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FORM 10-K

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


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

For the fiscal year ended June 30, 1999

OR

[ ] 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 0-17214


ADMIRAL FINANCIAL CORP.
(Exact name of registrant as specified in its charter)

FLORIDA 59-2806414
(State of incorporation) (I.R.S. Employer
Identification No.)
7101 Southwest 67 Avenue
South Miami, Florida 33143
(Address of principal executive office) (Zip Code)

Registrant's telephone number, including area code: 305-794-7707

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, par value $.001 per share
(Title of Class)

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 and (2) has been
subject to such filing requirements for the past 90 days. Yes X No

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 Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K.

Aggregate market value of the voting stock held by non-affiliates of
the Registrant as of September 29, 1999 (based on the last closing sale
price as reported on the OTC Bulletin Board on such date) was $2,746,261.

Number of shares of common stock outstanding as of September 29, 1999, was
10,985,046.




DOCUMENTS INCORPORATED BY REFERENCE

None




ADMIRAL FINANCIAL CORP.


FORM 10-K


TABLE OF CONTENTS


Page

Part I

Item 1. Business 1
Item 2. Properties 5
Item 3. Legal Proceedings 5
Item 4. Submission of Matters to a Vote of
Security Holders 6


Part II


Item 5. Market for the Registrant's Common Stock
and Related Security Holder Matters 7
Item 6. Selected Consolidated Financial Data 7
Item 7. Management's Discussion and Analysis of
Consolidated Financial Condition and
Results of Operations 8
Item 8. Consolidated Financial Statements 9
Item 9. Disagreements on Accounting and Financial
Disclosure 9


Part III


Item 10. Directors and Executive Officers of the
Registrant 9
Item 11. Executive Compensation 10
Item 12. Security Ownership of Certain Beneficial
Owners and Management 12
Item 13. Certain Relationships and Related Transactions 13


Part IV


Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K 14



PART I

ITEM 1. BUSINESS.

ADMIRAL FINANCIAL CORP. ("ADMIRAL"), an inactive corporation, is
currently seeking to recapitalize the Company in order to resume its prior
activities with respect to the acquisition and investment in interest-
earning assets and specialty real estate, as well as other new lines of
business, as yet unidentified. Admiral has been a plaintiff in a
"Winstar-type" action against the United States government in the United
States Court of Federal Claims since 1993, wherein the Company seeks
damages for the government's breach of a contract involving the
Supervisory Goodwill and Regulatory Capital granted in connection with
Admiral's previous acquisition of an insolvent savings and loan
association in 1988.

This discussion may contain statements regarding future financial
performance and results. The realization of outcomes consistent with
these forward-looking statements is subject to numerous risks and
uncertainties to the Company including, but not limited to, the
availability of equity capital and financing sources, the availability of
attractive acquisition opportunities once such new equity capital and
financing is secured (if at all), the successful integration and
profitable management of acquired businesses, improvement of operating
efficiencies, the availability of working capital and financing for future
acquisitions, the Company's ability to grow internally through expansion
of services and customer bases without significant increases in overhead,
seasonality, cyclicality, and other risk factors.

Admiral is presently conducting virtually no business operation,
other than its efforts to effect a merger, exchange of capital stock,
asset acquisition, recapitalization, or other similar business combination
(a "Recapitalization") with an operating or development stage business
which Admiral considers to have significant growth potential. Admiral has
neither engaged in any operations nor generated any revenue since the
confiscation of the Company's entire asset base by the United States
government in 1990 (See Admiral's "Winstar"-type breach of contract
litigation regarding Admiral's former supervisory goodwill position,
discussed below). It receives no cash flow. Admiral anticipates no capital
infusions prior to effectuating a Recapitalization. Until such time as
Admiral effectuates a Recapitalization, with the exception of certain
other professional fees and costs for such a transaction, Admiral
currently expects that it will incur minimal future operating costs.

No officer or director of Admiral is paid any type of compensation
by Admiral and presently, there are no arrangements or anticipated
arrangements to pay any type of compensation to any officer or director in
the near future. Admiral expects that it will meet its cash requirements
until such time as a Recapitalization occurs. However, in the event
Admiral depletes its present cash reserves, Admiral may cease operations
and a Recapitalization may not occur. There are no agreements or
understandings of any kind with respect to any loans from officers or
directors of Admiral on the Company's behalf.

Admiral was formed in 1987 to acquire an insolvent savings and loan
association in a supervisory acquisition solely with private investment
funds, and without the benefit of any federal assistance payments.
Admiral acquired Haven Federal Savings and Loan Association ("Haven") on
June 16, 1988. Admiral had no prior operating history.

Haven was a Federally chartered stock savings and loan association
that had been conducting its business in Winter Haven, Florida, since
1964. In addition to its main office, Haven had four branch offices in
Polk County which were located in central Florida. A large portion of the


1


population of Polk County consists of retired persons on fixed incomes so
that the operations of the Association were dependent primarily on the
needs of this community and were relatively unaffected by the prosperity
of any of the businesses located in its primary market area.

As a result of the enactment of The Financial Institution Reform,
Recovery and Enforcement Act of 1989 ("FIRREA"), the United States
government retroactively applied new capital standards to Haven, declared
Haven to be insolvent and in default of certain provisions of an agreement
that the federal government itself had disregarded, and confiscated the
net assets of Haven on March 2, 1990.

Admiral's sole significant asset was its investment in Haven, and
Admiral has been reduced to an inactive corporate shell.

Admiral acquired Haven on June 16, 1988. The acquisition occurred
through a contributed property exchange, whereby Admiral issued 8,000,000
new common shares in exchange for assets (primarily real estate and a
profitable business engaged in the purchase and redemption of Florida tax
sale certificates) having fair market values of approximately $40 million,
subject to approximately $27 million of mortgages and other liabilities,
and less approximately $1 million of fees and expenses (necessary to
provide the proper forms and documentation in accordance with government
rules and regulations) during the ensuing sixteen month application and
negotiation process with federal regulatory authorities, for a net fair
value equity contribution of approximately $12 million. Admiral then
contributed virtually all of these net assets and liabilities to the
capital of Haven, while simultaneously issuing an additional 987,000 new
common shares of Admiral to the former Haven shareholders, in exchange for
100% of the outstanding shares of Haven in an approved "supervisory
acquisition" of an insolvent thrift institution. Admiral has had
substantially no assets, and no operations other than its investment in
Haven, and all active business operations were carried on through Haven.

Prior to the consideration of any of the equity capital contributed
by Admiral in the exchange, the fair value of Haven's liabilities assumed
by Admiral, plus the cost of acquisition, was determined to have exceeded
the fair market value of Haven's tangible assets acquired by approximately
$14,902,000, of which approximately $5,374,000 was attributable to the
estimated intangible value of Haven's deposit base and approximately
$548,000 to the estimated intangible value of Haven's mortgage loan
servicing portfolio. The balance of approximately $8,980,000 was recorded
under generally accepted accounting principles (GAAP) by Haven as excess
cost over net assets acquired ("Goodwill"). The acquisition was accounted
for as if it occurred on June 30, 1988. The purchase method of accounting
was used to record the acquisition and, accordingly, all assets and
liabilities of Haven were adjusted to their estimated fair value as of the
acquisition date.

By way of a Resolution (the "Agreement") dated April 26, 1988, the
Federal Home Loan Bank Board ("FHLBB") approved the acquisition of control
of Haven by Admiral. A condition of the Agreement authorizing the
acquisition required that Admiral account for the acquisition of Haven
under the "purchase" method of accounting, whereby an asset in the nature
of "Supervisory Goodwill" would be calculated in accordance with the
"Regulatory Accounting Principles" (RAP) then in effect. Supervisory
Goodwill was realized, generally, to the extent of any previous negative
net worth of the acquired insolvent thrift, plus the excess of the fair
market values of the contributed assets over their respective historical
costs. Haven's Supervisory Goodwill of approximately $20 million was, in
accordance with the Agreement, to be amortized against future earnings
over a period of twenty-five years.


2


Also in accordance with the Agreement, Haven was credited with new
capital under RAP accounting, equal to $11 million. This amount was
computed by taking into account the $13 million fair market value of the
net assets contributed by Admiral to Haven, less the $1 million of fees
and costs incurred, and less an additional $1 million resulting from
reduced valuations of certain of the contributed assets for purposes of
calculating Haven's RAP equity by the appraisal division of the Federal
Home Loan Bank Board.

In accordance with GAAP, however, the contributed equity values
reported to Admiral's shareholders was the net historical book value of
$596,812, net of approximately $1.05 million of out-of-pocket professional
fees, expenses, and other transaction costs associated with the
supervisory acquisition, and not the appraised net fair market equity
values of $13 million.

As an integral part of Admiral's application to acquire Haven,
Admiral filed a Business Plan of proposed operations calling for a
significant growth of earning assets, and an increase in low-cost deposits
and other lower-cost liabilities to refinance Haven's relatively high cost
of funds. This growth was to be generated both internally, and by
acquisitions of other branches and thrifts. The FHLBB Agreement approved
Admiral's Business Plan.

In exchange for the favorable accounting treatments regarding the
Supervisory Goodwill and the resulting calculation of RAP equity, the
Agreement imposed a number of conditions upon Admiral. Specifically:

Admiral was required to record the supervisory acquisition
transaction utilizing the "purchase" method of accounting, resulting
in the recognition of Supervisory Goodwill of approximately $20
million.

Admiral agreed that it would cause the regulatory capital of Haven
to be maintained at a level at or above the quarterly minimum
regulatory capital requirement and, if necessary, infuse additional
equity capital sufficient to comply with this requirement.

Should Admiral default in this provision and be unable to cure the
default within 90 days, the FSLIC could exercise any right or remedy
available to it by law, equity, statute or regulation. In addition
to the rights that were available to the FSLIC by virtue of the
Agreement, whenever any savings and loan association fails to meet
its regulatory capital requirement, the FHLBB and the FSLIC (or
their successors) could take such actions as they deem appropriate
to protect the Association, its depositors and the FSLIC.

Admiral agreed that it would cause Haven to liquidate all of the
contributed real estate according to a schedule specified by the
FHLBB as follows: 37.5% of the market value of the properties (as
determined by the FHLBB's District Appraiser) by March 31, 1989, an
additional 12.5% by June 30, 1989, and an additional 12.5% during
each succeeding quarter.

If Admiral had defaulted in this regard, it could have been subject
to forfeiture of 100% of its Haven stock. The FSLIC would have the
right to vote the Haven stock, remove Haven's Board of Directors
and/or dispose of the stock of Haven.

Admiral acquired Haven solely with private equity capital. There
were no federal assistance payments, capital assistance notes, or any
other form of federal payments (which had been made available to other
purchasers of insolvent thrifts), involved in the acquisition Agreement
negotiations. The only elements of the Agreement that Admiral


3


specifically bargained for was the allowance of Supervisory Goodwill, with
its twenty-five year amortization period, to compensate Admiral for its
recapitalization of an insolvent thrift with a $15 million negative net
worth on the supervisory acquisition date.

For the fiscal year ended June 30, 1989, Haven experienced a "Net
Interest Income" (similar to a "Gross Profit" for commercial business
operations) of $1.635 million, as opposed to a Net Interest Expense of
($.163 million) for the fiscal year immediately preceding Admiral's
supervisory acquisition of Haven. These results represented a significant
turnaround for Haven during the first year of post-supervisory acquisition
operations.

Haven was successful in meeting the real estate liquidation
requirements imposed by the Agreement, including any extensions of time
granted thereunder. However, Haven experienced a $4.3 million erosion of
its regulatory capital due to losses sustained as a result of liquidating
one single, large commercial property included in the stated real estate
under what can only be described as "fire sale" conditions, on the last
possible day under the Agreement, in order to meet the time schedules
mandated by the FHLBB in the Agreement. This loss, together with other
operating losses and goodwill amortization expenses, caused Haven to fail
to meet its minimum capital requirement as of March 31, 1989, and at all
times thereafter.

The Financial Institution Reform, Recovery and Enforcement Act of
1989 ("FIRREA") was introduced on February 5, 1989, and enacted into law
on August 9, 1989. FIRREA imposed, by no later than December 7, 1989,
more stringent capital requirements upon savings institutions than those
previously in effect. These capital requirements were applied to Haven on
a retroactive basis. Haven did not meet these new capital requirements on
the date of enactment, or on the earlier date of Haven's acquisition by
Admiral. Because of certain provisions of FIRREA relating primarily to
the disallowance of supervisory goodwill and certain other intangible
assets in the calculation of required net capital, management estimates
that Admiral would have been required under the Agreement to infuse
additional capital of approximately $18 million by December 7, 1989. Had
FIRREA been in effect on the date of Haven's acquisition by Admiral, Haven
would have fallen short of the capital requirements by approximately $14
million, after taking into account Admiral's contribution of $11 million
of new regulatory capital. Admiral did not infuse any additional capital,
and the net assets of Haven were confiscated by the federal authorities on
March 2, 1990.

With nearly $20 million of Supervisory Goodwill on the books and
only $11 million of contributed capital (thereby resulting in a negative
tangible net worth in excess of $8 million, and an immediate shortfall of
qualifying capital in excess of nearly $15 million) on the date of the
supervisory acquisition of Haven by Admiral, Haven did not meet these new
capital requirements imposed by FIRREA.

The FHLBB, in a supervisory letter dated March 31, 1989, designated
the Association as a "troubled institution" subject to the requirements of
the office of Regulatory Activities Regulatory Bulletin 3a ("RB3a"). A
troubled institution under RB3a is subject to various growth restrictions
concerning deposit accounts and lending activities. Haven was directed to
"shrink" its asset and deposit base, thereby assuring future operating
losses.

As of March 31, 1989, Haven's regulatory capital fell approximately
$580,000 below its minimum regulatory capital requirement, as the direct
result of a $4.3 million real estate loss recorded on March 31, 1989. As
of June 30, 1989, Haven's regulatory capital was approximately $2.3
million below the minimum regulatory requirement. This regulatory capital


4


deficiency was a result of the Association's substantial operating losses
incurred as a result of the directive from FHLBB supervisory personnel to
"shrink" the assets and deposits of Haven, and the sale of certain parcels
of contributed real estate, under circumstances that could only be
described as a "fire sale," at amounts which approximated predecessor
cost, rather than at the substantially higher appraised values (which had
previously been reviewed and approved by the appropriate regulatory
authorities). In addition, due to Haven's inability to continue
operations without a significant capital infusion or other source of
recapitalization, the value of the Association's excess cost over net
assets acquired (Goodwill) was considered permanently impaired and,
accordingly, the entire balance was written off at June 30, 1989.

Admiral was notified by the FHLBB on July 17, 1989, that since the
regulatory capital deficiency had not been corrected, Admiral was in
default of the Agreement and had 90 days (i.e., until October 18, 1989) to
cure the default. Admiral management was directed to resign any positions
held at Haven, Haven personnel were directed to cease communications with
Admiral, and to abandon any efforts to meet the contributed real estate
liquidation schedule contained in the Agreement. Admiral did not infuse
the additional capital required, and the net assets of Haven were
confiscated by the federal government on March 2, 1990.

Due to the regulatory capital requirements imposed by FIRREA, even
if Admiral were able to infuse the approximate $2.3 million June 30, 1989
regulatory capital deficiency and cure the default, the cure would have
only been temporary. Because of certain provisions of FIRREA relating
primarily to the treatment of intangible assets, management estimates that
Admiral would have been required to infuse additional capital of
approximately $18 million by the December 7, 1989 date specified by the
new law. Had the FIRREA requirements been effective and fully phased in
at the time of the acquisition, Haven would have had a tangible capital
deficiency of approximately $14 million as of the acquisition date; and to
meet the capital requirements, Admiral would have had to fund
approximately $14 million, in addition to the assets which were
contributed with an appraised equity value of approximately $11 million
for regulatory capital purposes.

At all times prior to the enactment of FIRREA, Haven had met the
contributed real estate sale schedule. On September 27, 1989, the
Association received a letter from its Supervisory Agent in which the
Supervisory Agent agreed not to enforce its rights upon a default in the
real estate sale schedule until after hearings were conducted regarding
various applications requesting administrative relief that were filed by
Haven could be conducted. The net assets of Haven were confiscated by the
federal government on March 2, 1990.

Because of the effects of FIRREA, and the impact of certain
requirements imposed by the Federal Home Loan Bank Board ("FHLBB") and the
Federal Savings and Loan insurance Corporation ("FSLIC") upon Admiral and
upon the operations of Haven, Admiral's management determined that the
initial economic decisions leading to the acquisition, recapitalization
and operation of Haven had been frustrated by FIRREA, and the only
remaining alternative available to Admiral was to sell or merge Haven, and
withdraw from the savings and loan business. Once Haven was divested,
Admiral would have no other operations.

In the meantime, Admiral and Haven applied, immediately after the
enactment of FIRREA, for relief from the requirements of the Agreement.
Haven also applied for regulatory relief from sanctions imposed by FIRREA
for failing to meet the minimum regulatory capital requirements.
Furthermore, Admiral and Haven applied for federal assistance payments
under a FIRREA relief provision which management believed was intended to
be applicable to prior acquirers of insolvent thrift institutions in


5


supervisory acquisitions, where a significant amount of "supervisory
goodwill" is involved, and those acquirers were being treated by the
effects of the new legislation as if they had been the persons who had
caused the thrift to become insolvent in the first place. Admiral
management was never notified of any action taken or hearing scheduled in
connection with the various forms of relief being sought.

Because of all of the circumstances enumerated above, Admiral
attempted to dispose of its Haven common stock and to secure a release of
its obligations under the Agreement either through a merger, an
acquisition or a tender of its Haven common stock to the FHLBB or its
successor in the event that the Association's applications for specific
relief were not approved.

The net assets of Haven were confiscated on March 2, 1990.


ITEM 2. PROPERTIES.

Admiral Financial Corp.'s principal office is located in South
Miami, Florida. The Company is currently being allowed to share, free of
charge, certain office facilities and office equipment located at 7101
Southwest 67 Avenue, South Miami, Florida 33143. Admiral does not have
any lease obligations.


ITEM 3. LEGAL PROCEEDINGS.

On August 5, 1993, Admiral filed a Complaint against the United
States of America in the United States Court of Federal Claims, arising in
part out of contractual promises made to Admiral by the United States'
Government, acting through the Federal Home Loan Bank Board ("FHLBB") and
the Federal Savings and Loan Insurance Corporation ("FSLIC") pursuant to
their statutory supervisory authority over federally insured savings and
loan institutions and savings banks (hereinafter referred to a "thrifts"
or "thrift institutions"), and in part out of takings of property by the
FHLBB and FSLIC in the course of exercising that authority. In this
action, Admiral seeks (1) a declaration that the government's actions
constitute a repudiation and material breach of their contractual
obligations to Admiral and, thereby, effect a taking of Admiral's property
without just compensation and a deprivation of Admiral's property without
due process of law, in violation of the Fifth Amendment, and (2)
compensatory damages for the United States' breach of contract, or (3)
rescission of the contract and restitutionary relief, or (4) compensation
for the taking of Admiral's property, or (5) damages for the deprivation
of Plaintiffs' property without due process of law."

This action was stayed by order of the Court dated September 3,
1993, pending the en banc decision on rehearing of the Court of Appeal for
the Federal Circuit in Winstar Corp., et al. v. United States, a pending
action which Admiral management believes to contain a similar fact
pattern.

On August 30, 1995, the United States Court of Appeals for the
Federal Circuit, in an en banc decision, affirmed the summary judgment
decisions by the Court of Federal Claims on the liability portion of the
breach of contract claims against the United States in Winstar, and in two
other similar cases (Statesman and Glendale) which had been consolidated
for purposes of the appeal. In its Winstar decisions, the Court of Federal
Claims found that an implied-in-fact contract existed between the
government and Winstar, and that the government breached this contract
when Congress enacted FIRREA. In Statesman and Glendale, that Court found


6


that the Plaintiffs had express contracts with the government which were
breached by the enactment of FIRREA.

The federal government appealed the Winstar decisions to the United
States Supreme Court. On November 14, 1995, Admiral's action (and all
other similar actions) was stayed by order of the Court, pending the
outcome of that appeal.

On July 1, 1996, the United States Supreme Court concluded in
Winstar that the United States is liable for damages for breach of
contract, affirmed the summary judgment decisions in Winstar, and remanded
the cases to the Court of Federal Claims for further hearings on the
calculation of damages. The majority of the Court found "no reason to
question the Federal Circuit's conclusion that the Government had express
contractual obligations to permit respondents to use goodwill and capital
credits in computing their regulatory capital reserves. When the law as
to capital requirements changed, the Government was unable to perform its
promises and became liable for breach under ordinary contract principles."

Subsequent to the United States Supreme Court decision in Winstar,
the stay on Admiral's litigation proceedings was lifted by the United
States Court of Federal Claims, and Admiral filed its own Motion for
Summary Judgment on April 29, 1997. The United States has opposed the
motion, and alleged that there exist genuine issues of material fact and
that further discovery is necessary regarding contract formation and the
Government's authority to enter into the contract with Admiral. The Court
is currently allowing pre-trial discovery proceedings to be conducted, and
such discovery is tentatively scheduled to be completed by October 29,
1999.

While the Supreme Court's ruling in U.S. v. Winstar Corp., et al.,
serves to support Admiral's legal claims in its pending lawsuit against
the federal government, it is not possible at this time to predict what
effect the Supreme Court's ruling, and the subsequent rulings of a lower
court concerning damages, will have on the outcome of Admiral's lawsuit.
Notwithstanding the Supreme Court's ruling, there can be no assurance that
Admiral will be able to recover any funds arising out of its claim and, if
any recovery is made, the amount of such recovery.

Admiral is not a party to any other legal proceedings.


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

Not Applicable.


7

PART II


ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND
RELATED SECURITY HOLDER MATTERS.

Admiral's common stock currently trades on the OTC Bulletin Board
(OTCBB) under the symbol ADFK.

On June 21, 1988, Admiral's common stock began trading on the
National Association of Securities Dealers Automatic Quotation System
(NASDAQ) under the symbol ADFC. In 1989, Admiral was notified by NASDAQ
that Admiral's net worth did not meet the minimum standards for listing on
the NASDAQ National Market System and that Admiral's stock would begin
trading in the "over-the-counter" market after September 30, 1989, if the
minimum capital standards were not met.

Since September 30, 1989, Admiral's shares have been listed in the
"over-the-counter" market on the OTC Bulletin Board. There was no firm
making a market in Admiral's stock until June 27, 1997, at which time
active trading resumed. The Company was notified of a change in the stock
symbol to ADFK in January 1999.

The following table sets forth, for the periods indicated, the high
and low sales prices as reported on the OTC Bulletin Board.



Ask Bid
--------------- -------------
High Low High Low

1998:
First Quarter 5/8 5/8 3/8 3/8
Second Quarter 3/4 7/16 15/32 1/4
Third Quarter 11/16 7/16 1/2 1/4
Fourth Quarter 5/8 1/2 7/16 7/16

1998:
First Quarter 5/8 31/64 7/16 1/4
Second Quarter 17/32 31/64 9/32 1/32
Third Quarter 1/2 1/4 7/16 1/4
Fourth Quarter 17/32 1/4 1/4 1/8



As of June 30, 1998, there were 497 stockholders of record.

The Company has not paid cash dividends since inception. The
Company anticipates that for the foreseeable future any earnings from
future operations will be retained for use in its business and no cash
dividends will be paid on its common stock. Declaration of dividends in
the future will remain within the discretion of the Company's Board of
Directors, which will review its dividend policy from time to time on the
basis of the company's financial condition, capital requirements, cash
flow, profitability, business outlook and other factors.


ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA.

Admiral was formed in 1987 for the purpose of effecting the
Contributed Property Exchange Offer and Merger with Haven and had no prior


8


operating history. Admiral's acquisition of Haven occurred on June 16,
1988, and has been accounted for as if it occurred on June 30, 1988. The
following table sets forth selected consolidated financial data for
Admiral for the five years ended June 30, 1999. In addition, selected
financial data on the financial position of Admiral is shown as of June
30, 1999,1998, 1997, 1996, and 1995. Such information is qualified in its
entirety by the more detailed information set forth in the financial
statements and the notes thereto included elsewhere herein.




Year ended June 30,
------------------------------------------
1999 1998 1997 1996 1995
------- ------- ------- ------- -------

(Dollars in thousands except per share data)

Admiral income $ 0 0 0 0 0
Haven:
Interest income - - - - -
Interest expense - - - - -
------- ------- ------- ------- -------
Net interest income
before provision
for loan losses
(expense) 0 0 0 0 0

Provision for loan losses - - - - -
------- ------- ------- ------- -------
Net interest income
(expense) after
provision for
loan losses 0 0 0 0 0

Loss before extraordinary
item and cumulative effect
of change in accounting
principle 0 0 0 0 0
Extraordinary item - - - - -
Cumulative effect of change in
accounting principle - - - - -
------- ------- ------- ------- -------

Net earnings (loss) $ 0 0 0 0 0
======= ======= ======= ======= ======

Earnings (loss) per share $ 0.00 0.00 0.00 0.00 0.00





Year ended June 30,
1999 1998 1997 1996 1995
------- ------- ------- ------- -------

(Dollars in thousands except per share data)

Net assets of Haven $ - - - - -
Total assets 0 0 0 0 0
Net liabilities of Haven - - - - -
Total liabilities 24 24 24 24 24
Total stockholders' equity
(deficit) (24) (24) (24) (24) (24)
Book value (deficit) per
common share (.00) (.00) (.00) (.00) (.00)
Number of offices of Admiral 1 1 1 1 1




9


ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONSOLIDATED
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Results of Operations

Admiral was formed in 1987 and had no operations until its
acquisition of Haven on June 16, 1988. Admiral's only significant asset
was its investment in Haven. Admiral has been inactive since 1990.


Comparison of Years Ended June 30, 1999 and 1998

Admiral was inactive, and recorded no revenues or expenses during
either period.


Comparison of Years Ended June 30, 1998 and 1997

Admiral was inactive, and recorded no revenues or expenses during
either period.


Liquidity and Capital Resources

Admiral is currently inactive, and awaiting the ultimate outcome and
results of the Company's Winstar-type litigation against the United States
government for breach of contract. There is no corporate liquidity, no
available capital resources, and no immediately foreseeable prospects for
the future improvement of Admiral's financial picture.

Admiral management intends to seek a new line of business, as yet
unidentified. In connection therewith, Admiral's management believes that
a restructuring of Admiral may be necessary in order to raise capital for
new operations, and any such restructuring may have a substantial dilutive
effect upon Admiral's existing shareholders. Admiral has no ongoing
commitments or obligations other than with respect to its obligations
related to the acquisition and subsequent confiscation of Haven.


Year 2000

Year 2000 Issue. Many software applications, hardware and equipment
and embedded chip systems identify dates using only the last two digits of
the year. These products may be unable to distinguish between dates in
the year 2000 and dates in the year 1900. That inability (referred to as
the "Year 2000" issue), if not addressed, could cause applications,
equipment or systems to fail or provide incorrect information after
December 31, 1999, or when using dates after December 31, 1999. This in
turn could have an adverse effect on the Company due to a Company's direct
dependence on its own applications, equipment and systems and indirect
dependence on those of other entities with which a Company must interact.


10


Compliance Program. In order to address the Year 2000 issue,
Admiral has established a project team to assure that key automated
systems and related processes will remain functional through year 2000.
The team will address the project in the following stages: (i) awareness,
(ii) assessment, (iii) remediation, (iv) testing and (v) implementation of
the necessary modifications. The key automated systems consist of (a)
management and financial systems applications, (b) hardware and equipment,
(c) embedded chip systems and (d) third-party developed software. The
evaluation of the Year 2000 issue includes the evaluation of the Year 2000
exposure of third parties material to the operations of Admiral. If
necessary, Admiral will retain a consulting firm to assist with the review
of its systems for Year 2000 issues.

Company State of Readiness. The awareness phase of the Year 2000
project has begun with a corporate-wide awareness program which will
continue to be updated throughout the life of the project. The assessment
phase of the project involves, among other things, efforts to obtain
representations and assurances from third parties, including third party
vendors, that their hardware and equipment, embedded chip systems and
software being used by or impacting Admiral are or will be modified to be
Year 2000 compliant. To date, Admiral does not expect that responses from
such third parties will be conclusive. As a result, management cannot
predict the potential consequences of these or other third parties are not
Year 2000 compliant. The exposure associated with Admiral's interaction
with third parties is also currently being evaluated.

Management expects that the remediation, testing and implementation
phases will be completed prior to the year 1900.

Costs to Address Year 2000 Compliance Issues. While the total cost
to the Company of the Year 2000 project is still being evaluated,
management currently estimates that the costs to be incurred by Admiral in
1999 and 1900 associated with assessing and testing applications, hardware
and equipment, embedded chip systems, and third party developed software
will be less than $1,000. The Company expects that planned capital
expenditures to replace existing financial system applications and
hardware will substantially address its existing Year 2000 issues with
financial system applications and hardware. To date, Admiral has not
expended significant funds related to its Year 2000 compliance assessment.

Risk of Non-Compliance and Contingency Plans. The major
applications which pose the greatest Year 2000 risks for Admiral if
implementation of the Year 2000 compliance program is not successful are
the Company's management systems, financial systems applications and
related third-party software. Potential problems if the Year 2000
compliance program is not successful include disruptions of the Company's
revenue gathering from and distribution to its customers and vendors and
the inability to perform its other reporting, financial and accounting
functions.

The goal of the Year 2000 project is to ensure that all of the
critical systems and processes which are under the direct control of the
Company remain functional. However, because certain systems and processes
may be interrelated with systems outside of the control of the Company,
there can be no assurance that all implementations will be successful.
Accordingly, as part of the Year 2000 project, contingency and business
plans will be developed to respond to any failures as they may occur.
Such contingency and business plans are scheduled to be completed during
1999. Management does not expect the costs to Admiral of the Year 2000
project to have a material adverse effect on the Company's financial
position, results of operations or cash flows. However, based on
information available at this time, Admiral cannot conclude that any
failure of the Company or third parties to achieve Year 2000 compliance
will not adversely affect the Company.


11


ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements and schedules listed in Item 14 hereof and
included in this report on Pages F-1 through F-11 are incorporated herein
by reference.


ITEM 9. CHANGES IN, AND DISAGREEMENTS WITH, ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE

Not Applicable.



PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The following table sets forth, as of June 30, 1999, certain
information with respect to the directors and executive officers
continuing in office until their successors have been elected and
qualified.



Officer
And/or
Director
Name Age Position Since


Wm. Lee Popham 48 Chairman of the Board, 1987
Chief Executive Officer
and President

Linda E. Baker 60 Director, Vice President, 1987
Secretary, and Treasurer

Charles E. Fancher, Jr. 49 Director 1988





Certain background information for each director is set forth below.

WM. LEE POPHAM has served as Chairman of the Board and President of
Admiral since its inception in 1987. He has also been an independent
corporate planning and acquisition consultant since 1996, as well as a
Senior Sales Associate with the Prudential Florida Realty, Miami, Florida,
since 1997. He had also served as Chairman of the Board and President of
Caesar Creek Holdings, Inc. (CCH), Miami, Florida (a financial acquisition
company) since June 1985, and in various other officer and director
positions with several subsidiaries and affiliates of CCH, until its
liquidation in December 1989. He has also served as a Director and
Secretary-Treasurer of Jeanne Baker, Inc., a real estate brokerage company
located in Dade County, Florida, since 1973, and was actively employed by
that Company from 1990 until its sale in 1996. He previously served as
President of First Atlantic Capital Corporation, Miami, Florida (an
investment company) from July 1983 to May 1985. Prior thereto, he was a


12


partner in the accounting firm of KPMG Peat Marwick, LLP, Miami, Florida,
where he practiced as a Certified Public Accountant. He also served as a
director of Cruise America, Inc.(AMEX-RVR), Mesa, Arizona (a recreational
vehicle rental and sales corporation), which shares were traded on the
American Stock Exchange until its sale to Budget Group, Inc.(NYSE-BD),
from 1984 until 1991.

LINDA E. BAKER has served as Vice President, Secretary and Treasurer
of Admiral since its inception in April 1987. She has also served as Vice
President, Secretary and Treasurer of CCH, Miami, Florida (a financial
acquisition company) from June 1985 until its liquidation in December
1989, and in various other officer and director positions with several
subsidiaries and affiliates of CCH. Ms. Baker has been employed as
Office/Personnel Manager at Trivest, Inc., Miami, Florida, an investment
holding company, since January 1990. She was Vice President and Secretary
of First Atlantic Capital Corporation, Miami, Florida (an investment
company) from October 1983 to June 1985. Prior thereto, she was a Manager
with the accounting firm of KPMG Peat Marwick, LLP, Miami, Florida. Ms.
Baker is a Certified Public Accountant and a licensed Florida real estate
broker.

CHARLES E. FANCHER, JR. has served as President and Chief Operating
Officer of Fancher Management Group, Inc., Miami, Florida (a water, waste
water, and liquid propane gas utility consulting company), since April
1996. He previously served as President and Chief Operating Officer of
General Development Utilities, Inc., Miami, Florida (a water, waste water,
and liquid propane gas utility company) from June 1991 until March 1996,
and Vice President of Atlantic Gulf Communities Corporation (f/k/a General
Development Corporation), in Miami, Florida (a real estate development
company) from January 1986 until March 1996. Mr. Fancher was also
previously Senior Vice President of General Development Utilities, Inc.,
from January 1986 until June 1991. Prior thereto, he served as a Vice
President of General Development Utilities, Inc. in the areas of finance
and operations.


ITEM 11. EXECUTIVE COMPENSATION

Cash Compensation

The following table sets forth certain information with respect to
the Chief Executive Officer, and each other executive officer of Admiral
and/or Haven whose total cash compensation exceeded $100,000 during the
year ended June 30, 1999.




Annual Compensation Awards
Name and -------------------------------
Principal Position Year Salary Bonus Other


Wm. Lee Popham 1999 $ --- --- ---
Chairman and President 1998 --- --- ---
Chief Executive Officer 1997 --- --- ---




Incentive Bonus Plan

Admiral has a policy of paying discretionary bonuses to eligible
officers and employees based upon the individual's performance. Under the
plan, Admiral and its subsidiaries distribute approximately 20% of
Admiral's consolidated pre-tax profits in the form of cash bonuses awarded
by the Compensation Committee of the Board of Directors, based on
management's recommendations and evaluations of performance. No bonuses
have been paid since Admiral's inception in 1987.


13


Retirement Plan

No Admiral employee is currently covered under any form of
retirement plan.

In prior years, Haven employees were covered under a non-
contributory trusteed pension plan, which was replaced by a contributory
Section 401(k) plan for Admiral and Haven employees on March 31, 1989.
Employees were permitted to contribute amounts up to 6% of their annual
salary to this plan, with the employer providing matching contributions at
a rate of 50% of such employee's contributions (to a maximum of 3% of such
employee's salary), together with a discretionary contribution amount not
exceeding 1% of covered compensation.

The Section 401(k) contribution plan was suspended when the net
assets of Haven were confiscated, and all Admiral employees were removed
from their employment positions by the federal regulators.


Stock Compensation Program

The Board of Directors and shareholders of Admiral adopted the 1988
Stock Compensation Program (the "Program"), effective December 19, 1988,
for the benefit of directors, officers and other employees of Admiral and
its subsidiaries, including Haven, who are deemed to be responsible for
the future growth of Admiral. Under the Program, Admiral has reserved
1,100,000 shares of authorized but unissued Common Stock for the future
issuance of option grants. Options granted under the Program can be in
the form of incentive options, compensatory options, stock appreciation
rights, performance shares, or any combination thereof.

There have been no grants of any rights or options to any director,
officer or employee of Admiral or any affiliate.


Employee Stock Purchase Plan

The Board of Directors and shareholders of Admiral approved the 1988
Employee Stock Purchase Program on December 19, 1988, enabling the
directors, officers and employees of Admiral and its affiliates to acquire
a proprietary interest in Admiral's Common Stock through a payroll
deduction program. To date, this plan has not been implemented by
Admiral.


Employment Agreements

There are no employment agreements between Admiral and any of
Admiral's employees.


Indebtedness of Management

Admiral has made no loans to its directors, officers or employees.


Compensation of Directors

While each Director is entitled to receive $500 plus reasonable out-
of-pocket expenses for attending each meeting, each Director volunteered


14


to suspend the receipt of all director fees due to Admiral's current
financial condition, beginning with the meeting held during the third
fiscal quarter of the fiscal year ended June 30, 1989. No additional
compensation is paid for attendance of committee meetings.



ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT

The following table sets forth information regarding the beneficial
ownership of Admiral's Common Stock as of June 30, 1999 by (i.) each
person who is known by Admiral to own beneficially 5% or more of Admiral's
Common Stock, (ii.) each Director and/or officer of the Company, and
(iii.) all Directors and executive officers of Admiral as a group. Except
as indicated below, each person has sole dispositive and voting power with
respect to the shares of Common Stock indicated.



Amount and Percent
Nature of of
Name and Address of Beneficial Common
Beneficial Owner Ownership Stock


Wm. Lee Popham (l) 1,923,684 17.51%
7101 Southwest 67 Avenue
South Miami, Florida 33143

Ti-Aun Plantations, N.V. 889,007 8.09%
Suite 600
600 Brickell Avenue
Miami, Florida 33131

David C. Popham (2) 668,651 6.09%
3166 Commodore Plaza
Coconut Grove, Florida 33133

Linda E. Baker 150,120 1.37%
Suite 800
2665 South Bayshore Drive
Coconut Grove, Florida 33133

Charles E. Fancher, Jr. 12,000 *
2844 Chucunantah Road
Coconut Grove, Florida 33133

All directors and
executive officers as a
group (3 persons) 2,085,804 18.99%



* Less than one percent

(1) Includes 46,278 shares held in a testamentary trust for members of
Wm. Lee Popham's family, for which Mr. Popham disclaims beneficial
ownership. Does not include any shares directly or beneficially
owned by David C. Popham (his brother) or Jeanne M. Baker (his
mother).

(2) Includes 76,185 shares held jointly by David C. Popham and Valerie
P. Popham, his wife. Also includes 119,928 shares held jointly by
David C. Popham and Jeanne M. Baker, the mother of David C. Popham


15


and Wm. Lee Popham. Does not include any shares beneficially owned
by Wm. Lee Popham, the brother of David C. Popham.


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Wm. Lee Popham, the Chairman and President of Admiral, was
previously also the Chairman, President and controlling stockholder of
CCH. Mr. Popham's mother, Jeanne M. Baker, was also a director of CCH.
While CCH did not receive any fees or other compensation from Admiral or
Haven during the fiscal year, CCH did receive a consulting, management and
organizational fee in connection with the acquisition of Haven by Admiral
of $354,286, plus expense reimbursements payable in cash during fiscal
1988. CCH and its affiliates, including Caesar Creek TSC, Ltd. (CCTSC)
were liquidated in December 1989.

Wm. Lee Popham, together with certain members of his family
(including David C. Popham and Jeanne M. Baker) and certain affiliates
including CCH and CCTSC, participated in a transaction which capitalized
Admiral in order to effect the acquisition of Haven in a contributed
property exchange offer. The total historical cost of the property
contributed by Wm. Lee Popham, his family and affiliates in the exchange
was $1,228,227, the aggregate appraised value of such contributed property
was $12,586,553, and the net contribution value was $7,022,965. Mr.
Popham and his family and affiliates received an aggregate of 4,330,208
shares of Admiral Common Stock in the exchange, which occurred on June 16,
1988.

Linda E. Baker, a director, officer and stockholder of Admiral was
also an officer, director and stockholder of CCH prior to its liquidation,
as described above. She is not related to Jeanne M. Baker.

In accordance with the approved supervisory acquisition Agreement,
Haven was contractually obligated to pay Admiral a management fee of
$25,000 per quarter for financial and operational advice, budgeting,
business planning, marketing and public relations. Haven was directed by
FHLBB supervisory personnel to cease in honoring this approved contractual
obligation, beginning with the January 1990 payment.

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS
ON FORM 8-K

ADMIRAL FINANCIAL CORP.

INDEX

(a.)1. Admiral Financial Corp.: Page

Statement Regarding Sec. 210.3-11 of Regulation S-K F-1

Consolidated Balance Sheets as of June 30, 1999 and 1998 F-2

Consolidated Statement of Operations for the three years
ended June 30, 1999 F-3

Consolidated Statement of Stockholders' (Deficit) Equity
for the three years ended June 30, 1999 F-4

Consolidated Statement of Cash Flows for the three years
ended June 30, 1999 F-5


16


Notes to Consolidated Financial Statements F-6



(a.)2. There are no financial statement schedules required to
be filed by Item 8 of this Form 10-K, or by paragraph
(d) of Item 14.


(a.)3. Exhibits

(3) The Articles of Incorporation and By-Laws of Admiral
are incorporated herein by reference to Exhibits 3.1
and 3.2 of Admiral's Form S-4 Registration Statement
filed with the Securities and Exchange Commission on
January 22, 1988.

(4) A specimen copy of Admiral's common stock certificate
is incorporated herein by reference to Exhibit 4.1 in
Amendment No. 1 of Admiral's Form S-4 Registration
Statement filed with the Securities and Exchange
Commission on April 5, 1988.

(9) Not applicable.

(10) Admiral hereby incorporates by reference the sections
entitled "Appendix A - Agreement and Plan of
Reorganization, as amended, dated October 26, 1987,
and related Agreement and Plan of Merger, as amended"
and "Contributed Property Exchange Offer" contained
in Haven's Prospectus/Proxy Statement filed pursuant
to Section 14(a) of the Securities Exchange Act of
1934 in connection with Haven's special meeting held
on June 3, 1988.

(11) Not applicable.

(12) Not applicable.

(13) Not applicable.

(16) Not applicable.

(18) Not applicable.

(21) Admiral's sole subsidiary has been Haven Federal Savings
and Loan Association. The assets and liabilities of
Haven were confiscated by the federal government on March
2, 1990.

(22) Not applicable.

(23) Not applicable.

(24) Not applicable.

(27) Financial Data Schedule attached.

(28) Not applicable.

(99) Not applicable.


17


(b.) Admiral filed no reports on Form 8-K during the fiscal year
endedJune 30, 1999.


(c.) The exhibits required by Item 601 of Regulation S-K are
included in (a)(3) above.


18

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned, hereunto duly
authorized.

ADMIRAL FINANCIAL CORP.



By:/s/ Wm. Lee Popham
Wm. Lee Popham, President and
Date: September 29, 1999 Chief Executive Officer



Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated.


Signature Title Date


/s/ Wm. Lee Popham Chairman of the Board September 29, 1999
Wm. Lee Popham Of Directors, Chief
Chairman and President Executive Officer, and
Principal Executive President
Officer


/s/ Linda E. Baker Director, Vice President September 29, 1999
Linda E. Baker Secretary And Treasurer
Principal Financial
Officer



/s/ Charles E. Fancher, Jr. Director September 29, 1999
Charles E. Fancher, Jr.


19

FINANCIAL STATEMENTS OF AN INACTIVE REGISTRANT

Pursuant to Sec. 210.3-11 of Regulation S-X, Admiral Financial Corp.
qualifies as an inactive entity, meeting all of the following conditions:

(A.) Gross receipts from all sources for the fiscal year are not in
excess of $100,000;

(B.) Admiral has not purchased or sold any of its own stock,
granted options therefor, or levied assessments upon
outstanding stock;

(C.) Expenditures for all purposes for the fiscal year are not in
excess of $100,000;

(D.) No material change in the business has occurred during the
fiscal year, including any bankruptcy, reorganization,
readjustment or succession or any material acquisition or
disposition of plants, mines, mining equipment, mine rights or
leases; and

(E.) No exchange upon which the shares are listed, or governmental
authority having jurisdiction, requires the furnishing to it
or the publication of audited financial statements.

Accordingly, the attached financial statements of Admiral Financial
Corp. are unaudited.


F-1

ADMIRAL FINANCIAL CORP.
AND SUBSIDIARY

Consolidated Balance Sheets




Assets June 30, 1999 June 30, 1998
(Unaudited) (Unaudited)

Cash $ 0 $ 0
Prepaid expenses and other assets 0 0
Net assets of Haven Federal Savings and
Loan Association (note 2) 0 0
------------- -------------
Total assets $ 0 $ 0
============= =============


Liabilities and Stockholders'
(Deficit) Equity

Accrued expenses and other liabilities $ 23,890 $ 23,890
Net liabilities of Haven Federal Savings
and Loan Association (note 2) 0 0
------------- -------------
Total liabilitis 23,890 23,890

Preferred stock, $.01 par value.
Authorized 6,000,000 shares,
none outstanding

Common stock, $.001 par value,
50,000,000 shares authorized
10,987,000 shares issued 10,987 10,987
Treasury stock, 1,954 and 1,954
shares, at cost 0 0
Additional paid-in capital 680,710 680,710
Deficit (715,587) (715,587)
------------- -------------
Total stockholders'
(deficit) equity (23,890) (23,890)
------------- -------------

Total liabilities and
stockholders'(deficit)
equity $ 0 $ 0
============= =============



See accompanying notes to consolidated financial statements.


F-2


ADMIRAL FINANCIAL CORP.
AND SUBSIDIARY

Consolidated Statements of Operations
(Unaudited)




Years Ended June 30,
-----------------------------------
1999 1998 1997
------ ------ ------

REVENUES:

Interest Income $ 0 $ 0 $ 0
Other income -- -- --
------ ------ ------
Total income 0 0 0

EXPENSES:

Employee Compensation -- -- --
Other Expense 0 0 0
------ ------ ------
Total expense 0 0 0

Loss from discontinued operation
(note 2) 0 0 0
------ ------ ------
Net loss $ 0 $ 0 $ 0
====== ====== ======

Loss per share $ 0.00 $ 0.00 $ 0.00
====== ====== ======

Dividend per share -- -- --
====== ====== ======

Weighted average number
of shares outstanding 10,985,046 10,985,046 10,985,046
========== ========== ==========





See accompanying notes to consolidated financial statements



F-3


ADMIRAL FINANCIAL CORP.
AND SUBSIDIARY


Consolidated Statement of Stockholders'
(Deficit) Equity

For the years ended June 30, 1999





Common Stock Additional Retained
Issued and Outstanding Paid-In Earnings
Shares Amount Capital (Deficit)


Balance at June 30, 1988 10,985,046 $ 10,987 $ 680,710 $ -

Net loss for the year - - (13,813,316)
---------- --------- --------- ------------

Balance at June 30, 1989 10,985,046 10,987 680,710 (13,813,316)

Confiscation of Subsidiary
Net Assets and Liabilities - - 13,238,189

Net loss for the year - - (79,030)
---------- --------- --------- ------------

Balance at June 30, 1990 10,985,046 $ 10,987 $ 680,710 $ (654,157)

Net loss for the year (21,043)
---------- --------- --------- ------------

Balance at June 30, 1991 10,985,046 $ 10,987 $ 680,710 $ (675,200)

Net loss for the year (20,194)
---------- --------- --------- ------------

Balance at June 30, 1992 10,985,046 $ 10,987 $ 680,710 $ (695,394)

Net loss for the year (20,193)
---------- --------- --------- ------------

Balance at June 30, 1993,
1994, 1995, 1996, 1997,
1998 and 1999 10,985,046 $ 10,987 $ 680,710 $ (715,587)
========== ========= ========= ============





See accompanying notes to consolidated financial statements.



F-4


ADMIRAL FINANCIAL CORP. AND SUBSIDIARY

Consolidated Statements of Cash Flows
(Unaudited)



Year Ended June 30
----------------------------------------
1999 1998 1997
------ ------ ------


Cash flows from operating activities:

Net loss $ 0 $ 0 $ 0

Adjustments to reconcile net loss to
net cash provided by operating
activities:

Decrease in deficit arising from
confiscation of Haven Federal after
retroactive disallowance of agreed
supervisory goodwill and regulatory
capital
Decrease in prepaid expenses and other
assets
Decrease (increase) in net assets of
Haven Federal
(Decrease) in accrued expenses and
other liabilities
(Decrease) Increase in net liabilities
of Haven Federal
Amortization of organization expenses 0 0 0
------ ------ ------
Net cash provided (used) by operating
activities 0 0 0

Cash and cash equivalents, beginning
of year 0 0 0
------ ------ ------
Cash and cash equivalents,
end of year $ 0 $ 0 $ 0
======= ======== ========




See accompanying notes to consolidated financial statements



F-5


ADMIRAL FINANCIAL CORP.
AND SUBSIDIARY

Notes to Consolidated Financial Statements



(1) Organization and Regulatory Matters


Admiral Financial Corp. ("Admiral") is inactive.

On June 16, 1988, Admiral acquired Haven Federal Savings and
Loan Association ("Haven"). Admiral was a newly formed
savings and loan holding company that was capitalized
through the contribution of various parcels of real estate,
investment securities and a tax sale certificate business
("Contributed Property") recorded at its net predecessor
cost of $596,812, net of transaction costs. The Association
was acquired by Admiral through the exchange of common stock
which was accounted for under the purchase method of
accounting and, accordingly, the assets and liabilities were
adjusted to their estimated fair market values as of the
date of acquisition.

In connection with the acquisition, the Federal Home Loan
Bank Board ("FHLBB"), which was abolished by the Financial
Institutions Reform, Recovery and Enforcement Act of 1989
and was succeeded by the Office of Thrift Supervision
("OTS") of the Treasury Department, issued a resolution (the
"Agreement") on April 26, 1988, requiring that Admiral must
comply with certain conditions. Those conditions included
a Regulatory Capital Maintenance/Dividend Agreement (the
"Capital Agreement") dated June 15, 1988, by and between the
Federal Savings and Loan Insurance Corporation "FSLIC" and
Admiral:

(a.) No dividends will be paid by the Association until all
of the real estate included in the Contributed
Property is liquidated and the cash proceeds recorded
on the Association's books. Any dividends that are a
result of income from the sale of real estate are
restricted to the sales price less the regulatory
appraised value minus any carrying costs paid by the
Association. In addition, unless prior approval has
been obtained from the FHLBB, dividends paid by the
Association shall be limited to 50% of its income for
that fiscal year as reflected in its quarterly reports
to the FHLBB, except for the fiscal year of
acquisition when dividends paid by the Association
shall be limited to 50% of its net income earned after
the effective date of the acquisition, provided that
any dividends permitted under this limitation may be
deferred and paid in a subsequent year, and the
payment of dividends would not reduce the regulatory
capital of the Association below the required level.

(b.) If the Association fails to meet its regulatory
capital requirements, then Admiral must infuse
sufficient equity capital, in a form satisfactory to
the FHLBB, into the Association during the subsequent
quarter. Admiral was permitted to cure any default
within 90 days.

Failure to do so will allow the FSLIC to exercise its
legal or equitable rights under the Capital Agreement
to enforce the terms of the Capital Agreement.
Admiral was deemed by the FHLBB on July 17, 1989, to
have defaulted on its obligation to infuse capital
under the Capital Agreement and was given until
October 18, 1989, to cure such defaults. Failure to


F-6


cure such default by that date would permit the FSLIC
(or its successor) to seek its legal or equitable
remedy as set forth in the Capital Agreement, which
included specific performance or administrative or
judicial enforcement proceedings.

(c.) Admiral shall cause the Association to liquidate all
of the real estate contributed as regulatory capital
within two years after consummation of the transaction
according to the following schedule: at least 37.5% of
the market value of the properties as determined by
the FHLBB District Appraiser by the end of the third
quarter after consummation and thereafter at least
12.5% each subsequent quarter. The Association shall
not provide financing to facilitate the liquidation of
the real estate contributed as regulatory capital
without the prior written approval of the
Association's Supervisory Agent. If Admiral does not
meet this real estate liquidation schedule, the FSLIC
shall have the right to vote the Association's stock,
remove the Association's Board of Directors and/or
dispose of any or all of the common stock of the
Association owned by Admiral. The Association applied
for relief from the requirements of the Resolution and
Capital Agreement which mandate the sale of real
estate in accordance with the schedule above, but was
never given the opportunity for a hearing, or the
benefit of a response.

For regulatory purposes, the Association was required to
comply with minimum regulatory capital requirements. During
the year ended June 30, 1989, the Association incurred
substantial operating losses and sold certain parcels of
Contributed Property at amounts which approximated
predecessor cost, rather than at the substantially higher
regulatory appraised values. These factors contributed to
the Association's failure to meet its minimum regulatory
capital requirement on June 30, 1989. At June 30, 1989,
such minimum regulatory capital requirement amounted to
approximately $6,642,000. When an association fails to meet
its regulatory capital requirement, the FHLBB and the FSLIC
(and their successors) may take such actions as they deem
appropriate to protect the Association; its depositors; the
FSLIC; and its successor, Savings Association Insurance
'Fund ("SAIF").

The FHLBB, in a supervisory letter dated March 31, 1989,
designated the Association as a "troubled institution"
subject to the requirements of the Office of Regulatory
Activities Regulatory Bulletin 3a ("RB3a"). A troubled
institution under RB3a is subject to various growth
restrictions concerning deposit accounts and lending
activities.

Admiral did not have the ability to infuse sufficient equity
capital into the Association in accordance with the
Agreement and Capital Agreement. Due to the inability to
continue operations without a significant capital infusion
or other source of recapitalization, the value of the
Association's excess cost over net assets acquired was
considered permanently impaired and, accordingly, was
written off at June 30, 1989.

On August 9, 1989, the Financial Institutions Reform,
Recovery and Enforcement Act of 1989 ("FIRREA") was signed
into law. FIRREA imposed, by no later than December 7,
1989, more stringent capital requirements upon savings
institutions than those currently in effect. In addition,
FIRREA included provisions for changes in the Federal
regulatory structure for institutions including a new
deposit insurance system, increased deposit insurance
premiums and restricted investment activities with respect
to non-investment grade corporate debt and certain other
investments. FIRREA also increases the required ratio of
housing-related assets in order to qualify as an insured
institution.


F-7


FIRREA's provisions for new capital standards required
institutions to have a minimum regulatory tangible capital
equal to 1.5% of total assets and a minimum 3.0% leverage
capital ratio by no later than December 7, 1989. The
ability to include qualifying supervisory goodwill for
purposes of the leverage capital ratio requirement will be
phased out by January 1, 1995. In addition, institutions
were required to meet a risk-based capital requirement. In
all cases, the capital standards were also required to be
no less stringent than standards applicable to national
banks. Currently, national banks are required to maintain
a primary capital-to-assets ratio of 5.5% and a total
capital-to-assets ratio of 6.0%.

The Association did not meet these new capital requirements
imposed by FIRREA.

The Association sought regulatory relief from sanctions
imposed by FIRREA for failing to meet the minimum regulatory
capital requirements, and applied for financial assistance
to the FDIC. There was no response or hearing prior to the
seizure of Haven.

The net assets of Haven were seized by the federal
government on March 2, 1990.


(2) Summary of Significant Accounting Policies


(a) Basis of Presentation

The accompanying balance sheets as of June 30, 1999 and
1998, include references to the accounts of Admiral and the
net assets and net liabilities of its wholly-owned
subsidiary, Haven Federal Savings and Loan Association. Due
to Haven's status as a discontinued operation, as discussed
in note 1, the Association's net assets, net liabilities,
and net losses from operations have been presented in the
aggregate. The consolidated statements of operations,
stockholders' (deficit) equity and cash flows for the years
prior to 1990 included the accounts of Admiral and the
Association. All significant intercompany transactions have
been eliminated in consolidation.


(b) Office Properties and Equipment

All office properties and equipment were sold when the
offices of the Company were closed during the fiscal year
ended June 30, 1990, and the proceeds from such sales are
reflected as "other income."


(c) Income Taxes

Admiral and its wholly-owned subsidiary file a consolidated
tax return. Taxes are provided on all income and expense
items included in earnings, regardless of the period in
which such items are recognized for tax purposes, except for
income representing a permanent difference.


(d) Real Estate

Loss from real estate operations includes rental income,
operating expenses, interest expense on the related
mortgages payable, gains on sales, net and provision for
estimated losses to reflect subsequent declines in the net
realizable value below predecessor cost.


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Provisions for estimated losses on real estate are charged
to earnings when, in the opinion of management, such losses
are probable. While management uses the best information
available to make evaluations, future adjustments to the
allowances may be necessary if economic conditions change
substantially from the assumptions used in making the
evaluations.

(e) Excess Cost Over Net Assets Acquired and Other
Intangibles

The excess cost over net assets acquired was amortized by
the interest method over the estimated lives of the long-
term, interest-bearing assets acquired. The remaining
unamortized excess cost over net assets acquired was written
off at June 30, 1989 (see note 1).


(g) Cash and Cash Equivalents

For the purpose of the statement of cash flows, cash and
cash equivalents include the accounts of Admiral.


(3) Purchase Accounting

At June 30, 1989, the remaining unamortized excess cost over
net assets acquired of $7,768,074 was written off and
charged to operations (see note 1).


(4) Income Taxes

At June 30, 1999 and 1998, the Company has estimated net
operating loss carryforwards of approximately $10,447,000
and $10,447,000, respectively, for Federal income tax
purposes, and $10,095,000 and $10,095,000, respectively, for
state income tax purposes to offset future taxable income.

These carryforwards were scheduled to expire in future years
as follows:




Year ending
June 30, Federal State

1990 $ 2,348,000 $ 2,304,000
1991 2,984,000 2,941,000
1992 5,360,000 5,230,000
2001 1,549,000 1,537,000
2002 1,288,000 1,288,000
2004 7,468,000 7,128,000
-------------- -------------
Net operating loss
carryforwards,
June 30, 1989: 20,997,000 20,428,000

Less: 1990
Expirations (2,348,000) (2,304,000)
2005 79,000 79,000
-------------- -------------
Net operating loss
carryforwards,
June 30, 1990: 18,728,000 18,203,000
Less: 1991 Expirations (2,984,000) (2,941,000)
2006 21,000 21,000
-------------- -------------
Net operating loss
carryforwards, June 30, 1991 15,765,000 15,283,000
Less: 1992 Expirations (5,360,000) (5,230,000)
2007 21,000 21,000
-------------- -------------
Net operating loss
carryforwards, June 30, 1992 $ 10,426,000 $ 10,074,000
2008 21,000 21,000
-------------- -------------
Net operating loss
carryforwards, June 30, 1993,
1994, 1995, 1996, 1997, 1998
and 1999 $ 10,447,000 $ 10,095,000
============= =============




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The Company has not filed its federal or Florida income tax
returns for the fiscal years ended June 30, 1999, 1998,
1997, 1996, 1995, 1994, 1993, 1992, 1991 and 1990. While
the confiscation of the assets and liabilities of Haven may
have resulted in a taxable event, management believes that
any taxable income resulting from such confiscation of
assets and liabilities should not exceed the available net
operating loss carryforwards.

The net operating loss carryforwards expiring through 2002
were generated by the Association prior to its acquisition
by Admiral Financial Corp. and have been carried over at
their original amounts for income tax purposes. For
financial statement purposes, these purchased loss
carryforwards will not be used to offset the future tax
expense of Admiral. They will be accounted for as an
adjustment to equity if and when a tax benefit is realized.
At June 30, 1999 and 1998, such purchased loss carryforwards
remaining amounted to approximately $2,837,000 and
$2,837,000, respectively.


(5) Disposal of the Association Assets and Liabilities

The net assets and net liabilities of Haven were confiscated
by the federal government on March 2, 1990.


(6) Commitments and Contingencies

On August 5, 1993, Admiral filed a Complaint against the
United States of America in the United States Court of
Federal Claims, arising in part out of contractual promises
made to Admiral by the United States' Government, acting
through the Federal Home Loan Bank Board ("FHLBB") and the
Federal Savings and Loan Insurance Corporation ("FSLIC")
pursuant to their statutory supervisory authority over
federally insured savings and loan institutions and savings
banks (hereinafter referred to a "thrifts" or "thrift
institutions"), and in part out of takings of property by
the FHLBB and FSLIC in the course of exercising that
authority. In this action, Admiral seeks (1) a
declaration that the government's actions constitute a
repudiation and material breach of their contractual
obligations to Admiral and, thereby, effect a taking of
Admiral's property without just compensation and a
deprivation of Admiral's property without due process of
law, in violation of the Fifth Amendment, and (2)
compensatory damages for the United States' breach of
contract, or (3) rescission of the contract and
restitutionary relief, or (4) compensation for the taking


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of Admiral's property, or (5) damages for the deprivation
of Plaintiffs' property without due process of law."

This action was stayed by order of the Court dated September
3, 1993, pending the en banc decision on rehearing of the
Court of Appeal for the Federal Circuit in Winstar Corp.,
et al. v. United States, a pending action which Admiral
management believes to contain a similar fact pattern.

On August 30, 1995, the United States Court of Appeals for
the Federal Circuit, in an en banc decision, affirmed the
summary judgment decisions by the Court of Federal Claims
on the liability portion of the breach of contract claims
against the United States in Winstar, and in two other
similar cases (Statesman and Glendale) which had been
consolidated for purposes of the appeal. In its Winstar
decisions, the Court of Federal Claims found that an
implied-in-fact contract existed between the government and
Winstar, and that the government breached this contract when
Congress enacted FIRREA. In Statesman and Glendale, that
Court found that the Plaintiffs had express contracts with
the government which were breached by the enactment of
FIRREA.

The federal government appealed the Winstar decisions to the
United States Supreme Court. On November 14, 1995,
Admiral's action (and all other similar actions) was stayed
by order of the Court, pending the outcome of that appeal.

On July 1, 1996, the United States Supreme Court concluded
in Winstar that the United States is liable for damages for
breach of contract, affirmed the summary judgment decisions
in Winstar, and remanded the cases to the Court of Federal
Claims for further hearings on the calculation of damages.
The majority of the Court found "no reason to question the
Federal Circuit's conclusion that the Government had express
contractual obligations to permit respondents to use
goodwill and capital credits in computing their regulatory
capital reserves. When the law as to capital requirements
changed, the Government was unable to perform its promises
and became liable for breach under ordinary contract
principles."

Subsequent to the United States Supreme Court decision in
Winstar, the stay on Admiral's litigation proceedings has
been lifted. Admiral filed its own Motion for Summary
Judgment on April 29, 1997. The United States has opposed
the motion, and alleged that there exist genuine issues of
material fact and that further discovery is necessary
regarding contract formation and the Government's authority
to enter into the contract with Admiral. The Court is
currently allowing pre-trial discovery proceedings to be
conducted.

While the Supreme Court's ruling in U.S. v. Winstar Corp.,
et al., serves to support Admiral's legal claims in its
pending lawsuit against the federal government, it is not
possible at this time to predict what effect the Supreme
Court's ruling, and the subsequent rulings of a lower court
concerning damages, will have on the outcome of Admiral's
lawsuit. Notwithstanding the Supreme Court's ruling, there
can be no assurance that Admiral will be able to recover any
funds arising out of its claim and, if any recovery is made,
the amount of such recovery.

Admiral is not a party to any other legal proceedings.



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