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, 2000.


             [ ] Transition report under Section 13 or 15(d) of the
                        Securities Exchange Act of 1934

          For the transition period from ------------ to ------------.

                        Commission file number: 000-28889


                            FAR REACH HOLDINGS, LTD.
                     --------------------------------------
        (Exact name of small business issuer as specified in its charter)



             Nevada                                     33-0885763
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

               44489 Town Center Way #D415 Palm Desert, CA 92260
                   ------------------------------------------
               (Address of principal executive office) (Zip Code)

                                 (760) 773-9227
                             ----------------------
                          (Issuer's telephone number)


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

Securities  registered pursuant to Section 12(g) of the Act: Common Stock, $.001
par value.

Indicate  by check  mark  whether  the  Registrant:  (1) has filed  all  reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
Registrant was required to file such report(s), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No ___.





<PAGE>



Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best  of  the  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 .

At December 31, 2000,  the aggregate  market value of all shares of voting stock
held by non-  affiliates was $0.00. In determining  this figure,  the Registrant
has assumed that all  directors  and  executive  officers are  affiliates.  Such
assumption shall not be deemed  conclusive for any other purpose.  The number of
shares  outstanding  of each  class  of the  Registrant's  common  stock,  as of
December  31,  2000,  was as follows:  Common  Stock $.001 par value,  2,000,000
shares.

Total revenues for fiscal year ended December 31, 2000: $0

At December  31,  2000,  the number of shares of common  stock  outstanding  was
2,000,000.

Transitional Small Business Disclosure Format (check one): Yes  ; No X



<PAGE>





                                     PART I


ITEM 1.  DESCRIPTION OF BUSINESS

           The   Company  has  not   engaged  in  any   operations   other  than
organizational  matters.  Far Reach Holdings,  Ltd., a Nevada  corporation  (the
"Company") was incorporated on May 23, 1996, and was formed specifically to be a
"clean public shell" and for the purpose of either  merging with or acquiring an
operating company with operating history and assets.

           The primary  activity of the Company has  involved  and will  involve
seeking  merger  or  acquisition  candidates  with whom it can  either  merge or
acquire.  The Company has not selected any company for acquisition or merger and
does not intend to limit  potential  acquisitions  candidates to any  particular
field or  industry,  but does  retain the right to limit  acquisition  or merger
candidates,  if it so chooses, to a particular field or industry.  The Company's
plans are in the conceptual stage only.

           The  proposed  business  activities  described  herein  classify  the
Company as a "blank check" or "shell company" whose sole purpose at this time is
to locate and  consummate  a merger or  acquisition.  Many states  have  enacted
statutes, rules and regulations limiting the sale of securities of "blank check"
companies in their respective jurisdictions. Management does not believe it will
undertake  any  efforts to cause a trading  market to  develop in the  Company's
securities  until such time as the  Company  has  successfully  implemented  its
business plan described  herein.  However,  if the Company intends to facilitate
the eventual creation of a public trading market in its outstanding  securities,
it must consider that the Company's securities, when available for trading, will
be subject to a Securities  and Exchange  Commission  rule that imposes  special
sales practice  requirements  upon  broker-dealers  who sell such  securities to
persons other than established customers or accredited  investors.  For purposes
of the  rule,  the  phrase  "accredited  investors"  means,  in  general  terms,
institutions  with assets in excess of $5,000,000,  or individuals  having a net
worth in excess of $1,000,000  or having an annual income that exceeds  $200,000
(or  that,  when  combined  with  a  spouse's  income,  exceeds  $300,000).  For
transactions  covered  by the  rule,  the  broker-dealer  must  make  a  special
suitability  determination for the purchaser and receive the purchaser's written
agreement  to the  transaction  prior to the  sale.  Consequently,  the rule may
affect the ability of broker-dealers  to sell the Company's  securities and also
may affect the ability of purchasers  in this offering to sell their  securities
in any market that might develop therefor.

Competition

           The  Company  expects to  encounter  substantial  competition  in its
efforts to locate attractive opportunities,  primarily from business development
companies,  venture  capital  partnerships  and  corporations,  venture  capital
affiliates  of  large  industrial  and  financial  companies,  small  investment
companies,   and  wealthy   individuals.   Many  of  these  entities  will  have
significantly greater experience, resources and managerial capabilities than the
Company and will  therefore be in a better  position  than the Company to obtain
access to attractive business opportunities.






<PAGE>



Employees

           The  Company's  only employee at the present time is its sole officer
and  director,  who will devote as much time as he  determines  is  necessary to
carry out the affairs of the Company.

ITEM 2.  DESCRIPTION OF PROPERTY

           The Company has a working  agreement  with the Company  president  to
share  use of 600  square  feet of  office  space,  telephones  and  secretarial
services supplied on a gratis basis.

ITEM 3.  LEGAL PROCEEDINGS

           No material  legal  proceedings to which the Company (or its director
and  officer  in his  capacity  as such) is  party or to which  property  of the
Company  is  subject  is pending  and no such  material  proceeding  is known by
management of the Company to be contemplated.

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

           None.

                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS

           There has been no public  trading  market  for the  Company's  common
stock.  Holders of common stock are entitled to receive such dividends as may be
declared by the Company's  Board of Directors.  No dividends on the common stock
have been paid by the Company,  nor does the Company  anticipate  that dividends
will be paid in the foreseeable future.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OR PLAN OF OPERATION

           The  following  discussion  should  be read in  conjunction  with the
Financial Statements and notes thereto.

OPERATIONS

           The Company intends to seek,  investigate and, if such  investigation
warrants, acquire an interest in one or more business opportunities presented to
it by persons or firms who or which  desire to seek  perceived  advantages  of a
publicly held corporation.

           The Company will not  restrict  its search to any specific  business,
industry or geographical location, and the Company may participate in a business
venture of virtually any kind or nature. The discussion of the proposed business
under this caption and throughout is purposefully general and is not meant to be
restrictive of the Company's  virtually  unlimited  discretion to search for and
enter into potential business opportunities.

           The Company may obtain  funds in one or more  private  placements  to
finance the operation of any acquired business, if necessary. Persons purchasing
securities in these placements and other



<PAGE>





shareholders will likely not have the opportunity to participate in the decision
relating to any  acquisition.  The  Company's  proposed  business  is  sometimes
referred  to  as a  "blind  pool"  because  any  investors  will  entrust  their
investment  monies  to the  Company's  management  before  they have a chance to
analyze any  ultimate  use to which their  money may be put.  Consequently,  the
Company's  potential success is heavily  dependent on the Company's  management,
which will have  unlimited  discretion  in  searching  for and  entering  into a
business  opportunity.  The sole officer and director of the Company  likely has
had no  experience  in any  proposed  business of the  Company.  There can be no
assurance that the Company will be able to raise any funds in private placement.

LIQUIDITY AND CAPITAL RESOURCES

           The Company  remains in the development  stage and, since  inception,
has  experienced  no  significant  change in liquidity  or capital  resources or
stockholder's  equity.  The  Company's  balance  sheet as of December  31, 2000,
reflects a current asset value of $0.00, and a total asset value of $0.00.

           The Company will carry out its plan of business as  discussed  above.
The Company  cannot  predict to what extent its liquidity and capital  resources
will be  diminished  prior to the  consummation  of a  business  combination  or
whether its capital will be further depleted by the operating losses (if any) of
the business entity which the Company may eventually acquire.

RESULTS OF OPERATIONS

           During the period from June 5, 1999 through  December  31, 2000,  the
Company  has  engaged in no  significant  operations  other than  organizational
activities  and  preparation  for  registration  of  its  securities  under  the
Securities Exchange Act of 1934. No revenues were received by the Company during
this period.

           For the current fiscal year, the Company anticipates incurring a loss
as a result of organizational  expenses,  expenses  associated with registration
under the Securities Exchange Act of 1934, and expenses associated with locating
and evaluating  acquisition  candidates.  The Company  anticipates  that until a
business  combination is completed with an  acquisition  candidate,  it will not
generate  revenues other than interest income,  and may continue to operate at a
loss after completing a business combination,  depending upon the performance of
the acquired business.

Need for Additional Financing

           The Company  believes that its existing capital will be sufficient to
meet the  Company's  cash  needs,  including  the costs of  compliance  with the
continuing  reporting  requirements  of the Securities  Exchange Act of 1934, as
amended, for a period of approximately two years. Accordingly,  in the event the
Company is able to  complete a  business  combination  during  this  period,  it
anticipates  that  its  existing  capital  will be  sufficient  to  allow  it to
accomplish the goal of completing a business combination. There is no assurance,
however,  that the available funds will ultimately prove to be adequate to allow
it to  complete  a business  combination,  and once a  business  combination  is
completed,  the Company's needs for additional  financing are likely to increase
substantially.





<PAGE>



FEDERAL INCOME TAX ASPECTS OF INVESTMENT IN THE COMPANY

           The discussion  contained herein has been prepared by the Company and
is based on  existing  law as  contained  in the  Code,  amended  United  States
Treasury Regulations ("Treasury Regulations"),  administrative rulings and court
decisions as of the date of this Annual  Report.  No assurance can be given that
future legislative  enactments,  administrative  rulings or court decisions will
not modify the legal basis for statements contained in this discussion. Any such
development may be applied retroactively to transactions  completed prior to the
date thereof,  and could contain  provisions  having an adverse  affect upon the
Company and the holders of the Common Stock. In addition,  several of the issues
dealt with in this summary are the subjects of proposed and  temporary  Treasury
Regulations.  No assurance can be given that these  regulations  will be finally
adopted in their present form.

FORWARD LOOKING STATEMENT

           This Management's  Discussion and Analysis of Financial Condition and
Results of  Operations  includes  a number of  forward-looking  statements  that
reflect  Management's  current views with respect to future events and financial
performance. Those statements include statements regarding the intent, belief or
current  expectations  of the Company and members of its management team as well
as the assumptions on which such statements are based. Prospective investors are
cautioned that any such forward-looking  statements are not guarantees of future
performance  and involve  risk and  uncertainties,  and that actual  results may
differ materially from those  contemplated by such  forward-looking  statements.
Readers are urged to carefully review and consider the various  disclosures made
by the Company in this report and in the Company's  other reports filed with the
Securities  and  Exchange  Commission.  Important  factors  currently  known  to
Management  could  cause  actual  results  to differ  materially  from  those in
forward-looking  statements.  The Company  undertakes no obligation to update or
revise forward-looking statements to reflect changed assumptions, the occurrence
of unanticipated  events or changes in the future  operating  results over time.
The Company believes that its assumptions are based upon reasonable data derived
from and known about its business and operations and the business and operations
of the Company.  No assurances are made that actual results of operations or the
results of the Company's future  activities will not differ  materially from its
assumptions.

ITEM 7.  FINANCIAL STATEMENTS

     The financial  statements  are included  beginning at F-1. See Index to the
Financial Statements.

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

           None.











<PAGE>





                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS

Directors and Executive Officers.

           The members of the Board of Directors of the Company  serve until the
next  annual  meeting  of  stockholders,  or until  their  successors  have been
elected.  The  officers  serve  at the  pleasure  of  the  Board  of  Directors.
Information  as to the  director  and  executive  officer  of the  Company is as
follows.

     David Sitko has been sole Director,  President, Chief Financial Officer and
Secretary of the Company since its inception. Mr. Sitko has been teaching in the
Desert Sands Unified  School  District since 1995. Mr. Sitko has taught math and
technology-related  courses.  Mr. Sitko received his Multiple  Subject  Teaching
Credential from Chapman University,  Palm Desert, CA in 1996. Mr. Sitko received
his Bachelors of Arts in American  History from the  University  of  California,
Santa Cruz,  CA in 1992.  He has also  completed  his  Masters in  Instructional
Technology  from Cal State San Bernadino,  San Bernadino,  CA in 2000. Mr. Sitko
has extensive  education and  experience in Internet  service,  web design,  and
computer technology.

           During the past five years,  none of the officers or directors of the
Company has been subject to a bankruptcy petition,  criminal conviction,  or any
order, judgement or decree, not subsequently  reversed,  suspended or vacated of
any court of  competent  jurisdiction,  permanently  or  temporarily  enjoining,
barring,  suspending  or  otherwise  limiting  his  involvement  in any  type of
business,  securities  or  banking  activities,  or  found to be  guilty  of any
securities laws infractions.

Conflicts of Interest

           Certain  conflicts of interest  now exist and will  continue to exist
between the Company and its sole  officer and director due to the fact that each
has other business interests to which he devotes his primary attention.

           Certain  conflicts of interest may exist  between the Company and its
sole director and officer,  Mr. Sirko,  and conflicts may develop in the future.
The Company has not  established  policies or procedures  for the  resolution of
current or potential conflicts of interests.  There can be no assurance that Mr.
Sitko will  resolve  all  conflicts  of interest  in favor of the  Company,  and
failure by Mr. Sitko to conduct the  Company's  business in the  Company's  best
interest may result in liability to Mr. Sitko.  Mr.  Sitko,  as the sole officer
and director, is accountable to the Company as a fiduciary,  which means that he
is required to  exercise  good faith and  integrity  in handling  the  Company's
affairs. Shareholders who believe that the Company has been harmed by failure of
Mr.  Sitko to  appropriately  resolve any conflict of interest  may,  subject to
applicable  rule  of  civil  procedure,  be able to  bring  a  class  action  or
derivative suit to enforce their rights and the Company's rights.

           The Company has no arrangement,  understanding  or intention to enter
into any  transaction for  participating  in any business  opportunity  with any
officer,  director,  or  principal  shareholder  or with  any  firm or  business
organization with which such persons are affiliated, whether by reason of



<PAGE>



stock ownership, position as an officer or director, or otherwise.

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

           Section 16(a) of the Exchange Act,  requires the Company's  officers,
directors and persons who  beneficially  own more than ten percent of the Common
Stock to file reports of securities ownership and changes in such ownership with
the Securities and Exchange Commission. Officers, directors and greater than ten
percent  beneficial  owners  also  are  required  by  rules  promulgated  by the
Securities  and  Exchange  Commission  to furnish the Company with copies of all
Section 16(a) forms they file.

ITEM 10.  EXECUTIVE COMPENSATION

           No compensation is paid or anticipated to be paid by the Company.  It
is  possible  that  upon  an  acquisition  some  compensation  may  be  paid  to
management.  On acquisition of a business  opportunity,  current  management may
resign and be  replaced  by persons  associated  with the  business  opportunity
acquired,  particularly if the Company participates in a business opportunity by
effecting a reorganization,  merger or  consolidation.  If any member of current
management  remains after  effecting a business  opportunity  acquisition,  that
member's time  commitment will likely be adjusted based on the nature and method
of the  acquisition  and  location of the business  which  cannot be  predicted.
Compensation of management will be determined by the new board of directors, and
shareholders  of the Company will not have the opportunity to vote on or approve
such compensation.

ITEM 11.  SECURITY OWNERSHIP OF BENEFICIAL OWNERS AND MANAGEMENT

Principal Shareholders

           The table below sets forth  information  as to each person  owning of
record or who was known by the Company to own  beneficially  more than 5% of the
2,000,000 shares of issued and outstanding  Common Stock,  including  options to
acquire stock of the Company as of December 31, 2000 and  information  as to the
ownership of the Company's Stock by each of its directors and executive officers
and by the  directors  and  executive  officers as a group.  Except as otherwise
indicated,  all shares are owned  directly,  and the persons  named in the table
have  sole  voting  and  investment  power  with  respect  to  shares  shown  as
beneficially owned by them.
                                                          # of
Name and Address                        Nature of        Shares
of Beneficial Owners                    Ownership        Owned           Percent
Directors

Principal Shareholders


David H. Sitko                            Common         1,600,000         80.00

Directors and Executive Officers


David H. Sitko                            Common         1,600,000         80.00

All Executive Officers and
Directors as a Group (1



<PAGE>




person)                                   Direct          1,600,000       80.00%
                                          Options            None         None %
                                              Total       1,600,000      80.00 %

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

           In connection with organizing the Company,  on May 23, 1996,  persons
consisting of its officers, directors, and other individuals were issued a total
of 1,000 shares of Common  Stock at a value of $.001 per share.  On November 11,
1999, the outstanding shares were forward split 1,000 to 1, resulting in a total
of 1,000,000 shares outstanding. Under Rule 405 promulgated under the Securities
Act of 1933, Mr. Hodges may be deemed to be a promoter of the Company.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K


           (a)       EXHIBITS


           The following  documents are filed  herewith or have been included as
           exhibits to previous filings with the Commission and are incorporated
           herein by this reference:


           Exhibit No.         Exhibit


           *3                  Articles of Incorporation


           *3.2                Bylaws


           *3.1                Amended Articles of Incorporation




     (b)  Reports on Form 8-K.  No  reports  on Form 8-K were  filed  during the
          period covered by this Form 10-KSB.

     *    Incorporated  herein by  reference  from  Registrant's  Form  10SB12G,
          Registration Statement, dated January 13, 2000.

                                   SIGNATURES

           In accordance with Section 13 or 15(d) of the Securities Exchange Act
of 1934,  the  registrant  caused  this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

FAR REACH HOLDINGS, LTD.

By:   /s/ David H. Sitko
      David H. Sitko
      President, Chief Finance Officer and
      Director
Date: March 29, 2001



<PAGE>

                            FAR REACH HOLDINGS, LTD.
                          (A Development Stage Company)

                                       -:-

                          INDEPENDENT AUDITOR'S REPORT

                           DECEMBER 31, 2000 AND 1999






<PAGE>






                                    CONTENTS


                                                                          Page

Independent Auditor's Report..............................................F - 1

Balance Sheets
  December 31, 2000 and 1999..............................................F - 2

Statements of Operations
  For the Years Ended December 31, 2000 and 1999..........................F - 3

Statement of Stockholders' Equity
 Since May 23, 1996 (Inception) to December 31, 2000......................F - 4

Statements of Cash Flows
  For the Years Ended December 31, 2000 and 1999..........................F - 5

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



<PAGE>











                          INDEPENDENT AUDITOR'S REPORT


Far Reach Holdings, Ltd.
(A Development Stage Company)


           We  have  audited  the  accompanying  balance  sheets  of  Far  Reach
Holdings,  Ltd. (a development  stage company) as of December 31, 2000 and 1999,
and the related  statements of operations and cash flows for the two years ended
December 31, 2000 and the  statement of  stockholders'  equity from May 23, 1996
(inception)  to  December  31,  2000.   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 audits.

           We  conducted  our  audits  in  accordance  with  generally  accepted
auditing  standards.  Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the 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 financial position of Far Reach Holdings,
Ltd. (a  development  stage  company) as of December 31, 2000 and 1999,  and the
results of its  operations  and its cash flows for the two years ended  December
31, 2000 in conformity with generally accepted accounting principles.

                                                          Respectfully submitted



                                                      /S/ ROBISON, HILL & CO.
                                                    Certified Public Accountants

Salt Lake City, Utah
March 19, 2001


                                      F - 1

<PAGE>




                            FAR REACH HOLDINGS, LTD.
                          (A Development Stage Company)
                                 BALANCE SHEETS





                                                               December 31,
                                                            -------------------
                                                             2000        1999
                                                            -------     -------

Assets: ................................................    $  --       $  --
                                                            =======     =======

Liabilities - Accounts Payable .........................    $   671     $  --
                                                            -------     -------

Stockholders' Equity:
  Common Stock, Par value $.001
    Authorized 100,000,000 shares,
    Issued 1,000,000 shares at December 31,
    1999, and 2,000,000 shares at December 31, 2000 ....      2,000       1,000
  Paid-In Capital ......................................      2,590         440
  Retained Deficit .....................................     (1,200)     (1,200)
  Deficit Accumulated During the
    Development Stage ..................................     (4,061)       (240)
                                                            -------     -------

     Total Stockholders' Equity ........................       (671)       --
                                                            -------     -------

     Total Liabilities and
       Stockholders' Equity ............................    $  --       $  --
                                                            =======     =======















   The accompanying notes are an integral part of these financial statements.

                                      F - 2

<PAGE>



                            FAR REACH HOLDINGS, LTD.
                          (A Development Stage Company)
                            STATEMENTS OF OPERATIONS





                                                                      Cumulative
                                                                       since
                                                                    June 5, 1999
                                             For the year ended     inception of
                                                December 31,         development
                                            ---------------------
                                              2000         1999          stage
                                            -------       -------       -------
Revenues: ............................      $  --         $  --         $  --

Expenses: ............................        3,821           240         4,061
                                            -------       -------       -------

     Net Loss ........................      $(3,821)      $  (240)      $(4,061)
                                            -------       -------       -------

Basic & Diluted loss per share .......      $  --         $  --
                                            =======       =======























   The accompanying notes are an integral part of these financial statements.


                                      F - 3

<PAGE>



                            FAR REACH HOLDINGS, LTD.
                          (A Development Stage Company)
                        STATEMENT OF STOCKHOLDERS' EQUITY
               SINCE MAY 23, 1996 (INCEPTION) TO DECEMBER 31, 2000


<TABLE>
<CAPTION>

                                                                                       Deficit
                                                                                     Accumulated
                                                                                     Since June 5,
                                                                                         1999
                                                                                     Inception of
                                         Common Stock          Paid-In    Retained    Development
                                        Shares   Par Value     Capital     Deficit       Stage
                                      ---------   ---------   ---------   ---------    ---------
<S>                                   <C>         <C>         <C>         <C>          <C>
Balance at May 23, 1996 (inception)        --     $    --     $    --     $    --      $    --

June 10, 1996 Issuance of Stock for
Services and payment
 of Accounts Payable ..............   1,000,000       1,000

Net Loss ..........................        --          --          --        (1,000)        --
                                      ---------   ---------   ---------   ---------    ---------

Balance at December 31, 1996 ......        --          --          --        (1,000)        --

Net Loss ..........................        --          --          --           100         --
                                      ---------   ---------   ---------   ---------    ---------

Balance at December 31, 1997 ......   1,000,000       1,000        --        (1,100)        --

Net Loss ..........................        --          --          --          (100)        --
                                      ---------   ---------   ---------   ---------    ---------
Balance at December 31, 1998 ......   1,000,000       1,000        --        (1,200)        --

Capital contributed by Shareholder         --          --           440        --           --
Net Loss ..........................        --          --          --          --           (240)
                                      ---------   ---------   ---------   ---------    ---------

Balance at December 31, 1999 ......   1,000,000       1,000         440      (1,200)        (240)

October 2000 Issuance of Stock
for Services and Payment of A/P ...   1,000,000       1,000        --          --           --

Capital contributed by Shareholder         --          --         2,150        --           --
Net Loss ..........................        --          --          --          --         (3,821)
                                      ---------   ---------   ---------   ---------    ---------

Balance at December 31, 2000 ......   2,000,000 $     2,000   $   2,590   $  (1,200)   $  (4,061)
                                      =========   =========   =========   =========    =========


</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                      F - 4

<PAGE>



                            FAR REACH HOLDINGS, LTD.
                          (A Development Stage Company)
                            STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                                          Cumulative
                                                                             Since
                                                                         June 5, 1999
                                                   For the years ended   Inception of
                                                       December 31,      Development
                                                    ------------------
                                                     2000        1999      Stage
                                                    -------    -------    -------
CASH FLOWS FROM OPERATING
ACTIVITIES:
<S>                                                 <C>        <C>        <C>
Net Loss ........................................   $(3,821)   $  (240)   $(4,061)
Issuance of Common Stock for Services ...........     1,000       --        1,000
Increase (Decrease) in Accounts Payable .........       671       (200)       471
                                                    -------    -------    -------
  Net Cash Used in operating activities .........    (2,150)      (440)    (2,590)
                                                    -------    -------    -------

CASH FLOWS FROM INVESTING
ACTIVITIES:
Net cash provided by
  investing activities ..........................      --         --         --
                                                    -------    -------    -------

CASH FLOWS FROM FINANCING
ACTIVITIES:
Capital contributed by shareholder ..............     2,150        440      2,590
Net Cash Provided by
  Financing Activities ..........................     2,150        440      2,590
                                                    -------    -------    -------

Net (Decrease) Increase in
  Cash and Cash Equivalents .....................      --         --         --
Cash and Cash Equivalents
  at Beginning of Period ........................      --         --         --
                                                    -------    -------    -------
Cash and Cash Equivalents
  at End of Period ..............................   $  --      $  --      $  --
                                                    =======    =======    =======

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the year for:
  Interest ......................................   $  --      $  --      $  --
  Franchise and income taxes ....................   $   200    $  --      $   200

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES: None
</TABLE>


   The accompanying notes are an integral part of these financial statements.


                                      F - 5

<PAGE>



                            FAR REACH HOLDINGS, LTD.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999


NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

           This summary of accounting  policies for Far Reach Holdings,  Ltd. is
presented to assist in understanding  the Company's  financial  statements.  The
accounting policies conform to generally accepted accounting principles and have
been consistently applied in the preparation of the financial statements.

Organization and Basis of Presentation

           The Company was incorporated under the laws of the State of Nevada on
May 23, 1996. The Company ceased all operating activities during the period from
May 23, 1996 to June 5, 1999 and was considered dormant. Since June 5, 1999, the
Company is in the development  stage,  and has not commenced  planned  principal
operations.

Nature of Business

           The Company has no products or services as of December 31, 2000.  The
Company was organized as a vehicle to seek merger or acquisition candidates. The
Company intends to acquire interests in various business opportunities, which in
the opinion of management will provide a profit to the Company.

Cash and Cash Equivalents

           For purposes of the  statement of cash flows,  the Company  considers
all highly liquid debt instruments  purchased with a maturity of three months or
less to be cash  equivalents  to the  extent  the funds  are not being  held for
investment purposes.

Pervasiveness of Estimates

           The preparation of financial  statements in conformity with generally
accepted  accounting  principles  required  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.







                                      F - 6

<PAGE>



                            FAR REACH HOLDINGS, LTD.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
                                   (Continued)

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

Loss per Share

           The  reconciliations  of the numerators and denominators of the basic
loss per share computations are as follows:


                                                                      Per-Share
                                         Income       Shares           Amount
                                         ------        ------          ------
                                       (Numerator)  (Denominator)

                                       For the year ended December 31, 2000
Basic Loss per Share
Loss to common shareholders           $     (3,821)     1,210,959   $      --
                                      ============  =============   ===========


                                       For the year ended December 31, 1999
Basic Loss per Share
Loss to common shareholders           $       (240)     1,000,000   $      --
                                      ============  =============   ===========

           The  effect  of  outstanding   common  stock   equivalents  would  be
anti-dilutive for December 31, 2000 and 1999 and are thus not considered.

Concentration of Credit Risk

           The Company has no significant  off-balance-sheet  concentrations  of
credit  risk such as foreign  exchange  contracts,  options  contracts  or other
foreign  hedging  arrangements.  The Company  maintains the majority of its cash
balances with one financial institution, in the form of demand deposits.

NOTE 2 - INCOME TAXES

           As of  December  31,  2000,  the  Company  had a net  operating  loss
carryforward for income tax reporting purposes of approximately  $5,300 that may
be offset against future taxable income through 2011. Current tax laws limit the
amount of loss  available  to be offset  against  future  taxable  income when a
substantial  change in  ownership  occurs.  Therefore,  the amount  available to
offset future taxable income may be limited. No tax benefit has been reported in
the financial statements, because the Company believes there is a 50% or greater
chance the  carryforwards  will expire  unused.  Accordingly,  the potential tax
benefits of the loss  carryforwards  are offset by a valuation  allowance of the
same amount.

                                      F - 7

<PAGE>



                            FAR REACH HOLDINGS, LTD.
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
                                   (Continued)

NOTE 3 - DEVELOPMENT STAGE COMPANY

           The Company has not begun principal  operations and as is common with
a development  stage  company,  the Company has had recurring  losses during its
development stage.

NOTE 4 - COMMITMENTS

           As of December  31,  2000 all  activities  of the  Company  have been
conducted by  corporate  officers  from either their homes or business  offices.
Currently,  there are no  outstanding  debts owed by the  company for the use of
these facilities and there are no commitments for future use of the facilities.

NOTE 5 - STOCK SPLIT

           On November  11, 1999 the Board of  Directors  authorized  1,000 to 1
stock split,  changed the authorized number of shares to 100,000,000  shares and
the par value to $.001 for the Company's common stock. As a result of the split,
999,000  shares  were  issued.  All  references  in the  accompanying  financial
statements  to the number of common  shares and  per-share  amounts for 1999 and
1998 have been restated to reflect the stock split.

NOTE 6 - STOCK ISSUED

           During October of 2000 the Board of Directors authorized the issuance
of  1,000,000  shares of stock to its sole  officer and  director  for  services
performed.


















                                      F - 8