       (1)      (2)      PA      Not
                                                                                 Legal
--------------------------------------------------------------------------------------

Bonus 6                       (1)     A        A        (1)      (2)      A       Not
                                                                                 Legal
--------------------------------------------------------------------------------------

Push Your Luck                (1)     PA        (3)     (1)      (2)     (3)      Not
                                                                                 Legal
--------------------------------------------------------------------------------------

Hold'em 88                    (1)      A        (3)     (1)      (3)      A       Not
                                                                                 Legal
--------------------------------------------------------------------------------------

Catalina Dice                 Not      Not      (3)     (1)      (2)     Not      Not
                             Legal    Legal                             Legal    Legal
--------------------------------------------------------------------------------------

Pro Shuffle                   (6)     (6)       (6)     (6)      (6)      (6)     (6)
--------------------------------------------------------------------------------------
</TABLE>

PA - Pending Approval
A  - Approved

(1) As of the date of this Annual Report, neither the State of California nor
New Mexico has any rules or regulations regarding licensing of the Company's
gaming products. Therefore, all of the Company's gaming products, with the
exception of Catalina Dice, can be played in the State of California and New
Mexico without state regulatory approval. Dice and roulette games, such as
Catalina Dice, are not legal in California.

(2) As of the date of this Annual Report, the State of Nevada has rules and
regulations which provide that the gaming products of the Company may be
distributed and marketed without prior licensing but with state approval. Bet
the House, Bonus 6, Push Your Luck and Catalina Dice have all been approved by
the State of Nevada.

(3) As of the date of this Annual Report, management of the Company has not
pursued applications for approval and/or licensing.

(4) In the State of Wisconsin, management believes that state regulatory
approval may not be obtainable until the laws governing blackjack gaming in
Wisconsin are changed.

(5) In the State of Colorado, management believes that state regulatory approval
will be obtained by approximately fourth quarter 2003.

(6) Approved and generating revenues.

<PAGE>


     Marketing Strategy

     The Company intends to seek to capture market niches in the gaming industry
within the States of California, Colorado, Kansas, Mississippi, Nevada, New
Mexico, South Dakota and Wisconsin. Although the Company's principal office is
located within the State of Colorado, management believes that the market in
Colorado is limited for the Company's gaming products. Therefore, management
intends to move into the marketplaces of primary states such as Arizona,
Mississippi, New Mexico, Nevada, California, Kansas and Wisconsin. By fiscal
year ended 2003, management intends to commence marketing its gaming products
internationally, including countries such as Africa, Canada, South America,
Caribbean Islands and Southeast Asia, which have legalized gaming.

     As of the date of this Annual Report, the Company is currently focusing on
marketing its gaming products within the States of Arizona, Colorado, New
Mexico, Nevada, South Dakota, Mississippi, California, Kansas and Wisconsin by
(i) implementation of sales trips and contacts by independent commissioned
representatives, (ii) use of direct mail, trade publications and press releases
for advertising of the gaming products, and (iii) attendance and display of the
gaming products at well-known gaming trade shows and/or conferences. The Company
intends to market its gaming products through the use of direct sales and
independent commissioned representatives. To aid in the marketing of its gaming
products, the Company intends to utilize several marketing approaches including
advertising in trade publications, submitting press releases, and continuing its
participation in trade shows. The Company's services and gaming products are
also electronically advertised on the Company's web page at www.TenStix.com.

     The Company will continue to emphasize use of press releases and
independent commissioned representatives in its marketing efforts. Management
currently anticipates that participation in trade shows, particularly the World
Gaming Show, will be a significant source for marketing the Company's products.
There are approximately six annual major trade shows that the Company
participates in. This includes the largest show, the World Gaming Show, that is
held annually in Las Vegas, Nevada during September/October. During the 2002
World Gaming Show, management believes that over 20,000 key gaming executives,
casino managers and supervisors attended. The Company obtained approximately 80
leads and introductions for its various products from U.S. and international
casinos. Management is currently negotiating with several of these contacts.
Management intends to direct a significant portion of its marketing efforts
toward market penetration in the States of Nevada, New Mexico and California,
with continued emphasis on the State of Colorado.

EMPLOYEES AND CONSULTANTS

     As of the date of this Annual Report, the Company's President and
Vice-President, Messrs. Sawyer and Cranford, are employed by the Company on a
full-time basis. They are primarily responsible for all day-to-day operations of
the Company. The Company does not employ any other persons on either a full-time
or a part-time basis. Other services, including sales representatives, will be
generally provided by outsourcing and contractual arrangements. As the need
arises and funds become available, management may seek to hire employees as
necessary in the best interests of the Company.

STATE GAMING REGULATION/FEDERAL LEGISLATION

     State Gaming Regulation

     The Colorado Gaming Commission and similar commissions in other states have
adopted general rules and regulations governing the operation of gaming
establishments and/or governing stock ownership of and reporting by public
companies engaged in gaming activities. The Colorado Gaming Commission's rules
and regulations are extensive and any violations thereof could subject the

<PAGE>


Company's proposed operations to materially adverse consequences. The Company
and its key personnel are required to hold various gaming licenses; their
failure to obtain or retain a license could have a material adverse effect on
the Company. Generally, the Colorado Gaming Commission has broad discretion in
granting, renewing and revoking licenses. Gaming licenses and related approvals
are deemed to be privileges under Colorado law, and no assurance can be given
that any new license, permits or approvals that may be required in the future
will be given or that existing ones will be renewed or will not be revoked.
Regulatory changes or increases in applicable taxes or fees in Colorado could
have a material adverse effect on the Company.

     The Company's gaming products may also be subject to approval by other
state governmental authorities prior to distributing and marketing the games.
State regulations vary regarding which gaming products may be played in that
respective state and the betting limitations. As of the date of this Annual
Report, neither the State of New Mexico nor California have any rules or
regulations applicable to the licensing of the Company's gaming products prior
to distribution and marketing. Casinos in New Mexico or California are located
on Native American reservations and therefore operate under state compacts. In
the states which have adopted such rules or regulations, in general, the Company
is required to apply to the respective state regulatory agency for verification
that the game is legal under the state's laws and for approval to distribute and
market such game. In connection with obtaining such a license, management
believes that most state regulatory agencies require a background check on and
approval of any shareholder owning over a five percent (5%) equity ownership
interest before a license will be granted. See "Part I. Item 1. Description of
Business - Customers and Marketing."

     Federal Legislation

     As of the date of this Annual Report, the Company is not subject to
existing federal governmental regulation, such as the Gambling Devices Act of
1962 and the Gambling Devices Transportation Act, which regulates the
transportation of gaming devices within the United States. Any such legislation,
if applicable, could have a material adverse effect on the Company's business or
results of operations. Moreover, during 1996, President Clinton signed a bill
creating the National Gambling Impact and Policy Commission, which conducted a
comprehensive study of all matters relating to the economic and social impact of
gaming in the United States. The legislation provided that the commission issue
a report to the President and Congress containing its findings and conclusions.
Any such commissions created under future federal legislation, which recommend
legislation and administrative actions regarding the gaming industry, if enacted
into law, could adversely impact the gaming industry and have a material adverse
effect on the Company's business or results of operations. Moreover, from time
to time, certain federal legislators have proposed a federal tax on gaming
revenues. Any such tax, if imposed, could also have a material adverse effect on
the Company's business or results of operations.

PATENTS, COPYRIGHTS AND TRADEMARKS

     The Company's gaming products have or may have varying degrees of
protection from issuance of patents, copyrights and trademarks. Management
believes that certain of the Company's gaming products either have electronic
systems that may be patented or a layout that may be copyrighted.

<PAGE>


     Patent Application

     The Company filed a patent application with the United States Patent and
Trademark Office for patent protection of its "lighting" invention and
electronic system and method for operating an incentive auxiliary game (the
"Patent Application"). On March 24, 2003, the Company received a "Notice of
Allowance and Fees Due" from the U.S. Patent and Trademark Office, which stated
that the patent application is allowed for issuance as a patent subject to
payment by the Company of the issue fee in the amount of $650.00 within three
months from March 24, 2003. As of the date of this Annual Report, the Company
has not paid such issuance fee, but management intends to make such payment
within the time allowed.

     Other Applications

     The Company has sought protection of its various products through
application for trademark and copyright registration. In general, a "trademark"
is a distinctive word, phrase, logo, graphic symbol or other device that is used
to identify the source of a product and to distinguish a product from anyone
else's. As a general rule, trademark law confers legal protection to names,
logos and other marketing devices that are distinctive. The Company sought
trademark protection of "Ten Stix 21" in order to identify its product in the
marketplace to prevent consumer confusion and to protect the means it chose to
identify its product against use by competitors.

     In general, a copyright gives the owner of a creative work the right to
keep others from using the work without the owner's permission. In general, a
creative work must meet three criteria to be protected by copyright: (i) it must
be original; (ii) it must be fixed in a tangible medium of expression; and (iii)
it must have at least some creativity, i.e. produced by an exercise of human
intellect. The Company sought copyright protection of the table game design of
"Ten Stix 21".

     Ten Stix 21. The U. S. Patent and Trademark Office has issued to the
Company a Certificate of Registration, No. 2,092,620, dated September 2, 1997
for the trademark "Ten Stix 21", which registration will remain in full force
and effect for a period of ten years. Management of the Company must comply with
certain rules and regulations pertaining to the issuance of such registration of
the trademark. Such registration will be canceled after six years by the
Commissioner of Patents and Trademarks unless, before the end of the sixth year
following the date of September 2, 1997, management files an affidavit of
continued use. Moreover, such registration will expire ten years following the
date of September 2, 1997 unless management files an application for renewal of
the registration. Management intends to file such documents, however, there is
no assurance that the U.S. Patent and Trademark Office will grant such renewal
of registration.

<PAGE>


     The United States Copyright Office issued to the Company a Certificate of
Registration dated January 29, 1996, which registration will remain in full
force and effect for a period of twenty-one years. Such registration applies to
the table game design of "Ten Stix 21".

     Management of the Company believes that the copyright and trademark
protection for "Ten Stix 21" provides adequate protection for the game "Ten Stix
21". Even though such copyright and trademark for "Ten Stix 21" has been issued
to the Company, there is no assurance that such copyright and trademark will not
be attacked by third parties or that, if any such attack were made, it would not
be successful. The costs in defending such copyright or trademark or prosecuting
a copyright or trademark infringement action could be substantial.

     Pro Shuffle. Pursuant to the Asset Purchase Agreement, the Company acquired
from Summit all of its right, title and interest to U.S. Patent No. 5,718,427,
which is a patent issued on February 17, 1998 by the U. S. Patent and Trademark
Office covering a card shuffling device marketed by Summit under the name "Pro
Shuffle". The Pro Shuffle patent has been issued for a term of twenty (20) years
from the date of filing and expires on September 20, 2016 and may not be
renewed. Maintenance fees must be paid by the Company to maintain the patent in
force throughout its life and are payable three times as follows: (i) February
2001 through February 2002; (ii) February 2005 through February 2006; and (iii)
February 2009 through February 2010. There is no assurance that the Company will
have sufficient funds to pay the maintenance fees. In the event the Company
fails to timely pay such maintenance fees, the patent may be canceled.

     Even though such patent for the Pro Shuffle has been issued, there is no
assurance that such patent will not be attacked by third parties or that, if any
such attack were made, it would not be successful. The costs in defending such
patent or prosecuting a patent infringement action could be substantial. As of
the date of this Annual Report, the Company does not have the resources to
pursue such an action if necessary.

     Bet the House. Mr. Tony Cranford applied to the U.S. Patent and Trademark
Office for patent protection of Bet the House. As of the date of this Annual
Report, the Company has not received an order granting a patent. The Company,
however, received a provisional patent from the U.S. Patent and Trademark Office
which is valid for a period of one year. As of the date of this Annual Report,
the Company has filed a patent application with the U.S. Patent and Trademark
Office for protection of its "method of play" for Bet the House. Management of
the Company believes that such patent will be granted by approximately fourth
quarter 2003. In the event the Company does not receive a patent relating to the
"method of play" for Bet the House, management does not believe that this would
have a material or adverse effect on the business operations of the Company or
the manufacture or marketability of its gaming products.

     As of the date of this Annual Report, the Company has not obtained patent,
copyright or trademark registrations for its other games. The Company applied to
the U.S. Patent and Trademark Office for registration of "Hold'em 88"; however,
on March 13, 1997, the Company was refused registration for such trademark on
the basis that it was confusingly similar to the existing registered trademark
of "88" for playing cards. At this time, management of the Company does not
intend to appeal this finding.

     Although management believes that its other products may be patentable and
intends to aggressively pursue obtaining such registrations, there can be no
assurance that any such registrations will be issued. In the event such

<PAGE>


registrations were not issued, management believes that this would not adversely
affect the operations of the Company due to the current market identification
and portfolio of the Company's other products. As of the date of this Annual
Report, management has not taken any steps to apply for such protection of its
other products and does not intend to take such steps until approximately June
2003. Therefore, until such time as a patent, copyright or trademark is issued
for the Company's other products, the Company will not have the right to bring a
patent, copyright or trademark infringement action against a third party which
makes a product similar to the Company's.

COMPETITION

     The gaming industry is highly fragmented and characterized by a high degree
of competition among a large number of participants. Ten to Win and other games
of the Company will be competing with well-known, established and popular games
in the gaming industry. Management believes that the five most successful
specialty games in the united States are (i) "Let it Ride" owned by
Shufflemaster, (ii) "Three Card Poker" owned by Shufflemaster, (iii) "Carribean
Stud" owned by Mikohn, (iv) "Spanish 21" owned by Masgue Publishing, and (v)
"War" owned by Bet Technology.

     Although management believes that sufficient demands exist in the gaming
markets to support its operations, no assurance can be made to that effect nor
can the Company ensure the current growth of the gaming industry in Colorado and
other states.

     The Company will compete with other well-known games as well as other forms
of gaming operations nationwide. Many jurisdictions may legalize various forms
of gaming and wagering that may compete with the Company in the future, such as
on-line computer gambling, bingo, pull tab games, card clubs, sports books,
telephonic betting on horse racing and dog racing, state sponsored lotteries,
video lottery terminals and video poker terminals. Ten to Win and other games of
the Company may be integrated into these new forms of gaming and wagering,
however, there is no assurance that the Company will be successful.

ITEM 2. DESCRIPTION OF PROPERTIES

     Except as described above, the Company does not own any real estate or
other properties. The Company's principal office is maintained at 3101 Riverside
Drive, Idaho Springs, Colorado 80542, which consists of an office area, a show
room and work area, and storage space. The Company leases its office space at no
expense from Mr. Tom Sawyer, the President of the Company. Mr. Sawyer holds
title to the real property, which is encumbered by a mortgage. The property
consists of approximately 1,100 square feet. Management believes that the
Company's offices are adequate for its reasonable foreseeable needs. The Company
does not intend to acquire any properties at the current date. In the event the
Company generates sufficient revenues to adequately fund operational expenses in
the future, management intends to enter into a lease arrangement with Mr.
Sawyer, which provides for payment of the rental of such premises on terms
favorable to the Company as may be obtained from an unrelated third party.

ITEM 3. LEGAL PROCEEDINGS

     Management is not aware of any legal proceedings contemplated by any
governmental authority or other party involving the Company or its properties.
No director, officer or affiliate of the Company is (i) a party adverse to the
Company in any legal proceedings, or (ii) has an adverse interest to the Company
in any legal proceedings. Management is not aware of any other legal proceedings
pending or that have been threatened against the Company or its properties.

<PAGE>


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

     No matters were submitted to a vote of the Company's shareholders through
the solicitation of proxies or otherwise during fiscal year ended December 31,
2002.


                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

     As of the date of this Annual Report, the Company's Common Stock trades on
the Over-the-Counter Bulletin Board under the symbol "TNTI". The Company's
Common Stock commenced trading on the OTC approximately second quarter of 2002.
The market for the Company's Common Stock is limited, volatile and sporadic and
the price of the Company's Common Stock could be subject to wide fluctuations in
response to quarterly variations in operating results, news announcements,
trading volume, sales of Common Stock by officers, directors and principal
shareholders of the Company, general market trends, changes in the supply and
demand for the Company's shares, and other factors. The following table sets
forth the high and low sales prices relating to the Company's Common Stock for
the last fiscal year since commencement of trading. These quotations reflect
inter-dealer prices without retail mark-up, mark-down, or commissions, and may
not reflect actual transactions.

                                         FISCAL YEAR ENDED
                          --------------------------------------------------
                                         DECEMBER 31, 2002
                          --------------------------------------------------
                                    HIGH BID           LOW BID
                          --------------------------------------------------

First Quarter                         n/a                n/a
Second Quarter                      $3.11              $0.25
Third Quarter                       $1.80              $0.51
Fourth Quarter                      $1.90              $0.73

HOLDERS

     As of the date of this Annual Report, the 19,083,228 shares of Common Stock
outstanding were held by approximately 292 holders of record worldwide,
including approximately 93 holders of record in the United States.

DIVIDENDS

     The Board of Directors has never authorized or declared the payment of any
dividends on the Company's Common Stock nor on the Preferred Stock, and does not
anticipate the declaration or payment of cash dividends in the foreseeable
future. The Company intends to retain future earnings, if any, to finance
operational expenses. Future dividend policies will be subject to the discretion
of the Board of Directors and will be contingent upon, among other things,

<PAGE>


future earnings, the Company's financial condition, capital requirements,
general business conditions, level of debt, and other relevant factors. The
Company's losses do not currently indicate the ability to pay any cash
dividends, and the Company does not indicate the intention of paying cash
dividends in the foreseeable future.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

     Pursuant to the terms of the Letter of Intent, the Company will issue to
Magnum 150,000 shares of its restricted Common Stock in the event the option is
exercised by the Company to acquire the rights, title and interest to Bet the
Set 21.

     During August 2002, the Company issued to an investor 2,000 units at $1.00
per unit (the "Unit(s)"). Each Unit consists of one share of restricted Common
Stock of the Company and one non-transferable share purchase warrant of the
Company. Each warrant is convertible into one additional share of restricted
Common Stock at an exercise price of $2.00 per warrant commencing upon the date
of issuance of the Units for a two-year period.

     During fiscal year 2002, certain shareholders of the Company advanced an
aggregate of $66,000 to the Company. The terms of the debt provide that the
amounts are payable upon demand, are non-interest bearing, and may be converted
into an undetermined number of shares of the Company's restricted Common Stock
at any time by the holder thereof.

<TABLE>
<CAPTION>


                                         Equity Compensation Plan Information
-----------------------------------------------------------------------------------------------------------
                         Number of Securities      Weighted-Average Exercise        Number of Securities
                          To be Issued Upon          Price of Outstanding           Remaining Available for
Plan Category          Exercise of Outstanding        Options, Warrants              Future Issuance Under
                          Options, Warrants               and Rights               Equity Compensation Plans
                             and Rights                                              (excluding column (a))
                                (a)                          (b)                                (c)
------------------------------------------------------------------------------------------------------------
<S>                             <C>                         <C>                             <C>
Equity Compensation              n/a                         n/a                                n/a
Plans Approved by
Security Holders

Equity Compensation           150,000 shares                $0.00                               n/a
Plans Not Approved by
Security Holders -
Letter of Intent

Equity Compensation             2,000 shares                $2.00                               n/a
Plans Not Approved by
Security Holders -
Units

Equity Compensation             undetermined               undetermined                          n/a
Plans Not Approved by
Security Holders -
Notes

Total                         152,000 shares
------------------------------------------------------------------------------------------------------------
</TABLE>

RECENT SALES OF UNREGISTERED SECURITIES AND CHANGES IN CONTROL OF THE COMPANY

     During fiscal year 2002, to provide capital, the Company has sold stock in
private placement offerings, issued stock in exchange for debts of the Company

<PAGE>


or pursuant to contractual agreements including, but not limited to, the
following. See "Part III. Item 11. Security Ownership of Certain Beneficial
Owners and Management and Related Stockholder Matters."

     (a)  The Company had incurred a debt in the aggregate amount of $8,000.00
          to Leif A. Nelson ("Nelson") for prior services rendered by Nelson on
          behalf of the Company for legal fees. Therefore, the Company and
          Nelson entered into a settlement agreement dated July 11, 2002 (the
          "Settlement Agreement"). Pursuant to the terms of the Settlement
          Agreement: (i) the Company agreed to settle the $8,000.00 debt due and
          owing Nelson by the issuance of 32,000 shares of its restricted Common
          Stock at the rate of $0.25 per share; and (ii) Nelson agreed to accept
          the issuance of the 32,000 shares of restricted Common Stock as
          settlement and full satisfaction of the aggregate debt due and owing
          him as of the date of the Settlement Agreement. The Company issued the
          shares in reliance upon the exemption from registration provided by
          Section 4(2) and Rule 506 of Regulation D under the Securities Act of
          1933, as amended (the "Securities Act"). The creditor executed a
          subscription agreement and acknowledged that the securities to be
          issued have not been registered under the 1933 Securities Act, that he
          understood the economic risk of an investment in the securities, and
          that he had the opportunity to ask questions of and receive answers
          from the Company's management concerning any and all matters related
          to the acquisition of securities.

     (b)  On July 3, 2002, the Company and Thomas Perkins ("Perkins") entered
          into the Bonus 6 Option pursuant to which Perkins granted to the
          Company an option from July 5, 2002 through August 30, 2002 to acquire
          the ownership rights from Perkins to Bonus 6 table games which exist
          or may exist in the future for the state of Colorado, South Dakota,
          California and Arizona. Pursuant to the terms of the Bonus 6 Option,
          the Company issued to Perkins an aggregate of 75,000 shares of its
          restricted Common Stock. The Company issued the shares in reliance
          upon the exemption from registration provided by Section 4(2) and Rule
          506 of Regulation D under the Securities Act.

     (c)  On July 3, 2002, the Company and Perkins entered into the Bonus 6
          Video Option pursuant to which Perkins granted to the Company an
          option from July 30, 2002 through January 30, 2003 to acquire the
          ownership rights from Perkins to Bonus Stud Poker video games and to
          any and all video applications related thereto for the United States.
          Pursuant to the terms of the Bonus 6 Video Option, the Company issued
          to Perkins an aggregate of 20,000 shares of its restricted Common
          Stock. The Company issued the shares in reliance upon the exemption
          from registration provided by Section 4(2) and Rule 506 of Regulation
          D under the Securities Act.

     (d)  As of the date of this Annual Report, the Company is engaged in a
          offering pursuant to which it intends to raise an aggregate of
          $1,000,000. In accordance with the terms and provisions of the Private
          Placement Memorandum, the Company is offering and selling 4,000 shares
          of Series A Convertible Preferred Stock at $250.00 per share. Each
          share of Series A Convertible Preferred Stock is convertible into five
          hundred shares of restricted Common Stock at any time after December
          31, 2001. As of the date of this Annual Report, there are 96 shares of
          Series A Convertible Preferred stock issued and outstanding. As of the
          date of this Annual Report, in the event the Company's Series A

<PAGE>


          Convertible Preferred shareholders elect to convert the outstanding
          shares of Series A Convertible Preferred stock, an additional 48,000
          shares of restricted Common Stock would be issued. As of the date of
          this Annual Report, the Company has sold 96 shares of Series A
          Convertible Preferred Stock to nineteen investors. Of the nineteen
          investors, one was an accredited investor as that term is defined
          under Regulation D. The Company has received $24,000 in gross
          proceeds. The Company issued the shares in reliance upon the exemption
          from registration provided by Section 4(2) and Regulation D, Rule 506,
          of the 1933 Securities Act. The investors executed subscription
          agreements and acknowledged that the securities to be issued have not
          been registered under the 1933 Securities Act, that they understood
          the economic risk of an investment in the securities, and that they
          had the opportunity to ask questions of and receive answers from the
          Company's management concerning any and all matters related to the
          acquisition of securities. No underwriter was involved in the
          transaction, and no commissions or other remuneration were paid in
          connection with the offer and sale of the securities.

     (e)  On July 11, 2002, the Company issued 80,000 shares of its restricted
          Common Stock, respectively, to Damascus Group LLC ("Damascus") at
          $0.25 per share. Pursuant to the terms of a sale and purchase
          agreement, the Company received an aggregate of $40,000.00 from
          Damascus as payment for acquisition of the securities. The Company
          issued the shares in reliance upon the exemption from registration
          provided by Section 4(2) and Rule 506 of Regulation D under the
          Securities Act. The investor acknowledged that the securities to be
          issued have not been registered under the 1933 Securities Act, that it
          understood the economic risk of an investment in the securities, and
          that it had the opportunity to ask questions of and receive answers
          from the Company's management concerning any and all matters related
          to the acquisition of securities.

     (f)  On August 27, 2002, the Company issued 2,000 units at $1.00 per unit
          (the "Unit") to one investor. Each Unit consists of one share of
          restricted Common Stock of the Company and one non-transferable share
          purchase warrant of the Company. Each warrant is convertible into one
          additional share of restricted Common Stock at an exercise price of
          $2.00 per warrant commencing upon the date of issuance of the Unit for
          a two-year period. The Company received $2,000.00 in gross proceeds.
          The Company issued the Units to one investor, who was not an
          accredited investor, in reliance upon the exemption from registration
          provided by Rule 506 of Regulation D under the Securities Act. The
          investor executed a subscription agreement and acknowledged that the
          securities to be issued have not been registered under the 1933
          Securities Act, that he understood the economic risk of an investment
          in the securities, and that he had the opportunity to ask questions of
          and receive answers from the Company's management concerning any and
          all matters related to the acquisition of securities.

     (g)  As of the date of this Annual Report, the Company is engaged in an
          offering pursuant to which it intends to raise an aggregate of
          $1,000,000.00. In accordance with the terms and provisions of the
          Private Placement Memorandum, the Company is offering and selling
          2,222,222 shares of its restricted Common Stock at $0.45 per share. As
          of the date of this Annual Report, the Company has received $89,100.00

<PAGE>


          in gross proceeds. The Company has issued 198,000 shares of its
          restricted Common Stock to six investors, none of which were
          accredited investors, in reliance upon the exemption provided by Rule
          506 of Regulation D under the Securities Act. The investors executed
          subscription agreements and acknowledged that the securities to be
          issued have not been registered under the 1933 Securities Act, that
          they understood the economic risk of an investment in the securities,
          and that they had the opportunity to ask questions of and receive
          answers from the Company's management concerning any and all matters
          related to the acquisition of securities. No underwriter was involved
          in the transaction, and no commissions or other remuneration were paid
          in connection with the offer and sale of the securities.

     (h)  As of the date of this Annual Report, the Company is engaged in a
          Regulation S offering pursuant to which it has agreed to sell up to
          5,000,000 shares of its restricted Common Stock to non-U.S. residents
          at a purchase price of twenty percent (20%) of the bid price per share
          as quoted on the OTC Bulletin Board on the date of sale execution. As
          of the date of this Annual Report, the Company has received $128,164
          in gross proceeds and has issued approximately 912,540 shares of its
          restricted Common Stock to 20 investors. The Company issued the shares
          in reliance upon the exemption from registration provided by
          Regulation S of the Securities Act. The investors executed
          subscription agreements and acknowledged that the securities to be
          issued have not been registered under the 1933 Securities Act, that
          the investors understood the economic risk of an investment in the
          securities, and that the investors had the opportunity to ask
          questions of and receive answers from the Company's management
          concerning any and all matters related to the acquisition of the
          securities.

     As of the date of this Annual Report, the Company has 19,083,228 shares of
its Common Stock issued and outstanding and 96 shares of its Series A
Convertible Preferred Stock issued and outstanding. Of the 19,083,228 current
outstanding shares of Common Stock, 2,000,000 shares are free trading. At such
time, the holders may offer and sell these shares of Common Stock at such times
and in such amounts as they may respectively determine in their sole discretion.

     Of the 19,083,228 current outstanding shares of Common Stock, 17,083,228
shares are "restricted shares" as that term is defined in the Securities Act and
the rules and regulations thereunder. To be eligible for sale in the public
market, the holders must comply with Rule 144. In general, Rule 144 allows a
person holding restricted shares for a period of at least one year to sell
within any three month period that number of shares which does not exceed the
greater of 1% of the Company's then outstanding shares or the average weekly
trading volume of the shares during the four calendar weeks preceding such sale.
Rule 144 also permits, under certain circumstances, sale of shares by a person
who is not an affiliate of the Company and who has satisfied a two year holding
period without any volume limitations, manner of sale provisions or current
information requirements. As defined in Rule 144, an affiliate of an issuer is a
person who, directly or indirectly, through one or more intermediaries, controls
or is controlled by, or is under common control with, such issuer, and generally
includes members of the Board of Directors. Sales pursuant to Rule 144 or
otherwise, if in sufficient volume, could have a depressive effect on the market
price of the Company's securities. Moreover, the possibility of such sales may
have a depressive effect on market prices.

<PAGE>


TRANSER AGENT

     The transfer agent and registrar for the Company is Global Securities
Transfer, Inc., 191 University Blvd., Suite 410, Denver, Colorado 80206,
telephone number (303) 355-4646.

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

     Statements made in this Form 10-KSB that are not historical or current
facts are "forward-looking statements" made pursuant to the safe harbor
provisions of Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act of 1934. These statements often can be identified by the
use of terms such as "may," "will," "expect," "believe," "anticipate,"
"estimate," "approximate" or "continue," or the negative thereof. The Company
intends that such forward-looking statements be subject to the safe harbors for
such statements. The Company wishes to caution readers not to place undue
reliance on any such forward-looking statements, which speak only as of the date
made. Any forward-looking statements represent management's best judgment as to
what may occur in the future. However, forward-looking statements are subject to
risks, uncertainties and important factors beyond the control of the Company
that could cause actual results and events to differ materially from historical
results of operations and events and those presently anticipated or projected.
These factors include adverse economic conditions, entry of new and stronger
competitors, inadequate capital and unexpected costs. The Company disclaims any
obligation subsequently to revise any forward-looking statements to reflect
events or circumstances after the date of such statement or to reflect the
occurrence of anticipated or unanticipated events.

     This section should be read in conjunction with the Company's Financial
Statements included herein. See "Part II. Item 7. Financial Statements".

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATION

     Fiscal Year Period Ended December 31, 2002 Compared to Fiscal Year Ended
     December 31, 2001

     The Company's net loss for fiscal year ended December 31, 2002 was
approximately ($145,012) compared to a net loss of approximately ($67,796) for
fiscal year ended December 31, 2001 (an increase of $81,018).

     Total revenue for fiscal years ended December 31, 2002 and 2001 were
$123,274 and $46,470, respectively (an increase of $76,804). Total revenue
generated during fiscal year ended December 31, 2002 was comprised of (i)
$99,225 in lease income; and (ii) $24,049 in equipment sales. Total revenue
generated during fiscal year ended December 31, 2001 was comprised of $46,470 in
lease income. The increase in revenue during fiscal year ended December 31, 2002
was primarily due to an increase in the number of gaming products and shufflers
leased to casinos and the sale of shufflers.

     During fiscal year ended December 31, 2002, the Company incurred operating
expenses of $337,682 compared to $100,236 of operating expenses incurred during
fiscal year ended December 31, 2001 (an increase of $237,446). Operating
expenses for fiscal year ended December 31, 2002 primarily consisted of: (i)
$276,770 as selling, general and administrative expenses; (ii) $45,611 as
depreciation expense; (iii) $10,844 as amortization expense; and (iv) $4,457 as
cost of sales. Operating expenses for fiscal year ended December 31, 2001

<PAGE>


primarily consisted of: (i) $67,588 as selling, general and administrative
expenses; (ii) $23,225 as depreciation expense; and (iii) $9,423 as amortization
expense. The Company also incurred $25,604 as interest expense during fiscal
year ended December 31, 2002 as compared to $14,030 as interest expense during
fiscal year ended December 31, 2001. The increase in operating expenses during
fiscal year ended December 31, 2002 compared to fiscal year ended December 31,
2001 was primarily due to an increase in selling, general and administrative
expenses resulting from an operational emphasis on and increased scale and scope
of overall corporate activity pertaining to the marketing and distribution of
the Company's gaming products. General and administrative expenses generally
include corporate overhead, administrative management, consulting costs and
professional fees.

     During fiscal year ended December 31, 2002, such operating expenses were
offset by the realization of $95,000.00 as a gain on the settlement of the
aggregate debt due and owing Xpectra pursuant to the Asset Purchase Agreement.

     As discussed above, although the Company generated revenues in the amount
of $123,274 during fiscal year ended December 31, 2002, the increase in net loss
during such period compared to fiscal year ended December 31, 2001 is
attributable primarily to a substantial increase in selling, general and
administrative expenses. The Company's net loss during fiscal year ended
December 31, 2002 was approximately ($131,790) or ($0.01) per common share
compared to a net loss of approximately ($67,796) or ($nil) per common share
during fiscal year ended December 31, 2001. The weighted average of common
shares outstanding were 17,800,048 for fiscal year ended December 31, 2002
compared to 17,655,920 for fiscal year ended December 31, 2001.

LIQUIDITY AND CAPITAL RESOURCES

     Since inception, the Company has focused primarily on the research,
development and design of the its products, and generated minimal revenues.
During prior fiscal years, the principals of the Company invested personal funds
and arranged for loans and/or lines of credit from private lenders to support
the business operations of the Company.

     As of the date of this Annual Report, management of the Company believes
that an estimated $500,000 is required over the next fiscal year for payment of
expenses associated with the ongoing business operations of the Company. The
Company generated $123,274 in total revenue during fiscal year ended December
31, 2002 and $46,470 in total revenue during fiscal year ended December 31,
2001. Management anticipates that overall generation of revenues will continue
to increase on an annual basis based on existing contracts and marketability of
its gaming products. Management believes that the Company can satisfy its cash
requirements for approximately the next six months based on its ability to
successfully generate revenues from the marketing of its gaming products and to
obtain advances from certain investors and related parties, as necessary.

     The Company has only recently generated sufficient cash flow to partially
fund its operations and activities. The Company may experience a liquidity
crisis and be required to raise additional capital. Historically, the Company
has relied upon internally generated funds and funds from the sale of shares of
stock and loans from its shareholders and private investors to finance its
operations and growth. Management may raise additional capital through future
public or private offerings of its stock or through loans from private
investors, although there can be no assurance that the Company will be able to
obtain such financing. The Company's future success and viability are entirely

<PAGE>


dependent upon the ability of the Company's current management to (i) strengthen
and increase its customer base by enhancing the marketability of its products,
and (ii) increase the number of customers and expand into additional markets.
Management is optimistic that the Company will be successful in its capital
raising efforts. There can be no assurance, however, that the Company will be
able to continue to successfully distribute and market its gaming products and
to raise additional capital. The Company's failure to do so would have a
material and adverse affect upon the Company and its shareholders.

     The Company's financial statements have been prepared assuming that it will
continue as a going concern and, accordingly, do not include adjustments
relating to the recoverability and realization of assets and classifications of
liabilities that might be necessary should the Company be unable to continue in
operations.

     Fiscal Year Ended December 31, 2002

     As of December 31, 2002, the Company's current assets were $10,807 and its
current liabilities were $405,808, which resulted in a working capital deficit
of $395,001.

     As of December 31, 2002, current assets were comprised of: (i) $2,736 in
inventory; (ii) $8,071 in cash. As of December 31, 2002, current liabilities
were comprised of: (i) $270,154 in notes payable; (ii) $71,000 in notes payable
to shareholders; (iii) $30,000 in accounts payable to related party; and (iv)
$34,654 in accounts payable and accrued expenses.

     As of December 31, 2002, the Company's total assets were $517,455 and its
total liabilities were $405,808.

     As of December 31, 2002, the Company's total assets exceeded its total
liabilities by $111,647. As of December 31, 2002, the Company's total assets
consisted primarily of (i) $10,807 as current assets; (ii) $178,026 in net cost
equipment; (iii) $8,500 in loan receivable from shareholder; (iv) $86,536 in net
intangible assets (consisting of costs associated with the acq1uisition of
patents, copyrights and licenses which are amortized over lives ranging from 5
to 11 years); and (v) $162,100 in valuation of game rights relating to the Bonus
6 Option Contract. As of December 31, 2002, the Company's total liabilities
consisted of $405,808 as current liabilities.

     The Company's stockholders' equity increased from a deficit of ($18,841)
for fiscal year ended December 31, 2001 to $111,647 for fiscal year ended
December 31, 2002.

     For fiscal year ended December 31, 2002, net cash flow used by operating
activities was ($112,756) compared to net cash flow used by operating activities
of ($4,916) for fiscal year ended December 31, 2001. The increase in net cash
used by operating activities during fiscal year ended December 31, 2002 compared
to December 31, 2001 resulted primarily from: (i) a net loss of ($145,012)
incurred during fiscal year ended December 31, 2002 compared to a net loss of
($67,796) incurred during fiscal year ended December 31, 2001; (ii) an increase
in accounts payable and accrued expenses to ($103,165) during fiscal year ended
December 31, 2002 from $15,232 during fiscal year ended December 31, 2001; and
(iii) an increase in depreciation and amortization to $56,455 during fiscal year
ended December 31, 2002 from $32,648 during fiscal year ended December 31, 2001.

<PAGE>


     During fiscal year ended December 31, 2002, net cash flows provided by
investing activities was $2,957 compared to ($8,500) of net cash flows used by
investing activities during fiscal year ended December 31, 2001, which relates
primarily to the purchase of equipment.

     Net cash flows provided by financing activities was $117,563 during fiscal
year ended December 31, 2002 compared to net cash flows provided by financing
activities of $8,400 during fiscal year ended December 31, 2001. The increase
during fiscal year ended December 31, 2002 was primarily attributable to: (i)
$111,100 in proceeds from sale of shares of Common Stock; (ii) $23,950 in
proceeds from issuance of shares of Series A Convertible Preferred Stock; and
(iii) $73,000 in loans from shareholders.

SOURCES OF FUNDING FOR MATERIAL COMMITMENTS AND WORKING CAPITAL

     Material Commitments

     Cranford Assignment Agreement. A significant and estimated material
commitment for the Company for fiscal year 2003 is the amounts due and owing
under an assignment agreement with Mr. Tony Cranford dated January 19, 2001 (the
"Cranford Assignment Agreement"). Pursuant to the Cranford Assignment Agreement,
Mr. Cranford assigned all of his right, title and interest in Bet the House,
including his rights to the provisional patent application no. 60/240.091, to
the Company. In accordance with the terms and provisions of the Cranford
Assignment Agreement, the Company agreed to pay Mr. Cranford (i) for a period of
six months a monthly royalty fee of $175.00 for each Bet the House game that the
Company leases to a third party during the six month period; and (ii) an
aggregate purchase price of either (a) an amount to be calculated by multiplying
the average monthly gross revenues generated by the Company for each Bet the
House game leased during the six month period by three, or (b) $30,000,
whichever is greater. The terms of Cranford Assignment Agreement further provide
that such aggregate purchase price may be paid by the Company to Mr. Cranford on
a monthly basis or in one aggregate payment, with such aggregate purchase price
to be paid in full no later than March 31, 2002.

     As of the date of this Annual Report, Mr. Cranford has not received any
payments from the Company and has agreed to extend such payment date to June 30,
2003. Management has not determined the manner of payment to be made to Mr.
Cranford and may not make such determination until the Company is adequately
funded and several Bet the House games have been successfully marketed and
generating revenues.

     Asset Purchase Agreement. A significant and estimated material commitment
for the Company for fiscal year 2003 is the amount of $300,000.00 due and owing
under the terms of an asset purchase agreement entered into with Summit
International Group, Inc. dated May 1, 2001 (the "Asset Purchase Agreement").
Pursuant to the terms of the Asset Purchase Agreement, the Company agreed to pay
the amount of $300,000.00, as evidenced by the execution of two promissory
notes. The first promissory note dated May 1, 2001 was in the amount of
$80,000.00 and was payable to Michael Humecki (the "Humecki Promissory Note").
As of the date of this Annual Report, the Company has paid the Humecki
Promissory Note in full.

     The second promissory note dated May 1, 2001 is in the amount of
$220,000.00 and is payable to Summit International Group, Inc. (the "Summit
Promissory Note"). The terms of the Summit Promissory Note require the Company
to make payments to Summit after payment in full is made by the Company of the

<PAGE>


Humecki Promissory Note as follows: (i) on the 15th of each month commencing
after the Humecki Promissory Note, the greater of either (a) 50% of gross
revenues collected during the prior month from the lease or sale by the Company
of any of the assets acquired by the Company pursuant to the Asset Purchase
Agreement (including the Pro Shuffle) or (b) $2,000.00; (ii) on the 15th of the
month after the receipt of 25% of aggregate gross funds raised by the Company at
any time on or after May 1, 2001 pursuant to any private or public offering of
its securities (but such 25% shall not be paid on the first $100,000 of funds so
raised by the Company and not until after payment in full of the Humecki
Promissory Note); and (iii) interest at the rate of 8% per annum commencing May
1, 2004 on any portion of the $220,000.00 outstanding on the first of each month
payable monthly.

     As of the date of this Annual Report, the Company has paid Summit an amount
of $28,177.40 under the terms of the Summit Promissory Note.

     Loans from Shareholders. A significant and estimated material commitment
for the Company for fiscal year 2003 is the amount of $66,000.00 due and owing
certain shareholders of the Company. During fiscal year 2002, certain
shareholders of the Company advanced an aggregate of $66,000.00 to the Company
pursuant to notes payable. The terms of the notes payable provide that the notes
are payable upon demand, are non-interest bearing, and may be converted into an
undetermined number of shares of the Company's restricted Common Stock.

PLAN OF OPERATION

     Funding

     As of the date of this Annual Report, the Company is engaged in an offering
pursuant to which it intends to raise an aggregate of $1,000,000. In accordance
with the terms and provisions of the Private Placement Memorandum, the Company
will offer and sell 4,000 shares of Series A Convertible Preferred Stock at
$250.00 per share. Each share of Series A Convertible Preferred Stock will be
convertible into five hundred shares of restricted Common Stock at any time
after December 31, 2001. The Series A Convertible Preferred Stock will be senior
to the Common Stock with respect to dividends and upon liquidation, dissolution
or winding up. The securities are not registered under the 1933 Securities Act
and are therefore being offered pursuant to an exemption from registration
provided by Section 4(2) and Regulation D, Rule 506, of the Securities Act. As
of the date of this Annual Report, the Company has sold and issued 96 shares of
Series A Convertible Preferred Stock to nineteen investors for aggregate
proceeds of $24,000.

     As of the date of this Annual Report, the Company is engaged in an offering
pursuant to which it intends to raise an aggregate of $1,000,000.00. In
accordance with the terms and provisions of the Private Placement Memorandum,
the Company is offering and selling 2,222,222 shares of its restricted Common
Stock at $0.45 per share. The securities are not registered under the 1933
Securities Act and are therefore being offered pursuant to an exemption from
registration provided by Section 4(2) and Regulation D, Rule 506, of the
Securities Act. As of the date of this Annual Report, the Company has received
$89,100.00 in gross proceeds. The Company has issued 198,000 shares of its
restricted Common Stock to six investors, none of which were accredited
investors.

     As of the date of this Annual Report, the Company is engaged in a
Regulation S offering pursuant to which it intends to sell up to 5,000,000

<PAGE>


shares of its restricted Common Stock to non-U.S. residents at a purchase price
of twenty percent (20%) of the bid price per share as quoted on the OTC Bulletin
Board on the date of sale execution. The securities are not registered under the
Securities Act and are therefore being offered pursuant to an exemption from
registration provided by Section 4(2) and Regulation S of the Securities Act. As
of the date of this Annual Report, the Company has received $128,164 in gross
proceeds and has issued approximately 912,540 shares of its restricted Common
Stock to 20 investors.

     Management intends to use net proceeds received from the offerings for the
Company's capital requirements, which consist primarily of marketing,
advertising and travel expenses and professional fees.

     Based upon a twelve-month plan proposed by management, it is anticipated
that the Company's operational work plan will require approximately $500,000 of
financing designed to fund the general business operations. As of the date of
this Annual Report, the Company does not have any material commitments other
than those described above nor does management anticipate any further material
commitments within the next twelve months. It is anticipated that any
expenditures to be incurred by the Company will be operational. Management
anticipates that a substantial portion of the initial budget of $500,000 for the
twelve-month work plan, which includes such expenditures, will be funded
pursuant to public or private offerings, including the private placement
offerings described above under Regulation D, Rule 506, and Regulation S, of its
debt or equity securities and future advancements. The Company may not be able
to raise such funds and, therefore, the successful marketing of its products may
not be accomplished.

     From the date of this Annual Report, management believes that the Company
can satisfy its cash requirements for approximately the next six months based on
its ability to obtain advances from certain investors and related parties. In
the event the Company is unable to obtain advances from certain investors and
related parties, management believes that the Company can satisfy its cash
requirements for approximately the next three months from its liquid assets.

     As of the date of this Annual Report, the Company has generated little
revenue from operations, has a working capital deficit and a retained earnings
deficit. Therefore, the Company has been deemed a "going concern" by its
independent auditors, AJ. Robbins, P.C., as noted in the financial statements
attached hereto. There is substantial doubt that the Company will be able to
retain its status as a "going concern", that is assumption of the continuity of
operations of the Company in the absence of evidence to the contrary. Management
believes that it can maintain its status as a "going concern" based on its
ability to raise funds pursuant to future public and private offerings and to
obtain advances and minimize operating expenses by not duplicating expenses or
incurring needless expenses.

OFF-BALANCE SHEET ARRANGEMENTS

     As of the date of this Annual Report, the Company does not have any
off-balance sheet arrangements that have or are reasonably likely to have a
current or future effect on the Company's financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that are material to investors. The
term "off-balance sheet arrangement" generally means any transaction, agreement
or other contractual arrangement to which an entity unconsolidated with the
Company is a party, under which the Company has (i) any obligation arising under
a guarantee contract, derivative instrument or variable interest; or (ii) a
retained or contingent interest in assets transferred to such entity or similar
arrangement that serves as credit, liquidity or market risk support for such
assets.

<PAGE>


AUDIT COMMITTEE

     As of the date of this Annual Report, the Company has not appointed members
to an audit committee. As of the date of this Annual Report, no audit committee
exists. Therefore, the role of an audit committee has been conducted by the
Board of Directors of the Company.

     The Company intends to establish an audit committee. When established, the
audit committee will be comprised of at least two disinterested members. When
established, the audit committee's primary function will be to provide advice
with respect to the Company's financial matters and to assist the Board of
Directors in fulfilling its oversight responsibilities regarding finance,
accounting, tax and legal compliance. The audit committee's primary duties and
responsibilities will be: (i) to serve as an independent and objective party to
monitor the Company's financial reporting process and internal control system;
(ii) to review and appraise the audit efforts of the Company's independent
accountants; (iii) to evaluate the Company's quarterly financial performance as
well as its compliance with laws and regulations; (iv) to oversee management's
establishment and enforcement of financial policies and business practices; and
(v) to provide an open avenue of communication among the independent
accountants, management and the Board of Directors.

     The Board of Directors has considered whether the provision of such
non-audit services would be compatible with maintaining the principal
independent accountant's independence. The Board of Directors considered whether
the Company's principal independent accountant was independent, and concluded
that the auditor for the fiscal year ended December 31, 2002 was independent.

     Audit Fees

     During fiscal year ended December 31, 2002, the Company incurred
approximately $17,550 in fees to its principal and former independent accountant
for professional services rendered in connection with preparation and audit of
the Company's financial statements for fiscal year ended December 31, 2002 and
for the review of the Company's financial statements for the fiscal quarters
ended March 31, 2002, June 30, 2002 and September 30, 2002.

     Financial Information Systems Design and Implementation Fees

     During fiscal year ended December 31, 2002, the Company did not incur any
fees for professional services rendered by its principal and former independent
accountant for certain information technology services which may include, but is
not limited to, operating or supervising or managing the Company's information
or local area network or designing or implementing a hardware or software system
that aggregate source data underlying the financial statements.

     All Other Fees

     During fiscal year ended December 31, 2002, the Company did not incur any
other fees for professional services rendered by its principal independent
accountant for all other non-audit services which may include, but is not
limited to, tax-related services, actuarial services or valuation services.

<PAGE>


ITEM 7. FINANCIAL STATEMENTS

     The information required under Item 310(a) of Regulation S-B is included in
this report as set forth in the "Index to Financial Statement".



                                      INDEX

                                                                        Page
                                                                        ----

Independent Auditors' Report                                             F-2

Independent Auditors' Report                                             F-3

Balance Sheet                                                            F-4

Statements of Operations                                                 F-6

Statement of Changes in Stockholders' Equity                             F-7

Statements of Cash Flows                                                 F-8

Notes to Financial Statements                                            F-9




<PAGE>


                                AJ. ROBBINS, P.C.
                          CERTIFIED PUBLIC ACCOUNTANTS
                              216 SIXTEENTH STREET
                                    SUITE 600
                                DENVER, CO 80202

                          INDEPENDENT AUDITORS' REPORT



Ten Stix, Inc.
Denver, Colorado

We have audited the accompanying balance sheet of Ten Stix, Inc. as of December
31, 2002, and the related statements of operations, changes in stockholders'
equity, and cash flows for the year then ended. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Ten Stix, Inc. as of December
31, 2002, and the results of its operations and its cash flows for the year then
ended in conformity with generally accepted accounting principles in the United
States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company has suffered recurring losses from operations
and has a working capital deficiency of $395,001 that raises substantial doubt
about the entity's ability to continue as a going concern. Management's plans in
regard to these matters are also described in Note 2. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.


                                        AJ. ROBBINS, PC.
                                          CERTIFIED PUBLIC ACCOUNTANTS

Denver, Colorado
March 8, 2003



                                      F-2
<PAGE>



                            Comiskey & Company, P.C.
                  Certified Public Accountants and Consultants
                          789 Sherman Street Suite 440
                             Denver, Colorado 80203
                                 (303) 830-2255





                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS



The Board of Directors and Stockholders of
Ten Stix, Inc.


We have audited the accompanying statements of loss and accumulated deficit,
stockholders' equity, and cash flows of Ten Stix, Inc. for the year ended
December 31, 2001. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the results of operations, cash flows, and changes in
shareholders' equity for the year ended December 31, 2001, in conformity with
accounting principles generally accepted in the United States.



Denver, Colorado
April 19, 2002

                                                        /s/ COMISKEY & COMPANY
                                                        PROFESSIONAL CORPORATION


                                       F-3


<PAGE>


                                 TEN STIX, INC.
                                  BALANCE SHEET
                                DECEMBER 31, 2002
                                ==================


                                     ASSETS
                                     ------

CURRENT ASSETS:
   Cash                                                                 $  8,071
   Inventory                                                               2,736
                                                                        --------

         Total Current Assets                                             10,807
                                                                        --------


EQUIPMENT, at cost, net                                                  178,026

INVENTORY, non-current                                                    51,986

LOAN RECEIVABLE - STOCKHOLDER                                              8,500

PURCHASE OPTIONS                                                          19,500

INTANGIBLE ASSETS, net                                                    86,536

GAME RIGHTS                                                              162,100
                                                                        --------

                                                                        $517,455
                                                                        ========

                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

                                       F-4

<PAGE>


                                 TEN STIX, INC.
                            BALANCE SHEET (CONTINUED)
                                DECEMBER 31, 2002
                                =================


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

CURRENT LIABILITIES:
  Accounts payable and accrued expenses                               $  34,654
  Accounts payable, related party                                        30,000
  Notes payable                                                         270,154
  Notes payable, stockholders                                            71,000
                                                                      ---------

         Total Current Liabilities                                      405,808
                                                                      ---------

COMMITMENTS AND CONTINGENCIES


STOCKHOLDERS' EQUITY:
  Preferred A stock, $.001 par value, 100,000 shares
     authorized; 96 shares issued and outstanding                             1
  Common stock, $.001 par value; 500,000,000 shares
     authorized: 18,170,688 issued and outstanding                       18,171
  Additional paid-in capital                                            974,865
  Accumulated (deficit)                                                (881,390)
                                                                      ---------

         Total Stockholders' Equity                                     111,647
                                                                      ---------

                                                                      $ 517,455
                                                                      =========

                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

                                      F-5
<PAGE>



                                 TEN STIX, INC.
                            STATEMENTS OF OPERATIONS
                            ========================


                                                For the Years Ended December 31,
                                                --------------------------------
                                                     2002              2001
                                                 ------------      ------------

REVENUES:
   Lease income                                  $     99,225      $     46,470
   Equipment sales                                     24,049              --
                                                 ------------      ------------

         Total Revenues                               123,274            46,470
                                                 ------------      ------------



EXPENSES:
   Cost of sales                                        4,457              --
   Selling, general and administrative                276,770            67,588
   Depreciation                                        45,611            23,225
   Amortization                                        10,844             9,423
                                                 ------------      ------------

         Total Expenses                               337,682           100,236
                                                 ------------      ------------


OPERATING (LOSS)                                     (214,408)          (53,766)
                                                 ------------      ------------


OTHER INCOME (EXPENSE):
   Interest expense                                   (25,604)          (14,030)
   Gain on reduction of debt                           95,000              --
                                                 ------------      ------------

           Net Other Income (Expense)                  69,396           (14,030)
                                                 ------------      ------------


NET (LOSS)                                       $   (145,012)     $    (67,796)
                                                 ============      ============


NET (LOSS) PER SHARE, BASIC AND DILUTED          $       (.01)     $          *
                                                 ============      ============

Weighted average number of
   common shares outstanding,
   basic and diluted                               17,800,048        17,655,920
                                                 ============      ============

  *Less than $.01 per share


                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

                                      F-6

<PAGE>
<TABLE>
<CAPTION>

                                                              TEN STIX, INC.
                                               STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                                              FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2002
                                              ==============================================


                                                                                           Additional
                                     Preferred A Stock              Common Stock            Paid In                      Total
                               ---------------------------     ------------------------    Additional    Accumulated  Stockholders'
                                  Shares         Amount          Shares         Amount      Capital       (Deficit)  Equity(Deficit)
                               ------------    -----------     ----------    ----------   -----------    ----------- ---------------
<S>                              <C>           <C>              <C>           <C>           <C>              <C>
Balances,
   December 31, 2000                 76,000    $        76      2,442,688   $     2,443   $   691,618    $  (668,582)   $    25,555

Common stock issued for
   conversion of 76,000
   preferred shares                 (76,000)           (76)    15,200,000        15,200       (15,124)          --             --
Sales of common stock                  --             --           16,800            16         8,384           --            8,400
Contributed capital,
   services                            --             --             --            --          15,000           --           15,000
Net (loss)                             --             --             --            --            --          (67,796)       (67,796)
                                -----------    -----------    -----------   -----------   -----------    -----------    -----------

Balances,
   December 31, 2001                   --             --       17,659,488        17,659       699,878       (736,378)       (18,841)

Contributed capital,
   services                            --             --             --            --           7,500           --            7,500
Sales of common stock                  --             --          280,000           280       110,820           --          111,100
Sales of preferred stock                 96              1           --            --          23,949           --           23,950
Stock issued for services              --             --          111,200           112        47,488           --           47,600
Stock issued for interest
   on previously converted
   note                                --             --           15,000            15         3,735           --            3,750
Stock issued for game rights           --             --           75,000            75        62,025           --           62,100
Stock issued for video
   rights purchase option              --             --           20,000            20        11,980           --           12,000
Stock issued for card game
   purchase option                     --             --           10,000            10         7,490           --            7,500
Net (loss)                             --             --             --            --            --         (145,012)      (145,012)
                                -----------    -----------    -----------   -----------   -----------    -----------    -----------

Balances,
   December 31, 2002                     96    $         1     18,170,688   $    18,171   $   974,865    $  (881,390)   $   111,647
                                ===========    ===========    ===========   ===========   ===========    ===========    ===========


                                                SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

                                                                     F-7
<PAGE>


                                               TEN STIX, INC.
                                          STATEMENTS OF CASH FLOWS
                                          ========================

                                                                           For the Years Ended December 31,
                                                                           --------------------------------
                                                                                2002                2001
                                                                             ---------            ---------
CASH FLOWS FROM (TO) OPERATING ACTIVITIES:
Net (loss)                                                                   $(145,012)           $ (67,796)
  Adjustments to reconcile net (loss) to net cash from
     operating activities:
       Depreciation and amortization                                            56,455               32,648
       Amortization of debt discounts                                           17,094                 --
       Services provided at no charge                                            7,500               15,000
       Issuance of common stock for services                                    47,600                 --
       Issuance of common stock for interest on previously converted
         note                                                                    3,750                 --
  Changes in assets and liabilities:
       Inventory                                                                 2,702                 --
       Accounts receivable                                                         320                 --
       Accounts payable and accrued expenses                                  (103,165)              15,232
                                                                             ---------            ---------

         Net Cash (Used) By Operating Activities                              (112,756)              (4,916)
                                                                             ---------            ---------

CASH FLOWS FROM (TO) INVESTING ACTIVITIES:
  Purchase of equipment                                                         (1,500)                --
  Cost of equipment sold                                                         4,457                 --
  Note receivable - stockholder                                                   --                 (8,500)
                                                                             ---------            ---------

         Net Cash Flows Provided (Used) By Investing Activities                  2,957               (8,500)
                                                                             ---------            ---------

CASH FLOWS FROM (TO) FINANCING ACTIVITIES:
  Payments on notes payable                                                    (88,487)                --
  Proceeds from issuance of common stock                                       111,100                8,400
  Proceeds from issuance of preferred stock                                     23,950                 --
  Loans from stockholders                                                       73,000                 --
  Payment on loans from stockholders                                            (2,000)                --
                                                                             ---------            ---------

         Net Cash Provided By Financing Activities                             117,563                8,400
                                                                             ---------            ---------

INCREASE (DECREASE) IN CASH                                                      7,764               (5,016)

CASH AND CASH EQUIVALENTS, beginning of period                                     307                5,323
                                                                             ---------            ---------

CASH AND CASH EQUIVALENTS, end of period                                     $   8,071            $     307
                                                                             =========            =========

Supplemental information:
  See Note 11


                               SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

                                                F-8
</TABLE>

<PAGE>


                                 TEN STIX, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          =============================


NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Business
--------
Ten Stix, Inc. ("The Company") was incorporated on January 10, 1996 under the
laws of the State of Colorado. The Company's office is located at the office of
its President at 3101 Riverside Drive, Idaho Springs, Colorado. The Company uses
this space free of charge. The Company develops and markets unique card games
and other gaming products for the gaming industry.

In prior years, the Company had been in the development stage.

There are two types of gaming products that the Company has designed,
distributes and markets. The first is the "table game with electronics", which
includes Ten to Win and ShotGun 21.

The other type of gaming product is a "layout game", which includes all of the
other gaming products. The layout game is a table game utilizing a table cover
or layout with no electronic system, which includes Hold'em 88, Push Your Luck,
Catalina Dice, Bonus 6, Bet the Set, and go fish 21.

The Company also manufactures, leases and sells shufflers under the name Pro
Shuffle.

Casinos use automatic card shufflers to save time and eliminate the possibility
of a dealer manipulating the cards while hand shuffling. Hand shuffling takes
approximately one minute and forty seconds, whereas the Pro Shuffle shuffles
six decks of cards in forty seconds.

Concentrations of Credit Risk
-----------------------------
The Company maintains all cash in deposit accounts, which at times may exceed
federally insured limits. The Company has not experienced a loss in such
accounts.

Reclassification
----------------
Certain amounts reported in the Company's financial statements for the period
ended December 31, 2001 have been reclassified to conform to the current period
presentations.

Cash and Cash Equivalents
-------------------------
Cash and cash equivalents include cash on hand and investments with original
maturities of three months or less.

Inventory
---------
Inventory is valued at the lower of cost or market and consists of repair parts.
It is estimated that approximately $51,986 of inventory will be used beyond one
year.

                                      F-9
<PAGE>



                                 TEN STIX, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          =============================


NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
         POLICIES (Continued)

Equipment
---------
Equipment is recorded at cost. Depreciation expense is provided on a
straight-line basis using the following useful lives: gaming equipment
(including gaming equipment leased to customers under short term arrangements),
5 years; and furniture, fixtures and equipment, 3-5 years. Maintenance and
repairs are charged to expense as incurred. Total depreciation expense was
$45,611 and $23,225 for the years ended December 31, 2002 and 2001,
respectively. The cost and accumulated depreciation of assets retired, sold, or
otherwise disposed of are eliminated from the accounts and any resulting gain or
loss is credited or charged to income as appropriate.

Intangible assets
-----------------
Intangible assets consist of costs associated with the acquisition of patents,
copyrights, and license costs which are amortized over lives ranging from 5 to
11 years. Total amortization expense was $10,844 and $9,423 for the years ended
December 31, 2002 and 2001, respectively.

The game rights have an indefinite life; therefore, no amortization has been
recorded.

Impairment Of Long-Lived Assets
-------------------------------
The Company evaluates its long-lived assets by measuring the carrying amounts of
assets against the estimated undiscounted future cash flows associated with
them. At the time the carrying value of such assets exceeds the fair value of
such assets, impairment is recognized. To date, no adjustments to the carrying
value of the assets have been made.

Advertising Expense
-------------------
The Company expenses advertising costs as incurred. Advertising expense for the
years ended December 31, 2002 and 2001 was $24,955 and $905, respectively.

Research and Development Expense
--------------------------------
Costs relating to the development of new products are expensed as incurred.

Revenue Recognition
-------------------
Revenues derived from the sale of shufflers are recognized when shipped and
title has passed to the customer. Revenues derived from leasing shufflers and
games are recognized when earned, which is generally simultaneous with receipt.

Use of 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 and assumptions.


                                      F-10
<PAGE>


                                 TEN STIX, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          =============================


NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
         POLICIES (Continued)

Income Taxes
------------
The Company follows the provisions of Statement of Financial Accounting
Standards No. 109 - Accounting for Income Taxes. Under SFAS No. 109, the
Company's policy is to provide deferred income taxes related to items that
result in differences between the financial reporting and tax basis of assets
and liabilities.

As of December 31, 2002 the Company had a net operating loss carryforward of
approximately $297,983, expiring through 2022. Management has determined that it
is more likely than not that the Company will not utilize the net operating loss
in the near term, accordingly, a valuation allowance equal to the deferred tax
asset, which consisted primarily of the net operating loss carryforwards, has
been provided.

Fair Value of Financial Instruments
-----------------------------------
The carrying amounts of cash, accounts payable, accrued expenses, and notes
payable approximate fair value because of the short maturity of these items.

Earnings Per Common Share
-------------------------
The Company computes earnings per common share in accordance with Statement of
Financial Accounting Standards No. 128, Earnings Per Share (SFAS No. 128). This
Statement simplifies the standards for computing earnings per share (EPS)
previously found in Accounting Principles Board Opinion No. 15, Earnings Per
Share, and makes them more comparable to international EPS standards. SFAS No.
128 replaces the presentation of primary EPS with a presentation of basic EPS.
In addition, the Statement requires dual presentation of basic and diluted EPS
on the face of the income statement for all entities with complex capital
structures and requires a reconciliation of the numerator and denominator of the
basic EPS computation to the numerator and denominator of the diluted EPS
computation.

Stock-Based Compensation
------------------------
The Company accounts for stock based compensation in accordance with the
Financial Accounting Standards Board Statement of Financial Accounting Standards
No. 123 "Accounting for Stock-Based Compensation" (SFAS No. 123). Under the
provisions of SFAS No. 123, companies can either measure the compensation cost
of equity instruments issued under employee compensation plans using a fair
value based method, or can continue to recognize compensation cost using the
intrinsic value method under the provisions of APB No. 25. However, if the
provisions of APB No. 25 are continued, proforma disclosures of net income or
loss and earnings or loss per share must be presented in the financial
statements as if the fair value method had been applied. The Company recognizes
compensation costs under the provisions of APB No. 25 and provides the expanded
disclosure required by SFAS No. 123.


                                      F-11
<PAGE>


                                 TEN STIX, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          =============================


NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
         POLICIES (Continued)

Stock Option Plan
-----------------
Effective January 2001 the Company's board of directors adopted a Non-Qualified
Stock Option Plan under which 1,000,000 shares of the Company's Common Stock
were reserved for issuance at prices greater than, less than, or equal to the
current market value on the date of grant. The board may grant options to
employees, directors, officers, contractors or advisors. To date, no options
have been granted under this plan.

Recently Issued Accounting Pronouncements
-----------------------------------------
In April 2002 the FASB issued SFAS No. 145, Rescission of FASB Statements No. 4,
44 and 64, Amendment of FAS Statement No. 13, and Technical Corrections. This
statement rescinds the requirement in SFAS 4, Reporting Gains and Losses from
Extinguishment of Debt, that material gains and losses on the extinguishment of
debt be treated as extraordinary items. The statement also amends SFAS No. 13,
Accounting for Leases, to eliminate an inconsistency between the accounting for
sale-leaseback transactions and the accounting for certain lease modifications
that have economic effects that are similar to sale-leaseback transactions.
Finally the standard makes a number of consequential and other technical
corrections to other standards. The provisions of the statement relating to the
rescission of SFAS 4 are effective for fiscal years beginning after May 15,
2002. Provisions of the statement relating to the amendment of SFAS 13 are
effective for transactions occurring after May 15, 2002 and the other provisions
of the statement are effective for financial statements issued on or after May
15, 2002. The Company has adopted SFAS 145 and its adoption did not have a
material effect on its financial statements.

In July 2002 the FASB issued SFAS No. 146, Accounting for Exit or Disposal
Activities. SFAS 146 applies to costs associated with an exit activity
(including restructuring) or with a disposal of long-lived assets. Those
activities can include eliminating or reducing product lines, terminating
employees and contracts, and relocating plant facilities or personnel. SFAS 146
will require a Company to disclose information about its exit and disposal
activities, the related costs, and changes in those costs in the notes to the
interim and annual financial statements that include the period in which an exit
activity is initiated and in any subsequent period until the activity is
completed. SFAS 146 supersedes Emerging Issues Task Force Issue No. 94-3,
Liability Recognition for Certain Employee Termination Benefits and Other Costs
to Exit an Activity (including Certain Costs Incurred in a Restructuring), and
requires liabilities associated with exit and disposal activities to be expensed
as incurred and can be measured at fair value. SFAS 146 is effective
prospectively for exit or disposal activities initiated after December 31, 2002,
with earlier adoption encouraged. The Company has reviewed SFAS 146 and its
adoption is not expected to have a material effect on its financial statements.

In December 2002 the FASB issued SFAS No. 148, Accounting for Stock-Based
Compensation-Transition and Disclosure-an amendment of SFAS No. 123. This
Statement amends SFAS No. 123 to provide alternative methods of transition for a
voluntary change to the fair value based method of accounting for stock-based
employee compensation from the intrinsic value based method of accounting
prescribed by APB No. 25. In addition, this Statement amends the disclosure
requirements of SFAS No. 123 to require prominent disclosures in both annual and
interim financial statements about the method of accounting for stock-based

                                      F-12

<PAGE>



                                 TEN STIX, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          =============================


NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
         POLICIES (Continued)

employee compensation and the effect of the method used on reported results.
Under the provisions of SFAS No. 148, companies that choose to adopt the
accounting provisions of SFAS No. 123 will be permitted to select from three
transition methods: Prospective method, Modified Prospective method and
Retroactive Restatement method. The transition and annual disclosure provisions
of SFAS No. 148 are effective for the fiscal years ending after December 15,
2002. The Company is currently evaluating SFAS No. 148 to determine if it will
adopt SFAS No. 123 to account for employee stock options using the fair value
method and, if so, when to begin transition to that method.

NOTE 2 - GOING CONCERN AND MANAGEMENT'S PLANS

The Company's financial statements are prepared using accounting principles
generally accepted in the United States of America applicable to a going
concern, which contemplates the realization of assets and satisfaction of
liabilities in the normal course of business. The Company's continuation as a
going concern is dependent upon its ability to generate sufficient cash flow
from operations to meet its obligations on a timely basis and/or obtain
financing as may be required. The Company has incurred net losses from
operations since inception and has an accumulated deficit of $881,390 and a
working capital deficit of $395,001 as of December 31, 2002.

The Company's strategy is to expand the marketing of their games and shufflers
and continue to form positive relationships with casinos throughout the United
States. The Company recently has loaned the "Bet The House" game to several
casinos to use on a trial basis. Initial responses to the game have been
positive and the Company anticipates beginning generating lease revenues by July
2003.

Although the Company has obtained short-term loans, in the absence of long-term
financial support, there can be no assurance that additional financing can be
obtained from conventional sources. Management is pursuing alternatives that
include plans to raise capital through private placements and other offerings.

NOTE 3 - PURCHASE OPTIONS

In July 2002 the Company entered into an option agreement to purchase the video
rights for "Bonus 6 Stud Poker". The Company issued 20,000 shares of common
stock valued at $12,000 when the option was accepted. The option period expires
January 30, 2003. If the option was exercised, the Company would have paid
$150,000 and issued 200,000 shares of common stock. The Company did not exercise
this option and it expired on its own terms and accordingly, the $12,000 cost
will be written off in the first quarter of 2003.

In July 2002 the Company entered into a letter of intent to purchase the rights
to the casino card game known as "Bet the Set "21"", including copyrights,
trademarks, leases and all equipment. The Company issued 10,000 shares of common
stock valued at $7,500 when the option was accepted. If the option is exercised,
the Company will pay $400,000 and issue 150,000 shares of common stock. The
option expired in November 2002 at which time the grantor of the option agreed
to a verbal extension with the details to be negotiated.


                                      F-13
<PAGE>


                                 TEN STIX, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          =============================


NOTE 4 - EQUIPMENT

Equipment consists of the following:

                                                                    December 31,
                                                                        2002
                                                                    ------------

Furniture, fixtures and equipment                                    $   1,500
Gaming equipment                                                       247,279
                                                                     ---------
                                                                       248,779
Less accumulated depreciation                                          (70,753)
                                                                     ---------

                                                                     $ 178,026
                                                                     =========

The Company leases its shufflers to customers under short-term operating leases.
The cost of shufflers subject to operating leases was $56,122 at December 31,
2002. Accumulated depreciation related to the leased shufflers was $14,552 at
December 31, 2002.

NOTE 5 - INTANGIBLE ASSETS

Intangible assets consists of the following:

                                                                    December 31,
                                                                        2002
                                                                    ------------

Patents                                                              $  82,351
License costs                                                           30,000
                                                                     ---------
                                                                       112,351
Less accumulated depreciation                                          (25,815)
                                                                     ---------

                                                                     $  86,536
                                                                     =========

In January 2001 the Company's Vice President assigned all of his right, title
and interest in "Bet the House", including his rights to the provisional patent
application no. 60/240.091, to the Company. In accordance with the terms and
provisions of this Assignment Agreement, the Company agreed to pay a monthly
royalty fee of $175 for each "Bet the House" game that the Company leases to a
third party during the six month period; and (a) an amount to be calculated by
multiplying the average monthly gross revenues generated by the Company for each
"Bet the House" game leased during the six month period by three, or (b)
$30,000, whichever is greater. The purchase price was to be paid in full by
March 31, 2002. The payment date has been extended until such time the Company
is adequately funded and "Bet the House" games have been successfully marketed
and are generating revenues.


                                      F-14
<PAGE>



                                 TEN STIX, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          =============================

NOTE 6 - GAME RIGHTS

In July 2002 the Company entered into an option agreement to purchase the rights
to the Bonus 6 games within the states of Colorado, South Dakota, California,
and Arizona for $100,000 payable in five equal installments through April 2003
and issued 10,000 shares of restricted common stock valued at $10,100 upon
acceptance of the option agreement. An additional 65,000 shares of restricted
common stock valued at $52,000 were issued in August 2002 when the option was
exercised and the first installment was paid.

NOTE 7 - PRO SHUFFLE ACQUISITION

In May 2001 the Company entered into an asset purchase agreement and acquired
(i) all of the right, title and interest to U.S. Patent No. 5,718,427 regarding
a card shuffling device under the name "Pro Shuffle"; (ii) all Pro Shuffle
devices, parts, inventory and equipment related to the manufacturing and
assembly of the Pro Shuffle; (iii) all contracts related to the Pro Shuffle;
(iv) all accounts receivable arising out of the sale or lease of the Pro
Shuffle; (v) two promissory notes receivable made by a related party totaling
$8,500, (vi) two Blackjack tables located in Las Vegas, Nevada; and (vii) all
other business assets located in Colorado (of which no material assets were
actually acquired). The Company is renegotiating the terms of the promissory
notes.

In exchange for the assets acquired, the Company assumed a liability up to an
aggregate amount of $110,000 related to fifty updated Pro Shuffle devices and
parts and two liabilities totaling $6,000. The Company also agreed to pay
$300,000 as evidenced by the execution of two promissory notes payable in the
amounts of $220,000 and $80,000 (See Note 8). In addition, the Company's
President and Vice President surrendered their shares of the sellers stock they
owned personally. During 2002 the Company paid the $6,000 of liabilities,
renegotiated and paid $15,000 as settlement of the $110,000 liability and
recorded a gain of $95,000.

NOTE 8 - NOTES PAYABLE

In May 2001 the Company entered into a promissory note to pay $80,000 to an
individual as follows: (i) on the 15th of each month commencing June 15, 2001,
the greater of either (a) 50% of gross revenues collected during the prior month
from the lease or sale by the Company of any of the assets acquired by the
Company pursuant to the Asset Purchase Agreement (including the Pro Shuffle) or
(b) $2,000; (ii) on the 15th of the month, after the receipt thereof, 25% of
aggregate gross funds raised by the Company at any time on or after May 1, 2001
pursuant to any private or public offering of its securities (but such 25% shall
not be paid on the first $100,000 of funds so raised by the Company); and (iii)
interest at the rate of 8% per annum commencing May 1, 2002 on any portion of
the $80,000 outstanding on the first of each month payable monthly. The balance
at December 31, 2002 was $10,313. The Company imputed interest at 8.0% on the
note through April 2002 in the amount of $5,926 and reduced the note by this
amount. The Company recognized the remaining $1,482 as interest expense during
2002. Subsequent to year end the note was paid in full.


                                      F-15
<PAGE>


                                 TEN STIX, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          =============================


NOTE 8 - NOTES PAYABLE (Continued)

In May 2001 the Company entered into a promissory note to pay $220,000 after the
above $80,000 note is paid in full as follows: (i) on the 15th of each month the
greater of either (a) 50% of gross revenues collected during the prior month
from the lease or sale by the Company of any of the assets acquired by the
Company pursuant to the Asset Purchase Agreement (including the Pro Shuffle) or
(b) $2,000; (ii) on the 15th of the month, after the receipt thereof, 25% of
aggregate gross funds raised by the Company at any time on or after May 1, 2001
pursuant to any private or public offering of its securities (but such 25% shall
not be paid on the first $100,000 of funds so raised by the Company and not
until after payment in full of the $80,000 note); and (iii) interest at the rate
of 8% per annum commencing May 1, 2004 on any portion of the $220,000
outstanding on the first of each month payable monthly. The Company imputed
interest at 8.0% on the note through April 2004 in the amount of $45,357 and
reduced the note by this amount. The Company recognized $15,119 in interest
expense during 2002.

NOTE 9 - STOCKHOLDERS' EQUITY

Preferred Stock
---------------
Each share of preferred A stock may be converted into 200 shares of common
stock. No dividend has been designated to preferred shares. Subsequent to year
end the Company increased the conversion rate to one share may be converted into
500 shares of common stock.

Contributed Capital
-------------------
The Company's management performed services in the development and marketing of
the Company's products but had elected to forego cash compensation due to the
liquidity position of the Company. The Company recorded the fair value of such
services as a capital contribution. Management had classified these costs into
marketing and product development, based upon an estimate of the amount of time
devoted to such activities. In July 2002 management began receiving cash
compensation.

NOTE 10 - RELATED PARTY TRANSACTIONS

The Company has the distributorship rights to market a card game called Bonus 6
after entering into an assignment agreement dated December 28, 2000 in which (i)
its President agreed to assign to the Company his distribution rights,
previously obtained under an agreement with the owner of Bonus 6, to market and
distribute Bonus 6 within the United States, excluding the State of Colorado,
and (ii) the Company agreed to assume the obligations under the previous
distribution agreement as such obligations pertain to the marketing and
distribution of Bonus 6 within the United States, excluding the State of
Colorado. Prior to the assignment agreement, the Company's President had
individually marketed and distributed Bonus 6 to casinos within the State of
Colorado and he receives a 40% commission on gross revenues generated from the
sale or lease of Bonus 6 to these casinos on a monthly basis. During 2002 the
Company's President received $4,480 in commissions.




                                      F-16
<PAGE>


                                 TEN STIX, INC.
                          NOTES TO FINANCIAL STATEMENTS
                          =============================


NOTE 10 - RELATED PARTY TRANSACTIONS (Continued)

The Company obtained loans from stockholders in the amount of $66,000 during
2002. The notes are non-interest bearing and may be converted into shares of the
Company's common stock in an amount to be determined based upon negotiations
between the parties, when and if the loans are converted.

In April 2002 the Company entered into a promissory note for $7,000 with a
lender. The note bore interest at prime plus 11.25% and was due April 2003. In
September 2002 a stockholder paid the note in full on behalf of the Company,
less $2,000 that the Company had paid. The Company and the stockholder are
currently negotiating payment of the remaining $5,000 principal balance now owed
to the stockholder as of December 31, 2002.

NOTE 11 - SUPPLEMENTAL CASH FLOW INFORMATION

The Company paid $4,760 and $-0- for interest expense during the years ended
December 31, 2002 and 2001, respectively.

NOTE 12 - SUBSEQUENT EVENTS

In January 2003 the Company entered into an Offshore Stock Purchase Agreement
with a British Virgin Islands corporation to sell 5,000,000 shares of the
Company's common stock at prices equal to 20% of the bid price on the day of
sale. The Company has sold 912,540 shares for $128,164 under this agreement.





                                      F-17


<PAGE>


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

     The Company's former principal independent accountant from September 1,
2000 to October 1, 2002 was Comiskey & Company, P.C., 789 Sherman Street, Suite
440, Denver, Colorado 80203. Comiskey & Company, P.C. ("Comiskey") resignation
as the principal independent accountant for the Company resulted from a mutual
business decision made by the respective management of Comiskey and the Company
that it would be in the best interests of the Company to engage the services of
an independent accountant, which provides services to developmental companies.
Subsequently, on October 2, 2002, management of the Company engaged the
accounting firm of AJ. Robbins, P.C. as the Company's independent auditors. The
decision to change accountants was approved by the Board of Directors.

     During the Company's two most recent fiscal years and any subsequent
interim period preceding the resignation of Comiskey, there were no
disagreements with Comiskey which were not resolved on any matter concerning
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure, which disagreements, if not resolved to the satisfaction of
Comiskey, would have caused Comiskey to make reference to the subject matter of
the disagreements in connection with its reports. The reports of Comiskey &
Company, P.C., for each of the fiscal years ended December 31, 2001 and 2000
were qualified reports in that adverse financial conditions identified by the
accountants "raise[d] substantial doubt about the Company's ability to continue
as a going concern." Further, the reports stated that "[t]he financial
statements do not include any adjustments that might result from the outcome of
this uncertainty." The adverse financial conditions identified by Comiskey &
Company, P.C., consisted of net losses, working capital deficiencies, and net
worth deficiencies in the respective fiscal years covered by the reports.

<PAGE>


     Except as described in the immediately preceding paragraph, the reports of
Comiskey did not contain an adverse opinion or a disclaimer of opinion, and were
not qualified or modified as to uncertainty, audit scope, or accounting
principles.

     On October 2, 2002, the board of directors of the Company approved and
authorized the engagement of AJ. Robbins, P.C., Certified Public Accountants,
216 Sixteenth Street, Suite 600, Denver, Colorado 80202 as the principal
independent accountant for the Company. The Company's principal independent
accountants have not provided an adverse opinion nor disclaimer of opinion to
the Company's financial statements for fiscal year ended December 31, 2002, nor
have they modified their opinion as to audit scope or accounting principles.


                                    PART III

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

IDENTIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS

     The directors and executive officers of the Company are as follows:

Name                           Age          Position with the Company
----                           ---          -------------------------

Thomas E. Sawyer               54           Director and President/Treasurer
                                            and Chief Executive Officer

Tony A. Cranford               50           Director and Vice
                                            President/Secretary

     THOMAS E. SAWYER has been a Director, the President/Treasurer and Chief
Executive Officer of the Company since January 10, 1996 (inception). Mr. Sawyer
received accreditation from the University of Nevada at Reno for Table Game
Management. Mr. Sawyer was also the owner and president of Colorado West Metal
Studs & Drywall, Inc., which was a successful contracting business. This
business was instrumental in the development of large projects located in major
ski resorts within the State of Colorado. Over the past ten years, Mr. Sawyer
has established a career within the gaming industry ranging from a dealer at
game tables to serving as an assistant general manager and a table game manager
at casinos located in Blackhawk, Colorado. Mr. Sawyer has developed products,
conducted analysis and created marketing strategies relating to internal
controls for table game accounting, cheating and detection controls, and other
protection controls, all of which have resulted in the operation of successful
casinos. Mr. Sawyer also possesses key gaming licenses that require passing
extensive background checks relating to personal and financial information. He
attends on an annual basis many conferences, such as the World Gaming Conference
held in Las Vegas, Nevada, and the National Indian Gaming Conference.

     TONY A. CRANFORD has been the Vice President/Secretary and a Director of
the Company since January 10, 1996 (inception). Prior to working in the gaming
industry, Mr. Cranford was involved in the entertainment business for a period
of twenty-four years. Over the past fourteen years, Mr. Cranford has established

<PAGE>


a career within the gaming industry and recently resigned as a table game
manager from the Lodge Casino in Blackhawk, Colorado. The Lodge Casino is
well-known in Colorado for its table games. Mr. Cranford was responsible for
setting up all internal controls, hiring personnel, including dealers and floor
supervisors. He also established and arranged all table game areas and games.
Mr. Cranford owned and operated a successful bingo hall in Texas from 1986 to
1990. Mr. Cranford was one of the inventors of the Pro-Shuffle, which is a
patented multi-deck card shuffler. Mr. Cranford also possesses key gaming
licenses that require passing extensive background checks relating to personal
and financial information. He attends on an annual basis many conferences such
as the World Gaming Conference and the National Indian Gaming Conference.

     The directors of the Company serve until their respective successor takes
office or until death, resignation or removal. The executive officers serve at
the pleasure of the Board of Directors of the Company.

     Involvement in Legal Proceedings/Personal Bankruptcy

     On approximately May 10, 2000, Mr. Cranford filed a petition or motion for
a Chapter 13 bankruptcy in the United States Bankruptcy Court for the District
of Colorado. On approximately June 30,2000, Mr. Cranford filed an amended plan
pursuant to Local Bankruptcy Rule 202 entitled Motion to Confirm First Amended
Chapter 30 Plan. No objections to or requests for hearing on the
motion/application were received, therefore, the United States Bankruptcy Court
granted an order confirming the Chapter 13 Plan.

     Other than as described above and as of the date of this Annual Report, no
director or executive officer of the Company is or has been involved in any
legal proceeding concerning (i) any bankruptcy petition filed by or against any
business of which such person was a general partner or executive officer either
at the time of the bankruptcy or within two years prior to that time; (ii) any
conviction in a criminal proceeding or being subject to a pending criminal
proceeding (excluding traffic violations and other minor offenses) within the
past five years; (iii) being subject to any order, judgment or decree
permanently or temporarily enjoining, barring, suspending or otherwise limiting
involvement in any type of business, securities or banking activity; or (iv)
being found by a court, the Securities and Exchange Commission or the Commodity
Futures Trading Commission to have violated a federal or state securities or
commodities law (and the judgment has not been reversed, suspended or vacated).

     Audit Committee Financial Expert

     As of the date of this Annual Report, the Board of Directors of the Company
has determined that the Company does not have an audit committee financial
expert nor does the Company have an audit committee.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

     Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and officers, and the persons who beneficially own more
than ten percent of the Common Stock of the Company, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Copies of all filed reports are required to be furnished to the Company pursuant
to Rule 16a-3 promulgated under the Exchange Act. Based solely on the reports
received by the Company and on the representations of the reporting persons, the
Company believes that these persons have complied with all applicable filing
requirements during the fiscal year ended December 31, 2002.

<PAGE>


EXECUTIVE COMPENSATION

     As of the date of this Annual Report, none of the directors or officers of
the Company are compensated for their roles as directors or executive officers.
However, as of the date of this Annual Report, Messrs. Sawyer and Cranford
derive remuneration from the Company as compensation for day to day management.
Mr. Sawyer, the President and Chief Executive Officer of the Company, currently
receives from the Company $3,000 bi-weekly. As of the date of this Annual
Report, the Company has paid approximately $24,000 to Mr. Sawyer. Mr. Cranford,
the Executive Vice President and Secretary of the Company, currently receives
from the Company $3,000 bi-weekly. As of the date of this Annual Report, the
Company has paid approximately $24,000 to Mr. Cranford.See "Summary Compensation
Table" below.

     Moreover, prior to the Sawyer Assignment Agreement, Mr. Sawyer marketed and
distributed Bonus 6 to casinos within the State of Colorado for which he
receives a 40% commission on gross revenues generated from the sale or lease of
Bonus 6 to these casinos on a monthly basis. During fiscal year 2002, Mr. Sawyer
received $4,480 in such commissions.

     Officers and directors of the Company may be reimbursed for any
out-of-pocket expenses incurred by them on behalf of the Company. As of the date
of this Annual Report, none of the officers or directors are party to employment
agreements with the Company. The Company presently has no pension, health,
annuity, insurance, profit sharing or similar benefit plans.

     Summary Compensation Table

                               Annual Compensation        Awards       Payouts
                             ---------------------    -------------  -----------
                                $      $       $       $       #       $     $
Name and Position            Salary  Bonus   Other    RSA   Options  LTIP  Other
-----------------            ------  -----   -----    ---   -------  ----  -----

Thomas E. Sawyer       1999      0    0        0       0         0     0      0
Pres./Director         2000      0    0        0       0         0     0      0
                       2001      0    0        0       0         0     0      0
                       2002 39,000    0     $4,480*    0         0     0      0

Tony A. Cranford       1999      0    0        0       0         0     0      0
Executive V.P./Secr.   2000      0    0        0       0         0     0      0
and Director           2001      0    0        0       0         0     0      0
                       2002 39,000    0        0       0         0     0      0

     *Pursuant to the Sawyer Assignment Agreement, Mr. Sawyer retained the
distribution rights to market and sell/lease marketed and distributed Bonus 6 to
casinos within the State of Colorado for which he receives a 40% commission on
gross revenues generated from the sale or lease of Bonus 6 to these casinos on a
monthly basis. During fiscal year 2002, Mr. Sawyer received $4,480 in such
commissions.

<PAGE>


NON-QUALIFIED STOCK OPTION PLAN

     On January 10, 2001, the Board of Directors of the Company adopted the
Non-Qualified Stock Option Plan (the "SOP") which initially provided for the
grant of options to purchase an aggregate of 1,000,000 shares of Common Stock.
The purpose of the SOP is to make options available to directors, officers,
management and significant contractors of the Company in order to encourage them
to secure an increase on reasonable terms of their stock ownership in the
Company and to remain in the employ of the Company, and to provide them
compensation for past services provided.

     The SOP is administered by the Board of Directors which determines the
persons to be granted options under the SOP, the number of shares subject to
each option, the exercise price of each option and the option period, and the
expiration date, if any, of such options. The exercise of an option may be less
than fair market value of the underlying shares of Common Stock. No options
granted under the SOP will be transferable by the optionee other than by that
provided by the Option Grant Agreements or will or the laws of descent and
distribution and each option will be exercisable, during the lifetime of the
optionee, only by such optionee.

     The exercise price of an option granted pursuant to the SOP may be paid in
cash, by the surrender of options, in Common Stock, in other property, including
the optionee's promissory note, or by a combination of the above.

     As of the date of this Annual Report, no options have been granted.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth the name and address, as of the date of this
Annual Report, and the approximate number of shares of Common Stock owned of
record or beneficially by each person who owned of record, or was known by the
Company to own beneficially, more than five percent (5%) of the Company's Common
Stock, and the name and shareholdings of each officer and director, and all
officers and directors as a group.

--------------------------------------------------------------------------------
Title of Class     Name and Address                Amount and Nature    Percent
                   of Beneficial Owner                  of Class        of Class
--------------------------------------------------------------------------------
                                                           (1)(2)(3)(4)
Common Stock      Thomas E. Sawyer                     6,395,750         35.20%
                  3101 Riverside Drive
                  Idaho Springs, CO 80452

                                                           (1)(2)(3)(5)
Common Stock      Tony A. Cranford                     7,093,350         39.04%
                  12252 W. Chenango Drive
                  Morrison, CO 80465

Common Stock      Officers and directors as a         13,489,100         74.24%
                  Group (2)

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

     (1)  On September 16, 1998, Tony A. Cranford and Thomas E. Sawyer each
          exchanged their previously owned 10,200 shares of common stock,
          respectively, for 38,000 shares of Preferred Stock, respectively, for
          a total of 76,000 shares of Preferred Stock issued and outstanding.

<PAGE>


          The provisions of the Articles of Incorporation provided that each
          share of Preferred Stock had the voting rights equivalent to 500
          shares of Common Stock as if converted and, that after September 16,
          1998, each share of Preferred Stock may be converted into such 500
          shares of Common Stock. On January 23, 2001, both Thomas E. Sawyer and
          Tony A Cranford elected to convert their 38,000 shares of Preferred
          Stock into 7,600,000 shares of Common Stock, respectively, at the rate
          of one share of Preferred Stock for 200 shares of Common Stock, for a
          total of 15,200,000 shares of Common Stock.

     (2)  These are restricted shares of Common Stock.

     (3)  Does not include the assumption of the exercise of options, warrant,
          rights, conversion privileges or similar obligations to acquire shares
          of common stock within sixty days. Although the board of directors
          adopted a Non-Qualified Stock Option Plan to purchase an aggregate of
          1,000,000, no options have been granted to date. There are no other
          similar obligations outstanding.

     (4)  As of the date of this Annual Report, Mr. Sawyer has gifted
          approximately 1,190,250 shares of restricted Common Stock and has sold
          14,000 shares of restricted Common Stock pursuant to private sales,
          resulting in 6,395,750 shares of Common Stock held of record.

     (5)  As of the date of this Annual Report, Mr. Cranford has gifted
          approximately 358,150 shares of restricted Common Stock and has sold
          148,500 shares of restricted Common Stock pursuant to private sales,
          resulting in 7,093,350 shares of Common Stock held of record.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

CRANFORD ASSIGNMENT AGREEMENT

     Pursuant to the Cranford Assignment Agreement, Mr. Cranford assigned all of
his right, title and interest in Bet the House, including his rights to the
provisional patent application no. 60/240.091, to the Company. In accordance
with the terms and provisions of the Cranford Assignment Agreement, the Company
agreed to pay Mr. Cranford (i) for a period of six months a monthly royalty fee
of $175.00 for each Bet the House game that the Company leases to a third party
during the six month period; and (ii) an aggregate purchase price of either (a)
an amount to be calculated by multiplying the average monthly gross revenues
generated by the Company for each Bet the House game leased during the six month
period by three, or (b) $30,000, whichever is greater. The terms of Cranford
Assignment Agreement further provide that such aggregate purchase price may be
paid by the Company to Mr. Cranford on a monthly basis or in one aggregate
payment, with such aggregate purchase price to be paid in full no later than
March 31, 2002.

     As of the date of this Annual Report, Mr. Cranford has not received any
payments from the Company and has agreed to extend such payment date to June 30,
2003. Management has not determined the manner of payment to be made to Mr.
Cranford and may not make such determination until the Company is adequately
funded and several Bet the House games have been successfully marketed
generating revenues.

<PAGE>


SAWYER ASSIGNMENT AGREEMENT

     Prior to the Company's incorporation, Mr. Thomas Sawyer together with other
individuals created and designed a card game called "Bonus 6". On approximately
October 13, 1997, the board of directors of the Company held a special meeting
in which it was decided that the Company was not interested in acquiring or
marketing Bonus 6. Among the factors considered by the board of directors in
evaluating the acquisition of Bonus 6 were: (i) the status of the research and
development of Ten Stix 21; (ii) a cost-effective analysis which included the
potential for generation of revenues compared to capital expenditures required
to market Bonus 6; and (iii) the best interests of the Company. Therefore, Mr.
Sawyer in his individual capacity entered into a distribution agreement with Tom
Perkins, the owner of Bonus 6, for the distribution rights of Bonus 6 (the
"Distribution Agreement"). Mr. Sawyer individually proceeded to market and
distribute Bonus 6 to casinos within the State of Colorado. On December 28,
2000, however, the Company and Mr. Sawyer entered into the Sawyer Assignment
Agreement in which (i) Mr. Sawyer agreed to gift and grant his distribution
rights under the Distribution Agreement to the Company to market and distribute
Bonus 6 within the United States, excluding the State of Colorado, and (ii) the
Company agreed to assume Mr. Sawyer's obligations under the Distribution
Agreement as such obligations pertain to the marketing and distribution of Bonus
6 within the United States, excluding the State of Colorado.

     With the exception of the above-described agreements, as of the date of
this Annual Report, the Company has not entered into any other contractual
arrangements with related parties. The Board of Directors believes that the
terms of each of the above-described agreements is as favorable to the Company
as it would expect to negotiate with unaffiliated third parties, and that
consummation of such agreements is in the best interests of the Company and its
shareholders. The Board of Directors of the Company has not, however, adopted or
approved any policy regarding possible future transactions with related third
parties.

     Messrs. Sawyer and Cranford are not engaged in other businesses, either
individually or through partnerships and corporations in which they may have an
interest, hold an office or serve on the boards of directors. The directors of
the Company, Messrs. Sawyer and Cranford, may in the future have other business
interests to which they may devote a minor portion of their time. Certain
conflicts of interest, therefore, may arise in the future between the Company
and its directors. Such conflicts can be resolved through the exercise by
Messrs. Sawyer and Cranford of judgment consistent with their fiduciary duties
to the Company. Messrs. Sawyer and Cranford intend to resolve any such conflicts
in the best interests of the Company.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits.

     None.

(b) Reports.

     Report on Form 8-K filed on October 7, 2002 regarding Item 4. Changes in
Registrant's Certifying Accountant.

<PAGE>


ITEM 14. CONTROLS AND PROCEDURES

     The Company, under the supervision of the President, has conducted an
evaluation of the effectiveness of the design and operation of the Company's
disclosure controls and procedures within ninety (90) days of the filing date of
this Annual Report. Based upon the results of this evaluation, the Company
believes that they maintain proper procedures for gathering, analyzing and
disclosing all information in a timely fashion that is required to be disclosed
in its reports under the Securities Exchange Act of 1934, as amended. There have
been no significant changes in the Company's controls subsequent to the
evaluation date.

SIGNATURES

     In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                         TEN STIX INC.


Dated: April 15, 2003                    By: /s/ Tom Saywer
                                         ---------------------------------------
                                                 Tom Sawyer, President
                                                 and Chief Executive Officer

<PAGE>

                                 TEN STIX INC.
                              3101 Riverside Drive
                         Idaho Springs, Colorado 80452
                                 (303) 567-0163

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


     In connection with the Annual Report on Form 10-KSB for fiscal year ended
December 31, 2002 of Ten Stix Inc., a Colorado corporation (the "Company"), as
filed with the Securities and Exchange Commission on the date hereof (the
"Annual Report"), I, Thomas E. Sawyer, President and Chief Executive Officer of
the Company certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that:

     1.   I, Thomas E. Sawyer, have reviewed and read this Annual Report on Form
          10-KSB;

     2.   To the best of my knowledge, this Annual Report does not contain any
          untrue statement of a material fact or omit to state a material fact
          necessary to make the statements made, in light of the circumstances
          under which such statements were made, not misleading with respect to
          the period covered by this Annual Report;

     3.   To the best of my knowledge, the financial statements and other
          financial information included in this Annual Report, fairly present
          in all material respects the financial condition, results of
          operations and cash flows of the Company as of, and for, the periods
          presented in this Annual Report;

     4.   I am responsible for establishing and maintaining disclosure controls
          and procedures (as defined in the Exchange Act Rules 13a-14 and
          15d-14) for the Company and have:

          (a)  designed such disclosure controls and procedures to ensure that
               material information relating to the Company, including its
               subsidiary, is made known to us by others, particularly during
               the period in which this Annual Report is being prepared;

          (b)  evaluated the effectiveness of the Company's disclosure controls
               and procedures as of a date within 90 days prior to the filing
               date of this Annual Report (the "Evaluation Date"); and

          (c)  presented in this Annual Report my conclusions about the
               effectiveness of the disclosure controls and procedures based on
               my evaluation as of the Evaluation Date;

     5.   I have disclosed, based on my most recent evaluation, to the Company's
          auditors and board of directors performing the equivalent functions of
          an audit committee:

          (a)  all significant deficiencies in the design or operation of
               internal controls which could adversely affect the Company's
               ability to record, process, summarize and report financial data
               and have identified for the Company's auditors any material
               weaknesses in internal controls; and

          (b)  any fraud, whether or not material, that involves management or
               other employees who have a significant role in the Company's
               internal controls; and

     6.   I have indicated in this Annual Report whether there were significant
          changes in internal controls or in other factors that could
          significantly affect internal controls subsequent to the date of my
          most recent evaluation, including any corrective actions with regard
          to significant deficiencies and material weaknesses.


                                           /s/ Thomas E. Sawyer
                                           -------------------------------------
                                           Thomas E. Sawyer, President and Chief
                                           Executive Officer